All Forum Posts by: Eric F.

You should be honest but I would not use the term wholesale. Not to lie to the seller, but because the seller will not know what it means. It is too difficult of a concept to explain. Basically, instead of using the term wholesale say something along the lines of "I plan on purchasing the house, however someone I deal with might end up being the actual purchaser, either way you will get the same amount of money at closing, is that OK with you?" NOTE: YOU BETTER PLAN ON PURCHASING THE HOUSE EITHER WAY OR ELSE JUST STOP READING The seller cares about 2 things. They get the money you say they will get and the house will sell when you say it will sell. I feel like a lot of people in this forum who attack wholesaling do not grasp this. The seller does not care who buys the house. If they expect to walk with 80k at closing and the check says 80k at closing, then they are happy. They don't care if you buy it and rent it, Tommy buys it instead, heck you can buy it and burn it down 5 seconds later, if they get paid then they don't care. They care that the deal closes and they get the check they expect. That is it. Those are your two jobs. Get them paid and make it close.

Now the important part, everything I said assumes you are actually going to close on the deal if you can't find a buyer. If you are not willing to close on it yourself it is not a deal. If it is a deal you WILL find a buyer or a way to close. There is dishonesty in this business I cannot stand. If you are not going to close on it if you can't find a buyer, then step back and figure out how you can get to where you can close on deals. Find hard money, family money, etc. If it is a good enough deal to wholesale for a fee it is good enough to buy. The wholesaler who is truly dishonest is the one who offers more than is actually a deal just because that is what the seller wants. They don't have the ethics to say "well, they want 100k, I can't buy it for more than 70k, I will just let this one go." They know they will never close on it themselves. They lock it up for 10 dollars "earnest money" at 100k since it is easier than walking away. So now they have a deal that is not a deal that they try to market with a fee making it even a crappier deal. They waste 30, 45, 60+ days stringing along the seller knowing the entire time it is a bad deal. Then they back out losing 10 dollars while the seller kept paying the mortgage, utilities, etc. That is dishonestly that truly matters. If this is your plan, then yes you are a liar and no it is not OK. Throw your guru tapes in the trash and find someone locally to help you who has ethics. Or else you will be like the 10,000 other people who try wholesaling, lose money, and quit and wonder what went wrong.

@Brandon McLean long story short, this guy was trying to sell his father's house. His father was on Medicaid and in a nursing home. He wanted me to help him "hide" it from the government so he could keep all the money without Medicaid knowing. I said hell no. I'm not in the fraud business. I'm in the real estate business. I told my lawyer what happened and he said "don't have anything to do with this guy going forward." Not that he had to tell me, I was already done with him.

The house was also on West Barbee street so thankfully the deal did not go through. I asked a guy I know in Zebulon about that street and I swear he said "Oh yea, my buddy has some units on there....he got stabbed collecting rent last year." I had already signed the deal so I would have closed if this guy was honest, but thankfully this guy gave me a reason to back out. Once I told him I would not hide the sale he didn't want anything to do with me anyway.

Sidenote: People are crazy. This dude straight up asked me to commit fraud. Even crazier is probably half the investors out there would have tried to help him instead of saying no. Commit Medicaid fraud to make a few thousand....no thanks!

@Ken Yu my take is I'd rather have 10 names of people who buy houses than 100 people who have not bought a deal in their lives. 

By driving route I mean I put 30 random addresses into the app and it will tell me the most efficient route to take to drive to all 30. So if the closest address to my starting point is the third address on the list, it will make that the first stop, then the house closest to stop 1 will be stop 2, etc. Basically if I just drove my list 1-30 it might be 14 hours and 290 miles, but if the software optimizes it so I take the most efficient route it can be reduced to 4 hours and say 100 miles but still hitting all 30 stops.

As for the paying in Euros, the cost on the routeXL site is in Euros, not dollars, so I quoted the Euro price.

I would like to plan a driving route where I can copy addresses from a spreadsheet, paste them into a window, and have the route optimized for efficiency. After that, I would like to be able to send it to google maps so I can use navigation on my phone.

I have been using https://www.routexl.com/ which does everything I want. It is free for up to 20 stops. I can pay either 5 Euro a day or 35 Euro a month for 100 stops. I'm unclear if I pay 5 euro and make an 80 stop route if I can still access it a week later (I did not see an answer on their site so I sent an e-mail, no response yet). I will probably subscribe to it but before I do I figured I'd ask here if anyone else uses anything else. So far I have only used the free 20 stop version.

A strong, and cheaper, alternative looks to be Road Warrior ( https://www.roadwarriorllc.com/ ). It might even be better since it is an app on my phone and has a website. It looks like you have to use their exact formatted spreadsheet to upload multiple addresses. Has anyone used Road Warrior? 

I tried to read this whole thread and I have a couple of comments and a question.

The question first: What constitutes marketing? Someone said "Don't post it on craigslist...that is why you have a buyers list." If I e-mailed an unclosed deal to a buyers list isn't that also marketing? 

Also, I have never done this, but I know a broker who has put properties on the MLS while they are under contract, but before his client closed. I was told they did all their due diligence and it was legal. Personally, I don't mass market anything until I close. I'll show it to a few people but that is it. I always plan on closing myself, although I have and will assign them too.

My comments:

First, there are great posts in this thread I cannot rival. My main problem with any wholesaling discussion is every single time it is allowed to be reduced to the wholesaler as "having no money, sending out letters, never intending to close, planning on weaseling out if they can't find a buyer, etc." Thus the entire discussion is built on a strawman. Of course that type of business model is unethical and (almost always) illegal.  But that is not the only way to wholesale. I'm not naming names, but some people on this forum basically have this definition copy and pasted and somehow shift every thread into arguing over this definition of wholesaling. Now the discussions becomes like discussing politics, all strawman, no facts, big generalizations, and just a waste of time. 

I also don't blame people who think that is how you do things at first. The first real estate seminar I went to AT MY REIA had the instructor say "now, in your contract put subject to business partner's approval, and WE ARE ALL YOUR BUSINESS PARTNERS *exaggerated wink*, so you can say we did not approve and back out." This guy was on the board of my REIA, which BiggerPockets told me to go to. I have enough business experience to know that was some garbage logic and god bless defending it in court, but most people would think it sounds logical. After all, this is a position of authority (successful investor, REIA board member, etc) telling them it is OK. You don't need Robert Cialdini to tell you most newbies will believe someone with that much authority.

This is where these constant hijackings hurt the wholesaling board by the way. Berating someone as a criminal, as was happening in the wholesaling forum quite often (I quit going to it because of the constant hijackings) will never let anyone learn why bs contract clauses are wrong. Maybe it has changed, but darn near every thread flew off the rails with brokers posting about how terrible it is.

@Bill Gulley "They cannot appear to be representing you as a buyer. $100 per appointment? Set appointment standards. If they begin talking about real estate or prices or condition or specifics, they can get into a licensing issue."

If they work for her company why is there a problem? If her company buys houses and they are employees of the company, then would that be OK? In that instance, I would imagine the legal situation is "Company A buys houses, door knocker B is working for Company A, therefore door knocker B is acting as Company A when he/she makes the offer."

To be clear: I am looking at this as she wants to buy the houses for herself as an investor and is not trying to get listings as a broker. If it is the latter I have no clue what the rules are, but if she wants to actually BUY the houses, then I cannot see how hiring someone to go door to door to make offers on her company's behalf is a problem. 

@Nate Hawkins I don't know what @David Faulkner is talking about, you didn't do anything foolish. You made almost $10,000 dollars for a day of driving, a few handwritten letters, and tying up 16k for 48 hours. There are people who go to work every day for 5 or more months to make $10,000 dollars! Over half the country doesn't even have that as a net worth (probably, I'm not googling to make sure)   (edit: I just reread his post and realized he meant foolish as he thinks what you did was illegal, it varies by state but it sounds like you did your due diligence for your state and were fine. For some reason I thought he was saying it was foolish you did not keep the house yourself.)

You did everything ethical too. You said you would buy it, and you did. Even if you would have assigned instead of double closing, if you would have closed otherwise then you still are not doing anything wrong. The only problem I have is people who have zero intention of buying the property and plan on backing out with a BS excuse if they can't assign it. 

Way to take action and make it happen. Too many people try to figure out step 47 before taking step 1. On the last page someone implied it is bad that you took the first steps and then asked "what now?" I think it is great. The alternative would be you sitting here 2 months later still being scared to take step one because step 17 is unclear to you. Instead you did a deal and made damn near 5 figures! Put that check on your wall and look at it every day. You earned it.

Great job my man no matter what anyone says.

To repeat from my first post in this thread

PS If the second, fourth, and fifth call have not sold follow up with them now. 

have you called them to follow up? Any one of those could be another 5 figures!

UPDATE

It wasn't that a big of a deal except I wasted my morning there (thankfully they called me yesterday to let me know I didn't have to come in on Wednesday). It was awkward listening to testimony before I got called because honestly none of it is my business. Luckily the case wasn't too bad with accusations but still that is his personal business and there is no reason I should know any of it. I tried my best not to listen to anything anyone said. At the first recess I asked the attorney who subpoena'd me if I could go sit in another room because I felt like all this testimony was none of my business and I should not know what goes on in this guy's family life, but he said he would call me next. He actually apologized and said he would have called me first but he did not know I was there yet (long story, not his fault, the bailiff I checked in with didn't tell him).  

Basically after he called me to the stand he just asked me what work he did for me and if my spreadsheet of payments was accurate. I wanted to be like "of course it is, you think I'm lying under oath to save this guy some child support?" but I held the sarcasm in check and just said yes. His ex's lawyer asked all the questions but let me compliment the guy pretty big (all of it true). He asked an open ended question along the lines of "how is [blank] to work with" Basically I said his work is great, he is about the only person you can hire in this line of work who is always on time, he never drinks a beer while working, etc. etc. which should be the standard but we all know is not. It was pretty much a 3 minute commercial for the guy. Then they let me go.

 I cannot imagine I possibly added anything to either side of the case. What a waste of my time. 

However, on the bright side this was the first time I've ever had to give testimony in court so at least it was not defending myself. I am actually glad it happened because I got to see how everything worked with nothing at stake for myself except a Thursday morning. 

Not to be rude, you have a list of 500 names with maybe 15 real cash buyers. "Huge buyers lists" are a joke.