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All Forum Posts by: Tae Seung Kim

Tae Seung Kim has started 3 posts and replied 23 times.

Where do you obtain the holding, purchase and selling closing costs? Does the title company provide all that for you when you request it or do you have to research those costs yourself? Like for example for holding costs such as mortgage, utility, etc (durable time for flipper's months). I'm aware that with these costs you have to actually do individual research, correct? 

The wholesaling calculator has space for you to fill out for the fixed costs. I see a lot of investors use the 70% ARV rule but I was told that it's better to use "Fixed cost method" as mentioned when I read Brandon Turner's book on investing with no money down.

Post: Buyer's list

Tae Seung KimPosted
  • Burke, VA
  • Posts 23
  • Votes 7

Hello, 

I'm a new wholesaler and I"m here trying to build a buyer's list. Anyone who flips property in particular in Northern Virginia area? 

I heard there are some variety of steps in order to obtain fixed costs. To obtain fixed costs such as seller's mortgage, insurance fees, and annual property taxes, are wholesalers allowed to act as "power of attorney" and permission to obtain seller's information by contacting seller's mortgage company, insurance agent, etc? Would they give you such information relating to seller's purchase price of the seller’s house, estimated settlement date, loan payoff amount left on the seller’s mortgage(s), seller contribution to the buyer’s closing costs, buyer’s loan amount, buyer’s down payment amount, annual property taxes and real estate commission?

What would seller's utility company want? Would they say... "sorry I cannot give you such information because you are not the (seller's name). 

Or does the title company/attorney take care of all that? I know they take care of researching costs and closing fees associated with closing process but would they require you as wholesaler to search for the mortgage payments (of seller's), annual property taxes, utility payment, secondary loan, etc? 

How does any wholesaler here figure out all those costs? Would the seller's mortgage company give you such information? How can you trust the seller's word when they tell you they are "behind This $$$$ amount behind certain month?"?

Also where does Affidavit of Memorandum fit in the wholesaling process? Do I actually have to file this paper with the court? And which court? or is it county recorder's office? or is sending the title company a copy of Affidavit of Memorandum (signed by the seller) enough? Does the title company/attorney take care of the affidavit of memorandum? 

So I get this signed by the seller and THEN I present to the buyer my ARV and other calculations (to hope that the buyer doesn't cheat me with the seller behind my back?)

What happens later during the closing process? Do I have to be present so I can sign to release the affidavit of memorandum? How does that get extinguished later? When I send the title company copy of purchase and sale agreement and contract of sale, do I have to send all that at once or send purchase and sale agreement and THEN later send contract of sale? What is this invoice thing? Is invoice a copy of cashier's check (EMD) or do I have to send the original check? I'm so confused with all this. I spend over 10K with variety of gurus and still couldn't get all my questions answered and am bit frustrated. I did thorough research on this biggerpockets to look for questions that I was asking and I couldn't find any of them.

I know the basic process of how wholesaling work but I don't know which happens in what order. So I'm going to picture it here like this. 

1) First Find the seller ( market for seller using MLS, Marketing, Advertising, etc...)

2) Contact and ask seller basic questions to know their reason for selling and financial situation

3) Tell the seller you will call back and get a time to further research, obtain general contractor to visit the house, take pictures, get rehab estimates, find out the mortgage liens, and other encumbrances

4) contact the title company to do research on seller's property to make sure there are no hidden liens

5) present the offer (ARV, Maximum allowable offer) and if the seller agrees, get them to sign the purchase and sale agreement and affidavit of memorandum contract (?) and then send the title company necessary paperwork

6) find and market for buyer and interview them about their evidence of hard money cash or from their home equity (evidence of cash) and if approved

7) present to the buyer using wholesaling calculator from biggerpockets and pictures in nice package for buyer to decide

8) have cash buyer give you non-refundable EMD

9) send the title company all the paperwork and the EMD from cash buyer

So okay from here, how does the title company know that you will get assignment fee? Is that stated from the (Contract of sales?) and what is this invoice thing? Does that mean I just send the title company the EMD? and what is the order for this? Do I obtain the EMD from the buyer first and THEN give the other remaining EMD to the seller? and where does the affidavit of memorandum fit in all this? Do I file this personally to court and which court? Where do I file this affidavit of memorandum? and is sending this paperwork to title company enough? I just don't seem to understand the starting order and how it works step by step. I'm so confused and totally lost.

If I happen to get my purchase and sale agreement, contract of sale and affidavit of memorandum furnished and reviewed by real estate attorney and I happen to use it and seller doesn't understand what is on the contract and ask me to explain it to them, can I do that? is that considered violating the law (constitute as practicing law without law license) and does that mean I will end up in federal prison? 

I'm very serious about this question because the last thing I want to end up is behind bars.