All Forum Posts by: Jacci Konkle

Hi Mark,

Deals are just tight and hard to come by right now. Remember, in order to wholesale, an investor needs to get it cheap enough to be able to make a profit in between and still sell it cheap enough to be a deal for the next guy. If a wholesaler is offering on a property and so is another investor who will hold the property or rehab it themself, then it's hard to beat the other offer and they do not get it under contract. There really isn't a magic bullet for being able to buy from wholesalers as much as you just need to be on their list. Nobody just sells to one buyer (unless they are crazy...LOL). I recommend making sure you are connected with your REIA and getting any emails they send with property announcements.

Sherika, that's a great question!  I have only assigned properties to cash buyers, so I don't know the answer to this.  They totally SHOULD, but that doesn't always mean they will.  The best thing to do is to check with a few of the main lenders in your area.  I would guess it would be easier if they are using a smaller, local bank or credit union than a national company or a mortgage broker.  When you verify the lenders that have no problem with it, you can always require that a buyer either be cash or work with one of those approved lenders if they want to buy the home.  Unless, of course, someone finds a problem with that, but I can't think of any.  Cash/Lending is not a protected "class" for equal housing, so I don't know how they could have a case to say you can't stipulate where they get the funds to pay you.  This is certainly a question that will require more digging though.  As always, this is my best educated guess, but by no means am I a licensed lender or an attorney.  A few calls to some lenders should be able to get you a pretty clear picture of what you might be looking at if a buyer needs financing though.  Otherwise, just stick to "cash buyers only" in your marketing of the property.  Another reason is the time to close.  If you are assigning, it's unlikely you will have long enough to market, sell AND wait for a traditional bank closing with appraisals and all the other junk that goes with it.  It's more of a situation for a purchase and wholesale in that situation.

Samuel, first of all, sorry to hear about your back!  I am all too familiar with back pain and injury.  I hope you feel better very soon. I use Cryotherapy to help, but there aren't any cryosaunas in Point.  However, there will be soon!  The owner here is from Point and is looking to put a Cryotherapy Spa in your area.  I suggest giving it a try to anyone who needs pain relief as it is AMAZING!  If you get over to Appleton or Green Bay, look it up.  Ok...on to business...

People do assignments and wholesales all over the country.  It is not illegal.  If it was, title companies would take no part.  Sometimes you run into a title company who says it IS illegal, but they are generally not fully informed and you can just move to the next one.  Now, please remember I am not an attorney, so this is all based on my laymen understanding and my own experiences over the past 10+ years of wholesaling on my own.  What would make it a licensed activity is finding a seller and connecting them with a buyer and collecting a commission or a fee for the service.  What changes the dynamic is you having a contract on the home.  Once you have an accepted contract to purchase the home, you have equitable interest in the property and you are selling YOUR interest.  If you actually close on it and then sell it, it's very simple because you are simply selling your own property...even if it's a double closing and you're selling a minute after you buy it.  If you are using an assignment and NOT closing on it, you are selling the paper (your interest in the property).  You will just need to make the offer as the buyer being "your name, and/or assigns" and then you can use a simple assignment contract to sell that contract to buy the property to another investor and/or buyer.  You will never be as excited to get a check than you are when you get these types of deals and they are a reward for great marketing and negotiating....they are not illegal.  Again, run it by an attorney if you feel the need, but I do these all day long.  As a matter of fact, if you DO go get a license, it mucks it up a bit.  You do NOT need a license to wholesale or assign.  Bottom line....you need an accepted offer.  Hope that helps, now go hit that marketing and scrape up some winning deals to sell :-)

Nick, I don't advertise over in your neck of the woods so I wouldn't have leads there at this time. Are you looking to invest anywhere if it's a good cash flow or are you looking to stay in your area? I guess the key point would be to know if you are planning to manage them yourself or are open to having a property management company do all the heavy lifting if the numbers still work out to be the ROI you need.

My pleasure!  I also saw you were hesitant to get in contact with the homeowners.  I understand that fear, and it's easy to say "just get over it and make the call", but not everyone has the confidence to do it when they aren't 100% sure of what they are asking for or offering.  The next time you run into something like this, let me know (or anyone else who is comfortable with short sales or working with underwater sellers), and I'm sure you can get the help you need!  I do 3-way calls to help people with the first ones all the time so they can see how easy it is.  It's really just a bunch of questions and letting them talk and then sharing a few solutions for them...some of which will also benefit you.  They're just people and they're scared too :-)  The BEST day you will ever have in this business is the day you close a deal where you really really helped a person who was sinking!  I usually get huge hugs and lots of tears at those closings and I'm high for the rest of the day.

What tax benefits??? There are none. And very little to no liability protections of a single owner LLC either.

Ryan, I agree with everything that has already been said about the property. At this point, just continue to watch it and wait for it to come onto the MLS for sale from the bank. I highly doubt anyone will bid on it at all...unless they are crazy. Once it comes out, you will be able to purchase before investors because you plan to live in the home. If there's a first look period, you win! That gives you a proper opportunity to inspect the property and bring any contractors in that you might need to bid on mold, foundation repair or other special items.

Now, that being said, next time you are trolling a property for over a YEAR, take steps early to contact the homeowner and try to work out a short sale helping them AND you in the situation and keeping it from the court house steps.  That $360k the bank is asking includes all the years of penalties, extra interest, taxes, property preservation, attorney fees, etc....  likely you could've worked a nice deal a year ago and done it with permission to inspect the home first. When homeowners truly understand how you can help them, they generally jump on board to work together with you.

My 2 cents....

PS.  The key to all of it is to get a GREAT insurance policy from a qualified agent who knows our business!!  If you'd like a referral to one of the best in the state, let me know and I'll be happy to send you his info.

I don't see the point. There are absolutely NO tax benefits, just extra accounting and reporting costs. There's also little to no liability protection whatsoever. I find this to be the biggest myth in real estate investing...the myth that you need an LLC and it also that it will protect you. It is easily pierced, and in order to even have a shot of it protecting, you need to make sure you have all the reporting done on time all year long like meetings, minutes, etc....need an attorney to manage that or at least get you started on the right road. Really the only benefits are marketing and branding. You can very easily keep your books separate and even set up a bank account for each different property. If you really want, you could just use a DBA (doing business as) name and then there is no cost or reporting whatsoever but you can use it to brand and market. You can even get a DBA bank account. I'm not an attorney or a CPA, but I've been doing this stuff for 100 years...this is my 2 cents.

Mike, that's a deep question. I believe there's a lot of opportunity in WI right now. It's a bit of a challenge to get truly great deals right now compared to when the markets were more buyer favored as inventory is low and sellers are winning big time here! However, there are always deals to be made and those who follow the strategies of doing their own marketing to get their phone to ring instead of looking at the MLS and chasing foreclosures will still always have a place to win. There's enough deals out there to sustain a family, but it certainly is a business and it takes real focus and work just like any other business. Many of us do it full time and sustain a comfortable living for our families. You're military. You're not afraid of hard work! I believe if you use the same discipline they taught us in basic training and beyond, you can succeed here as well. Lots of room for more investors to grow a business here.