All Forum Posts by: Account Closed

Most of the rehabs we have been doing the past few years have been duplex into SFH conversions. We always run new electric into one, usually 200 amp, service. We usually leave the second gas meter and just use the one. I have seen them before where they still used both gas meters.

I cannot say if you should keep it a SFH or convert back to a duplex. You need to figure the optimal use for that property. Usually in our market, converting and flipping in the retail market will provide the most gains. In your market, maybe a 2 family rental makes more sense. I don't know.

I do both.  I try to assign the contract when I can, but sometimes the deal will not allow for that.  

My average fee is around $3,000.  Most of my deals are going to be less than 50 cents on the dollar too.  Usually around less than 20 cents on the dollar, not including rehab.  I try to leave a large portion on the table for my buyer so that they will buy 50 more from me over the next 10 year or so.  I try to close 2-3 each month and I also have other streams of RE income so I don't need to make $20k on a wholesale deal.  

It bothers me a little when other wholesalers ask for such large fees sometimes.  Especially when they have their numbers all wrong to begin with.  

Most wholesalers don't have any idea how much things cost to repair, how to comp houses in certain areas, or how to negotiate a deal so that it is attractive to their buyer. I've probably done at least 300 real wholesale deals and I'll be the first to admit that I didn't really know those things either when I first started 12 years ago. I learned by showing the property and listening to what people had to say. Over the past 12 years I've probably rehabbed close to 300 properties too, so I know what things cost. Most people just guess. I think it's funny when I see other wholesalers posting a property with an ARV of $250k, when I know we might only be able to get $185k retail. $50k in rehab, when I know with out even looking at it that it's going to cost closer to $80k. Good wholesalers are hard to find indeed.

Two life lessons I am constantly reminded of when I am wholesaling is to (1) not count your chickens before they hatch and to (2)  not put all of your eggs in one basket.  

When you are selling off market properties, especially when you are seeking an assignment fee, many things can go wrong and deals fall through more often than you might think.  Because of this, it is wise to have another stream of income other than your assignment fees.

I've sold several war zone properties in Memphis over the years and surprisingly they usually turned out to be great rentals because you can get them super cheap and put a minimum amount of work in them.  If you can find a good tenant, like an elderly person on a fixed income, you'll get your rent like clock work and make great returns.  

I know a guy in St. Louis who invest in war zones too, but he buys the house and sells them with owner financing to owner occupants with out doing any kind of work to them at all. He'll buy something for say $3k and owner finance it to an occupant for say $6k, but the new owner has to do all the work to it go get it livable.  

I tried to sell one in a war zone in St. Louis too, to an owner occupant.  She loved the house and we agreed to meet the following Monday to sign the papers.  As we were both walking to our cars, 3 gun shoots rang out.  Needless to say, she did not proceed with the purchase.   

I'm not sure I can tell you in this forum because I would get flagged for self promotion.  

We use yellow post cards because the recipient doesn't have to open them, they are cheaper, the stamp is cheaper too.   

FYI, if you are going to be a real estate agent 95% of the time your broker will not let you wholesale.  It happened to me with my first two deals I sold back in 03.  Look for properties in fringe neighborhoods.  It also depends on what your buyers want.  Are they looking for rentals, flips, multi units?  

You would use a regular purchase and sale agreement and either assign that contract to your buyer or use another purchase and sale agreement with a higher price with your buyer.  If you are fortunate enough your title co will not charge you closing cost.  Mine, didn't because I brought them so many deal each month.  

You need an assignment of contract document.  That should have the assignment fee on it.  You can just write one up your self too, it doesn't have to be anything fancy.   Just say that you have a contract with the seller for X amount to buy this address and you are assigning all rights to the contract to ____________ in consideration for the sum of X to be paid at closing.