All Forum Posts by: Jonathan Hasan

@Richard S Myers

Richard,

I think that people who can successfully do both already have a game plan in place after spending much time doing research. Do you know what type of real estate strategy you want to pursue? That is to say do you want to do wholesale, fix and flip or buy and hold for example? Each of those strategies has their own unique benefits and fall backs and you need to choose the one that works for you and aligns with your goals. 

Since it sounds like you are new, I would recommend trying to absorb as much info as you can from experts such as @Steve Morris. Go on forum posts, watch webinars, read books. Your most valuable resource is your time. Its almost like a second job...but those who can weather the storm have access to financial freedom that is not possible for many. 

Do your research, learn as much as you can and when you are sick of learning, learn some more. It takes a lot of dedication and time to do well in this business and I am speaking as a newbie. Most of the experts on this forum didn't get there through handouts. They invested their time to mastering their craft and provided value for others. 

If you are serious about this, be prepared to put in the work. This is the realization that I had after talking with these people. 

as i understand it, you use a standard purchase agreement. One between you and the seller (A-B) and then the second between you and the end buyer (B-C). You then have all parties available at the title company and then perform the transaction. With the buyers funds in escrow, you pay the seller, keep the fee and then transfer the title. 

A - B - C

money goes from C to A with B pocketing difference.

title goes from A to C with B holding temporary title ownership thus you are not brokering since you "owned" the property, albeit for a short time period. 

hope this helps

Also dont forget to verify. This is what I have come to understand about how this works. Do your own due diligence and dont just trust my words. 

in the end, make sure you are 100% confident in what you are doing.

@William Eric Schaefer

If you have a title company, then your contracts will be the final piece of the puzzle.

As I said before, it might help getting an REA to help you draft it. Its pricey but it will save you a lot of headache from what i understand.

@William Eric Schaefer

As steve said, it would help to make sure that you can do this type of transaction in the first place.

This is my experience so far in MO. 

Doing research on this issue myself, it seems that certain title companies do not do dry funded double closes because they are uncomfortable with performing such transactions. If I recall correctly, dry funded double closes have been misidentified as mortgage fraud in the past thus leading to excessive concern. There are other title companies that have no problems with these sorts of transactions, so try and find those types of companies. I personally found one and have to re-verify on the second company I talked to recently. 

If you cant find one, you are going to need transactional funding to officially "purchase" the property and the resell it in a few minutes to the end buyer. Of course, you incur more fees so keep that in mind.

Also talk to a real estate attorney when writing your purchase agreements. Make sure that it is someone well versed in wholesale transactions who can help you structure the contract verbiage. I would recommend telling both seller and end buyer exactly what is going to happen. It seems that way you avoid fraud by inducement since you have laid out exactly how the transaction is going to happen. 

Hopefully this helps, I am new to this game myself so I will try and share whatever info I can. 

@Heather B.

Everyone seems to have already given you a treasure trove of advice.

Dont let age keep you down. There are people of all ages starting in real estate and many are doing great.

Just make sure you do proper due diligence no matter what strategy you pursue.

I am sorry. It just occured to me that you didnt have "pro" under your profile pic and i was going to change my response. My apologies. 

Having a Pro membership might be in your best interests though. Not only do you have the marketplace but access to a bunch of tools to help in your real estate journey. 

In the end, the choice is yours. 

Good luck in your business!

@Lamar Wint

Hey Lamar,

I would advise to put this post in the marketplace forum. That is where I went to find partners. It might be easier to get the traction you need there.

@Kris H.

Yeah, i used to have an engineering job before covid hit. It really put a damper on things when they downsized.

 Could I trouble you to explain this in more detail? Specifically about the interest only loan and the refi into a conforming loan. 

@David M.

You make a good point.. In that situation, there is not much purchasing power. 

You kind of have me intrigued with your comment on leverage on fix and flips. Do HML and PML really want to work with someone who can repay the loan so quickly that they don't get any substantial interest for the money loaned?