Skip to content
×
Pro Members Get
Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
ANNUAL Save 54%
$32.50 /mo
$390 billed annualy
MONTHLY
$69 /mo
billed monthly
7 day free trial. Cancel anytime
×
Try Pro Features for Free
Start your 7 day free trial. Pick markets, find deals, analyze and manage properties.
All Forum Categories
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

All Forum Posts by: Account Closed

Account Closed has started 0 posts and replied 111 times.

Post: Co-Wholesaling and Non-Circumvent

Account ClosedPosted
  • Professional Investor
  • Dayton, OH
  • Posts 113
  • Votes 36

You can have JV agreements, non-circumvent agreements, this agreement and that agreement. What are you going to do if the other party breaches? Sue? I don't think so. Litigation is costly and lengthy.

The best way I have found to keep people honest who want to wholesale my wholesale properties (JV or whatever you want to call it) is to have them put up non-refundable cash. You'll find out pretty quickly all you need to know about them when you do.

They want to shop my deal, they have to pay for the privilege.  Oh, and give them a short leash, like maybe a week.  That way, if they don't produce a buyer quickly, your property isn't encumbered.

Post: Contracts

Account ClosedPosted
  • Professional Investor
  • Dayton, OH
  • Posts 113
  • Votes 36

Consider bird-dogging for an experienced wholesaler in your area.  That way, you will learn and earn.

Post: Assigning Contract or Double Closing?

Account ClosedPosted
  • Professional Investor
  • Dayton, OH
  • Posts 113
  • Votes 36

On your buy side, write your contract so the seller pays all the closing costs.  Truly motivated sellers will agree to that.

On the sell side, write your contract so the buyer pays all the closing costs.  Deal hungry buyers will agree to that.

Result?  You pay no closing costs.

As far as the high cost of transactional funding, shop around.

Post: Virtual Wholesailing

Account ClosedPosted
  • Professional Investor
  • Dayton, OH
  • Posts 113
  • Votes 36

How much wholesaling do you do in your own backyard?  Do you have the fundamentals of wholesaling down?  Have you already done a number of wholesale deals right there in Houston?

If your answers to those questions are none, no and no, the question is then, why?

My point is that if you don't have success right where you live, having success where you don't is even harder.

Post: Broker Commission???

Account ClosedPosted
  • Professional Investor
  • Dayton, OH
  • Posts 113
  • Votes 36

That's a discussion to have with your broker.

Post: Legal or Not

Account ClosedPosted
  • Professional Investor
  • Dayton, OH
  • Posts 113
  • Votes 36

Bear in mind that real estate contract law is fundamentally just contract law.  Yes, all states have regulations specific to real estate transactions to protect consumers, but most of those ONLY apply to licensed agents and are about disclosures THEY must make.  If you own a property (or are selling your ownership interest), a number (not all) of the regs don't apply to you.

If you are not a licensed agent, you must have some ownership interest in the property.  If you have it under contract, you can sell your contractual interest, just like you can in any contract.  To sell a property otherwise without being licensed is illegal in Arkansas and every other state as far as I know.

However, I am unaware of any state that prohibits your selling your own property or your interest in a contract, and if there are any, they are contrary to centuries of contract law that dates back to when the Magna Carta was signed in England, and THOSE laws, if they exist, are probably illegal.

Don't let real estate agents scare you.  Just make sure you aren't trying to sell a property in which you have no ties whatsoever, and avoid the agent that told you that misinformation at all costs.

Post: Negative Equity... Creative Options here?

Account ClosedPosted
  • Professional Investor
  • Dayton, OH
  • Posts 113
  • Votes 36

Don't waste your time... Next

Post: What would you do? Wholesale it or wait to buy?

Account ClosedPosted
  • Professional Investor
  • Dayton, OH
  • Posts 113
  • Votes 36

Rather than "take a stab" at wholesaling, refer the deal to someone who is an established wholesaler in your market for a "bird dog" fee.  That way, you get paid on the deal without wasting your time on something you know nothing about (and probably won't execute successfully).

Post: Working with Realtors

Account ClosedPosted
  • Professional Investor
  • Dayton, OH
  • Posts 113
  • Votes 36

...

Post: Working with Realtors

Account ClosedPosted
  • Professional Investor
  • Dayton, OH
  • Posts 113
  • Votes 36

Wow!  You have asked a very comprehensive question that covers a lot of situations.  I'll do my best to give you a good answer based upon my 14 years of wholesaling experience.

Generally speaking, good wholesaling is just good business practice.  In other words, think about what makes good business practice and apply those principles.  In addition, bear in mind that in the words "real estate contract", the most important word is "contract".  By that I mean, you can't do something with a real estate contract that you couldn't do with a contract to buy an airplane, for example.  In other words, understand the elements of any contract, and you'll have the basis for u understanding a contract for real estate.

That being said, states have enacted laws governing real estate transactions to protect consumers so you have to be mindful of those.  If you want the best answers to real estate questions in your state, consult a real estate attorney.  Not just any attorney; one specializing in real estate.  If you don't know one, do what I do.  Go to the published guide that rates attorneys.  The are rated A, B, and not-at-all.  Pick one that is A rated.  Yes, you will pay more for his or her advice, but it is the cheapest advice you can get in the long run because 1) the attorney may charge more per hour but will take less time ultimately being less expensive, and 2) it will be advice that will save you from making costly mistakes later.

Needing a licensed realtor... you only need a real estate license if you are representing someone else other than yourself in a real estate transaction, i.e., you are not a party to the transaction. That means you or your LLC better have the property under contract before you try to sell it to someone else.

Some real estate agent will tell you at some time in your wholesaling life that you have to have a license to wholesale.  It's usually the new ones who just got his or her license the week before who tell you that.  Don't argue with them, if you have it under contract, just tell the agent that you hold equitable title to the property, and therefore, have an ownership interest and can sell that interest to whomever you please (the same as you can with any contract).  By all means, be nice about it.  You get him or her peeved, and the agent will tattle to some authority, and you'll have to be called in to explain yourself.  Not a problem, just a time waster and a hassle.

That being said, I always work with real estate agents who bring me deals.  It's only good business.  I make sure I understand how and how much they expect to be paid and get that clear on the front end.  I don't involve one on my own.  I only work with them when they involve themselves.  

A lot of times, I pay them more than they ask.  Why?  Because many of my wholesale properties are low end, and paying them a flat rate that is more than their 6% is good business.

To assign vs. a double close (aka ABC or A to B and B to C close)... that's your call.  If A and C (you are B) know what you are making or you don't care if they know what you are making, assigning saves closing costs.  I'm always cautious about that because people can get squirrelly.  They get more focused about the size of your piece of the pie rather than being happy with their own slice.  Simply, it's a judgment call.

The downstroke of an ABC close other than double closing costs is that most underwriters today require you "wet" the transaction.  You have to fully fund A to B before closing B to C.  You can't use the proceeds from B to C to fund the A to B.  If you don't have the cash, you have to use transactional funding, which will cost you a couple of points (at least) and adds one more variable in the transaction.  (I like as few moving parts as possible.)

In addition, you are in the chain-of-title.  Consequently, my practice is to provide a Special Warranty Deed to C in double closes.  In a Special Warranty Deed, I am only warranting the deed for the time I owned the property (which is maybe an hour?), limiting my exposure.

The answer to bullet point 2... I don't know of any "state" contracts.  States don't have a real estate contract, just laws about what must be in them.  The board of real estate for your area has one, I am sure.  Brokers always require their agents to use their contract (which is usually the board contract).  As far as whether or not you need to have a contract resigned when an agent is involved is determined by that agent's brokerage not the state.  If you use that agent, that agent and you will have to follow that agent's broker's rules.

The answer to point 3 - yes.  You simply write the elements in your contract you want to preserve in the Addendum to the broker's contract.  Just ask the agent for one if you don't see it.  They all have one.

Well, I've taken up enough of BP's space so it's someone else's turn.  I hope I helped!