All Forum Posts by: Brandon Kargol

Yeah and who knows... By throwing out an offer means that you're serious. The seller might tell you of his other properties and maybe you could get a bundled deal on a handful of his properties!

Theres a lot of good info here! Here's how a strong buyers list should be

1. You NEED a handful of VIP buyers. These are the guys and gals you can call up moments after putting a contract on a property. They are the people you stay in touch with, go out to lunch or dinner with, send Christmas cards to, go golfing with, etc... They are the ones who will buy up the vast majority of your deals (if they are good deals of course). 

2. Next you have the main body of your buyers list. These are generally less active investors who might buy a few properties each year. You NEED a lot of these people (hundreds or even better, thousands). You can find them through social media or online advertising and get them added to your buyers list. These should be the people who will buy up what your VIP buyers don't. 

Now if you choose to purchase a buyers list online I wouldn't expect to get great results. You need to be out networking with local investors! Don't sell yourself short and try to buy your way into wholesaling (sorry if that sounds harsh). Be excited, motivated, and passionate about what you do! If people see you as being someone who's out to make a quick buck then I'm afriad you'll have a long hard road. Hope this helps! Best of luck!

Brandon

 Ned is absolutely correct. The only time you need to pay back taxes before the close is if you are racing against a forclosure threat. Back taxes aren't a bad thing though for you, use it as a bargaining chip. Theres a few things you can do here. 

1. Close before the forclousure (your end buyer pays the taxes)

2. Schedule a closing date after the date of foreclosure (you front the seller cash to pay his taxes)

Okay so if you choose to close before the foreclosure date then make sure you negotiate the taxes as a total cost on the property. For example, if your goal is to buy a property for $40,000 but the owner owes $3,000 in back taxes then you need to negotiatate a sale price of $37,000 for the property and agree to pay the back taxes current at closing.

Now if you choose to front the seller the cash to pay his taxes current... I do not recommended this simply because the money you front the seller isn't going to escrow as an EMD. So there is some risk involved, as the seller could just walk away from the deal with your money. But its real estate, and if you have a smoking hot deal on your hands then you could consider this option. You have to ask yourself though, is the risk worth the reward?

I agree with you Richard for the most part. A lot of it is a matter of perception. I see a GOOD wholesaler as someone who helps another out of a bad situation. After all most wholesalers target sellers in pre foreclosure (with today's market) Good wholesalers can do a great service to the real estate market by selling houses that would otherwise be bank owned. But finding a good wholesaler is a tough task for sure. 

This is probably the listing of a wholesaler who is new to the game. He should have listed the property like this...

Purchase: $26,000

Repairs: $20,000

ARV: $121,000

Now unless those numbers are true this wholesaler found one nice deal. But I'm willing to bet that his repair cost has been WAY under estimated. Which is typical from a new wholesaler. Do your own research on the property. Unless you work with a wholesaler regularly and fully trust him/her then you need to do a good research on the property to find your own repair costs and ARV.

Richard, 

  I see where you are coming from. There are a lot of wholesalers out there that don't know how to properly market a property and can't sell the property after they have a contract with the seller. Either they had a failed marketing campaign to sell the property or they never had a good deal in the first place. Most homeowners in pre-forclosure do not have the time to market their property themselves or even list it with an agent before the house goes to auction. As a wholesaler purchasing pre foreclosures you are literally the sellers last option. But that's the nature of the business. That's the hard truth. 

J.j  I'm not to familiar on the process of wholesaling bank owned properties. I imagine that the process will vary slightly by each bank. But the concept should remain the same. There probably wont be as much wiggle room on the purchase price unless the property is a short sale. Even then to my knowledge the banks can be pretty stingey as they have procedures they must follow. If the bank owned property has a lien on it then it will need to be paid current before the sale as far as I know. Each state and county has different laws and procedures so its tough to give yes and no answers. My advice to you would be to dive into researching. You can call banks and ask them the procedure for purchasing a foreclosure from them. Ask and about liens on properties and how that all must be handled. I assume the liens will need to be paid current before the closing of the property. But don't quote me on that. Like I said, bank owned wholesaling is something I have limited knowledge on. Wish I had more advice but I hope this helps!

I don't see it as being dishonest. When i meet a seller I'm there to negotiate the deal and get a contract for the property and that is it. How I structure the deal is the last thing I should be discussing with the seller in my opinion. That's not what I'm there for. If its a good deal then its a good deal, and if the seller wants to ask questions about my plans with the property then I will give an honest answer. Otherwise I see no need to bring the topic up

Richard I hear where you are coming from, however, most sellers don't care or won't even ask what your intentions are with the house once you tell them you are an investor. Simplying disclosing the fact that you are a real estate investor already strongly implies that you have no intentions of making the property a primary residence. Yes you most certainly should tell them you are an investor, but telling them exactly what your intentions are with the property should only be disclosed if the seller asks. If you tell the seller "Mr Seller I am going to put your property under contract and sell that contract to someone for a higher price." The seller is then going to think you don't care for his house. All you care is that he signs the contract and you make a few bucks off of it. A lot of sellers you'll find as a wholesaler are people who've lived in there homes and have come across tough times and when you're building rapport with the seller you provide comfort to him knowing that he is selling the house to a good person. But telling him that you're going to wholesale his property will create a reluctancy or second thoughts. This isnt always but a lot of the time that's the case. You're better leaving out the wholesaling part UNLESS the seller specifically asks. Don't be dishonest, just say only what needs to be said.

The closing of a real estate transaction varies a little by state. For example... In North Carolina you MUST use a closing attorney on the sale/transaction of real estate. So I suggest you Google "title companies" or "closing attorneys" in your area. Then shop around making phone calls and ask if they do double or simultaneous closings. You could talk to local real estate agents too and see if they recommend any closing attorneys or title companies. 

Now in regards to the bank question... What are you using the bank for? Are you and your friend starting a business account? The reason I ask is because a true wholesale transaction shouldn't require lending on your end. Unless you needed financing for a couple thousand (depending on the deal) in good faith/due diligence funds to the seller