@Andriana Babikian
heres an example, there is a pretty successful whole seller in my area( hes damn near like a mini version of an MLS because he always has so many properties under contract) and this is what he does:
1- posts bandit signs "buy your house for cash", goes up to houses that appear in disrepair but in good areas and offers to buy their house, sends out letters to specific areas of town that he likes to get abandoned or neglected properties in, etc.
2 - once he finds a potential property and owner that is willing to sell but for some reason such as property condition cant sell in a traditional manner or simply wants the property gone asap, he will negotiate a sale price with the owner. In his negotiations he will account for: repairs, holding costs, after repair value, purchasing & reselling costs for the cash buyer, profit for the potential cash buyer, and of course his whole sell profit. - If you account for all of these correctly (research the 70% rule as a starting guide but keep in mind some cash buyers use a more stringent rule such as me I use 65% of ARV as my trigger, and remember it doesnt include your wholeselling profit) and are able to get the owner to agree to a price, that is how you have created " a deal".
3 - Now that you and the owner have agreed to a price, you both sign an assignable contract giving you a x amount of time to purchase or assign the contract to a different investor. Simple templates are available here on BP under the Resources tab - Fileplace. You can use them, alter them or choose to use a different version you find by searching past forum threads on here.
4 - at this point you now have "a deal", the wholeseller in my area primarily uses facebook, craigslist and zillow but NOT the MLS. (you can post on zillow without being on the MLS). his advertizing motto is that you will not find his deals on the MLS. Once you post it, provided its a deal, thats when the herd of buyers start blowing up your phone to beat out the next guy.
Regarding how you get paid, many generally get paid at closing as a contractual party to the transaction, the closing company cuts the wholeseller a check and the owner a check. Some whole sellers get paid at time of assignment, aka over coffee when they meet with the cash buyer to sign over the assignable contract.
This is just one example of my personal experience with wholesellers (from the perspective of the buyer). As to how much the wholeseller can make on the deal, depends on how low they got the purchase price in the first place. For me as long as I get a deal in a good area at 65% ARV(minus repair costs obviously), I tell whole sellers I dont care how much they make, without them (atleast for that specific find) I wouldn't of had the deal so the more the better.
if you want, send me a PM with your email and I will forward you the last email I got from him (im on his email list), shows his various properties he is wholeselling right now. probably help give you an idea of how he does it
You dont have to wholesell the deal either, if you want to do the work and flip the property yourself you can, but you will find less investors that want to only be a bank, and the ones that do will generally want you to have more then just a deal, they will want you to have some percentage of cash/skin in the game.
