All Forum Posts by: Mike Schorah

 But the offer that she said she would accept is $130k below market value.

Sounds like a question for @jerryllnoorden

Just drove by a pre-foreclosure that’s also an inherited property (double whammy). Spoke to the executor of the will. It has mold issues, roof issues… huge rehab. She said she would accept the first offer I gave her (so we agree on price).

She has a realtor, though. She wants a quick sale, sold in less than a week.

I hear that every listing somebody enters into, they’re pretty much unenforceable. Especially if they haven’t performed.

Could we go around the realtor to get this property sold?

And that’s enough to break even on cash flow? I guess that’s the main question I’m asking.

2 years ago, the consensus seemed to be that $50k minimum was needed to do a BRRRR effectively and positively cash flow. (Median home price in my area was $300k at that time… now $375k). So do you need $100k now since interest rates doubled and mortgages are twice as high?

Referring to C Class neighborhoods… nothing below C to C- and definitely not war zones.

Also should you factor in that cash out refi’s are a year now compared to 6 months back in 2021? So that’s 6 extra months of holding costs… Maybe an extra $10k on top of the $100k.

…Then also need to account for purchase price increase. So an extra $75k would mean an extra $20k if putting 25% down… 

Now we are up to $130k to do a BRRRR in 2023 compared to $50k only 2 years ago (in 2021).

And people wonder why I’ve been focusing on wholesaling and sub to’s the past year LOL

Can you get away with $50k in this market or do you need $100k?

50 cents on the dollar? 60 cents on the dollar? 70 cents on the dollar?

And are you in a low-demand, low-appreciation market or a high-demand, high-appreciation market?

Seems like BRRRR is way more popular. Why are so many people scared of sub to deals?

It's rare that I hear of someone wholesaling a MLS property and even when I do see it in my area, they never really get a ton of interest.

It’s also rare that I see a subject to wholesaled in my area. Usually, it’s a portfolio of subject to’s that get wholesaled and even then that’s rare to see (at least in my area). Individual subject to’s never seem to get any interest, but a portfolio seems to get a lot of interest.

This is just what I see on my Facebook REIA page. But I see a lot of regular off-market wholesale deals posted.

80-90% of my follow up calls seem to go to voicemail. I only have 1-2 scripted messages I use. I hate leaving 5-10 voicemails for the same person and only using the same script word-for-word. I realized that it makes for sounding like a robot is calling.

Here’s the script I use:

“Hey. This is Mike. I haven’t been able to get ahold of you. I’m assuming you’re busy or not interested. Let me know either way so I could either stop calling or stop calling so much. Let me know so I can plan accordingly please. I would appreciate it.”

What does your follow-up voicemail sound like? Does it sound different from mine?

Let say you contracted an entire development. You put it under contract.

You have 6 months to do your due diligence. You found a cash buyer out of a fancy city.

You let the guy woo you. He shows up in a Ferrari, takes you on an amazing boat ride. This cash buyer is flashing a massive amount of money. He puts down $100,000 escrow deposit. You think the deal was done. You’re going to make about $400,000 off the deal.

You find out the buyer is not what he represented. It was a rented car. It was a friend of a friend’s boat. It wasn’t his multimillion dollar mansion.

When he doesn’t perform on the contract, you find out the buyer got all this money from an illegal trade. The last time you meet with the buyer, he takes all the paperwork without you knowing about it. The buyer puts the property in a trust.

You find out the buyer’s attorneys owned this property and they threaten you for non-performance and they sue you. You’re sitting there with no paperwork, no alibi, no defense. You have an unscrupulous businessman and you’re honestly concerned with your safety.

What would you do? How much do you think it would cost you to get out of the deal?

Let's say a realtor drove the seller to the closing just to bust you as a wholesaler. Let's say the realtor highlights the assignment fee on the HUD and now your $40,000 check isn't there. And now the realtor has plans to sell your deal on the MLS.

Would you fund the deal with a hard money lender or private lender? Would you give your title company a heads up?