Ok. So this is actually my first post ever on Bigger Pockets. I've been listening to the podcast off and on for about a year and a half. Recently, I deceived to start playing he game instead of watching from he sidelines. With little capitol, wholesaling is my first strategy. As I begin to build up I will use the BRRRR strategy to have significant cash flow. As I complete wholesale deals I will pay down my rentals. (All sounds good in theory right?)
That's just a bit of information on how I ended up here. That's not the purpose for this post however. While driving for dollars in one of the most affluent areas in the country (Potomac, MD) I found a for sale by owner sign. I called the number on the sign and spoke with the owner. He's owned it for 30+ years and would like to sell the property for $1Million. In this particular neighborhood homes are selling for well over $3Million, some homes as high as $7Million with around the same square footage. The property sits on close to an acre. This may be a complete demo project but there is a lot of equity.
Here's where I am in a flux. I'd like to offer the $1Million and tied it up so I can assign it to an investor that I know would love this. Problem is I have no earnest money, no proof of funds, truth is this is my first time trying to wholesale. I am looking for some advice on how to handle this situation. Should I submit an offer with no earnest or proof? (Contract can be valid for 10-30 days) this seams to be the best option I can come up with.
Or should I sign a contract with the investor that says he will pay me the agreed finder's fee once he does purchase?
Thanks for reading!
