All Forum Posts by: Patrick H.

Since the wholesaler has a contract with a limited time-frame (maybe 30 days), the seller will know quickly if the property will sell. This forces the wholesaler to find a buyer or lose the contract.

I only see advantages of someone selling through a wholesaler. If more people knew about the process and understood it, they would want to sell through a wholesaler.

What are the disadvantages?

I went on Trulia and was looking at a few properties. There was a Notice of Default listed for $145k (4br/3ba). The house is 2760 sq feet. The $145k is the outstanding loan amount. I assume this is the amount owed to the lender filing the Notice of Default and does not include any other liens. I have found many properties where the listing price is below the market. Some may be for $145k, some may be for $45k.

1) Is there a way to get more information online to better assess the investment potential of properties without having to pay a service fee?

2) Are Trulia or Zillow of any use if I am looking to buy property at a discount? I like the list of 'sold home prices', but it seems the foreclosure listing prices may not be as useful.

I thought I read that a safe range would be:
70% ARV - Repairs = Offer Price
70% * 75,000 – 2,000
52,500 – 2000
50,500
Of course this is only a reference point

I am curious what the additional % in your formula accounts for.
((85% * ARV) - Repairs) * 70%

I am curious why the seller was so happy. He had a property that only needed 3k in repairs and he could have sold it through a real estate agent for a lot more than 120k. Can you provide more insight. I would like to find people like that :D

I was analyzing this older post to assess the posters comment. (to better understand the investment for learning purposes).

Evaluating Option 2 . Using ARV - Repairs - Extra Repairs...375k - 125k - 12.5k = 237.5k. At a 25% equity position the offering price is 178.1k. To make 20k, he can wholesale it for $198.1k. The buyer would get 17% equity.

Did I do the calculation right? If so, would someone buy this for 17% equity? I thought the target was 30%.

I went onto the metrolist for my region and noticed that most of the properties are listed as short sales. I have read elsewhere that the listing agent might list the property below what the lender really needs, to get as many offers as possible....maybe hoping the lender will accept one of them?

The lender can just sit on the offers to try and create artificial demand, hopefully raising the price of the properties. The lender may not have any incentive to accept an offer since they would have to recognize a big loss. Since the government is supporting some of the big lenders and possibly indirectly supporting the smaller lenders, the lender can just sit around until the market recovers. The property will decay, but maybe the lender is not concerned since the government is providing support (or should I say the taxpayer is).

Is something like this happening to some extent or are lenders really trying to get everything off their books?

So it is ok to have an 'open house' even though the tenant has their items in the house? I assume this has to be spelled out in the contract very clearly.

I am curious why people looking for a home to live in commonly buy through a real estate agent rather than a wholesaler? Since a wholesaler can negotiate a low price directly from the seller, wouldn't it be more beneficial to buy through a wholesaler?

Great comments. Thanks.

Lee V, I am curious what the retail price of your property was, and how much repairs are you estimating. I saw that 70% is what some investors look for. The $1,200 rent sounds like a middle-class neighborhood.

Ralph Scott, its interesting that the tax advantages are not used to access the benefit of the specific investment. But I now understand that even though a property may show positive cash flow after taxes, it is not related to that specific property. It is best to get a property with a better cash flow and the tax advantage is an added benefit.