All Forum Posts by: John Hixon

@Vincent C Riccio Its been along time but someone on BP posted a study they did on their portfolio, I think it was 200 or 300 units and the 50% rule is pretty close.  Overtime the expenses add up to about 50%.  I think this study was done over 5 or 7 years.

@Josette Reynolds what kind of marketing did you do once you got a house under contract?  What kind of marketing have you done to find cash buyers?

Can you tell us about some of the deals, what you projected the ARV's at and how much in rehab the houses needed and what you were asking for them? Knowing some of that might help in getting some advice. Thanks

@Candice Brown  Congrats on taking action that is a major step in itself.  I will PM you some advice.

Grant Cardone is a great guy who has a positive can do attitude and does a great job of inspiring others that they can do anything they want.  As far as his educational material goes I am 50/50.  I think his books are good, Sell or Be Sold, If Your Not First Your Last and 10X but I have ordered some of his other material and not be so impressed.  He recently had a sale on his site and I paid $15 for 3 items and I think they were just so so.  They had prices that said originally $399 or $599, If I would have paid that I would have been irate.   I am not going to spend $10K or $15K on a training course, Grant really pushes that stuff on his podcasts and I am not sure if it would be worth it for me.  But, I really do like his podcasts and think he is at his best when he is just talking and not taking calls which always leads into him saying "you need to get on this or that program I have".  All in all I think everyone should listen to him because he is very inspirational.

@Andrew Quinn Wholesaling or assigning is pretty simple, people tend to over complicate it.  Below is an example of how it works.

1. Find a house and put it under contract for $50,000

2. Assign the contract to a buyer for $70,000

3. Buyer shows up at closing with $70,000.  Title company gives seller $50,000 and give you $20,000. Buyer gets the house.

Just use the standard Missouri real estate contract.  Please do not use any weasel clauses like "contingent upon partners approval" or something like that.  Clauses like that are why wholesalers get bad raps.  All contracts allow a time frame for inspections usually 7-10 days.  That is your time to find a buyer.  If you cannot find a buyer in that time frame you need to cancel.  

Earnest money does not need to be double the what you put down.  Just have the buyer deposit the same amount you did with the title company and that is good.  Their earnest money will replace yours as per the assignment agreement.  

I have never done an affidavit and memorandum to protect my interest.  Once you have a signed contract with the seller they cannot go and sell the house to someone else.    

I will PM you some others stuff to help you get started.

@Arnoldas Serksnys there are a couple of issues.  Step 2. Do not include any weasel clauses in your contract.  A lot of people on BP tell you to put in all of the weasel clauses so you can just get out of the contract.  But, it is people like that who end of giving real wholesalers a bad rap.  The standard real estate contract for your state should provide you with enough protection.  If the contract says you have 7 days to perform inspections and cancel then you have 7 days.  You can try and add an addendum that allows more time but the seller may question that and I am not sure what the real estate laws say about that in your state.  

Step 5. You do not take the earnest money or down payment.  The person you are assigning it to sends their earnest money check to the title company and they replace your earnest money with theirs.

You have the concept now you just have to find a seller and a buyer.   

@Mark F. You need to listen to Grant Cardone, he just did a great podcast on this stuff.  Grant would say your problem is not that you are spending $150 a month on coffee your problem is $150,000,000.  Why you do not have $150,000,000 and how you are going to get it should be your problem.   $150 is not a problem, if you are going to have a problem then make it a real problem.  And, second is giving up something that you enjoy for 40 years really worth 152,602.02?. Instead of giving up Starbucks why don't you just figure out a way to earn $152K more this year.  People do not have a saving problem, they have an earning problem.  You can only cut so much before you have nothing left to cut or cut back on.  Before you know it you are 60 years old and you have cut out everything you possibly can in your life over the last 40+ years and you have only saved $500K or $600K.  I'm sorry and I am not trying to insult anyone on here but what is $600K going to do for you?  People need to stop looking at ways to cut back on things so they can save $600K over their life and start looking at ways to earn enough to start saving $600K a year over 40 years.  Because $24,000,000 sounds a lot better then $600,000.  

@Mark Buskuhl just sent you a DM.

@Jarron Jackson You do not have to worry about losing your money because when you do the assignment the person you are assigning the contract to puts down the same amount of earnest money as you do and it replaces your earnest money.  That way if for some reason he does back out it is his $3,000 earnest money that the seller gets not yours.  I only said $3,000 because I have gotten deals where I was willing to put down money and other wholesalers where not.  All of these get rich quick guys who went to a two day seminar think you can just show up and put a house under contract with no skin in the game are the guys giving all of the real wholesalers bad raps.  This is a serious business involving big time money and dealing with peoples property.  If you are not willing or able to put up something as small as $3,000 to show the seller you are serious then you need to take a step back and reevaluate what business you are in.  Not saying this directly at you but so many people on BP think you can just jump into wholesaling with no money or experience, use these weasel BS clauses to get out of contracts and somehow you are going to make it big in this business.  @Arnoldas Serksnys your question was already answered but like the others have said once it is under contract the seller cannot back out.  You can advertise that address to every investor you can and the seller cannot go around you.  But, as I said earlier be upfront and honest and let the seller know that you will be assigning this deal.  They never care as long as they are getting the price they want.

@Arnoldas Serksnys The time frame remains the same as the contract.  All you are doing is assigning your rights in the contract to the new buyer. I always use 30 days for closing.  So, once you have a buyer and you have them sign the assignment form, send that to the closing company along with the contract (well, the contract should be there from the start) and the closing company will know that you are no longer the buyer and the person on the assignment form is the new buyer.  My first deal was $135,000 and my second was $72,000 I used $3,000 on both.  It really doesn't matter I could put down $10,000 or $50,000 I am getting that money back because the new buyer will be replacing that with there own when they sign the assignment form.  Now, in reality $50,000 is a bit much but I was just making a point that I never lose the $3,000.  Just make sure you know by what date you have to cancel the contract if you can't find a buyer because if you miss that date then yes, you will be missing that $3,000 earnest money.