All Forum Posts by: Tyler Shoaf

You always want to proceed with contacting the seller if you have motivation indicators. You have 3. 1) Code enforcement & not being livable. 2) Boarded up and vacant. 3) Behind on taxes. These are all good indicators that the seller might want to sell at a discount to get rid of their problem property. But you will never know if it's an actual deal or not until you have a conversation with the seller. Like the other guy said see if they have a mortgage maybe there's not enough equity to make a profit and wholesale it to an investor. Or maybe there is but you won't know until you have a conversation with them. It sounds like they will be motivated to sell with those indicators so I'd suggest find out where the home owner lives and send them a letter.

Alex if you're not licensed then be careful saying "my commission" as a non licensed wholesaler that's a quick way to get in trouble. You get paid an assignment fee or a finders fee. Also, if I'm not mistaken you're not realizing what these other guys are saying when they're talking about commissions and closing cost. They're talking about when the investor resales the property. Keyword "resale". That's 6% commission on a 230k sale + closing cost comes out to around 210k. Not including other miscellaneous cost like holding cost, something coming up on the rehab that wasn't expected, or financing cost, etc. Is your investor getting his cash from a private or hard money lender? That's more expenses... But let's say best case scenario for you he doesn't need financing & your rehab numbers are on point he's still all in at 210k (195k purchase & rehab + resale commission + resale closing cost) leaving 20k profit. Is that really worth a 200k investment? 200k to make 20k. Think about it. That's only a 10% ROI for a lot of cash to fork up. If he's not a millionaire he'd likely take his cash elsewhere for a better ROI.

Hello Waide,

Usually wholesale deals won't work with agents. A few reasons why.

1; Agents are looking for buyers who are not looking to assign the contract. They are on a time limit before the listing contract expires and they don't want the property tied up with someone who's not guaranteed to close.

2; If its already been on the market for awhile its more than likely hundreds of investors have already seen the listing. If it's not sold yet there's probably a good reason why.

3; Even if you could get the property under contract the end buyer you have in mind could cut you out of the deal. If it's on the market its easy for the end buyer to find out who the listing agent is and figure out when your contract expires and go directly to them. I'm not saying all buyers will do this but there are some who will. (Having a big buyers list will help avoid this)

This is just a few reasons.. My advice to you would be to look for off market properties.

If you're not sure how to do that there is plenty of free info on this website just go to BP's search bar and search "How do I find off market properties" plenty of free info to get you started. 

I appreciate everybody's input on this. Before I back out of anything I want to see if we can still come to a win-win scenario for all parties including the seller. I will keep you guys updated and let you know how things go! 

Thanks everybody!

@Aaron Mazzrillo We agreed on the contract to a zero dollar deposit so I didn't have to put anything into escrow. It's a valid contract I've done it this way multiple times. Thanks for the book recommendation I'm going to have to look into that. 

@Account Closed I can understand your point with the hoarder comment. I will say that they do not seem like they're mentally ill. Their son who is a grown man was also there listening into the conversation, reading the contract, etc to make sure that they weren't being fooled. They knew exactly what was going on. Also there were younger kids there and no way was I being a creep and all 3 grown adults who were present the entire time didn't think so either. Otherwise why would they sign the purchase agreement happily? I think you're going a little overboard with that comment. 

@Michael Schaeffer Thanks for the input Michael. I've actually already built rapport with the seller and found out the problem. One of them being that they wanted to close on their time frame because they wanted to live in the property during Christmas. The second was the issue I already mentioned above about wanting to close and still live in the property until they find another house to move into. The third was they wanted me to pay for a dumpster rental while they are vacating the property so they can throw anything away that they don't want (they are hoarders). I've already agreed to close on their time frame and pay for the dumpster. They knew the risk of me maybe not being able to let them stay after closing. They still agreed and signed. Like I said I already built the rapport needed I spent a full hour at the property maybe more just looking at the property and chatting with both owners and their kids. I simply gave them a choice to sign now and if not the offer was off the table. The reason I did this was because I knew if I left without their signature they was going to go back to the other investor and tell him/her my offer. How do I know this? Because they literally told me that they had another offer on our first phone call and told me that they wanted to see what I had to offer before they signed the other contract. Then they showed me the unsigned written offer from the other investor.

@Adrien C. Oh ok! He called me and told me not to be a dick and just do it on anybody he already knew the situation. But I understand where you're coming from.

@David Dachtera That's a good idea didn't think of that! Thanks!

@Adrien C. My goal isn't to be a dick. Like I said I'm trying to create a win-win scenario for all parties involved. I've cancelled a contract with a seller before. The thing about this one is they already mentioned their situation and I told them I would do my best to do what I can and they didn't have a problem with it. They also mentioned on the phone earlier that they didn't have the money for closing cost and I told them before they signed that that money can be taken out of the purchase price of the property. So kinda seems they're just throwing excuses out there. They also had a previous offer on the property before I got to the property they just didn't sign yet (they even showed me the contract at the property). They called me up to see what I would have to offer first. That's when I went to the property offered an extra 5k on top of the other offer and told them that if I walk out of there without the deal that the offer was off the table. They was quick to sign after the entire conversation knowing the risk that I might not be able to close then let them stay until they found a house. If they had an issue with it why would they sign? I'm thinking that they went back to the other investor and got a better offer now trying to back out and just using the excuse of needing to find a new home first for me to agree with them.