All Forum Posts by: Chris Piper

@Ronald Kimbrough If you are looking for all the info you could ever need about commercial investing, check out The Investor Syndicate. It's $60/mo. but for all the info and training you get, that price is a steal. Hope that helps.

@Danielle Clark I would start out wholesaling, then move into rehabbing/flipping if you enjoy headaches, then add in buy and hold properties if you enjoy long term headaches. 

Wholesaling is the fastest in and out high profit way to make money in Real Estate. You can also add in tax sales and REO's to get some good deals. Just my two cents.

@Tim Pagano ACCURACY and PRICE are the two biggest factors in my opinion. Make sure your repair costs and comps are spot on, and make sure the price is right, meaning make sure you ALWAYS deduct 30%-35% right off the top of the ARV, then subtract the repairs and you have have your sell price to the cash buyer.

@Abraham H. Here are answers to your questions:

1. The purchase agreement between you and the seller does NOT need to be verified by an attorney. The purchase agreement is a legally binding contract, and you can use one that you found online. Also, If you go to Tools>FilePlace>Contracts at the top of this page, you will find a purchase agreement and an assignment contract I uploaded last month.

2. Yes the cash buyer will want to look at the house. You word your contract so that you, your agents, associates, business parnters, inspectors, or anyone else you want can inspect the property. Just make sure you meet them there so the seller doesn't try to cut you out of the deal.

3. You need an assignment contract in addition to the purchase agreement when doing a deal. The purchase agreement is between you and the seller for you to buy the house from them at the agreed upon price, and the assignment agreement is between you and the cash buyer for them to buy the property/contract from you.

4. I know nothing about land deals so I can't help you there.

@Brian Pleshek You CAN negotiate with wholesalers, but it doesn't mean they'll take the offer. Also, they provide a valuable service to cash buyers/investors if they are actually a good wholesaler, and they have already built in 30%-35% of the ARV for your profit, etc. so why haggle and possibly lose a deal over a couple grand? If your already making $25,000 and they're making $5,000, I doubt that they'll be too willing to negotiate, but anything is possilble. I agree with @Account Closed that you should negotiate if the price dosn't make sense for you. But if you have a good wholesaler, the price will always make sense for everyone involved.

@Austin Sanne Wholesaling is pretty simple once you get the hang of it. Find a house for sale NOT listed on the MLS and NOT listed with an agent. You need MOTIVATED sellers with offline deals for sale. You negotiate a good price, and then sell it to a cash buyer for a higher price. DO NOT offer to sell anyone's house for them EVER!!! You can go to jail for acting as an agent without a license.

You can legally wholesale, but as I said, that only works for properties that aren't listed with an agent. You find those deals by using bandit signs(WE BUY HOUSES), Craigslist, etc.Once you find a property, walk through it with the owner, see what needs to be fixed/repiared, figure out the repair costs(if you don't know how, call a few contractors out there to give you estimates), then you need an agent to pull 3 comps for the property. Similar size, beds, baths, etc within 1/2 mile of the property you are looking at, and all SOLD within the last 30-120 days. 

Once you have your comps(comps let you know how much the house you're looking at can be worth once it''s fixed up, also know as ARV- After Repaired Value), and know how much your repair costs are, then you figure out how much you can pay at the most for the property(also known as the MAO- Max Allowable Offer). Here is the formula to figure out how much you can pay at most for a property:

ARV-Repair Costs-Your Profit= MAO

Example: Property ARV $100,000-30%(Investor's Profit, etc.)-Repairs $20,000-Your Profit $7,000= Your MAO is $43,000.

So you can offer a maximum of $43,000 for that property,but not any more than that. I usually start at 85% of my MAO for my offer.

Example: MAO $43,000X85%= $36,550 Initial Offer

If it's rejected by the seller, you can counter offer somewhere between what they came back with and what you can pay. If they won't take less than your MAO, then it's not a good deal.

Google "The Wholesaler's Bible" by Jerry Norton. You can donwload it for free. It will give you some good info to get started with in wholesaling.

@Jason Harris You can wholesale the deal, but it needs to be to a cash buyer only(land lord or rehabber). When you wholesale a deal, it means your intent is to sell to a cash buyer, even if that may be an individual looking to live there themselves. Don't worry about what the end buyer will or won't be able to do. If they have cash, sell it to them. Get a non-refundable deposit from them at the signing of the assignemtn agreement and if possible a POF or bank statement showing they can pay in full at closing. You also should not be selling this as a FSBO or using FSBO signs. Stick to bandit signs once you get it under contract to find the cash buyers, and post it on Craigslist. You should sell it no problem if it's a good deal.

@Tyler Belliston You do not need a license to be a wholesaler. Just make sure you have accurate repair costs and comps on any property before trying to offer it to cash buyers.

The way to find cash buyers(investors) is:

1. By placing a ghost ad(fake ad) for a property you have for sale on Craigslist. Just grab pics of any property in the U.S., upload them to CL, put a ridiculously low price, and watch the phone ring. When ity does, you tell them it's been sold. Ask them if they are an investor because you are always getting new inventory. Take down their name, number, email, and find out what they like to buy and what areas.

2. Putting out bandit signs. Use a burner number, Google Voice, or Sideline number so it can't be traced back to you. Most cities will fine you for bandit signs. But hey work VERY well. On your signs, you basically put the same thing as the CL ad. 3bd/2Ba 1,200sf CASH ONLY!!! MUST SELL!!! (123)456-7890

3. Get a real estate agent, have them pull all the sold properties from the last 6 months that were paid for in cash. When they give you the list, go to been verified and sign up. Then plug in the cash buyer info, and you'll get a phone number/email for them. Call them and find out what they're looking for and add them to your cash buyer's list.

@DaVon Brooks I'm not sure how many wholesale deals you've gotten into and not closed on, but it should be a rare thing to NOT close ona deal, not the norm. The area where you are trying to wholesale really doesn't matter. You can make money in any market really. Use list source and pull a partial list of zips in your area where cash buyers are buying(absentee owners). Then, buy in the areas with the highest number of properties in those zips.

It sounds like you might be missing something in the wholesale process if deals aren't closing. You might be selling to high, you might have deals that cash buyers don't want, (buying the wrong deals), your rehab costs could be off, etc. 

There are three main components to being successful in wholesaling:

1. Buy at the right price

2. Get accurate and current comps

3. Have accurate repair costs

If even one of those 3 things are off, you won't close the deal or deals. 

Here is the process in a nutshell:

1. Find an OFFLINE deal from a motivated seller. Not a property listed in the MLS.

2. Do a walk through of the property and figure out your repair costs.

3. Pull at least 3 comps similar to the subject property within the last 3-6 months that have sold. Only use SOLD properties, pending or listed properties don't count.

4. Run your numbers and see if it's a good deal. If so, make an offer. If not, move on to the next deal.

5. Sign a purchase agreement with the seller.

6. Find a cash buyer ASAP! If no buyer within 1 week, drop the price. If no buyer within 2 weeks, call every wholesaler(We Buy Houses) in your area and see if they want to JV the deal with you(split it for bringing in a buyer).

7. Sign an assignment contract with a cash buyer and collect a non-refundable $2k minimum deposit from the cash buyer.

8. Close and get paid.

@Patrick Philip It's great that you want to have a massive cash buyers list, but 1,000's is fairly unrealistic. The truth is, you don't need 1,000's of cash buyers. If your just starting out, you just need 5-10 good cash buyers. Obviously, the more the merrier, but it will take time and money to build a big list. If you are trying to reach cash buyers nationwide, you could mail to a ton of cash buyers using something like Findcashbuyersnow, but it costs about $2,500 for access. I have access and it literally has tons and tons of cash buyers from every city in the U.S. In Orlando, which is close to you, I just checked and there are 777 cash buyers who have bought 2 or more properties in the last 4 months. And that's just 1 city. If you want to be more cost effective, you could post "ghost ads" on Craigslist in cities all over the U.S. I think they limit you to a few ads every couple of days though. Look at the pic below.