All Forum Posts by: Zoran Stanoev

You don't need a bank.  He sells it to you for 225k and when you show up at the closing, the bank (his old mortgage) gets it 106k and then he acts as the bank for the remainder. his loan is secured by a promissory note and a mortgage (recorded).  you then make payments to him/her. 

@Steve Borodin this might sound cold-hearted, but it sounds like you're going to rent your place to someone unemployed with six kids. Did you really dig into the references and prior landlord?  It definitely sounds they're trying to pull at your heart strings. I'd make sure you're making a decision with your head and not heart.  Good luck either way.

I analogize it to Chicago being very pro-tenant.  The city protects the little guy, not the corporation.  In this instance, the homeowner is the little guy and the wholesaler is the equivalent to the landlord. Wholesalers don't have a great reputation and in general, if someone were to give a brief overview of wholesaling to someone unfamiliar with real estate investing, I don't think that person is going to like wholesalers very much. Also, whether it's the "guru's" fault or just the nature of the business, wholesaling has been ruined by a few bad actors. And in my opinion, I don't think wholesaling sprung up because of the demand you explained. 

It's a state law so it will apply in every county  

@Patrice Boenzi just one more thing about the double close - the reason it wouldn't get around the new law is because the wholesaler would still be marketing their contract or position when trying to sell to the ultimate end buyer. to avoid being a wholesaler, they will need to be the actual owner of the property before being able to sell it, which means they will have to actually purchase it before trying to sell it. i'd guess that most wholesalers would rather spend the money on getting their license rather than paying the costs of double closing on every transaction.  

but yea, time will tell...

I think it will certainly change things. I don't see how it can't. and I don't think doing a double close would avoid running afoul of the law. Wholetailing would, but not a double close. While I don't doubt the hustle of some wholesalers, I also don't doubt the broker's lobby and that some brokers may push for this to be enforced.  I'm not sure how title companies will feel about this, but I think Illinois being very pro-tenant is going to also be very pro-consumer (or anti-wholesaler). 

I also think it'll affect some of the educational courses out there, which usually lead with wholesaling to entice people because it requires "no money" to start (although I think it actually may require the most). Illinois will have to be carved out as an exception. 

@Cirilo Villar

There are a lot of other factors and information needed to even begin to consider this scenario. First, what do you plan on doing with the house? Does it need any work? Is it worth $500k or is that what you'd be buying it for? 

If you don't have money for a traditional down payment and low credit, at the least, it means you can't get bank financing right off the bat. Of course, as RE investor, most people on BP don't buy using traditional bank financing.  But again, to my first point, there are so many other factors and information missing in order to be able to adequately consider your scenario. 

Being in a higher-end market, if you only have $10k (assuming you don't bring on a partner) you could easily get into a lot of trouble if you do any strategy other than wholesaling. Good luck 

@Erica Hatfield 

The host's name is Boyan. He's super friendly and helpful. I'll be there in a couple weeks.  Hope to see you there! Let me know if you have any other questions about it. 

As David mentioned, there are a ton listed on meetup.com. I've been to just about all of them at least once. Brie's is definitely one of the best. I was also at another one last night in Des Plaines that is excellent. I'm happy to chat about others, so you have better idea which ones you should spend time attending. 

I can understand if some of the posters in this thread can explain how this is a possible strategy, but how can they emphatically state that it is not a scam or that something fishy isn't happening.  Although it sounds like your request for additional information may have made them run for the hills, since it sounds like you're not 100% comfortable with it, I'd recommend hanging onto the properties and selling them via a traditional strategy.  You may incur additional holding costs, but it may save you a lot of headaches and money in the long run. Trust your gut.  Good luck.