Transcript “A-Team” Approach - 56 Wholesaling Secrets

www.realestatewholesalesystem.com
6 steps to 6k in 16 days
Wholesaling FSBOs and REOs
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Benefits of Wholesaling
 Fast Cash – 30 days or less
 Little or no money required
 Minimal risk
 Sell to a pool of regular buyers over and over
 No tenant issues
 No contractor issues
 No holding costs
 No credit needed
 No or low barriers to entry
 Profits range from 2k to 20k per deal
 Can wholesale FSBO’s or REO’s
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Disadvantages of Wholesaling
 No real tax shields available
 Profits are typically less than other forms of real estate investing
 No long term wealth building or appreciation
 Remember Risk versus Reward
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Wholesale Formula
 After Repaired Value
 Multiply times 65%
 Minus Repairs
 Equals Rehabber “Strike Price”
 Anything below the strike price is profit
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Wholesale Example
 After Repaired Value
 x’s 65%
 Repairs
 Strike Price
 Anything below 53k is profit
100k
65k
-12k
53k
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Wholesaling Basics
 Find buyers first
 If you have buyers you have a business
 No buyers = no exit strategy
 FSBO’s = marketing and assignments
 REO’s = listing agents and back to backs
 Remember the formula
 Market on the cheap at the beginning
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6 Steps to 6k in 16k days
Wholesale Profits
 Marketing and Evaluation
 Offer
 Secure contract between “A” seller and “B” buyer
 Market property to buyer’s list & Sell to “C” buyer
 Sign contract with “C” buyer = assign contract with addendum
 Close
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Elements to Ongoing Wholesaling Success
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You – what’s your mindset and motivation
Your Market – neighborhoods, prices,
Your Marketing – for sellers and buyers
Your Buyers – your exit strategy
Your Systems – automated to repeat over and over
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Wholesaling for Starters - Four Rules
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Rule #1 – Keep your marketing strategies cheap
Rule #2 – Always be marketing for sellers & buyers
Rule #3 - Don’t worry about your brand. You’ll build your
brand as you do deals.
Rule #4 – Understand your wholesaling sweet spot, prices
and what buyer’s are willing to pay
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Rule #1 – Marketing Strategies Cheap

In the beginning spend as little as possible
 Until you have a better feel for the market and what marketing is
working I recommend you keep it inexpensive
 Once you start to see some results and have a few successful
deals under your belt then expand your budget
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Rule #2 – Always be Marketing for
Buyers and Sellers
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Marketing for Buyers – Free
 Classified Ads online
 Referrals
Mortgage brokers, Hard $ Brokers,
 Attend Auctions
 Attend REIA’s, HBA, and ALA
 MLS/ Auditor Ninja Tactic
 Realtors
 Investor Open Houses
 Google “Real Estate Investors, Cleveland”
 Internet Marketing – Squeeze Pages = SIMS
Video, Articles, Email, Social, Banners, Websites
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Rule #2 – Always be Marketing for Buyers and
Sellers

Marketing for Buyers – $$
 Classified ads in newspaper
 Signs – Bandit and Yard
 Commercials, Radio
 Billboards
 White and Yellow Pages – Covers and C.C. sized ads
 Direct Mail to Apartments
 Promotional Material
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Buyers
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Rehabbers
 Landlords
 Fixer – uppers
 Builders who do rehabs on the side
 Get Buyers into properties by telling sellers and agents that you
have a partner (funding partner) who needs to see the house.
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Rule #2 - Always be Marketing for
Buyers and Sellers
 Marketing for Sellers – Free
 Driving for Dollars – Vacant Houses
 Classified ads online
Craigslist.com, oodle.com, trulia.com, many others
 Referrals
Mortgage Brokers, Attorneys,
 Attend REIA’s
 Building code violations – tall grass
 Internet Marketing
Video, Articles, Email, Social, Banners,
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Rule #2 - Always be Marketing for
Buyers and Sellers
 Marketing for Sellers – $$
 Classified ads in newspaper
 Signs – Bandit and Yard
 Commercials, Radio
 Billboards
 White and Yellow Pages – Covers and C.C. sized ads
 Promotional Materials
 Direct Mail to Lists
 Probate, Free and Clear, Expired Listings,
Delinquent Tax Sales, Out of Town Owners
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Sellers
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Motivated sellers with equity
 Banks with REO inventory
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Wholesaling: Branding
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Forget it
 Pay for things that result in sellers and buyers and closed deals
 Build your brand as you close deals
 Build your reputation as you close deals
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Know Your Wholesaling Sweet Spot
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Where do Wholesale buyers want to buy?
Inner ring neighborhoods
First ring suburbs
First time home buyers - they buy from rehabbers
If you get something in a prime suburb the rules stay the same
If you get something in the country the rules stay the same
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Wholesaling: Seller Lead System
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Buy Calls – if there’s equity “GO”
 Pre-Call Planning – drive the comps
 Presentation – Hot buttons for selling
 Negotiation – what’s the least you’ll take? Is that the best you
can do?
 Contract
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Phone Scripts
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Where is it located? Sweet spot?
 What’s it worth fixed up?
 How much work does it need?
 “If I could pay you all cash and closed in a week what’s the least
you would take?”
 “Whoew, is that’s the best you can do?”
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Wholesaling REO’s
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Network with listing agents and asset managers
Let listing agent manage both sides for two commissions
Target houses on market for 3 months or more (6 months)
 Less competition than new listings
Make offer with normal Realtor contract
Add inspection contingencies
Sell using normal contract for B to C
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Wholesale Closing: assignments
 FSBO’s
 “A” to “C” closing
 Assignment fee paid outside closing
 Addendum explaining fee and assignment
 Memorandum of Purchase Agreement
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Assignments: Contracts #1
 Standard Purchase and Sales Agreement
 Assignment of Contract Addendum
 Give both to title company
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Assignments: Contracts #2

Option Contract
 Notice of Option
 Affidavit of Contract
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Assignments: Contracts #3

Option Contract
 Notice of Option
 Affidavit of Contract
 Back to Back Closing
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Wholesale Closing: Back to back
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REO’s
 “A” to “B” then “B” to “C” closing
 Back to back
 Profit is spread between the two deals
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Back to Back: Contracts #1
 Standard Purchase and Sales Agreement – “A” to “B”
 Banks required P&S agreement
 Contract Addendum – “A” to “B”
 Banks required addendum
 Title company – “A” to “B”
 Standard Purchase and Sale Agreement – “B” to “C”
 Vanilla P&S agreement
As - is where-is
Owner of record prior to closing
 Title Company – Your preferred title company
 Closing instructions, title commitment, HUD1 from “A”- “B”
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