Wholesaling Step by Step Edward O Daniel
Agenda Marketing for sellers Taking seller calls Analyzing deals and making appointments Handling the paperwork Getting PAID!!!!
Goal of this call My goal for this call is to provide each one of you with all the information you will need to DO a wholesale deal. Lets get started!!!!!!!
Marketing Checkout the Quickstart area of FBU Bandit Signs www.supercheapsigns.com Craigslist Ads FSBO ads and real estate wanted section Direct Mail Alescodata.com Car Magnets wholesalemagneticsigns.com
Marketing Billboards (Bandit signs in front yard) Craigslist ads for rentals (ask if they want to sell) Code Violations and Evictions Driving for dollars FSBO For Sale by Owner Networking with business cards (REIA clubs)
Taking Seller Calls Please review FBU November 19 presentation over Maximizing Seller Leads and April 16 presentation Inbound call system setup. These are great resources for you that are already on FBU site.
Taking Seller Calls Calls are going to come in three primary categories People owe more than what property is worth People want retail value or close to it Motivated sellers that NEED to sell
I recommend finding a short sale specialist and get a referral fee Taking Seller Calls People owe more than what the property is worth! Nothing you can do here besides a short sale Short Sale Is where the bank or mortgage holder takes less on the loan payoff amount then what was originally owed.
Taking Seller Calls People who want retail value or close to it This is going to be the highest percentage call you get, +90% Try to find out where they are at from an equity perspective. If they have equity then negotiate otherwise refer out to real estate agent and get a referral fee. Call it a Marketing Fee.
Taking Seller Calls Motivated sellers that NEED to sell These are the calls you wait for. They will be the easiest calls you ever take because the person you are talking to is MOTIVATED to sell. They have a problem and YOU have the solution. When you get these calls, do your analysis quickly, then make an appointment to see it asap.
Deal Analysis How do I know if my lead is a DEAL? There are a few numbers you are going to have to figure out ARV After repair value Repair Costs Your offer price
ARV After Repair Value Best place to get these numbers are using the MLS and getting comparable sales comps. Comps should be houses that have sold within a.25-.5 mile area around the subject property no older than 6 months. Fee services: flipcomp.com and corelogic.com. Free service: Zillow.com, express.realquest.com
Repair costs In order to get this you should have gathered the information on the seller lead sheet when the seller initially called. Refer to Maximizing seller leads call on November 19, 2014. This is a skill that has to be learned and practiced. Use repair estimate sheet. Learn from REIA clubs, contractors other investors etc
Your offer price MAO Maximum Allowable Offer MAO = ARV *.7 Repair Cost Wholesale Fee Example: ARV $100,000, Repairs $23,000, wholesale fee (YOUR PAYDAY) $8,000 MAO = $100,000*.7 - $23,000 - $8,000 = $39,000 Your selling price $47,000
Setting the appointment Once you have gone through the analysis of the lead and determined it is a DEAL, you need to contact the seller immediately and schedule an appointment asap. Items that you should with you or in your vehicle Seller s lead sheet, Purchase and Sale agreement, Camera with a flash on it, and a lockbox
At the appointment You are going to verify that the information you obtained on the seller lead sheet to determine if the repair estimate you calculated is accurate or needs to be adjusted. If all looks good then you are going to make your offer at your price previously calculated. Get the purchase and sale agreement signed. Take lots of pictures of inside and outside the property and see if you can put a lockbox on it.
Handling the paperwork At this point you have met with the seller and got a purchase and sale agreement signed at a price you feel you can wholesale to another investor. HOLY CRAP!!!! WHAT DO I DO NOW?
Handling the paperwork First thing you need to do is find out how wholesale deals are closed in your area. Most areas use title companies but there are areas that require closing at real estate attorney office. Contact their office and verify they are comfortable handling contract assignments. If not find another title company or attorney.
Handling the paperwork You are going to fax the purchase and sale agreement into the title company and have them begin running the title search. At this point you are now in selling mode. Call the buyers on your buyers list, send them an email or text with your DEAL
How to find buyers One of the key elements of wholesaling to determine if you are going to be successful is your ability to find buyers for the properties that you find from your marketing. Where do you find buyers? REIA clubs, craigslist ads we buy houses, yellow pages under real estate section.
Marketing for buyers Now that you know how to find buyers, what information do you need to give them in order for them to make an informed decision? Wholesale packet Property basic information, pictures, repair estimate sheet, ARV.
Marketing for buyers Example of wholesale email: Subject: NON-MLS wholesale deal huge profit potential Body:
Marketing for buyers You would attach the repair estimate sheet and send a link to the pictures that you took when you met with the seller. You can use a tool like dropbox and send a shared link to the folder with the pictures. Works great even on mobile phone.
Marketing for buyers When you find a buyer they are going to want to physically see the property to inspect it. This is to be expected. If you were able to get a lockbox on the property great you can just give them the lockbox code and they can view it without you. If not then you have to setup appointment with the seller to view.
Found buyer now what? Once you have a buyer you need to get the assignment agreement filled out and signed to send to the title company. The assignment agreement tells the title company that you are letting your buyer take over the contract for a fee which the buyer will pay at closing.
Found buyer now what? Once you fax the assignment agreement into the title company you will give the title company the name of the seller and buyer and their phone numbers and let the closer schedule and setup the closing on the closing date set in your purchase and sale agreement.
Closing You will want to check in with the closer and make the closing happen as smoothly and quickly as possible. I would not recommend being there at the closing unless you want to get a video testimonial from the seller.
Getting PAID!!! Title company/closing Attorney can either process a check for you or wire your money to your account
Documents needed Seller lead sheet Repair estimate sheet Purchase and sale agreement Assignment agreement
Other items needed Marketing phone number Camera with flash Lockbox
Motivational Moment Action is the foundational key to all success. Pablo Picasso