Flip This Wholesaler

1/23/2008

Still waiting to hear what the verdict is on the REO I was talking about yesterday. The banks like to take their sweet old time. I’d rip my hair out of my head if I was doing short sales.

Tomorrow, I am having lunch with one of the investors that I have been working with over the last year.

He’s the guy I wholesaled my first deal to (he saw my ad on Craigslist), and we have done 2 other deals together since then. I call him all the time with stupid questions that I should probably already know the answers to, but don’t- questions such as “How do you tell if the electric has been upgraded?” or, “What the hell is a gravel roof?” He’s also saved my ass (more times than I’d like to admit) from putting shitty deals under contract.

In one instance, I was about to pull the trigger on an REO for 75k, but decided to give him a call and get his opinion first. He went out and looked at it and told me it needed to be torn down and was only worth the lot value (like 30k or so). Anyway, I took his advice, but I remember wondering if he really knew what he was talking about. Didn’t seem like a tear down to me (in all of my infinite rehabbing wisdom). Last time I checked the property was still on the market (5 months later) with a list price of $51,500. Good thing I listened.

I’ve decided that I need to find some more active cash buyers, so I am going to hit up the auctions on the courthouse steps starting next week. I always say that I’m going to, but then I never do. This time I’m doing it.

Well, the Nightmare Deal finally closed. I didn’t get the full assignment ($4500) that I was supposed to because the buyers were short on closing costs. I eneded up with 3 grand (plus the $500 deposit). I really don’t even care about the lost $1500, and am just glad the deal closed and everyone is happy. One of my biggest fears is having a deal blow up at the very end and screwing a seller over. So far every deal I’ve done I have built a very good rapport with each seller, and they have given their trust to me. It is very important to me to follow through with what I have promised to them (to buy their house).

I have kind of lost my focus in the last few days and have allowed myself to get distracted. Tomorrow I will get back to scouring for deals.

I had a seller call today on one of my signs- he is an investor who is liquidating and moving out of state (like everyone else).

He has a rented property worth about $145-$150k. The renter wants to buy the property (he’s been there 5 years and always pays on time) but has credit issues that he’s working on. The seller was asking $110k. After checking the comps, I realized the numbers weren’t good enough. I sent the seller an email telling him the deal, and that if he decided to lower his price to give me a call.

About 15 minutes later I get a call from another wholesaler asking me if I had any inventory. He then goes on to tell me that he has a buyer who is looking for a property with some equity (15-20%) that he can rent out (preferably something that already has a renter in place).

Spooky.

I told him about the property I was just looking at, and he said it sounded perfect for his buyer. We decided that if his buyer wants the property, we will split the assignment (he thinks he can get 10 grand). I just got an email from him saying he will not be in contact with his buyer until tomorrow am. It would be pretty sweet if this actually worked out.

If nothing else, I have another buyer/wholesaler to add to my list. I love networking. It’s the best type of advertising, and it’s free.

The signs I ordered Tuesday aren’t going to be shipped until this coming Tuesday (Monday is a holiday), so I won’t be getting them until the end of next week. I’m not too happy about that, but what can you do?

I need to get another deal by the middle of this month (I’m shooting for Thursday) in order to stay on track with my goals. This means I really need to get it together by tomorrow and start making some more progress.

I ended up losing one of the deals I was working on to another investor. This is the one where I offered 159k. The other investor got it for 165k. Oh well, win some lose some. I got a call from the title company today saying the nightmare deal is closing tomorrow @ 10:30. I’m very happy about that.

Last night I went to a networking cocktail party with a friend of mine. I got to meet a bunch of wholesalers. It was nice to be around so many other people who are out there doing the same thing.

I ended up staying out rather late, so I was pretty useless today. I did get about 5 calls from my signs, though. I’m really pleased with the results, so I ordered 100 more that I’m going to put out this weekend.

I have a good friend who sells different types of advertising, so I’m going to meet with him this week to get an idea of pricing. I figure if I can get a couple park benches, put out 100 signs/week, contact sellers directly, send postcards, and make offers on the mls, I should be in good shape if I stick with it. I want to have a deal signed by the 16th of this month (next Tuesday), and then get another one before the month is over.

Both leads I got yesterday didn’t pan out. One needed a complete rehab (the guy said it only needed minor repairs), and the other was worth less than what the seller claimed. Oh well. I was feeling a little discouraged today, so I sat in my office and didn’t get up until I called 20 “motivated” sellers. Out of the people I spoke to, I got one good lead that I’m going to check out tomorrow. There are still a few people who haven’t called back yet, so maybe something else will turn up. Who knows. One of the ads I called said “extremely negotiable seller. must sell. make offer.” When I finally got in touch with her (she called me back), she told me she wouldn’t take anything less than what the appraisal came in at. ??? What the heck? People are strange.

I’m really excited to not have to go to work tomorrow. I’m going to get up early, get the paper, and go check out some open houses. I may put some signs out tomorrow night as well.

Oh yeah, I found another buyer while calling ads today. I think I’m up to 27. Not all of them are buyers, some are wholesalers, but they all have their list of buyers as well. A lot of wholesalers will try to sell your property to their buyers and add on a few thousand for themselves.

Looking forward to the weekend and making lots of offers and talking to lots of sellers. Have to keep telling myself that it’s a numbers game.

Well, I’m officially a full time wholesaler! Kind of scary, but I know if I made it through the last couple of months, I will be OK.

I picked up a 10k check from the title company for the deal I just got under contract, gave 5k to the investor I worked the deal with, and kept 5k for myself.

The closing for the Nightmare Deal which was supposed to be today has been rescheduled for next week (big surprise). I did talk to the buyer today who said everything is still OK, the mortgage broker has just not been on the ball with this deal. I will be amazed if this actually closes.

I have been taking care of some other stuff for the last couple of days, so I really haven’t been able to look for deals a whole bunch. I have a few things to do tomorrow morning, then I’m going to start looking for deals again.

It is going to be such a huge benefit to have those extra days free to look for deals.

My goal is to get two deals under contract by the end of the month, with a minimum of 5k from each. Then I have to start looking for a house for my Dad to work on when he comes down.

I’m really am not looking forward to doing a rehab at all, and I do not want to lose my focus on wholesaling, so I’m going to see if he just wants to do the deal himself (I will find it for him). I really can’t afford to take a month or so off to work on a rehab when I have just started getting the ball rolling doing wholesale deals. My problem in the past (one of them), was not sticking to one investment strategy. I do not want to make the same mistake again.

Now that I have a little bit of money in the bank (not much, but more than a few weeks ago), I am going to start making more offers on mls properties. I haven’t really been able to do this much lately because I didn’t have any money to use for a deposit. I am going to focus mostly on calling sellers directly, and mls offers. I like these two methods best because they are the quickest and also the cheapest (free).

Tomorrow I am going to get a bunch of listings sent to me with the word “motivated” in the remarks section. I am also going to try to call 20 sellers that I think may be motivated. I also have some leads that I need to follow up on.

I’ve decided now that my weekends are free, I’m going to start going to open houses on Saturdays and Sundays to meet with different realtors, get to know neighborhoods better, and pass out my biz cards. I want as many people as possible to know that I am looking for deals.