Don't be a lazy wholesaler if you want deals!

Don't be a lazy wholesaler if you want deals!

Every week I get emails from wholesalers like this:

Subject: Look at these great deals!
-----
123 Main St
$40,000
3 Bed, 2 Bath
Single Family Home
1200 sqft
This property has a huge living room, needs some new carpet, and possibly a new roof.
-----
456 Main St
$32,000
2 Bed, 2 Bath
Single Family Home
900 sqft
This property has a brand new garage, needs all new appliances, and it needs some drywall work.
-----

It's great that they are doing the work to find the deals and send the emails to cash buyers, but what exactly can I, as a cash buyer, do with this information?! Not much.

Sure, I can look up each property by the address, and do all of my own research. But that can take hours, especially on multiple properties every day. I'm better off getting automated MLS listings from a Realtor.

If I wanted to get the information I need in the shortest amount of time, I am forced to write a long email with more questions about the properties. And chances are, I'm never going to end up sending that email because it's still a waste of time. I would rather send them an email training them on HOW to send me emails in the future.

Some of you might be asking "Well, what is that email missing??". As a wholesaler, you need to know which kind of properties your cash buyers want (rentals or flips). If you live in an area where your buyers list consists of both types of investors, then you need to make 2 separate buyers lists. This way you can send your emails with the correct information to each buyer, and because not every property is best for both types of investment strategies.

Some crucial information Rental Investors look for in an email:

  • Asking Price
  • Address
  • Bed/Bath
  • Sqft
  • ARV (helps determine what they can get out of a refi)
  • Rehab Cost (with details!)
  • Monthly Rent
  • Monthly Taxes
  • Monthly Insurance
  • Monthly Management
  • Monthly Maintenance Reserve (There is no right number, but I calculate $65/mo-4br, $50/mo-3br, $35/mo-2br)
  • Monthly Mortgage (not necessary unless you know your end buyer will refinance the property, I use 70% ARV at 6.5% interest for 15 years when calculating the mortgage rates, unless they tell you they can get a better one, so let them know how you calculated the mortgage costs!)
  • Monthly Cashflow (calculated by Monthly Rent minus Monthly Expenses)
  • Cap Rate (not relevant if they are refinancing the property, so exclude the mortgage cost when calculating this. Formula: Annual Cashflow divided by the sum of Purchase Price, Closing Costs, and Rehab)
  • At least 3 REALISTIC comps
  • 10 pics (7 interior, 3 exterior)

Some crucial information Flip Investors look for in an email:

  • Asking Price
  • Address
  • Bed/Bath
  • Sqft
  • ARV (helps determine what they can sell it for)
  • Rehab Cost (with details!)
  • Monthly Taxes (helps determine holding costs)
  • Monthly Insurance (helps determine holding costs)
  • Final Profit (ARV * 0.85 - Purchase Price - Buying Closing Costs - Rehab - 3 to 6 months holding costs)
  • At least 3 REALISTIC comps
  • 10 pics (7 interior, 3 exterior)

Hope that gives you all a better idea on what to send your cash buyers! Now, time for me to train my wholesalers!

__________________

Dominic

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Yes!

Awesome info! I'm getting started in wholesaling and it's a bit overwhelming trying to remember all the info investors want. Thanks for spelling it out like that, and reminding me that investors looking for rentals are looking for different things than the flippers.


This should be made into a sticky some where.

This is great info. I have never scene it broke down so simple.

Thank you.

__________________

Coast To Coast Property Investments


Wholesaling

When I first started wholesaling I provided three rehab estimates along with a CMA, closing costs, insurance, taxes, etc. What I discovered is active, knowledgeable rehabber and buy and hold cash investor buyers KNOW that stuff already. They all run their own numbers and do their own due diligence anyway. One rehab buyer will have a totally different rehab plan compared to another rehabber.
Buy and hold guys will run their own numbers. None of my real, active cash investor buyers rely on MY numbers.
So what I put out to my buyers is:
Address.
Description, example: 3 bed, two bath, 2 car garage. 1600 Sq. ft. ranch Built in 1979
ESTIMATED ARV
ESTIMATED Rehab costs for retail or rental.
Buy price.
My contact info so they can call for more details, set a showing or get the lock box code.
That's it. Of course I have the properties under contract and I control the deal.
Dominic, I think you may need to train a BIRD DOG to send you leads with that type of info. NEVER and I mean NEVER go by the info that a wholesaler sends you ANYWAY. You must do your own due diligence based on the BUY price and the rehab/remodel costs needed to bring the projected ARV or potential cash flow on a rental.
REAL cash buyer/investors will look at the numbers, condition, location and costs to do the deal and say yes or no. Again, NONE of them rely on anything other than the basic info I provided them, they do their own due diligence because they are professional investors.

For me, wholesaling is a numbers game. Multiple, multiple offers, very quick rehab estimates and a very large pool of investors that are ACTIVE in the LOCATION of the subject property. I supply them basic info, let them do their own due diligence. Sell it first come first served all while doing several others at the same time. I don't have time to TRAIN MY BUYER!!!

Just the way I wholesale, I am sure there are many ways to do it.

Good luck in all you do!

Michael Mangham
Mentoring/Team Building Nationwide
MD Home Acquisitions LLC

__________________

The ladder to success is NEVER crowded at the TOP!!

http://www.mdhomeacquisitions.com Seller site
http://www.mdhomeacquisitionsbargainhouses.com Buyer site
http://www.mdlodeals.com Tenant/Buyer site


I didn't mean to make it

I didn't mean to make it sound like cash buyers shouldn't do their due diligence. All I was saying is I'm most likely going to look right passed an email with barely any info in it, especially if it's an area I don't typically invest in and don't know much about.

Of course I would do my own due diligence after I think it's a good deal. But if I don't have SOME sort of detailed information, I'm better off having a Realtor send me an automated email with MLS listings.

__________________

Dominic

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Thanks for the feedback

Thanks for the feedback everyone! Glad it helped some of you!

__________________

Dominic

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Bookmarked!

Thanks for the clarity!!!! I Love it!

__________________

I AM THAT I AM

Follow My Awesome Journey Here:
http://www.deangraziosi.com/real-estate-forums/investing-journals/130178...


Definitely need ALL the info

I am totally agreeing with you guys! I get lists of properties from multiple wholesalers either without comps or with comps that are not realistic. Look at the email I got last night:

1046 N 25th Place (3bd/2ba) huge corner lot $67K cash as is
Comps: $ 30K - $202K

SERIOUSLY....comps from $30K to $202K? And when I looked it up, I couldn't find any comps near $202K, so that leads me to believe they don't know what they are doing. A wholesale deal a little under market value is not enough margin for me to do a fix N flip.


That's crazy Margaret! I

That's crazy Margaret! I mean, at least they are doing SOMETHING though! They just need to start doing it right Smiling

__________________

Dominic

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Thanks!

Excellent info from everyone. I really appreciate it. Gonna send that info out now lol!

__________________

~Rose'lani~


GREAT Details.

Dominic and Micheal,
Thank you so much for the information you have shared here. I am new at this and learning all I can and this information will make me more valuable to my investors.
Thanks!

__________________

With your success in mind,
Jim McKinney

"With integrity, nothing else matters.
Without integrity, nothing else matters!"


Great Wholesaling Info!

I agree with both Dominic & Michael Mangham in that getting slop from anybody is annoying, making me wonder sometimes if the correspondence is more of a stupid prank. Michael always drive home the point of submitting tons of offers to get a few good deals. That requires a ton of time. Another DGer mentioned how she only runs the numbers after submitting low ballpark guesstimate offers to gauge if she's dealing with truly motivated sellers. If they accept or acceptably counter, then she takes the time to do her due diligence, since running numbers on everything upfront would be a huge waste of time, especially when you're submitting a large volume of offers weekly/monthly.

Dominic, it looks like you've achieved a great understanding of the business, but perhaps you should take one from the ol' pro, Michael, and continuing to provide sufficient information to your buyers, but save yourself plenty of time to throw that net a few more times per month by not assuming the buyers work.

Both you guys have helped me tremendously here, as well as in the past. I saved Dominic's "Guide for BRAND Newbies". Thanks to you both.

__________________

You can't build a reputation on what you are going to do. - Henry Ford -


Amount of info

I agree with Michael as far as what info I furnish to end buyers.

I think a major key to all this is developing your relationships and your CREDIBILITY. Whether it is the BDs that furnish information TO you or info that is coming FROM you to the end buyers. You have to prove that you know what a deal IS and how to run your numbers. Once your buyers know that you know what you are doing, they are NEVER going to bypass an email from you!

Same goes when I get a lead from certain BDs. I know the ones who have the eye to spot distressed props and potential deals and which ones "not so much".

Karen

__________________

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Agree

Today's market is full of wholesaler wanna bees. This way of making a quick buck has spread like fire through states around the Country. And wholesaling has truly become survival of the fittest.

If you are not the best in what you do your buyer will go to someone who is. Your competition is great so your method should be even better Smiling

__________________

Do not fear, for I am with you; do not be dismayed, for I am your God.I will strengthen you and help you; I will uphold you with my righteous right hand. Isaiah 41:10

http://realwholesaling.com

To your success,
Carol Stinson


Great Info

Dominic,

Thanks for the info. I've tested two ghost ads on Craigslist and I've gotten more response when I added the extra information. I'm sure as Michael mentioned, they'll still do their due diligence after they've decided there may be a deal with the info I've provided.

Thanks.

__________________

Brian Carter

Proverbs 13:20

BirdDogBot


Good Wholesale INFO

Overall very useful information, Dominic, but I agree more with Micheal his comments about Buyers doing their own due diligence is spot on. We provide basic info usually such as ARV or FMV, 3-4 Comps,Annual Taxes, Auditor's Assessed Value Taxed Assessed Value, Last Sold price and date, TotalView & our estimated value, average listing & sale price for neighborhood if available,HOA Fees if applicable and any other info that could assist investor with making a preliminary decision.

With rehab & flip properties we use a formula to calculate cost and provide those estimates. Every investor differs on rehab cost based on there needs also most contractor bids are not free. Unless you have history with the investor buyer its almost impossible to know what some one is willing to spend on a rehab.

Find what works best for YOU!

Plan YOUR WORK & WORK YOUR PLAN! (IDK who said it first but I heard it from George Foreman)

Best of Luck DG Family


I'm not sure why everyone is

I'm not sure why everyone is thinking I'm telling buyers to not do their own due diligence. Maybe it's how I worded the post? But that's not the case.

I wrote this post AS A CASH BUYER, not a wholesaler. Being a cash buyer, this is exactly what I would want from any wholesaler sending me deals, no "ifs ands or buts" about it. I am by far more likely to work with a wholesaler that goes the extra mile than a lazy wholesaler, period.

Yes, I will still go through with doing my own due diligence on a property I am confident I want to pursue, based off the information the FULL SERVICE WHOLESALER gave me. Until eventually I do enough deals with that wholesaler that I can trust them that every deal they send me is a great deal and fits my criteria.

But I won't waste my time doing due diligence on every property sent my way by a LAZY WHOLESALER because I'm not even certain those properties are EVEN CLOSE to being a good deal because they didn't provide me with enough information. Who knows, maybe they are great deals! But I'm not going to waste my own time trying to figure that out myself. Time is money.

I'm in the game to buy volume, not to find the best deals possible each and every time. I would much rather buy 100 good deals than 10 AMAZING deals. And I can't buy fast enough to buy large volume if all my time is consumed doing my due diligence on every single property sent my way. There needs to be someone doing that work FOR me so I can decide quickly "yes or no".

That is what wholesaling is all about. You are essentially working FOR your buyers. They are the ones paying you for finding these good deals. Without them, you have no paycheck. So if you take care of them, they take care of you by giving you repeat business.

Jeeze... Where's Matt Larson when you need him?

__________________

Dominic

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Great Info!!!!

Thanks so much! I am putting together a buyer's sheet with the information you provided!


It's All in the "Presentation"

"I" show my buyers a presentation that gives them ALL the info needed along with expenses, repairs, taxes, HOA fees, rent rates, cap, time frames, pictures, fix/flip ROI, refi profits and MORE!

It SHOWS them that not only is this a Deal and meets and Exceeds their criteria for buying/investing, but also shows them in TRUE numbers that they would actually be an idiot to PASS on the deal.

As stated above, buyers should do their own homework and confirm the numbers, but, I showed them I've done mine.

If you'd like to know HOW to do this, PM me, its Easy and Free.


Thank you Mike!

Thank you Mike! Exactly!

Just because cash buyers are going to do their own due diligence themselves doesn't mean wholesalers are wasting their time by doing this work for their cash buyers. They are building credibility and also saving their cash buyers time and really making it easy for them.

Why WOULDN'T a wholesaler show all the info/numbers to brag about the deal they just got? To save time, maybe? But in my opinion, it's time well spent if all they are doing is wholesaling. It would be a waste of time NOT to put this info in an email.

__________________

Dominic

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The Short Version

Basically, you have to have to qualify both your sellers and your buyers. I am always working on both, and that's probably not a normal business plan for a realtor.

Of course, like any realtor, I am always seeking out motivated sellers. I try to buy the property as a wholesaler and then flip the contract to an investor if possible, but if I cannot, I then offer to list the property for sell on MLS and any number of other places.

I keep a master list of cash buyers (names and contact information for quick reference), and I have it backed up in at least 2 places. I then keep a file (computer and paper) on what what each investor buyer is looking for and how often.

__________________

Rick Allison, Realtor
Amarillo, Texas USA

Find comps, private lenders and cash buyers nationwide: www.TheRealEstate.PRO

Foreclosure and pre-foreclosure search engine: http://tinyurl.com/b6w7h6o

The People Helping People Movement: www.greatEPXsite.NET


LAZY?

If a wholesaler is getting the properties under contract there is NO WAY he is lazy. That is truly the HARD PART of wholesaling. Getting the property under contract and controlling the deal. NOT BEING A BIRD DOG in other words. Getting a REAL deal that an experienced Investor/buyer will purchase is the trick and it takes WORK. Selling a REAL deal IS EASY!!! Usually one phone call.

My buyers don't need to know all the details. They see the Address, ARV, the rehab costs and the buy price. If those numbers look good and the info they learn from the ADDRESS looks good,(they usually ALREADY know the area!) then they do their due diligence. They send contractors, plumber(sewer scope), roof guy, Realtor, their entire team and have a yes or no answer in 24 hours.

I guess a lot of the procedure has to do with what type of buyers you are dealing with. I am fortunate to have trigger pullers with actual buying capability on my buyers list. Buyers, not bird dog or daisy chain people!

I think when you are just starting it is good to provide your new buyers with a novel the size of the Grapes of Wrath concerning your subject property, but later all you will have to do is make a phone call. Besides it is good education to do the due diligence down to last drywall screw when you are just learning.

So I would be wrong to generalize that all buyers don't need all the info just like it is a generalization to say that all buyers need completely detailed presentations. Depends on who you are dealing with.

But a wholesaler that actually has properties under contract is NOT lazy!

Best to all,

Michael Mangham
Mentoring/Team Building Nationwide
MD Home Acquisitions LLC

__________________

The ladder to success is NEVER crowded at the TOP!!

http://www.mdhomeacquisitions.com Seller site
http://www.mdhomeacquisitionsbargainhouses.com Buyer site
http://www.mdlodeals.com Tenant/Buyer site


Not saying lazy just not detailed

I am not sure if everyone has the same experience. But I know that my buyers ask for more detailed information when ever we send them a property. If I just send a property address and a price they will ignore my emails. I make sure I provide enough information to make the decision as easy as possible.

Everyone does things different. I know that we cater to what our buyers ask for. That is the key. Provide what they ( your buyers) are looking for.

God Bless everyone and keep at it. Lets all be prosperous this year and make it Amazing!!!!

as always with gratitude,

__________________

When you say thank you, you are telling the world that you want more. Say thank you every day! It will bring joy, and it will bring so much more.

www.virtue-investments.com


I get your point on how new

I get your point on how new cash buyers may want different info from seasoned cash buyers. But what's the worst thing that could happen if you over-deliver to each and every one of your buyers, new or seasoned? I just don't see anything wrong with that.

__________________

Dominic

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Good Point Dominic

As a newbie wholesaler I think Dominic has a good point. Its better to have and not need, then to need and not have. Whether the cash buyer goes by your numbers or not you will separate yourself from the crowd by providing more information. It shows that you are serious about what you're doing and presenting yourself as an expert.

I try to send my buyers as much information as I can. I am not always accurate with my numbers but they appreciate being able to see where I got my numbers from. Most of the time they provide input to help me evaluate properties better. It becomes a learning experience. They come back to me because they know that I take pride in not just giving them numbers but understanding the numbers.

As a new wholesaler this was important to gain credibility. Now later on in relationships you may not need to give as much information but it certainly won't hurt.

{J}


INFO LIST FOR WHOLESALERS

TREMDOUSLY HELPFUl!! When I gather info, I was never quite sure as to add more info in my email/ad and have someone call me or get as much as possible up front.
Maybe now I'll get more replies!! Thanks again. Trisha


wholesale

I get those same emails all the time. I will reply once to let them know what info I need to make an informed decision. We all learned how to present a deal if you have watched Dean and Matt s videos. We like using the postlets. Its how we present deals for wholesale and retail.
Success to all

__________________

John and Julie Wakefield
JCW Properties, LLC


Insurance and taxes

How do you calculate the taxes and insurance?


FYI Postlets.com really works!!

Hi Everyone. I went and gave postlets a trial run like Dean suggested (I was bribed with the Iphone 5). Although I didn't have any property to sell, I simply used my condo address and posted a picture of the Trans America building in SF as a "filler".

One day later... I get a phone call and someone wants more info on this property! Doh'!!

The good news: It works!
The bad news: I need to take it down right now!

But thanks for the tip Dean... Now I have another great place to list properties - when I have them!
Bruno


This is AWESOME CONTENT...

I am off to make a few changes to the stuff I already have out there. Time to update things to include ALL the information included in the "for rent" buyer profile.

Thank you for this keen insight!


Calculations

JDubb340 wrote:
How do you calculate the taxes and insurance?

The taxes are calculated by going to the county's tax assessors website and finding the property. It will usually show an annual number, so just divide that by 12 to get your monthly number. You can find the tax website for each county by typing in something like "_____ county tax assessor" or "_____ county property search" but every county has a little bit different name for it, so it might take a little digging to find. I can almost guarantee that if you invest in a semi-large county, all this information will be found online. If you have trouble finding the link, call up your county's assessor and ask them where you can find it.

Insurance is calculated by whichever insurance company you want to go with. So the best way to get an accurate estimate would be to get a quote for that particular address. After you get a few quotes you will have a good idea on the general price would be for each property without actually getting a quote. If you are lucky enough, you might find an insurance company that will give you their exact multiplier/formula to find the exact annual premium based on the homes value without having to call them up.

Hope that helps!

__________________

Dominic

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