Flip This Wholesaler

9/5/2008

Well, I closed the deal today that I was talking about in my last post. Apparently, offering a $250 bonus to the bank's closing agent for meeting the deadline, is quite effective. The best $250 I've ever spent. It might just be beginner's luck, though, but I've got another deal that's supposed to close on the 26th of this month, and this title company is notoriously S-L-O-W (same title company, and same lender as the infamous pink house deal), so we'll see if I can go 2 for 2. I'll keep you posted.

I think I got the deal that I was talking about yesterday (the one where there are 3 other offers on the table), but I'm not positive yet. The listing agent sent me an email at 4:45 asking for my proof of funds (which I already sent with my original offer), and that is usually a good sign. I left him a VM at 6 asking if I got the deal (I really wanted to have confirmation today so I can start marketing it this weekend), but I still haven't heard back. I imagine more offers came in today because this is a good deal at list price, so I will be pretty surprised if I actually get it.

I'm not sure if I have mentioned it yet, but I am flying back to Illinois next Thursday for my brother's wedding. I'll be staying for 5 days. If I get the deal I was just talking about under contract, I'd really, really like to have it sold by the time I leave, because the last thing I want to be doing while I'm in Illinois is stressing out about finding a buyer. I know it's a good deal though, so I should be OK....

Itte rasshai....

8/11/2008

I had a great weekend in St. Louis... Got to hang out with my nephew Trevor, who is the sweetest, most adorable little kid on the planet....









It was the perfect, lazy, weekend. We ate a lot, watched the Olympics (I love, love, love the Olympics), and played Ms. Pac Man for hours on end. I got my ass kicked.

I managed to get both of the houses I have under contract sold while I was away, even though I said I wasn't going to do any work while I was there. I also got another promising counter offer, and am waiting to hear back from the listing agent to see if they are going to take my counter. I doubt they will come down that far, but you never know.

The pink house deal will be officially closed tomorrow. It was ready to go today, but my buyer couldn't get to the bank in time to get cash, so he's going in tomorrow at 9:30 to sign. There were a few last minute "issues" that we had to deal with, but I don't feel like getting into details, as I just want this stupid pain in the ass deal to be over and done with....

My intent is for September to be my best month yet, and I've already got 2 deals lined up, so if I work my butt off for the next few weeks, I'm pretty sure I can accomplish that goal. To be honest, I have been doing some serious slacking off in between deals, and really only work hard when my funds are running low. That's a horrible habit to get into, but I will tell you, when you have pretty much lived month to month your entire adult life, it is harder than you might think to break yourself of that mentality. Old habits die hard, I guess. I'll get there, though. If I made it this far, I can do anything...

7/27/2008

The deal with McHotterson closed Friday. He brought his girlfriend along to the closing. She seriously looks like a walking, talking barbie doll, and I secretly wanted to punch her in the face a little bit. But that's just between you and me. Hehe.

The deal that was supposed to close 5 years ago, is finally (for serious this time), for REAL, going to be ready to close next week. I got the good news right before I got the call from my buyer letting me know that he may not be able to buy it now because he is having a really hard time getting financing on the house he bought from me a month or so ago. He bought it with cash, and is trying to get his cash back out of it, but is having a really hard time doing so..... Hilarious, isn't it?? Now that the idiots at the bank finally have their shit together (a month and a half later), my buyer can't get the cash to buy it. HAHAHAHA. Hilarious!! So......after talking to Steve Cook about it, he advised me (for probably the 100th time), to get my ass out on the streets (I'm paraphrasing here, btw) and find a local lender who I can bring my buyers to. Honestly, he has been telling me to do this for the last six months or so, and I still haven't done it. If any of you guys from Flippinghomes.com are reading this, you know that Nate has been bringing all of his buyers to a few of the local lenders he has built relationships with, and he is doing very, very, well. So, that's my mission for this coming week- find a few small, local banks who I can bring my buyers to. I can't say I'm really looking forward to it, because I know there will be a lot of rejection involved in the process, but I know that it will be well worth my time once I get it done. I guess you could say that I'm in a comfort zone right now, and I need to get out of it and make some adjustments.

Oh yeah- the deal I closed on Friday with McHotterson was listed by one of the agents who I have now closed 4 deals with. I put in an offer on another of his properties on Thursday, and he called me Saturday to tell me that he's pretty sure he can get it pushed through. He also told me that he really likes doing business with me. Hehehehe.. Anyway, I will find out tomorrow if the bank is going to take my offer, and if so, I already have a buyer lined up for it. Good stuff.

And that's all I've got, folks.

Well, except this picture of Jim wearing his new hat....



Handsome little devil, isn't he?

7/24/2008

Well, the deal that was supposed to close today did not close, and the one that is supposed to close tomorrow (the pink house that was supposed to close a month or so ago), is not closing tomorrow either.

Any guesses as to why they didn't close??

I'll give you a hint- it begins with a "B" and ends with a "ank's stupid-ass title companies."

My favorite part was this morning when they sent over an extension for the one that was supposed to close today (the one where my title company has been ready to close since last week and the lady at Watson bit my head off when I called her to see when we could close)...Anyway, so they send over this extension and tried to get me to pay $100/day for each day it goes beyond the original closing date!! HAHAHAHAHAHA!! At least they have a sense of humor along with being slow and rude and incompetent. I sent the extension back with the $100/day nonsense crossed out and a little note letting them know there is no way in holy hell that I am paying a single dime for their screw up. Haven't heard back, so I'm guessing they aren't going to press the issue.

Nothing else exciting to tell. I'm pretty close on another deal, but still going back and forth with the bank. We're 8k apart right now, and I'm not going any higher, so we'll see. I've already got a buyer lined up if I get it, so that's a bonus.

Roger Dodger. 10-4 Over and Out.

P.S.
If anyone has sent me an email recently, and I haven't responded, it's not because I'm an asshole, I am just really behind right now. I swear.

7/18/2008

Well, the deal I have with McHotterson that is supposed to close on the 24th, is most likely not going to close on the 24th. Even though I get to pick my own title company, the bank still has their (incompetent) title company run a lien search. I really don't even understand it at all, to be quite honest with you. My title company already did the title work and is ready to close, but I guess I am still at the mercy of Watson fucking Title. I really hate them, and the lady I spoke to today deserves to be punched in the face for how RUDE she was to me. I'm not kidding, this lady was such an asshole, I almost hung up on her. The lady handling the file at my title company also spoke to her and told me she bit her head off when she tried to get a closing date out of her. They haven't even ordered the lien search yet, which takes them 5-10 days, so who knows if we will even get this closed this month. McHotterson ain't gonna be too happy, especially since he is leaving the country for a month the first week of August, and I already told him we could most likely close it early. Dang.

Yesterday I had a little get together with a bunch of local wholesalers. I won lunch for 15 people at the Thai restaurant behind where I live, so I thought it would be a good opportunity to do some networking. Actually, it wasn't really a "free" lunch, as we had to sit through a presentation by a financial planner, and then offer up our phone numbers and email addresses. A few hours after the lunch I got a call from the guy who did the presentation, and got trapped on the phone with him for 15 minutes, and somehow suckered into a meeting with him next week. I should have just told him I wasn't interested, but I'm really bad at rejecting people face to face (or on the phone). Also, I felt sorry for this guy, as he seemed really uncomfortable giving the presentation, and I kind of felt like I owed him something since he paid for lunch. Yes, I know, I am a big fat SUCKER.

A friend of mine called me a little bit ago and told me to go out on my balcony and check out the moon. This picture doesn't really do it justice, but it was pretty cool in person- all yellow and glow-y......



Happy Friday!

6/26/2007

I get quite a few emails from readers asking questions about wholesaling REOs. One of these days, I will put up a FAQ section on this blog, but until then, I thought I would start posting a few of the more commonly asked questions in case there are others out there who might be wondering the same thing.

So, here we go..

Hi Steph,

My name is Frank from NJ, and I am new to wholesaling . I have some short sale , and wholesale training but still looking for the first deal. I read about your transaction on reibrain.com and was just curious. I have asked a few investors in forums about wholesaling reo's. I have so many in my area and would really love to be able to wholesale the ones I find to be good deals. Anyway from what they have told me lenders will not approve of assignment contracts. So basically I would have to buy the house and then find an end buyer like one of my investors and do a double close . I really would rather flip the contract then put out my money first as you can understand. Can you give me any tips as to how you are assigning these reo properties without any problems from the lender? Continued good luck steph and thanks in advance.


Hi Frank,

You are correct in that (most) banks will not let you assign REOs. There are many ways to get around this, though, and still be able to wholesale them. What I am doing is using a simultaneous close. Basically, the closing between me and the bank and then between my buyer and me takes place at the same time, and both transactions are funded with my buyer's funds, so I don't have to come to the table with any money. Many title companies will not do this, but some will. What I would do is find the active wholesalers in your area and ask them who they are using as a title company. That is how I found mine.

You can also buy the property in an LLC or a land trust, and then sell your rights to your buyer at closing. I have never used this technique, although, this is the method my mentor, Steve Cook, teaches. Here is an article written by Steve that explains it in greater detail......

Another way is to have your buyer added on to your contract with the bank, and then after closing, give your buyer a quit claim deed in exchange for your fee. I would not recommend doing this, though, unless your buyer is someone you know and trust. I have only done it this way a few times, and it was with a buyer I have worked with several times before, and there was a mutual trust there...

Finally, as you mentioned, you can borrow the money for the first transaction, close on it with your funds, and then resell to your buyer right after the first closing (double close). There are quite a few companies who will lend money for this type of transaction. My recommendation is CashForMyClosing.com. They will also provide you with a free proof of funds letter to submit with your REO and short sale offers. If this is the route you are going to take, you would just have to take the extra costs into account when you are structuring your offer.

Anyway, those are the ways I know of to wholesale REOs. There are a few more hoops to jump through, but it's really not that big of a deal once you start doing them.

Hope that helps,
Steph