If You Think Wholesaling Real Estate Owned Properties is Impossible, Think Again!

One of the biggest challenges you’ll ever face when investing in properties is wholesaling real estate owned properties. As you may know, banks and lenders have certain policies on flipping REOs. Many of them prohibit buyers from assigning the contracts or quickly reselling these properties to other buyers.

So how does a real estate investor wholesales bank owned properties? It is quite simple actually. By doing simultaneous closing. A simultaneous closing occurs when a property is bought and sold on the same day. It basically means that two separate real estate transactions are being completed on the same day.

A simultaneous closing follows the A-to-B-to-C pattern of transaction. The A stands for the bank or lender that owns the REO, while the B stands for the wholesaler. The C, on the other hand, denotes the end buyer of the property. In the A-to-B transaction, the bank sells the property to the wholesaler. And in the B-to-C transaction, the wholesaler flips the property to the end buyer.

There are two types of simultaneous closing. The first one is called a simultaneous double-closing, popularly known as a “dry” close. In this method of wholesaling real estate owned properties, the wholesaler uses the funds of the end buyer to close the A-to-B deal. So if you’re going to do a “wet” close to complete an REO deal, you don’t have to bring your own money to the closing table.

However, there’s a disadvantage to doing a simultaneous double-closing. This method won’t work if the end buyer is going to get an FHA loan. Assigning the contracts of properties repossessed by Fannie Mae and Freddie Mac can also become a challenge because these two mortgage companies put deed restrictions to prevent buyers from reselling REO properties to anyone within three months.

The second type of simultaneous closing is called the true double-closing or “wet” close. Doing a true double-closing is pretty much the same as when doing a wet close. The difference between a wet and dry close, however, is that the wholesaler is the one who pays for the A-to-B transaction. Meaning, you will have to buy the property from the bank first before you can flip it to the end buyer.

If you don’t have enough cash to buy the investment property from the lender, don’t fret. You can always get transactional funding from hard money and private money lenders to make the process of wholesaling real estate owned properties a huge success.

Want to get more real estate investing tips? Go to www.REIWired.com.

How Wholesaling Real Estate Helps People in Despair

Wholesaling real estate is a very satisfying business. The satisfaction wholesalers get stems not only from the pay checks they regularly cash in banks but from the fact that they are able to help people in despair. A lot of homeowners were relieved after dealing with a house wholesaler.

It is important to know what types of homeowners wholesalers usually deal with. In most cases, wholesale investors buy properties from people who are in some sort of struggle. These people view the sale of their property the only way to end the struggle. Wholesaling houses usually involves homeowners who are having a hard time in life. They lost their job, had their car repossessed, and could not get loans from banks. What is left of them is their house. However, these people also realize that keeping the house is tantamount to prolonging the agony.

Some owners are struggling with mortgage payments or other huge loans. It could be that the house needs a lot of repairs and these owners – currently in dire straits – could not finance the needed improvements. Instead of waiting for foreclosure to devour their credit, these people opt to sell the house and start a new, debt-free life. Wholesaling real estate owned by these sellers is a good option for investors.

In wholesaling houses, tired landlords are also considered people in despair. They can no longer deal with headache tenants or vacancy. They would rather get the cash today and use it. After all, these are trying times. And what about owners who have just undergone divorce? Staying in the property means that person will have to maintain the huge house on his own. How hard is it to main a huge property that reminds you of your emotional pains everyday and doing it all by yourself? Selling the house fast is a better option for the owner.

Those who are into wholesaling real estate offer prices that are way below the retail price of the property. They can only offer a wholesale price because they need to resell the property and make profit. How does buying a house at a low amount help the owner? While the investor can’t give the ideal price the seller wants, he can close fast. This means the house will be sold faster and the struggle will end sooner. The house wholesaler spares the owner from further agony through a swift closing. For struggling homeowners, taking the lower price today is better than waiting – in pain – for a bigger amount.

Want to read more about wholesaling? Go to RehabList.com today.

Wholesaling Real Estate and the Internet

Investors who are wholesaling real estate can boost their business by harvesting the power of the Internet. The World Wide Web is not only a good way of finding buyers and sellers, it is also a staple source of real estate investing information. So whether you’re just starting in this venture, or have been active for decades, using the Internet to grow your business is an option you simply must not ignore.

Build relationships. Your success in wholesaling real estate, a business also known as flipping houses in many areas, will depend on how large your network is. You need to build a massive network of buyers and seller and serve as the middle man between the two groups. Wholesalers talk to sellers to place properties under contract and assign the contract to buyers. To find more sellers and buyers, go online. Look for websites and online groups that are looking to purchase properties or sell properties. For example, you can type “rehab list” on your search engine to reach for people interested in rehab properties.

Build a brand. You can also use Cyberspace to establish your own brand, which is helpful when flipping houses. That way, when people see a certain icon or slogan, they will be able to associate it with you. In short, people will be able to recall you – and call you – in case they have a deal for you. Just how will you do this? Join social networking sites. Then, use the same picture as your primary photo in your social media accounts. You can also use the same logo and slogan. That way, more people will be seeing your brand more often.

Build your knowledge base. One of the benefits brought by the Internet is the faster dissemination of information. By accessing the Internet, you will be able to read articles that are related to wholesaling real estate. You can also subscribe to websites of experienced wholesalers and get nuggets from them. You can also watch their videos online; just make sure that your Internet speed is fast enough for streaming and downloading. The only danger with expanding your knowledge online is the accuracy of the information available. Some culprits enjoy spreading false info. Others simply think they are doing the right thing – and teaching it to Internet browsers – when in fact their practice is flawed.

To be sure, visit only sites that are considered authority in a certain field. For example, if you want information on flipping and other forms of real estate investing, you can go to Rehab-Real-Estate.com, a trusted site on matters.

Four Reasons Wholesaling is a Great Way to Make Money With Real Estate

When I first started learning about making money with real estate, I often found myself overwhelmed.  There were so many different strategies available (short sales, rehabbing, buy and hold, subject to, wholesaling, etc), that it was hard to choose just one.  One month I would be reading everything I could get my hands on about subject to investing, and the next I would be learning about short sales.

I finally came to the realization that if I wanted to succeed, I needed to pick just one strategy and focus on it like a laser.  After careful consideration, I decided that wholesaling was the strategy that made the most sense for me.  Following are four reasons why:

Little to no Risk Involved- When wholesaling, you are not actually taking title to the properties, but rather assigning your interest in your contract to purchase.  There are no worries about holding costs, unexpected repairs, non-paying tenants, etc.  You’re in and out of the deal quickly, with very little at risk.

Low Start Up Costs- While it is much easier to get started if you have some extra cash for marketing expenses, it is still possible to get your wholesaling business up and running even if you are on a shoestring budget.  When I was getting started, I didn’t have a lot of extra cash for marketing or earnest money deposits, so I found cheap ways to advertise, and only offered one hundred bucks or less for earnest money deposits.

Credit is Not an Issue- Since you will not be purchasing the properties you put under contract to wholesale, there is no need to obtain financing, and therefore your credit is not an issue.  For those who have bad credit or who are in the process of repairing it, wholesaling is still a viable option.

Quick Paydays- Unlike many other real estate money-making strategies, wholesaling properties can put a check in your pocket in a relatively short amount of time.  As a matter of fact, I just closed a deal last week that took only four days from start to finish!  While most deals normally take a little longer than that to get to the closing table, you can usually expect to get paid within a month of getting a deal under contract.

While wholesaling may not be a good fit for everyone, it is definitely a strategy to consider if you’re looking to make some quick cash and don’t have a lot of money to get started!

Article Author: Stephani Davis

Photo: peasap

A Crash Course on Wholesaling Real Estate

Who says you can’t invest in real estate without a huge amount of cash on hand? Certainly not those investors who generate huge and stable income by wholesaling real estate!

Being new in the real estate investing business, you have probably heard the word “wholesale” a couple of times but do you really know what it is all about? For the uninitiated, here’s a crash course on wholesaling. Basically, wholesaling is a method of investing in real estate wherein an investor places a property under contract and then finds a buyer for the contract. This method is also sometimes known as assigning or “flipping” contracts.

This method of investing in real estate is perfect for first-timers, especially those who have yet to build a huge reserve of investment capital. Why? Because the main task of a wholesaler is to sell a property that is not his. Unlike when doing a conventional flip, you don’t have to buy the property that you’re going to wholesale.

You might be thinking that this is illegal but I assure you it is not. Wholesaling real estate is somewhat similar to brokering a real estate deal. Like a real estate agent, a wholesaler facilitates the transfer of a property from one person to another and makes profit from it. The difference between a wholesaler and a real estate agent, however, is that for a $100-deposit, a wholesaler can control an investment property worth hundreds of thousands of dollars.

Although this particular real estate investing strategy looks simple and easy, it would be difficult for you to facilitate good real estate deals if you don’t have a good list of home buyers and sellers. Thus, to become a successful wholesaler, you need to build a huge network of buyers and sellers that can help you move properties easily.

So how would you do that, you ask? For starters, you should start brushing up on your marketing skills to attract the attention of motivated home sellers and buyers. You should also attend REIA (real estate investing association) meetings and seminars because aside from conventional home buyers, your potential clients also include your colleagues in the real estate business, particularly those who fix and flip houses for a living.

Do you want to learn more about wholesaling real estate? Beef up your knowledge on investing in real estate by logging on to www.Rehab-Real-Estate.com. The website has everything you need, from articles and videos, to the latest real estate news.