What Comes First :Finding A Buyer Or Inking The Deal??
Hi All...
What should be done first when trying to wholesale property: Finding buyers and creating a buyers list to consult when you have a property OR inking a deal under contract, then finding buyers with ads and marketing techniques? I have read diiferent opinions where some put clauses which allow them to bail in case they can't find a buyer and other places say you should follow thru regardless of wether you find a buyer or not. I want to do the RIGHT thing, so is there any advice out there on this?
Thanks all 
Chris G
Hi:
I'm hardly an expert, but my little bit of experience has taught me to build a buyers list. I lost a deal because I did not have enough options. To make a long story short, upon my buyer's final inspection of my seller's property, he found out that the repairs were going to be much more extensive than he thought and told be me he had to back out unless I could get the property for MUCH cheaper( almost 25,000 LESS than the offer price because of foundation problems) Now, it was so far into the escrow period that I did not have time to run an ad and find another buyer to get a second opinion(yeah, I called all of the I buy houses ads in the paper, but had no luck.)Basically, I ran out of time and my seller signed with another investor who basically had cash in hand. OUCH!!! Hard lesson learned. Moral of the story: Have at least 2-3 pending offers from buyers on all of your properties. If you do so, then you will have someone ready just in case someone else bows out. You can't do that without a buyers list.
Let me know if my explanation makes sense to you.
One more thought:
Never put yourself into a contract that you do not have a clause to get out of........even seasoned investors have deals that they can't make work for whatever reason. So always try your hardest to honor any contract that you put your name on but ALWAYS cover your a** if you can't.
Hi Sharp. What I've been doing is scanning all the papers in Philadelphia for "We Buy Houses" ads and calling them. I find out what type of investor they are. Of the 15 or so that I've called, almost all of them are investors looking to buy, not flip, the property or rehabbers who do the same.
After a week or so of that, I'll start my own "Handyman Special" ad to lure some more investors out of the woodwork. Do I have a property under contract? No... but they don't know that. This is simply an information recon mission.
"Well, I just sold the 2 properties I had, but if somthing else comes along that I think might interest you, may I give you a call?" That's how you build relationships. It's a bad idea to take over a property without knowing who or what you'll immediately be doing with it.
By the way... don't just go for the big papers. Most of the serious investors that I have found advertised in the local free weeklies. Just a tip. Hope it helps. Good luck.
The Escape Clause is of course most important, but bend every effort to perform, even at no profit or gain. Oh my god that sounds like a sermon. Not meant that way, just good business. I have often footballed (passed to another) when my buyers ran dry or the selected buyer did not perform. I then go back in again and try try somemore.
Most of this stuff is usualy solved by just plugging away. I have assigned a position and then get a call that the person so assigned is not performing. I go dashing over, set everybody down, hear the reasons, try and solve and if not I take the assigned buyer out. I then sit down with the seller and work it out. They kick in a couple of payments, I kick in a few, we cry, hold hands, and out we go in search of someone in serious need of housing.
Nice to have a list of would be buyers, but it is hard as they keep finding properties and that terminates them. I much prefer investors. The grammer is bad but, the pockets deep.
Cheers Lucius
I think that you can do either/or. If there is a great deal out there that I know will be a hot property, I'd take it. I am just starting to get a list of buyers lately. Most of the time I just buy picking houses that I know appeal to the masses and will be a good mover. I am a rehabber though so I do fix them up first. They go fast every time. Pick em right and they will come! On the other hand, it doesn't hurt to have some names on a list. Saves time, saves money.
I have done both in the past, But now I am continually qualifing buyers for my wholesale properties. I do that on a daily basis. This way I can market qualified buyers just like properties. Just another way to wholesale!!!
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