Wholesale W/ Partner
I have been reading and reading and reading -- post here, post there, books, web notes, etc. I have all these thoughts and ideas running through my head now as I try to get started in the Real Estate market mainly in foreclosures. Many who are going through foreclosure are people down and out in life. Now, I need to make money, but I also have a heart. Thus my business motto when I get started: Business from the Heart.
From all the reading, I understand "preforeclosure" sells to be most profitable with the smallest amount of risk (since auction purchases may have high profit margins, but can also pose greater risk if your homework isn't done properly). That being said, I also understand that you still have a lot of homework to do with "pre's".
Has anyone setup an informal partnership with another investor to buy and sell property? The following scenario should make it clear what I am talking about.
Motivated seller has been notified that his home is in foreclosure -- worse -- it's at the NFS stage. If he doesn't act quickly, he'll lose it (unless he declares bankruptcy, sells it, or hits the lottery). If I buy his house, he has nowhere to go. The owner will now have no home, no money, and still have his other bills due. I have been trying to figure out a way to help the owner get out of the financial disaster he is in, find a house, and me still make money. I would like to make contact with LIS or NFS status owners, discuss the purchase of their house. After determining that it is worth my while, I would like to make an offer that pays the mortgage, gives them $5-10 from their equity, allows me to make $5-10K, then leaves enough room for repairs and profit for a partner investor who I will assign the property to.
Here is where the partner/investor comes in. I work with this investor so that I have information about his inventory to assist in finding affordable housing for my "clients" - the sellers. He would be able to take my assigned contracts and make profits on them after repairing them and placing them into his inventory for future buyers. Since he would have room to adjust his prices on the other end, we would be able to work together. We purchase homes from individuals in financial problems, help them sell their home and put them in a new home that is affordable. Like I said, Business from the Heart.
Can anyone give me information on this type of partnership. Are there any legal issues I am missing. My head is spinning with ideas, so any help would be appreciated.
Thanks,
Richard
Rich- I think your idea is great and you have a fresh approach to make it win win for everyone. I myself have had the same struggle when it comes in the area of foreclosures. Feel free to send me a meesage directly to talk more about this. you are the first person I see that has had the same idea as me when it comes to helping these people out of a jam and not just as a dollar signs. I would love to pick your brain more, keep in touch.
Richard since i'm new to this i can't help you with your quetion but i do think that your idea is great. Its so refreshing to come accross an investor who's focus is to also help people and not just money money money. I hope this partnership work out for you.
Georgebi and Hunni,
Thank you for your replies. I am still interested in whether or not there would be any legal or ethical issues to this. Like both of you discussed, I certainly see it as a Win-Win-Win for the seller, wholesaler, and buyer/investor. I would be more than happy to stay in touch with both of you. I saw a plaque in the GPS department of my former office that had the follwoing phrase: "If you don't know it, learn it. If you know it, share it!" That is certainly true for real estate investment. I know there are many on here that KNOW real estate, and I'm glad that they are willing to share their knowledge so we can learn (and in return teach).
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