How do you get started wholesaling real estate?
Real estate wholesaling can change your life. There is no question about it. It can add a substantial amount of ongoing income, deliver lump sum checks when you need them, give you back your time, and opens up all types of new opportunities.
So how do you get started?
STEP BY STEP GUIDE TO WHOLESALING REAL ESTATE
1. Learn
Whether you are new to real estate, or just new to wholesaling property invest in all the knowledge you can get. Find out the best practices, how the most successful do it, and discover the best tools for the job. Don’t let this become an excuse not to take action, but the best investment you can make is always in yourself.
2. Understand the Process and Options
‘Wholesaling’ is often used to describe several strategies for flipping properties. Some real estate wholesalers simply go into contract on properties, and then ‘flip’ or assign those contracts to others. Other wholesalers will buy and then immediately resell their properties, normally within 1 to 30 days. Some will go a step further and do some basic cleanup or clearing out and improvement to make the property more appealing to the next buyer. Though this last strategy really borders on fixing and flipping versus wholesaling real estate.
3. Build a Team
To get the most out of wholesaling, to achieve the most possible, minimize risk of making mistakes, and to experience results the fastest – leverage a team. There are many people and companies involved in every real estate transaction. The better your relationships and connections the better your results.
4. Find the Deals
The main mission of the wholesaler is to find and sign contracts on properties. They key here is finding distressed properties and motivated sellers. This is where the discounts are and the profits lie. It can be foreclosure properties, relocation situations, damaged and aging properties, and estates, as well as other similar cases. These deals can be sourced from a variety of places including lenders and local government who have repossessed homes and commercial real estate, real estate brokers, owners attempting to sell by themselves without an agent.
5. Find the Money
The most common excuse for not getting started in real estate, or doing more is the money. In reality there is plenty of money out there. There are many sources of capital to invest in real estate. Banks, credit unions, funds, mortgage lenders, business loan lenders, private lenders, friends and family members. Some will provide proof of funds letters, approval letters, cash, and lines of credit in advance. But once you find good deals you will certainly find plenty of capital partners willing to finance them.
6. Find the Buyers
Your wholesale transaction isn’t complete, and you don’t get paid until you find an end buyer and either assign your contract or flip the property to them. Your properties can be sold to anyone, though most wholesalers focus on reselling their inventory to rehabbers and rental property investors. Smart wholesalers get busy building up their list of potential buyers in advance so that they can turn their deals into cash instantly, and even utilize reverse wholesaling. These buyers may be found actively searching for deals online, through in person networking, or buy acquiring lead lists.
What Makes a Great Wholesaler?
Knowledgeable
To succeed, reach your potential, and see results quickly and consistently you’ve got to know what you are doing. The concept of wholesaling real estate isn’t that complicated, but you need to understand how the mechanics of it work. If you are new to real estate you also need to get to know your contracts, how to value properties and pull comps, and what other people in the process are looking for.
Gives Value
While many get into wholesaling real estate to get money, a wholesaler’s role is really all about giving value. That means serving others with a valuable service and product. You serve sellers by providing them with a fast and reliable exit from their properties and debt, while giving them cash to move on. You serve lenders by helping to put their capital to work and earning them a good return on investment. You serve the end buyers by giving them a product they need at a reasonable price. And you get paid for doing all of this.
Organized
To be the most effective real estate wholesaler you can be you need to get organized. This will help maintain your credibility, maximize profit and speed to getting paid, and provide you the most time freedom. This means getting the best tools and systems you can, as well as leveraging strategic business partners and assistants as needed.
Long Term Thinking
Yes, wholesaling may be appealing for its quick paydays, but those that want to continue to be successful will think long term and big picture as well. Do you just want one paycheck? Or do you want wholesaling to deliver a whole stream of paychecks each year and for years to come? Long term thinking means protecting your reputation, treating others well, working towards your greatest goals, automating systems, and giving your customers good deals so they’ll be rushing back for more and telling their friends.
Adding Wholesaling To Your Real Estate Mix
Wholesaling is a great choice for those just looking to get started in real estate for the first time. However, it is also a smart option for those returning to real estate after a long break, and a savvy addition for investors who may have been fixing and flipping houses, loaning their capital, or buying rental properties. All these strategies can work, but wholesaling can help fuel them all by providing fast and regular cash injections to keep those other ventures running. If you come up short on the budget to rehab a house, or are hit with a bad tenant, then wholesaling may provide that extra cash to get settled, avoid bankruptcy, and prosper again. And it’s really easy to integrate into what you are doing already.
Is Real Estate Wholesaling Legal
Sometimes you’ll find people complaining about wholesalers or questioning if it is legal, or really a form of investing. You can’t blame them. Wholesalers make a tremendous living, and they do it very easily compared to real estate agents, business owners, DIY landlords, and rehabbers and builders. Some of these parties get jealous about that, or see wholesalers as competition. Others just don’t understand what wholesaling is. Some have had bad experiences with new wholesalers who haven’t learned their craft and have offered poor deals, or who haven’t done things correctly. Wholesaling is perfectly legal, when done correctly. In fact, all of those mentioned in this section can be some of the best customers and business partners for wholesalers.
FIND REAL ESTATE WHOLESALING COURSES
Succeeding quickly, and maximizing your potential means learning. You want to know your stuff. Lifelong learning is something all successful people are committed to. In wholesaling you will certainly do some earning while you learn and master your new craft. But the most upfront knowledge you can get the better.
So what’s important in choosing a real estate wholesaling course? What do you need to know?
You will want to learn about real estate marketing so that you can find deals, real estate comps so that you can value deals fast, lending so that you can attract the best lenders, and how to present to buyers so you land home runs again and again.
There are a number of ways to learn about this form of real estate. You can pick up books, read blogs online, attend seminars and webinars, get online and home study courses, and even take advantage of personal one on one coaching.
There are a number of resources out there but they are not all equal in their value and effectiveness. Aspiring wholesalers need to make sure they are getting up to date information so that they are operating legally, they need methods and systems which really work in the current market, and should look for educators and trainers who are achieving and living the success they want to have in their own lives.
Take Action
You are already on the right track by reading up more on wholesaling, and more knowledge is always great. But, you’ll never see the results you really want until you actually start taking action.
Take steps towards building your wholesaling business and goals every day, and keep up that forward momentum. Start with what’s possible, build on that, and soon you’ll be achieving what you thought was impossible.
Time doesn’t wait for anyone. The market doesn’t wait for anyone. Motivated home sellers that need to sell, private lenders that need to lend, and end buyers that need to buy aren’t going to wait months for you. They need your help now. You can do it. You can help them, and get paid very well for doing it.
Just start taking action!
