How To Wholesale Real Estate Step By Step. Getting started wholesaling is a step where 70% of students get stumped. They just want everything to be perfect, they want to have the perfect script, they want to know all answers to objections, they want to know all aspects of the contract. I say FORGET all that… just get started!
What is Wholesale In Real Estate?
Wholesaling sis the art of finding cheap properties with values 50-70% their market value, to get them under contract. Then, we can sell the rights to purchase that property to the end buyer. This person usually makes money fixing and flipping. WE, the wholesalers, make money by finding this type of great deals.
What Are The Stages on How To Wholesale Real Estate?
There are four basic stages with many sub-processes and tips within. Relax! It’s easier than you think. Nothing too big not to not be accomplished. And I’ll walk you all the way. These stages are:
Number 1: Finding Deals
We have discussed several ways to find deals. This is basically a marketing stage that includes: online marketing, direct mail, using social media, networking… But who are you directing your mailing to? For this, you can:
- Get a contact list of homeowners that fit your criteria
- Import that into a prospect system
- Call them using a 3-line call systems
- Text homeowners using a mass text personalized system like we have on our site.
- Use a CRM system to keep up with clients. If you don’t have much money at least use google sheets or Excel.
Number 2: Dealing With The Seller
So, let’s say you found a deal. Now what?
- Run a Comparable Market Analysis. This is done by finding comparable sales. What have similar properties in the area sold for?
- Make an offer. Decide what the property is worth considering the results of your CMA and the After Repair Value (ARV). Normally, wholesaler’s offer is 50-70% the market value for that property.
- Submit the contract. If the seller accepts your offer, you must contact your closing agent (attorney or title company) and submit the contract to them.
Along this stage, always remember:
- Don’t be rude to homeowners who are rude to you. Beat them up with KINDNESS. You can win folks over with time.
- Follow up is key
Number 3: Find A Buyer
Like finding a deal, you will have to run a great marketing strategy to find a buyer. For instance, you can post the property online, use your network and alliances. You may also agree with a partner to ease the process by bringing the house to the deal and your partner bringing the buyer.
Number 4: Deal With The Buyer
- Proceed to the agreement. This is the process to transfer the right to purchase the property. This can be done either by using an assignment agreement (most common) or double closing.
- The closing. This is probably the phase where you must work the most on. You as the middleman must ensure everyone else is communicating and doing their part. But in the end, you’ll have your juicy commission.
Final Tips about How To Wholesale Real Estate
- Use a sales contract that is written to benefit YOU, “The Wholesaler / Buyer”
- Keep following up with any homeowners that may have an interest in selling. It takes 7-10 calls to convert a lead.
- KEEP FOLLOWING UP!!! This is the Key To Real Estate Sales & Sales in General