Wholesaling is a Hot Strategy Even in a Cool Real Estate Market
by: reiarticles1
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In case you’re not familiar with wholesaling, it’s an amazing real estate investing technique that offers investors some really tangible benefits, among them:
• Low risk
• No ownership headaches
• No credit or bank financing hassles
• No tenant issues
• Huge profit potential
First, because you don’t actually take title to property, it doesn’t come with any of the perceived negatives that many other real estate investing techniques have. In a sense, you could almost consider real estate wholesaling as an administrative function – as a well-paid paper pusher, you simply follow this formula for creating explosive profits:
Locate Properties with motivated sellers or motivated seller situations – There are any number of ways of locating motivated sellers – people who are facing financial problems due to unaffordable mortgage payments, job loss, personal or family problems, job transfer, etc. You could utilize online or offline strategies such as advertisements, direct mail, word of mouth, bandit signs, or you could even put the power of the web to work for you by using online strategies.
Negotiate price and place property under contract – Once you’ve located a prospective wholesale opportunity, do your due diligence, negotiate a price with the seller that is as little as 40%-45% of its after repair value (ARV), and sign a contract with the seller agreeing to purchase their property. In order to wholesale the property, you must have the legal right to assign your contract to somebody else, and that “permission” comes by adding the words “and/or assigns” next to your name as the purchaser of the property.
Find a real estate investor to assign the contract to – Give a real estate investor an offer that they can’t refuse – and they won’t! By assigning your contract to another investor that wants the property, you save them the hassle of locating a property that meets their criteria, negotiating terms, etc. In exchange for taking on this largely administrative “leg-work” for them, they will pay more for your contract than you have agreed to pay the seller. This difference is your profit (you do want to be well-compensated for your efforts, right?) and will usually be somewhere between $5K-$10K, depending upon what you and the investor agree to. Finding an investor is a breeze, too, because you can locate them by responding to one of their marketing ads, asking around at a REIA meeting, or by utilizing your own marketing campaign.
The investor closes in your place and you walk away with a fat check – When the real estate investor closes on the property in your place, you get paid very handsomely for your administrative efforts – without having to locate funding, submitting to invasive credit checks, or worrying about what long-term property value trends look like.
Wholesaling real estate always makes good sense, because there are always sellers with powerful motivations to sell quickly. The next 18-24 months represents an uncommonly good wholesale opportunity, though, due in part to the triple whammy brought on by the real estate crisis, the credit crunch, and the near-collapse of the economy.
This is your golden opportunity to tap into this lucrative market and fill your bank account with fat wholesale profits – money you can use for other investments, paying off debt, or expanding your own real estate investing empire. Get started today and change your life forever – for the better!
Article Source: http://www.ArticleStreet.com/profile/reiarticles1-12714.html
About the Author
Charrissa Cawley has a long standing reputation for excellence as a gifted speaker, real estate trainer and wealth coach. She offers accurate and proven strategies to investors of all different levels and is the founder of www.reiconferences.com, and www.rewexclub.com.
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