Author : Rob Swanson
You might be asking whether you can flip REO wholesale properties to cash buyers when the bank will not accept your offer price. The obvious answer to that is no, but there are a few things you can do to still get a wholesale house you can flip to your cash buyers. Remember, unless the seller of a property accepts your price, you can not flip that property.
And, in order to wholesale houses to cash buyers you need to have properties under contract. The key here is simple because unless you have properties under contract, you do not have anything to wholesale.
The only way to get properties under contract is to make offers. And, as any good real estate wholesaler knows, you have to make a lot of offers. The point is that if you are not making offers, you are not making money.
Question #1. How many offers did you make this week?
This means it is purely a numbers game. If you are trying to put bank owned properties under contract to wholesale, it is a numbers game and to win you have to make a lot of offers. If you are going after private sellers and motivated seller deals, it is a numbers game. You have to have a lot of great marketing out there to generate motivated seller leads so you can make offers.
I typically like to think of both making offers on REO, bank owned properties, as well as running my marketing campaigns for motivated sellers leads in much the same way. Here is what I mean. You should be more interested in the quality of your offer and the quality of your marketing than the quantity alone. Do not get me wrong, quantity is important, but if the quality of your effort is bad, your results will be too.
Question #2. Are you focused on both quality and quantity?
There are two different ways to tackle your marketing and making offers. The first way is to throw mud against the wall and to see what sticks. The other way is to get a little more targeted and focused and use a little bit better filtering process in how you put your offers and marketing together. Either way it is a numbers game. But, if you focus on the quality of your effort first, your efforts will pay off because of your growing quantity.
A common question is whether you can flip a REO house or motivated seller wholesale property if the seller will not accept your offer price. The answer to that is no. You have to have the property under contract. It is important to remember that it does not matter what the seller is willing to accept, it only matters what you are willing to pay. As a real estate wholesaler, you can easily figure out what you are willing to pay based on what your buyers tell you they are will to pay. And, you have to make offers.
Question #3. What price are you willing to pay?
Here is an example of how it works. If your cash buyers tell you they are willing to buy a 2 bedroom, 2 bath wholesale house in a certain neighborhood for $60,000, you just have to put it under contract a little bit cheaper. Your offer will probably be $50,000 to $55,000 so you can mark up your cash buyers purchase price by $5k or $10k and make a quick wholesale profit. If you have the right marketing, the right offers going out and you are consistent in both quality and quantity, you will buy wholesale houses cheaper than the price your cash buyers are willing to pay.
Remember, as a wholesaler, you have the wholesale buying systems in place that your wholesale cash buyers do not have. Once you build your buying systems and go you will put great wholesale real estate under contract. Then, you can sell these great deals to your cash buyers quickly and easily.
It is a win-win for everyone involved. But remember when making offers, it does not matter what your seller is willing to accept, it only matters what you are willing to pay.
Rob Swanson is the editor of Wholesaling Newsletter. Claim your 100% free copy right now to learn how you can quickly wholesale real estate without cash, credit or risk.
