James recorded a special episode of The James Orr Show where he covered all the basics of Wholesaling 101.

In that audio, he described the resources that were available at the time of the record (many of which have since changed) as well as information that is critical to getting started in wholesaling. To supplement the training that is currently provided, we wanted to give you access to that recording as well.

You will learn:

  • What is wholesaling?
    • Steps to wholesaling
      • Find deals
      • Analyze deals
      • Negotiate deals
      • Control deals
      • Sell deals
      • Collect fees
  • How much money can you make on a typical wholesale deal?
    • Will cover some examples after we go over different types of wholesale deals
  • Time invested to do a wholesale deal
  • How many deals can you do if you do it full time?
    • One per week is a reasonable goal if you really devote your time and energy to it
  • Finding deals
    • Much harder to wholesale deals via the Multiple Listing Service, so focus on dealing directly with sellers
      • If you decide to focus on wholesaling from the MLS, here are some recommended areas to consider starting with:
        • REO
        • Short sales
        • Vacant properties
    • Put out marketing like postcards, door to door flyers, classified ads, online ads to have sellers call you
    • Properties being sold by owner (often called For Sale By Owner or FSBO)
      • Find them in:
        • CraigsList
        • Newspapers
        • Signs in yards while driving neighborhoods
        • Zillow
  • Analyze deals
    • Know what your investor buyers want
    • For example, we want:
      • Fort Collins, Loveland, Wellington
      • For single family homes priced below $250K After Repair Value
      • Would consider higher priced for duplexes, triplexes, fourplexes and apartments
      • Fix up properties or pretty houses are both OK
    • If you are in Fort Collins or Loveland and you have a deal that you are wanting to wholesale to me and you want help analyzing or structuring then call me directly
  • Negotiate deals
    • Meet with sellers, make your full presentation
    • The “doesn’t work for me, but I know another investor approach”
  • Control deals
  • Sell deals
    • If you do not have investor buyers like wholesalers have in us here in Fort Collins and Loveland, Colorado you will need to do marketing to build your buyers list
  • Collect fees
    • Usually the fees are collected at closing as an assignment fee or a fee to clear title
    • In some rare cases, you will be forced to close on the property and then resell it
  • What is the guidelines on what a reasonable wholesale fee is?
    • Completely negotiable
    • Examples of deals and probable wholesale fees earned
      • Subject To deal
        • On a $200,000 property that we are buying for $167,000 Subject To the existing financing, the wholesale fee may be $3,000 since the equity is $30,000
      • Lease Option deal
        • On a $200,000 property that we are buying for $167,000 with a lease and option to buy the wholesale fee may be $3,000 since the equity is $30,000
      • Buying properties all cash at a discount
        • On a $200,000 property that we are buying for all cash at a discount for $124,000 that needs $10,000 in repairs we might pay a $6,000 wholesale fee since the equity is $60,000.
      • Owner Financing deal
        • Buying a $200,000 property for $200,000 with $20K down payment and the seller carrying back financing for 10 years with payments equal to the Net Operating Income (this deal really has no equity), we might pay a few thousand dollars as a wholesale fee depending on the exact terms

Download MP3 Audio

Download Wholesaling 101 as a MP3 file (use right-click “save as” to save it to your computer).

References

This is usually referenced from:

  • Wholesaler Daily Checklist
  • Wholesaling 102
  • Wholesaling
  • Real Estate Wholesaler

See also…

You may also want to check out these other resources related to Wholesaling and Wholesaling 101: