The Business Of Wholesaling

The Business Of Wholesaling

Hello To The DG Family:
I have been gone awhile now, as I have been very busy. The year is coming to an end, and it always becomes a flurry of activity to get deals done and get into gear for the new year.

For those who don't know me and there are many, my name is Paul Jacobi and I live and work in Fort Lauderdale, FL. I live right on the ocean and it is wonderful.

Every day that I wake up and see the ocean and the beach, I realize how thankful I am to have been able to make real estate a full time business.

I have been at this for ten and a half years of which 7 and a half have been full time. I did this for three years part time, and it was a really great preparation period and a period of getting my feet wet.

Guys like Mike Laurita are big advocates of learn what you need to do and go to it. Mike is like a marine drill sargeant and in a way, you have to respect that.

I wholesale and this is all I have ever done and will ever do. I like money and I do this for the money, I have no shame in saying that to anyone.

I also like to surf and swim and run on the beach with my dog Gino, who is a big old rotweiler, about 90 pounds. The last thing I want to do is be disturbed by tenants or a manager who can't do their job and this is why I do not buy and hold. I kid you not!!!

The purpose of this thread is to dig deep into wholesaling. I know there are alot of new people here, who are still wondering how it is done, and because they still have questions and uncertainties, they have not done a deal yet.

Lets cover the very first thing you must have to get going. That would be what is called comfort or as some would call it, confidence.

You have to get off the couch right now and go look in a mirror and you need to say the following, and I am serious about this. You must say:

My name is_________ and I am a real estate investor. I may be new but I am as good at this as anyone else who does this.

You are and do not allow anyone else to tell you any different. There are motivational books out there that will tell you to tell all your friends and family what it is your doing. That's great, go right ahead, but don't get upset when they tell you you can't do it.

When someone says that you can't, please realize that they know nothing about this business or know very little, so what they will say is to be expected.

My grandmom used to have a saying and it was this. People will tell you that you cannot do what they can't do. Very good advice.

The next thing you must do is educate yourself. Realize right away from the start that your not going to go out tomorrow morning and put a million dollar estate home under contract and flip it, for big dollars. It happens once in awhile, but not often enough to make a steady living.

I can do it, Tammy R can do it, Mike Laurita and a few others can do it, because we have all built a infrastructure where we have the contacts and it takes time to do it.

I live on the ocean, and if anyone knows Fort Lauderdale and Las Olas Blvd off Ocean Blvd, you know the area I live in. If I was out looking for the huge home deals, chances are I would pass by ten properties that I could make money on right now. I would rather wholesale ten medium priced homes, than one huge home deal.

Alot of people who get into wholesaling, don't really understand what it is. Wholesaling is getting properties under contract and assigning that contract to a end buyer for an assignment fee. Thats is it, very simple.

Now there have been discussions and arguments on this forum about whether this is legal. Many who start these conversations do so after talking to a realtor and being told it is not legal.

It is legal to do and as long as the contract does not state that the contract is not assignable, then the contract is assignable.

Now another point of conversation has surrounded putting the phrase "And/or Assigns" on a contract. First of all, you do not put that phrase next to your name at the top of the contract. You put it next to where you signed the contract at the bottom, so if I was to sign a purchase contract to lock up a deal, I would sign my name, Paul Jacobi and right next to it, I would print my name and then the wording And/or Assigns. THis makes the contract assignable.

Now if your dealing with a bank, chances are this won't fly, because the bank still believes and fails to understand that your not assigning the home or the purchase of the home or property, your assigning the contract, huge difference.

When you wholesale real estate, you own the contract and that contract can be assigned. Once again, your not assigning the property, but the contractual obligation and the terms surrounding that purchase to another individual or entity.

Now there has been alot said and alot written about the importance of a buyers list. My buyers list consists of contractors and others who have cash to buy, they also must have a pof letter on file with me. If they do not have cash, then they don't make it onto my list, it's that simple.

Now here is how to streamline your buy and sell process and there is no magic to this. It is as follows. Only look at properties that meet your buyers needs. I never look at a property unless I have it already sold and neither should you.

If you are out there lining up a deal then trying to find a buyer, you are playing russian roulette with your business, in other words, spinning your wheels in a sandtrap without a possibility of getting out of it any time soon.

Now allow me to tell you why buyers who don't have cash don't make the list. If a buyer needs to go get a loan to buy, there is a real chance they may not be able to get a loan. I have friends who have 880 credit scores and they cannot get a loan and no, they won't use hard money.

Cash talks, loans walk, it's that simple. It is written in stone and is not negotiable.

Also, when you assign the contract, get half your fee up front and the balance at closing. If your fee is $6,000.00, it is really nice gettin $3,000.00 at the front end and this is not refundable. In other words, if they can't close or don't close, this is a penalty to them for not coming through as they promise, and when the buyer has money on the line, they will take the deal very serious. This is a business and you must stand firm on your policies, period!!!

I am going to go for now, tomorrow I will post a thread about comps and determing the ARV yourself and I guarantee you will be very surprised at how simple it is.

For those who have written in and said in a post that they did the comps using a online service such as Zillow and nothing is adding up, you will know why after you read tomorrows post. Hint: Online services are not accurate at times for a reason and it has to do with the way the data is collected and provided to you.

__________________


Hello Paul Very well put,I

Hello Paul

Very well put,I enjoyed reading and look for more.

Thank You
Jim Kendrick


Hey Paul, thanks for your

Hey Paul,
thanks for your time and effort to write this out!looking forward to see how you determine FMV! do you have any pre-made scripts that you would send to your potential buyers?


Nice

Thanks for the info!

Chris


how to get buyers

hi paul ive have put ads on line and in papers but have yet to get any credible buyers. any advice.

thank you scott


THANKS PAUL

Thanks paul for all the education on wholeselling,that all makes sence.

__________________

mike


great info

thanks for sharing your knowledge-looking forward to reading your next post.
Valerie

__________________

Valerie

“And will you succeed? Yes indeed, yes indeed! Ninety-eight and three-quarters percent guaranteed!” ― Dr. Seuss

"I believe in angels, the kind that heaven sends; I am surrounded by angels, but I call them friends" - Unknown

My journal: http://www.deangraziosi.com/real-estate-forums/investing-journals/59110/...


Thankyou Paul!

I just happened to come across this post tonight and had already made up my mind to get SERIOUS about REI starting tonight.I need and want to change my present situation now. Silverhound (WHAT BOX?)

__________________

Silverhound(WHAT BOX?)


Thank you Paul

This is Great to here from someone as seasoned as yourself. I am having some trouble getting started, it seems at times I get scatter brained and can't move foreward but you are shedding some needed light on REI.

Again THANK YOU VERY MUCH

__________________

James Brogan


Thanks Paul for clearing and/or assigns up...

I am a Realtor/Investor. I get in arguments with my Broker all the time over this...I keep telling her to check out this site...as a matter of fact I have invited her 2 x now. Sometimes you can't teach an old dog new tricks. I will be doing these but not as a Realtor as an Investor but I will have to disclose this up front which I don't have a problem with.
Thanks again and looking forward to you next post...
Barbara


Thanks so much Paul

I have been studying wholesaling for some time and there were one or two points in there that really helps that I was not aware of. Keep sending the good info

__________________

I WILL NOT LOSE!!!!!


Wholesaling

EXCELLENT POST PAUL, VERY INFORMATIVE !!!!

THANKS
CURTIS FILLERS
(CHARLOTTE,NC)


THANKS

Good information. I look forward to more insights from you. Thanks again.
-Kay

__________________

Kay


Thanks Paul

Paul

Thanks for sharing this info

Regards
Tom


Follow Up Delayed

The post will happen tomorrow, I had a family emergency yesterday and I am still in it. Talk to everyone soon and thansk for all the nice replies.


Thank You very much for your post

I love the way you presented the facts and your process. I hope you will provide more of your very timely tips. Just know i am very grateful for your information.


Good Stuff, Thanks Paul!

I look forward to seeing your post tomorrow!


Wow Thanks

Wonderful information Paul I cant thank you enough.

God Bless DGF.


Wholesaling

Thanks so very much for your post, Paul. I've been studying about wholesaling for the past few months and you've provided some very important advice re buyers and non-refundable 1/2 comissions up-front...very nice to receive, but more importantly assuring buyer's commitment to the deal. Sorry to hear you've had a personal problem come up and trust all will be well soon. In the meantime we will all be looking forward to your post on comps when you're able to do so. Semper Fi D-LO


Simpe

Great post. It really is that simple. Investors old and new, read what Paul says and stick to it. Print it and put it on your mirror.
Joe


Thank You Paul

Thank you for getting back to me Paul

Scott


Find a new broker

bmcpherson wrote:
I am a Realtor/Investor. I get in arguments with my Broker all the time over this...I keep telling her to check out this site...as a matter of fact I have invited her 2 x now. Sometimes you can't teach an old dog new tricks. I will be doing these but not as a Realtor as an Investor but I will have to disclose this up front which I don't have a problem with.
Thanks again and looking forward to you next post...
Barbara

remember you are not beholden to any agency

I tell people who's brokers they feel are holding them back and if they are self-starters and think they don't need much supervision is to have an attorney sponsor them.

He's technically your broker but they normally allow their agents to roam free as long as they do nothing illegal and when they get clients, the attorney generally gets to double dip; as a broker and attorney. It fulfills both needs and a happy lawyer is one who has checks coming in.


Paul still waiting for that next post???

Thanks for the input Elix...
Barbara


wholesale

bump

__________________

Mike
https://tvallc.isrefer.com/go/RehabLite/renvestr/ Free tools


I just wrote a big private message

I just wrote a big private message to you but I will post it here because the message did not go through.

I loved what you had to say.

I am a wholesaler in Miami, wel I am starting I am a success academy member and I am trying to put some properties under contract, I haven't been able to do my first deal, but I am working on it.

I am now sending some offers to REO's, do you thing that is a good idea, to start with REO's, or should I try to find FSBO.

I have been living in Miami for a year now so I am learning the market here. I am trying to focus my efforts in SW Miami, since that’s where I live but I see that north east, North West Miami and south Broward counties have more opportunities, So I guess I am going to start looking for properties over there.

One day I wana be like you and be a full time REI, live on the beach and enjoy my time with my wife and my Dog...

I hope to get to know you personally one day and why not even make some deals.

Please feel free to contact me I will be glad to talk to you and learn from you, so any advice or comments are welcome.

I am not going to post my phone and email here so please send me a private message for whatever you need.

Hope to hear from you,

Juan D Cruz
www.investmentscruz.com


Thank You Paul.

Thank you Paul will keep wathching for your valued information

pauljacobi wrote:
Hello To The DG Family:
I have been gone awhile now, as I have been very busy. The year is coming to an end, and it always becomes a flurry of activity to get deals done and get into gear for the new year.

For those who don't know me and there are many, my name is Paul Jacobi and I live and work in Fort Lauderdale, FL. I live right on the ocean and it is wonderful.

Every day that I wake up and see the ocean and the beach, I realize how thankful I am to have been able to make real estate a full time business.

I have been at this for ten and a half years of which 7 and a half have been full time. I did this for three years part time, and it was a really great preparation period and a period of getting my feet wet.

Guys like Mike Laurita are big advocates of learn what you need to do and go to it. Mike is like a marine drill sargeant and in a way, you have to respect that.

I wholesale and this is all I have ever done and will ever do. I like money and I do this for the money, I have no shame in saying that to anyone.

I also like to surf and swim and run on the beach with my dog Gino, who is a big old rotweiler, about 90 pounds. The last thing I want to do is be disturbed by tenants or a manager who can't do their job and this is why I do not buy and hold. I kid you not!!!

The purpose of this thread is to dig deep into wholesaling. I know there are alot of new people here, who are still wondering how it is done, and because they still have questions and uncertainties, they have not done a deal yet.

Lets cover the very first thing you must have to get going. That would be what is called comfort or as some would call it, confidence.

You have to get off the couch right now and go look in a mirror and you need to say the following, and I am serious about this. You must say:

My name is_________ and I am a real estate investor. I may be new but I am as good at this as anyone else who does this.

You are and do not allow anyone else to tell you any different. There are motivational books out there that will tell you to tell all your friends and family what it is your doing. That's great, go right ahead, but don't get upset when they tell you you can't do it.

When someone says that you can't, please realize that they know nothing about this business or know very little, so what they will say is to be expected.

My grandmom used to have a saying and it was this. People will tell you that you cannot do what they can't do. Very good advice.

The next thing you must do is educate yourself. Realize right away from the start that your not going to go out tomorrow morning and put a million dollar estate home under contract and flip it, for big dollars. It happens once in awhile, but not often enough to make a steady living.

I can do it, Tammy R can do it, Mike Laurita and a few others can do it, because we have all built a infrastructure where we have the contacts and it takes time to do it.

I live on the ocean, and if anyone knows Fort Lauderdale and Las Olas Blvd off Ocean Blvd, you know the area I live in. If I was out looking for the huge home deals, chances are I would pass by ten properties that I could make money on right now. I would rather wholesale ten medium priced homes, than one huge home deal.

Alot of people who get into wholesaling, don't really understand what it is. Wholesaling is getting properties under contract and assigning that contract to a end buyer for an assignment fee. Thats is it, very simple.

Now there have been discussions and arguments on this forum about whether this is legal. Many who start these conversations do so after talking to a realtor and being told it is not legal.

It is legal to do and as long as the contract does not state that the contract is not assignable, then the contract is assignable.

Now another point of conversation has surrounded putting the phrase "And/or Assigns" on a contract. First of all, you do not put that phrase next to your name at the top of the contract. You put it next to where you signed the contract at the bottom, so if I was to sign a purchase contract to lock up a deal, I would sign my name, Paul Jacobi and right next to it, I would print my name and then the wording And/or Assigns. THis makes the contract assignable.

Now if your dealing with a bank, chances are this won't fly, because the bank still believes and fails to understand that your not assigning the home or the purchase of the home or property, your assigning the contract, huge difference.

When you wholesale real estate, you own the contract and that contract can be assigned. Once again, your not assigning the property, but the contractual obligation and the terms surrounding that purchase to another individual or entity.

Now there has been alot said and alot written about the importance of a buyers list. My buyers list consists of contractors and others who have cash to buy, they also must have a pof letter on file with me. If they do not have cash, then they don't make it onto my list, it's that simple.

Now here is how to streamline your buy and sell process and there is no magic to this. It is as follows. Only look at properties that meet your buyers needs. I never look at a property unless I have it already sold and neither should you.

If you are out there lining up a deal then trying to find a buyer, you are playing russian roulette with your business, in other words, spinning your wheels in a sandtrap without a possibility of getting out of it any time soon.

Now allow me to tell you why buyers who don't have cash don't make the list. If a buyer needs to go get a loan to buy, there is a real chance they may not be able to get a loan. I have friends who have 880 credit scores and they cannot get a loan and no, they won't use hard money.

Cash talks, loans walk, it's that simple. It is written in stone and is not negotiable.

Also, when you assign the contract, get half your fee up front and the balance at closing. If your fee is $6,000.00, it is really nice gettin $3,000.00 at the front end and this is not refundable. In other words, if they can't close or don't close, this is a penalty to them for not coming through as they promise, and when the buyer has money on the line, they will take the deal very serious. This is a business and you must stand firm on your policies, period!!!

I am going to go for now, tomorrow I will post a thread about comps and determing the ARV yourself and I guarantee you will be very surprised at how simple it is.

For those who have written in and said in a post that they did the comps using a online service such as Zillow and nothing is adding up, you will know why after you read tomorrows post. Hint: Online services are not accurate at times for a reason and it has to do with the way the data is collected and provided to you.

__________________

Real Property 4 You is your source for the best deals on foreclosed properties (REOs) nationwide with daily updates and construction

I Buy and sell residential property in and around the Salem OH 44460 area.
http://www.ebayclassifieds.com/user/realproperty4you


Thank You!

Thank you Paul for the valuable info.

Keely

__________________________________

The temptation to quit will be greatest just before you are about to succeed.


your post is a true inspiration

Great post Paul -

Your insight about wholesaling is inspiring and motivating. You are right about the online websites such as zillow.com etc for comps. These are great sites to start with in regards to numbers. However, they are not reliable because of the way that the data is collected and posted. These sites rely on public records and are not updated on a regular basis. Therefore some days you can work those numbers and they are quite accurate but others the numbers are way off. Many people are very confused by this and need to understand that when running the numbers before making a serious offer on a property you MUST collect comps from the MLS (through your agent) of SOLD properties within the last 3 mos. These will reflect numbers of what people are actually paying for these properties "RIGHT NOW" in todays market.

Thanks Paul - you are doing great!

__________________

KEEP MOVING FORWARD Smiling

"If it is important to you, you will find a way. If not, you'll find an excuse."
_____________________________________________________________________________

If you would like the chance to work with me or one of my fellow real estate investor coaches and our advanced training programs, give us a call anytime to see if Dean's Real Estate Success Academy and our customized curriculum is a fit for you. Call us at 1-877-219-1474 ext. 125


thanks paul

I look forward to reading your next post and... welcome back!

__________________

Jill Holden | San Diego
Investor Services
Team Development


Anyone know Paul?

His members page doesn't come up anymore...

Anyone still have contact with him? He seemed to disappear...

Him and Mike Laurita.. seem to vanish.


GREAT INFO

PAUL thank you for being an inspiration to all of us, who have been thinking of wholesaling.You have given us some great steps to follow. We are anxiously awaiting your other post.

__________________

Donna SIMON.I am interested in doing all of the strategies, then deciding which will be the one I am most comfortable with, but for now I would love to do wholesaling. This would definitely create fast cash, that I can use for investment in properties that I can eventually buy and hold.DEAN thank you for always creating that time to think of THE DG FAMILY AND WHAT WOULD be best FOR US.


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