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Can you partner with other Wholesalers to Wholesale or Flip Houses? The Flip Man —-
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http://www.cashnowforyourhome.com?yt01 – We have received a lot of inquiries through phone, fax, and email asking us what type of properties we buy and how to submit deals to us. We have put together this video to provide an efficient way to communicate with you.
The answer to the first question of what type of properties we are looking for is this. We typically are interested in residential real estate with an after repaired value of $250,000 or less. We want single-family homes and multi-units up to four units.
We will look at deals across the country. However, there are some areas that we may not be interested in such as Detroit, Michigan. That area is extremely depressed.
Now, we are not interested in paying more than 70% of the after repaired value. Remember we are wholesalers. The 70% after repaired value has to include the cost of the property, rehab cost, our wholesaler profit, points, and closing costs. Anything below that offer will be your profit.
For example, lets say you have a house with an after repaired value of $100,000. The first thing you will do is to multiply the ARV by .7 which represents 70%. In this case, it is $70,000. Now, you must deduct the rehab cost. In this example, lets say the rehab cost is $20,000. That leaves us with $50,000. Next, you deduct the taxes, insurance, and attorneys fess. For our example, we will use $2,000. Next you deduct the points for hard money, lets say 5% of $70,000 or $3500. After that, deduct our wholesaler profit which we typically look for about 10% of the ARV or $10,000 for this example. Deduct that from the amount and that leaves you with $34,500. We will buy this example property for no more than $34,500. So you must negotiate a price with the seller below $34,500 to profit.
Now this example represents a property that is in need of repairs. If you have a property that does not need repairs, then we may be willing to pay up to 80%. However, the property must have a tenant in place with a documented pay history and it must have a positive cash flow.
One note, in some areas, we may lower our purchase to value ratios if the area is saturated with foreclosures. Foreclosures will bring down the value of the real estate and we must adjust accordingly.
Now that answers the first question of what type of properties we are looking for. The second question that needs to be answered is how to submit deals to us. Many people have sent us links to deals from different websites or faxed us pages from an MLS listing. That is not the way to submit a deal to us or any other wholesaler. If you have a property that you would like to sell us, we require the following:
1. Comps for the after repair value. We prefer comps from a subject to repair appraisal. However, we will accept comps generated by a real estate agent. We dont want comps from Zillow or any other site. If you do not know what a subject to repair appraisal is, then we will provide information in the future or upon request.
2. We need a rehab list from a professional with price of repairs. It is best that you get the input from a licensed and bonded contractor. They will typically give you an estimate for free or for a small charge. Its best that you use someone who is reasonable but not cheap.
3. We need to know what you want to sell the property for.
4. We need a copy of the original purchase contract if it is going to be assigned to us.
5. We need to know the potential rent rate if the house is a rental. You can usually get this information from a realtor, a real estate investment club or other landlords in the area.
6. We also need pictures both interior and exterior. The more pictures the better. You may also want to take pictures of the street scene in both directions.
Remember, we are looking for conservative numbers. We do not want exaggerated after repaired values and low-ball repair estimates. If you have a property that you wish to sell to us, please send all of the information to us via email. You may also fax the information to us.
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Duration : 0:7:2
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