Sell Wholesale Properties Fast or Sell Them for Top Dollar--Tim Mai Shows You How

Follow Tim Mai's common-sense methods of selling wholesale properties. Whether you sell quickly or for top dollar, Tim shows you how to do it the right way!

Set Your Wholesale Objective--Sell Properties Quickly or Sell for Top Dollar!

Choose the Sales Method That Works Best for You in Any Given Wholesale Situation!

I n earlier articles, I showed you how to find great wholesale properties, sell owners on your deals, and conduct a title search so you can get the property free and clear of any legal entanglements. So, let's assumed you've purchased the contract and gotten a good deal. Now, you have to answer the question: "What am I going to do with this house? In other words, you have to choose the best exit strategy, the one that best meets your needs. You'll have to ask yourself questions like:



Do I want to wholesale it to another investor very quickly so I can get my money back in 30 days?
Am I going to take a little longer to wholesale it in order to make more profit?

It all depends on your goals, of course. If you want to wait a while to wholesale a property, you will have to wait 45 or 60 days (or however much time the seller gives you) in order to gain a greater profit. On the other hand, you may want to sell the house as quickly as possible. If the price is right and you're reasonable, you can sell a property within an hour.

Remember, it's all based on price. For example, if I'm trying to wholesale a deal and I think that the neighborhood is really good and it'll make either a really good rental property or a really good retail property and I want to wholesale up to 87% or 90%, then I know it'll take me more than ninety days to wholesale it. It'll probably take thirty-five, but I'm going to hope to wait for it. You can do that too and you can make a little bit more money.

If you're a beginner in wholesaling, I recommend that you set a goal of making money within thirty days. Wholesale a house at a price that's reasonable to just get in, get out, get paid, and move on to the next deal. Then, repeat the process until you're able to make enough cash flow for the month that you don't need to wholesale a good property within two or three weeks. With this method, you can wait longer on that particular property and reap a bigger profit.

One recommendation: always have a backup buyer on a deal even after you sign a contract with another buyer. In fact, the more backup buyers you have, the better. The reason to do this is that, sometimes, the original buyer can't meet the terms of the deal and has to back out. So, it's a good idea to have backups in case this situation happens to you.

Now let's look at the details of wholesaling a property quickly.

WHOLESALING QUICKLY

In order to wholesale quickly, you first must have buyers to whom you sell the contracts on your properties. That means you have to build a buyer's list. There are several ways to accomplish this task, and they're explained below.

Section 8 Properties
One of the ways to get started in building a buyers list in your area is to visit the local Section 8 office and get a list of all available Section 8 properties. Section 8 is a government housing program that helps low-income individuals with their rent. In effect, it's a federally subsidized voucher housing program that allows low income families to pay only a portion of the rent. So, if a Section 8 home has a monthly rent of $1,000, then the government will pay $800 of that amount, and the tenant will pay $200. Section 8's goal is to allow poverty level families to live in de-centralized areas of cities as well as encouraging families to save income for eventual home ownership.

There tend to be two types of renters-the ones who are good tenants and will be in their houses for a long time and the ones who are short-term. They're the type who'll mess up the house, break their contract with the government, and then get kicked out. It's the landlords of the latter type that you'll want to put on your buyers list and contact. Section 8 rental properties are typically found in your moderate-income and low-income neighborhoods, and, thus, are ideal for you.

Once you have a property, you can post it on my website and start building your buyer's list when investors contact you: www.dodeals.com

Or if you want to find out-of-town investors nationwide, you can post your property on such free services as: www.craigslist.org or www.backpage.com.

"We Buy Houses!" Ads
Another way to build your buyers list is to call those "We buy houses!" ads in the newspaper. When you call them, tell the person, "I have a property I want to wholesale? Do you want to buy it?" If they're not interested, you can find out what area they buy in and what price range they prefer. This will help build your list. You can also ask them if they have any properties they want to sell. Consider them both buyers and sellers. You should be able to buy houses from other investors all the time and get some good wholesale deals.

Classified Ads
Another method of building your buyers list is to place classified ads in newspapers. As the sample below shows, it only need be a simple "Handyman Special" ad"

Handyman Special
Cheap-CA$H
1-xxx-xxx-xxxx

This is a technique I learned from Ronald Graham. Just keep running the ad until you build up a good buyers list. Even if you don't presently have any houses, run the ad anyway. When interested parties call, tell them you're always getting houses into inventory, and you sell them quickly. Tell them you'll put them on your buyers list, and, as soon as you have a house, you'll contact them.

Yard Signs
Yard signs are great for attracting the attention of buyers. I use the neon color poster boards you can find at stores like Office Depot, Staples, Walgreens, etc. Below is an example:

Handyman Special
Cheap - CA$H
Must Sell Fast
$60,000 (Flexible)
1-xxx-xxx-xxxx

This is a good technique because investors have been trained by Ronald Graham to look for signs with words like "handyman special%u2026cheap-cash%u2026must sell fast%u2026flexible," etc. When they see those signs, they'll give you a call. Of course, put the signs all around the neighborhood because there may be tenants in the neighborhood who are now ready to buy a house.

I recommend that you put up at least twenty or thirty signs all around the neighborhood. If they get taken down, put more up. If you can put up signs with arrows on them, all the better! Arrowed signs make it easier for buyers to find the property. Put at couple at the house, of course.

Note: When you're first building up your buyers list, you don't want investors to know where the house is; you want them to contact you first and schedule an appointment. So, don't put up signs until your list is built up. If the house is occupied, then don't put up signs with arrows on them. The seller may wonder what's going on if a number of investors suddenly show up to inspect the house. So, be sure to inform the seller ahead of time that investors will be appearing. Tell him or her something like this:

"I work with a really big group of investors. Because your house needs a lot of work, I have to bring them all out to see what repairs are needed and to see if they're interested in the purchase of your property."

Most sellers will understand the process and will be happy that you're being aggressive in making a deal.

Other Tactics
With vacant houses, you can put "attention getters" on the property-plastic flags, streamers, etc. These get the attention of investors and others and pull their interest to your signs. Of course, this calls for a little more work on your part, but the more work you're willing to do, the faster you're going to be able to sell your properties and get top dollar for them.

Now, I'll show you exactly how to wholesale for top dollar.

WHOLESALING FOR TOP DOLLAR
One of the methods for achieving top dollar in wholesale transaction is by providing 100% financing for your buyer. This is a method whereby you structure the deal so your buyer can purchase the house with little or no money down. For example, maybe a buyer wants to put just $3,000 down. If you make your price attractive enough, they will want to find a private or hard moneylender who will loan them the purchase money on the house-and also the rehab money.

In effect, if you want a higher price, you have to be willing to carry back a second mortgage for the seller. This way the buyer will be into the deal for little money. I recommend that you don't carry back 100% of your wholesale fee. The buyer should be willing to put down at least $3,000 to $5,000 before you're willing to carry back the rest. After all, you don't want to be in on the deal and receive no money at all! But, if you have that $3,000 to $5,000 and the buyer defaults, you can then choose to foreclose on the house and get it back. You've made your money and can move on to the next deal.