Today’s REI Classroom Lesson
Alex Pardo reveals why it can be good to start out in wholesaling as money, credit, and experience aren’t required factors.
REI Classroom Summary
Building relationships with other wholesalers and even co-wholesaling can help get your foot in the door. Also find out more about building your cash buyer list.
Listen to this REI Classroom Lesson
Real Estate Investing Classroom Show Transcripts:
Mike: Welcome back to FlipNerd.com REI Classroom where experts from across the real estate investment industry teach you quick lessons to take your business to the next level.
And now, let’s meet today’s expert host.
Alex: Hey, guys, this is Alex Pardo and I’m your host for the REI Classroom. I’m really excited to bring you today’s information because so often I have people that reach out to me and they want to find out how they can get involved in wholesaling but the budget always seems to be a concern. So specifically today I’m going to share with you how to get started with no budget in the wholesaling business.
Mike: This REI Classroom real estate lesson is sponsored by AceBusinessFunding.com.
Alex: Okay, awesome. There are a few things that I want to share with you right off the bat. Number one, wholesaling is a fantastic niche in real estate because you don’t need any money, you don’t need any credit, and you don’t need any experience. That’s why I always feel that any investor, anybody that wants to get started in real estate, wholesaling should always be at the foundation of your business and should really be the heart of it, especially when you’re getting started for the three reasons I just mentioned.
While it is easier to get started if you have some money specifically for direct mail marketing to attract motivated seller leads, the same type of marketing for cash buyers, really, the great thing about this business is that you can get started with absolutely no money, and specifically today, in the next three to six minutes, that’s what I’m going to be sharing with you.
There are a couple different things. Number one, cold wholesaling. Cold wholesaling is nothing more than finding other wholesalers and investors in your area or a different market that already have deals under contract and then adding value to the transaction by bringing your cash buyers and getting their deal in front of your buyer’s list.
The first thing I would recommend with cold wholesaling is one of the themes that you’re going to hear from me today and in the next couple of months in the different classrooms that we do is this business is all about relationships. So the first thing you want to do is find the top wholesalers in your market and start building relationships with those people. Find out how you can add value to their business. I’ll give you a hint. One of the ways you can add value is by being a resource for them and making sure that you can put their deals in front of your top cash buyers.
So the first thing you want to do is identify the top wholesalers. You can easily do this by attending the REIS and finding out who are the movers and the shakers. You can go on craigslist and find out who are the people that are posting properties, and within a month’s time or so start getting on the different wholesalers list.
The key here is to find out who controls the deals. You don’t want to be working with too many people that just recycle wholesale properties, so make sure that you are connecting with the players. Make sure that you’re connecting with the people that are actually controlling the deals and try to work out some sort of arrangement with them. In most markets it is very common to do a 50/50 split if you’re able to bring a cash buyer. In your market it may be a little bit different, but try to pre-negotiate that before marketing their deals and then make sure that you can market it at the same price.
That is very important. You don’t want to develop a relationship . . . I’m sorry. You don’t want to develop a reputation for being someone that’s constantly adding fees to other people’s deals. I feel very strongly about that, although I know that there are people out there that will add $5,000 $10,000, $15,000 to other people’s deals. I have just found that it’s better to make sure you maintain a reputation of someone that’s always going to market properties at what the wholesaler who has the deal is marketing it at.
Quickly, I’m going to go into a couple different ways you can build your cash buyers list for free with no budget. Number one is craigslist. Everybody is familiar with craigslist but you can market other people’s deals on craigslist for free and then whenever people contact you, make sure that they’re a cash buyer, find out exactly what they’re looking for, and then start building a list of names, cell phone numbers, and emails, and then this way you can market out other people’s deals to your existing, growing cash buyers list. There’s also Backpage.com, Postlets.com, and MyHouseDeals.com, which are three websites and third-party sites that you can use to market other people’s deals and start generating a cash buyers list.
Mike: AceBusinessFunding.com can help you get access to up to $150,000 in revolving credit lines to fund your business, with rates as low as 0% for the first 12 to18 months. Use the funds for startup costs, marketing, inventory . . . heck, you can even use it to buy houses and pay for rehabs or almost anything else that your business needs. If they can’t get you funding, you don’t pay a dime. Get funds for your business today at AceBusinessFunding.com
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