Posted by Eric Medemar on July 08, 2008 at 24:55:09:
These are buyers that I wholesale homes to, flip homes to, or lease option contracts over to. If that is what your asking. If I am off in what you are asking just let me know.
Posted by Eric Medemar on July 08, 2008 at 24:55:09:
These are buyers that I wholesale homes to, flip homes to, or lease option contracts over to. If that is what your asking. If I am off in what you are asking just let me know.
A Lesson In Finding Buyers - Posted by Eric Medemar
Posted by Eric Medemar on July 07, 2008 at 02:41:02:
get email virtually every day from people who want to know where to find buyers for their wholesale deals. I see countless posts on here of people asking where to find buyers. So I figured I would put together most of the ideas that I have used or have seen used for finding buyers into a single post.
I am sure there are countless other places and ways to find buyers beyond what I am mentioning, so I will leave it up to other people to fill in the blanks that I have missed.
Keep in mind these are ways that I or my clients have actually used, so I know that they work because I have done it.
I usually ask them whether they are still buying, what they are looking for, what percentage up FMV they are typically paying, and what areas of town they want to buy in.
While I have them on the phone I also ask them if they wholesale out any of their homes, if they do then I ask them to call me when they have something good. I tell them that if the deal is right I can close in less than 2 weeks with cash.(I can do this because I have other buyers already in place to buy their deals, sometimes these buyers could be other cash for your house buyers)
Here is a sample of a deal that I put together using this.
I called a we buy houses sign
Found out where they were looking
Put a home under contract for $52k in that area
Called them and let them know.
I signed a 6 month lease option with them for $64k
I closed the home.
The lease option started
He sold the home
We close this week, I make about $12,000 (I also made commission when I bought the house, because im a realtor)
He makes around $12k.
Were all happy.
Call realtors I call realtors and find out if they have any cash buyers that are looking to buy some wholesale deals. It varies on what I offer to pay them but typically I offer 10%-20% of my profit, or a flat 2-3% fee, each time the buyer they have given me buys a home. It creates a win- win, I get a buyer and they get paid whenever their buyer buys a home.
I offer the continuous pay because a realtors worst fear is that they give you a buyer and he buys from you, then when they have a good property to show their buyers they cant buy because they have already purchased from you.
If the realtors dont have cash buyers, I tell them that if they bump into any great deals, they should call me and if the deals good enough we can buy with cash and close in less than 2 weeks.( Often times you can use other realtors buyers to buy another realtors house and you can make money setting the two up)
An example of one of my clients deals that he ran this way.
I called my client about a great HUD deal
He liked the deal and put the home under contract for $115k (I made a $4800 commission on the home when it closed so I was happy)
We had 60 days to close the HUD home so he started calling realtors
He found a realtor with a cash buyer that was willing to pay $122,000
We assigned the contract (this is a secret)
We went to closing and his buyer brought $122,000 cashiers check.
My buyer left with a check for $7,000 ( he used none of his own money, and I found him the house so he was happy)
I left with my $4800 commission
The realtor who brought the buyer took no commission but got a commitment from his buyer that he would list the home with him when he sold it.
Newspaper ads I dont personally use this one, I have clients who have had great success with it though. They simply place a small classified ad that reads “Looking for buyers to purchase homes at 50-70% of true value”
I have picked up endless buyers with this ad though “Free List of 45 foreclosed/distressed homes” call or visit www.$$$.com. The reason that I have had so much success with this ad is because anyone thinking of buying real estate would much rather get a free list of 45 then have to call each individual ad. You can have a local realtor put together a list of properties for you and email them to you if you cant find your own. Then take the list that they send you and email it out to people that respond to your ad. Keep in mind you dont really care about the list that you send, you care about getting the name, phone number, and buying qualifications of responding buyers.
A real life example.
These were realtor commissions, but if you can find a buyer who is taking the kind of action he was you could seriously line your pockets wholesaling to him.
A personal example.
If I were not a realtor, I would have simply talked to him and found out what he was willing to pay, then wrote up a wholesale contract, then put the home under contract with HUD, then played the spread.
This was my most recent deal, but I have picked up endless buyers for other homes while parked outside of HUD homes. I call it hunting for buyers. Its kind of like deer hunting with a bait pile. The home is the bait pile and the buyers are all coming to eat.
Personal example.
One of my buyers had too many homes and could not buy.
I asked him if he knew anyone else who might be interested.
He gave me the number to a cousin who was an even bigger investor
I ended up selling 3 homes to his cousin this year, and paid him a referal for each one.
Local REI meetings If you have a local investor club join it, if you dont then start one. It kind of speaks for itself that this is where many great buyers will be. Just be sure you know a fair bit about what you are doing before talking to very many people about potential deals. The last thing you want to do is burn alot of bridges by showing your new found buyers a bunch of crap.
Birddogs for buyers Outside of having bird dogs look for homes for you, you can also have them look for buyers for you. Give them your cards and have them hand them out to people they might meet that are looking to get into real estate investing.
Brochure Boxes Just like realtors use brochure boxes you can use them to. If you have a property to move leave a brochure box that talks minimally about the property that it is left at, always be sure to leave out pertitant info like price, sqft, or bed/baths. If you give all the info away then people will never call you about the property. Focus the brochure mainly on other potential deals in the area or say that you are looking for buyers for properties at 50-70%FMV.
Out of towner and landlords Many people sell themselves short when they are dialing for dollars. Typically people call or mail out of town owners and other landlords to see if they want to sell. The funny part is if they dont want to sell then there is a chance that they want to buy, so ask them if they arent selling, then would they like to buy some more, or if your mailing then include buying info on your mailer as well.
I gotta go now, the wifes ready for shopping, I will add to the post with some of my other ways but this should be a start. Hopefully the big dogs can come in and fill in the blanks.
Eric Medemar
Re: A Lesson In Finding Buyers - Posted by Robert
Posted by Robert on July 07, 2008 at 16:23:24:
What arrangement do you have with your buyers?
Thanks,
robert