Should you be using NDA agreements as a real estate investor or business owner?

Are Non-Disclosure Agreements (NDAs) an essential step in business? Or are they a dangerous pitfall which will do your venture more harm than good?

NDAs 101:

A non-disclosure agreement is designed to prevent those you share things about your business with from sharing them with others or stealing your ideas and replicating them.

These are similar to non-compete agreements as well.

Some companies have business partners, new hires, and others sign these agreements before an engagement.

It is a pretty standard legal form you can find online and fill in the blanks.

The Dangers Of Using NDAs

Very rarely are NDAs and non-compete agreements useful to small businesses. Even in the case of a breach, you may have a very hard time proving it, and collecting. That costs a lot of time and money in the courts. Often with little to gain.

This can be different for large corporations. Those with billions of dollars in revenue and giant multi-million dollar legal teams. You can imagine the impact of someone stealing the prototype of the next Apple product and taking it to the competition to replicate in advance of their launch.

An example of this is new banking and card startup Stash. They didn’t even buy their own website domain name until they had raised almost $300M in capital, and five years and five million customers down the road.

The first danger is that they just slow you down. The last thing you probably need is more paperwork and forms and dealing with more attorneys and negotiations at each step in your business. Focus and speed is an asset and advantage. Don’t throw that away.

The second danger is that it can do more harm than good when it comes to trying to raise money and hire great talent for doing more deals and growing your business. The best advisors, freelancers and investors are crazy busy. They have their pick of thousands of people to help. No matter how unique you think your business is, the truth is that they’ve already seen the same thing 100 times, this week alone. There is a huge demand for their help. If you put up barriers like this, they’ll probably just fund or invest their time in helping someone else.

Thirdly, as a younger company or investor, what you need most is awareness and recognition. The more people that talk about your business and concept, the better it is for you. The more secret you try to keep it, the longer and harder it will be to get customers and grow.

You should almost hope people will validate and steal your idea and spread them around. If anything this will only make you do ever better. Besides, most people won’t take action on it. That's where you stand out. Plus, there is nothing really secret today. It’s either publicly online already or easily hackable in less than 2 seconds by anyone who really wants to know.

Cling to your advantages, speed, focus, innovation and taking action. Don’t worry about what others are doing.

We’re here to help you fund your next wholesale deal, and provide the proof of funds letters and verifications of deposit you need to go fast.

 

 

The coronavirus pandemic has unexpectedly affected every aspect of our lives, delaying tasks and cancelling plans. If you are a wholesaler, house flipper or investor, you know the real estate market was not left unaffected. The initial market projections for 2020 have drastically changed.

But real estate is not dead. As the economy bounces back, so will the housing market. Realtor.com Chief Economist Danielle Hale recommends taking advantage of the online resources available. Interested investors can pursue listings online, communicate with the owner or seller by phone or email or text and complete transactions all in the comfort of their home, virtually.

There are a couple of challenges. Some owners, sellers and Realtors are being unrealistic. They are asking for far too much, or far too much down. Others think they don’t need to sell yet as foreclosure and eviction moratoriums drag on. This will bite many owners and investors over the coming months as they lose properties or have to sell at far steeper discounts.

So, as you wait for things to sort themselves out, what is the best way to make so COVID-safe additional money?

Stick to your numbers and find deals that you are confident will work. To keep up your income in the meantime, look for new ways to generate revenues and cash flow.

Best Transaction Funding has a deal to help you with this. Join our affiliate program and get a 10% fee on your referral’s transaction. If others are beating you to the deals, at least you can make money on all of those deals, without even having to do the work.

How does it work? Simply introduce a friend, family member, peer, client or other investor to the lending services of Besttransactionfunding.com.

The easiest and most convenient way is to automate this process with your own custom referral link. Send it directly to them, or post it online and let it work while you are sleeping and looking for other deals.

Otherwise, the introduction can be active, by promoting BTF’s 100% financing for real estate wholesalers on your social media and in online forums, texting and emailing your network, and recommending them when out there networking.

You can also email us to introduce your referral. You can also tell the referral to mention your name when they contact us, or for them to enter your name under “Referred by” and “Please specify” as they finish their funding request form.

 

Summer is here. It is peak season for the real estate market. Here’s what you need and want to give to make the most of this historic couple of months.

This summer is shaping up to be even better than ever for US real estate. Buyers are motivated, and sellers are too. In spite of all the recent mayhem and disruptions out there, property prices still seem to be going up. There’s no telling how long that will last, but this is a pivotal moment for real estate wholesalers looking to expand and boost income, as well as those looking to get started investing.

Of course, no matter how strong you have been financially up until now, and how much or little you have to start with, more capital is certainly always welcomed, and can help speed up results and lower risks.

Fortunately, while other types of credit may be contracting, Best Transaction Funding is still providing investors with 100% financing for their wholesale deals.

We also offer Proof Of Funds letters and Verification Of Deposit (VOD) services to help investors get more of their house offers accepted and under contract.

From Father’s Day, through 4th of July and this summer we’re offering special deals, including almost 80% off our VOD service.

We feel it is one of the best ways we can help support those getting over the fallout of COVID-19, for those out there working hard to support their families, and to help good real estate businesses do even more to help others.

These are also some of the most meaningful and powerful gifts you can give to others this season. Whether it is a son, father, neighbor, or someone else in your community, imagine the impact of being able to tell them you can help them fund all their deals, with all the money they need to close and wholesale all the houses they can handle, as well as giving them the proof of funds they need upfront to get great deals under contract. That can be life changing for most people.

Check out the VOD deal here.

Even better, we’ll give you the gift of a healthy referral fee when you introduce others to this funding. Check out how to get started HERE.

 

Where are the buyers and sellers to keep fueling your real estate wholesaling business?

We have been through some exciting times recently. Some investors are doing incredibly well, others are still struggling to find their feet again and adjust. It’s all about knowing who is buying and selling, how they are doing it, and what’s driving them. Know this, and you’ll find wholesaling much easier. Nail it and this could be your best year yet.

Who Is Buying Homes?

1. Flippers

Flippers are still buying. They need to in order to keep the money coming in. Though we may likely see more wholesaling than fix and flip due to market changes.

2. Landlords

Buy and hold investors realize that passive income is more important than ever before and they are looking for ripe opportunities.

3. Investors Who Are Expanding

Investors of all types, from those listed above to funds are expanding to new areas and property types to balance and de-risk portfolios.

4. Those Using Self-Directed Retirement Accounts

One of the biggest problems successful investors have is minimizing taxes. Retirement accounts can offer some relief. Yet, they often only provide real peace of mind, profitability, and maximum benefit in their self-directed forms.

5. The Wealthy Seeking Wealth Preservation

Wealthy home buyers have been very active. They are still buying up prime properties with big price tags. They see it as being safer than stocks or cash in the bank.

Who Is Selling Homes?

1. People Fleeing The City

Between the virus, lockdowns and rising crime, many are urgently looking to exit urban cities for less crowded areas.

2. Old Financial Centers

High priced areas that relied on physical office buildings and local jobs have quickly become less attractive, and will probably see steep declines in property values. People recognize those markets have popped and it’s time to cash out.

3. Owners Who Can’t Keep Up With Bills

With tens of millions of workers freshly unemployed, many just can’t keep up with the bills. Many need a reset or to downsize.

4. Over-leveraged Landlords

Landlords who over-leveraged and overpaid, and had no reserves to weather the storm should be cashing out if they can. They realize they can’t just count on high vacation rental and occupancy rates.

5. Speculators

Those who were banking on easy end loans and appreciation to make money are finding it’s not there now. They may have to sell at steep discounts and find another strategy.

 

One of the biggest challenges facing real estate investors today is how to minimize taxes.

It is great to make so much money from wholesaling houses, but without some countermeasures you may find your taxes are going up just as fast as your income. With the 2020 extension for filing federal income taxes you may have pushed off this bill for a few more weeks. Here are some tweaks to make sure you pay out less and keep more of your gains this year, and every year.

Income tax Deductions

Make sure you are maximizing the amount of tax deductions you are taking. Don’t just over pay. One of the most obvious this year is taking the home office tax deductions. Others can include mortgage interest, education, health care expenses and charitable contributions.

Max Out Retirement Account Contributions

By now you should absolutely have a self-directed IRA or 401k account. You can also have them for your spouse and children. You may even be eligible to contribute to ESA and HSA accounts. You may still be able to get the deduction for 2019 and 2020 by maxing out deductions for both years. You can then use that money to invest in real estate.

Property Taxes

Property tax authorities are notorious for over charging each year and hoping property owners just don’t notice or bother to challenge them. This year more than ever you could be in a great position to cut these bills. Appeal your property tax bills and save thousands.

Harvesting Losses

Making investments in businesses that may show net losses for the next year or two can help offset any gains. Those paper losses can be used to offset future gains as well.

1031 Exchanges

Real estate wholesalers and flippers with too much cash can also move capital into more buy and hold, new construction and value add property deals, while continuing to defer taxes on capital gains under the protection of 1031 exchanges.

Go Offshore

The US has one of the harshest tax regimes on the planet. Thinking short and long term, this could be a smart moment to diversify into some offshore real estate assets. Especially somewhere you’d like to spend at least six months of the year in better weather, or retire. It could be a path to completely eliminating corporate and personal income taxes.

 

 

Creative new moves are being made to block house flippers. What do you need to know? How can you keep your business thriving?

No Love For House Flippers & Wholesalers

Despite having single handedly pulled the US and probably the world out of the financial crisis, real estate wholesalers and house flippers aren’t getting much love.

In spite of the animosity and blame shifting, investors engaged in 2008 when no one else would. They took on the risk and put in the sweat to drag the country out of the hole. They saved people from even worse financial situations. They revitalized communities and saved home values for neighborhoods.

Now they are once again being blamed for rising property prices, high property taxes and gentrification.

Some states and cities are passing rules to try and prevent wholesaling and house flipping. Like Ohio and Illinois. Now Brooklyn, NY has its own plan to keep them out.

Cease & Desist

Brooklyn residents are pushing for Cease and Desist zones and the creation of a Do Not Call style registry which would make it illegal for house flippers to even try to contact them to buy their homes. The financial and legal penalties for ignoring the law could be steep.

What can you do to keep your business going now?

Move Fast, Make LOTS Of Offers

New York actually has many new real estate related laws on the verge of making things dramatically more difficult for investors. If you want to acquire, wholesale or flip in NYC, now is the time to make your move.

Go big. You can be cranking out many offers a day. Do it now, while you still can.

Inbound Marketing

When you can’t make outbound offers to buy homes, be there to take inbound leads.

Show up online when they search for help. Educate them on how you can help, and how they need to take action fast. Make it crazy easy to get an offer. There is really no reason home sellers shouldn’t be able to get true instant offers right online in seconds.

Be sure you are setting up a dominating presence now before the competition.

Personal Connections

Spam is the real problem. Irresponsible real estate flippers have just over done it. They sabotaged themselves with no respect for homeowners. Now it is biting them back.

If you can’t target them with Facebook ads, direct mail, email or text messages and phone calls any more, it is high time you got out from behind your screens and started making more personal connections. This is your chance to really help people without all the spam.

 

Are you about to make one of these deadly marketing mistakes?

This is looking like a fantastic year for real estate wholesalers. There are millions of motivated sellers. There is plenty of money for deals. Landlords and rehabbers are still looking for inventory. However, to connect all the dots requires marketing. As a new company just a year or two old you might be spending just $10,000 a month on this. If you’re moving fast you might have over a billion dollars to grow your business through marketing this year. No matter what your budget, the key is getting the most out of it. Fail to do that for a couple of months and you could be facing bankruptcy.

Here are the five top mistakes not to fall into now…

1. Copying Tactics That Don’t Work

The number one mistake real estate investors are making is copying tactics they see others using, but don’t really work. Or at least don’t work well. Just because someone looks successful, doesn’t mean their marketing is really working. At least it may not be working on anyone but you. They might have just put their last dollar in marketing to you, and are a week away from going broke.

If you don’t know the returns they are getting you really don’t know. This can apply to investment strategy, websites, videos, ads, the length of your content and podcasting.

Test and watch your data before you go all in.

2. Cheap & Flawed SEO

Trying to get noticed by the search engines and to rank high on Google can have great advantages. Yet, most get it horribly wrong and waste lots of money on these efforts. Most actually do more harm than good to their rankings and visibility.

The most common reasons for failure here, include:

• Hiring cheap SEO companies

• Keyword research by people who don’t really understand the real estate industry

• Copying outdated online suggestions over putting yourself in your customers’ shoes

• Ignoring common sense when picking keywords

• Not reviewing and updating keyword research and SEO on a monthly or quarterly basis

3. Taking Bigger Competitors Head On

You wouldn’t try to take a semi head on if you were driving a Prius on the road, right? Yet, many investors do this every day with their marketing. You can’t directly take on competitors who are spending $30,000 on blog content a month, or who are happy to throw away 4 billion dollars on online ads this year just to drive you out of business. Not if you are only investing $10k a month in your own marketing. You have to be creative and find a competitive edge and unique way to stand out.

4. Not Providing The Communication Options Your Ideal Customers Want

You might really want to get motivated sellers on the phone for a live pitch call. For all the same reasons they really don’t want to do it. You can spend $1M on ads to drive traffic to your website. Yet, if your only option is to call or use Facebook Messenger, you might only convert 1 in 1,000 hot leads. The rest are onto your competitors’ websites looking for other options. Like emailing, texting for help and live chat features. Remember, it’s not about you. It’s about them. Recognize that the last thing distressed sellers want is yet another person on the phone reminding them of how desperate their situation is and pressuring them.

5. Not Getting A Marketing Coach

Even if you don’t have other types of coaches and advisers yet, you already know that the best in every field has one. Given that 90% of your business relies on marketing, this is the most important part of your business to get help in. You don’t have to spend $40,000 on a cheesy coaching program full of fluff, but it pays to have an expert adviser to help you leap pitfalls and get right to winning in this area.

 

Ready to hit the ground running and crush your 2020 real estate investing goals?

Here are six types of motivated sellers out there in the market ready for you to make an offer on their homes.

1. Those Who Spent Too Much During The Holidays

There is a lot of pressure to overspend during the end of year holiday season. There are two types of people out there in January. Those who are flush and didn’t put any gifts on credit cards and stayed on top of their bills. Then those who splurged, racked up debt, tanked their credit scores, and are struggling to pay their bills. There is a good chance many in the last group won’t catch up and will lose their homes unless they sell fast.

2. Those Who Are Now Unemployed

Lots of places hire to keep up with the busy holiday shopping season. Then they let everyone go. That’s the last thing most can afford after splurging on gifts, food and going out for the last month. Now new employment laws threaten to dump tens of millions of people into the unemployment pool too. If California’s new employment laws effectively banning freelancers and independent contractors spreads, we could be looking at 60% plus unemployment rates in some areas of the US within the next 12 months. With no job or income, most are only a week away from falling behind on their housing payments.

3. Those Wanting To Start A New Life In 2020

Millions of people have promised themselves a new life this year. They are putting their foot down, resolving to change their lifestyles and step out in new directions. Many are ready to make big moves, cash out old homes and hit the road to travel.

4. Failed Landlords & House Flippers

Sadly, many investors have rushed in without educating themselves or they have relied only on speculation instead of buying assets at the right prices. Now they are out of credit, out of cash, and they are stuck with properties that keep drilling deeper money pits for their fleeting finances. Step up and help them get out.

5. Those Whose Homes Are Depreciating

As the correction spreads, homeowners who look up their house values online and see they’ve lost $6k, $60k ot $600k in equity in the past few months are going to get really motivated. Those values could plunge much further. Many will be smart to cash out. Yet, at the right price real estate wholesalers can still get in, buy low and flip for a profit. Even in a declining market.

6. Those With Big 2020 REI Goals

Connect with those with big goals for wholesaling or flipping houses in 2020, and who want to move deals fast and get a good headstart to the year. Help them crush their goals by moving their inventory for them.

 

Wholesaling is hot. It’s a fantastic way to get started in real estate. More opportunities appear to be popping up to be flipped as wholesale deals for those who want to scale their businesses.

One of the biggest hurdles some investors will have to overcome to cash in on these opportunities is the lack of trust the rest of the industry has for wholesalers. Realtors, rehabbers and rental property investors often have little faith in them. That can be a real drag on business, even when you are offering awesome deals. Of course, it is not too unlike investors, landlords, Realtors and real estate attorneys or mortgage lenders in general. So, why the lack of trust? How do you beat it to close more deals?

Value

Whether it is out of greed or not understanding the local market, one of the top complaints about wholesalers is that they are asking too much for their ‘deals’. Be sure you know the current value, ARV, and current market trends. Know what other investors are willing to pay as a percentage of ARV for real deals today. Offer value and you’ll move plenty of properties.

Property Condition

As a wholesaler you may never lift a hammer or swing a mop, but you’ll move far more properties if you get a good handle on the current condition and pass the most comprehensive and accurate information on to your end buyers.

If all you send is a couple of photos, they are going to have to assume the worst case scenario. That is that all the guts are bad and they may have to do a complete teardown. That pricing obviously isn’t going to line up with what you are asking in most cases.

So, is it just cosmetics? How is the expensive stuff like roof, plumbing, AC, and electrical?

Transparency

Lack of transparency is a big roadblock. Many investors have dealt with wholesalers who are tangled up in all types of chains and who don’t know what they are doing. Most wholesalers out there today don’t want to provide any transparency into their end of the deal. Typically because they are just trying to assign contracts and are not using transactional funding to buy and resell and protect their interests. By double closing you can avoid being cut out of the deal and protect your profits. So, you shouldn’t be too averse to sharing what you are making and being open to some negotiation.

Short Term Thinking

Most people in the industry are only thinking short term. They are only thinking about making money on this one deal. They are only thinking about the bills next month, this year’s goals or maybe 5 years out. If you can show buyers that you are serious about long term relationships and offer deals that reflect that everything changes. You earn trust. After a couple of deals, your buyers will just know that this is a buy and will take it. Sure, you may make a little less on this next deal, but you’ll may turn that buyer into someone who buys ten a month from you every month.

 

 

How should real estate wholesalers be pricing houses as the market changes?

There are a lot of rules of thumb thrown around about how much wholesalers should offer on homes. The truth is that there shouldn’t be any hard rules. This is a factor that must change over time. If you’ve been bidding 40% of ARV over the past few years, your deal flow has probably been pretty thin. If you were still bidding at 90% or 100% in 2006, there’s a good chance you got stuck with some properties you couldn’t resell.

Price trends are different all over the map too. They may already be in deep dive mode in some cities and neighborhoods already. Others may keep going up for a few years. So, be wary of hard rules.

Be flexible. Be ready to change your offers based upon:

1. Competition

2. Direction of the market

3. Who your end buyers are

There are wholesale buyers and house flippers out there who claim to be offering near market value. Some might get away with it. Some are able to do it for now because the are making money on deals in so many different ways. Though you have to be careful not to get stuck with a stable full of houses that you can’t get rid off. Expect that scenario to take down some very big real estate tech startups in the near future.

If you are buying at the top of the market, there are repairs to do, prices are down 10% and heading down another 10%, wise investor buyers aren’t going to want to be in for more than 70% of ARV. More likely 50-60 percent of ARV. As a wholesaler you may see deals go even cheaper as more foreclosure inventory mounts up.

Of course, having no income is a huge risk too. If there is a lot of competition, you will have to bid aggressively to keep deals flowing. Fortunately, in hot markets you may also be able to flip faster and for more to other investors (landlords and flippers). They may still be willing to pay 90% of ARV or more. You still need to be under that to make a profit.

The most important factor is really going to be knowing who your end buyers are, and who they are going to be when you are ready to close on the B to C side transaction.

Are they house flippers using hard money? Buy and hold investors using cash and retirement funds? Big real estate funds and tech companies? Or retail home buyers needing high LTV home loans?

Buy and hold investors need to make sure they can cash flow, even if rents float down a little. Use the 1% rule as a very rough rule of thumb. That means a $100,000 property should rent for at least $1,000 per month.

Retail buyers may be facing more challenges ahead as mortgage lenders tighten underwriting to reduce risk exposure. We’re already seeing that with government loans. Expect LTVs to come down as lenders identify declining markets. Your buyers will need to be those who have some cash for a down payment, and may be willing to come out of pocket above the appraisal.

How much are you offering on wholesale deals relevant to ARVs today? How are you pricing in downward pressure on prices or surges in competition?

 

Numerous Opendoor style websites are popping up to compete with wholesalers on a whole new level. What important lessons do wholesalers need to take away from this? How do you keep making money with all this pressure?

#1: It’s All About Marketing

Big companies like Zillow, Opendoor and now Redfin have transformed this space in months. They’ve given it legitimacy and visibility. Of course, if Zillow’s buying program is anything like its Zestimate tool, it’s terrible. Redfin Now reportedly takes a 7% fee to the seller on the purchase price of the home. That’s a lot for a ‘discount’ real estate service. Startups like Opendoor are attracting millions in VC investment, despite not really being unique. It’s all about the marketing. You should offer better deals and service, but it’s clear that winning is all about lots of marketing and making a lot of noise about your business.

You Can Think Bigger

One reason these companies are where they are is that they just think bigger. If you are only shooting for a handful of wholesale deals in your local market each month, that’s probably what you’ll get. These companies are coming out of the gate thinking about dominating on a national scale. They have the potential to at least do hundreds of deals each month. With Best Transaction Funding to finance your deals, you goals are the only thing to hold you back. Do you need to think bigger?

Clean Websites

In general real estate investor websites are ugly. They are outdated and ineffective. There are countless of these Investor Carrot type sites out there that really aren’t serving investors well. Can you imagine Redfin, Opendoor or Zillow soaring to fame with an ugly site? No. Aesthetics do matter.

Don’t Lose Money

Just because they are big, making lots of noise, and often in the way doesn’t mean these big internet wholesalers are making money. Zillow has been infamous for losing billions of dollars. As are many other tech startups. They might look cool, but all that attention isn’t worth much if you are losing money. If you are in real estate to make money, focus on profit. You can make a lot more by focusing on profit margins, and less on volume. It’s all about the bottom line.

You’re Onto A Good Thing

Wholesalers have been picked on for years. Especially in online forums. Realtors and other investors have long been jealous of how easy wholesalers can make so much money. This new trend is great validation that you are onto something great.

You’re Going To Have To Be More Creative

Most real estate wholesalers can’t afford to out market these big tech driven companies. They can’t afford to throw away billions just to stay visible. Fortunately, you don’t have to. Though you will have to be more creative to get the deals. Think guerrilla marketing, being earlier to the punch in making offers, making stronger offers, better positioning, and more focus on personal relationships.

 

Spring is officially here! Try out these strategies to boost your real estate wholesaling business now…

Hop to it While the Market is Good

We’re still in tax refund season, there is still likely more negative data to come out after the end of the quarter showing the new trajectory of the housing market. Get more inventory and flip it before more buyers are scared out of the market.

You can use Best Transaction Funding to scale and move fast without being limited by funds. Set a goal of making at least 5 offers a day. If you are already operating at that level, up your numbers by 5.

Spring Clean it

Try spring cleaning and prehabbing your deals to create a blank slate. It’ll be a lot easier for buyers to visualize the potential and can add a lot of perceived value to properties without costing you much.

Invite Them Over for Easter Brunch and an Egg Hunt

Build your brand and relationships in your community and target neighborhoods. Host an Easter egg hunt or brunch, and get to know people on personal basis so they come back and refer you when needing to sell.

If you are really doing well then maybe you can afford to give away the keys to a wholesale home in one of your golden eggs.

Get Out Those Easter Gift Baskets

Send out Easter baskets to potential referral sources and cash buyers. Hand deliver or ship them. It doesn’t have to be costly, but be more creative than just an Easter card. Stay top of mind, and look to open direct lines of communication via phone or text versus just Facebook or email.

Like these strategies? Look out for tips on making most of Mother's Day for real estate wholesalers...

 

Tax refund season is an especially great time for real estate wholesalers. Here’s why…

Tallying Up What You Made

For a start, this is probably when you are really tallying up all of your income and profits. If you’re newer to wholesaling then this should be a big year for you. If you’ve only been in a few years, you’ll be seeing how much more you can make in real estate than other jobs. It’s going to be mind blowing at first.

Just make sure you are tapping all of your available deductions, write-offs, and breaks. Don’t overpay. This is probably not the year for defaulting to DIY income tax filing, Turbo Tax or H&R Block. Upgrade to a real CPA who can help you with a real tax strategy.

Raising Capital

You can get virtually unlimited funds for your wholesale deals from Best Transaction Funding. Though you can rarely have too much capital. Given the trajectory of the economy and real estate market, the more you can amass now the better.

This is the perfect time to raise more capital. Many individuals and families are plowing double contributions into their IRAs (2018 and 2019). That’s dry powder to invest right away. Help them find a home for it. Others are just getting a good sized tax refund check and can use it to invest with you as a partner or private lender.

Wholetailing Properties

This may be the one chance many individuals and families have to come up with a down payment to buy their own home. Sure, some will blow it on new devices, cars, and taking on more debt. Beat the retailers to the punch and let them know they could be buying a home with that money. Try wholesaling retail to the consumer.

Distressed Properties

Just a few thousand dollars in tax refund money can be exactly what many homeowners and tenants have been waiting for to move. They may not be able to catch up on all their back payments. Though they can use it to move on and start fresh. Relieve them of the burden of their property, and let them move out.

 

If it hasn’t hit your markets yet, all the data is suggesting a softening housing market is coming your way. How can real estate wholesalers thrive during these times?

Recognize It

Don’t pretend it’s not happening. That won’t stop it. Don’t be scared. It’s just temporary. Instead, focus on being over-prepared. Be objective. Expect an over-correction. Know your numbers and what you’ll have to do each day to make your goals.

Don’t Stop Marketing

90% of the players in today’s real estate market have only gotten in the game post 2008. They haven’t planned for this. They don’t know how to handle this. That’s good for you if you get out in front of it. Whatever you do, don’t stop marketing. That’s what will keep the house deals and income coming in. In fact, try to find the budget to do more, and soak up the void being left by competitors.

Slash Unnecessary Overhead

To survive and thrive in a declining market you’ll need to be lean. Cut unnecessary bills, and gain more flexibility so that you can move faster, and aren’t fooled into making desperate decisions.

See the Opportunity

When the market falls in one city, it rises somewhere else. This may be a different segment of your own city. Like luxury versus affordable housing. Or it may be time to expand to a new market for more value and deal volume. Keep an eye on where other end investors are heading and where lenders are most likely to keep lending.

Bid Smart

Don’t overpay for deals. You can still make great money on wholesaling real estate every day. Providing you don’t pay too much for them. Price in enough profit for your end buyer, and to account for any further dip in prices before you flip it.

Work on Those Relationships

The strength of relationships with lenders, end buyers, vendors, and sellers will get you through. Show they can trust your recommendations, judgement, and service.

 

As a newer wholesaler you’ve got some great advantages over all other investors. Make sure you are using them!

It’s easy to see the disadvantages when you are a newer real estate investor or wholesaler. Yet, you also have many advantages. You are what keeps established companies up at night. They know that if only you understand how many advantages you have, and if you use them and are innovative and creative and hustle, you can take a big bite out of their business. Maybe even disrupt the industry.

 

Speed of Making Decisions

One of the great abilities you have as a solo investor or lean team is the ability to make decisions faster. The bigger you get, the more funding you raise and more people involved, the longer it takes to make decisions and act on opportunities. So, move fast.

 

Ability to Move to New Markets

You don’t have giant offices, your own servers, or need to pay employees hefty five or six figure relocation packages to do deals in new states and cities. You can do deals on the other side of the country tomorrow.

 

Underestimated

You’re capable of a lot more than you think. Often way more than a lot of the competition thinks. If they don’t think you are a threat you can get more out of your resources without butting heads with them. Don’t go head to head with larger competitors with more funds and bigger teams and more technology. Stay under the radar, and keep gaining traction until you are stronger.

 

Being Able to Take Risks

Big companies are often criticized for becoming boring. Even music artists often stop taking risks or testing exciting things once they make a name for themselves. It’s easy to criticize until you are there. After years or decades of building up a name for themselves, and having thousands of employees and investors counting on them, they can’t afford to be very interesting anymore. You can. You can be adventurous with marketing campaigns. You can test out new things. If it doesn’t work, no one will remember. You don’t have anything to lose. If it works, it could be your ticket to the big time.

Be interesting with your blogs, the language on your website, your design, your mail, the hooks you advertise and your branding.

 

 

Today we want to take a moment to thank and honor all the good real estate wholesalers out there.

While the pay may be good as a wholesaler, you rarely get the thanks and recognition you should. You are providing a valuable service. We see you.

Thank you for braving this new frontier and making the effort to improve your lives and others. It can take a big leap to get into wholesaling real estate, but it so worth it.

Thank you for helping distressed sellers and their families find a more gracious and profitable exit from their properties.

Thank you for helping buyers who can enjoy affordable new homes and for helping other investors with inventory who renovate them and rent them.

Thank you for graciously working with the tenants who are often caught in the middle of distressed real estate situations.

Thank you for choosing Best Transaction Funding for your funding needs on all your wholesale deals.

Thank you for sharing our service with others and empowering them to do all the above and below.

Thank you for sticking it out as a wholesaler. Even on the days it isn’t easy. What you do is worth it.

Thank you for all you do to give back and pay it forward.

Thank you for reading this blog.

We appreciate you!

Take today to relax, enjoy the rewards of your hard work, spend it with the people you have and are putting in all this hard work for.

We’ll see you back in the field on the flip side…

Happy Thanksgiving!

 

Wholesaling houses with tenants? It can be a highly profitable niche. It can also be a pain, with issues that can hurt your reputation if your end buyers aren’t getting what they expected.

Here are some quick power tips that can help real estate wholesalers turn properties with trouble and non-performing tenants into big profit centers.

Be Careful with Upfront Inspections & Walkthroughs

Visiting and going through the property in advance of purchase can be quite stressful for tenants. Many are going to be scared as to their future housing. If they have already been butting heads with the current owner that can escalate quickly. You don’t want to get off on the wrong foot with the tenant or get into a legal situation.

Get Estoppel Letters

You can’t rely on what the seller says about the lease or status of the tenant. Your title company or closing attorney should obtain estoppel letters, and get the tenant’s side of the story as well.

Communication, Communication, Communication

When people are scared, feel threatened, or they feel their family and kids are under threat and are backed into a corner they can obviously act pretty emotionally. It’s often the uncertainty that gets them most worked up. Be communicative. Especially as you are closing on your purchase transaction. If possible, have your property manager reach out to the tenant in advance. Let them know their options. Tell them what’s going on. Keep them calm. It can make all the difference in the world.

Take Advantage of the Fresh Relationship

Landlord tenant relationships can go off the rails and sour fast. It can be really hard to salvage them at that point. A new owner entering the scene can make all the difference. Take advantage of that to its fullest. Listen and let them vent about the previous owner. Be on their team. Give them confidence in their situation and ability to stay if you’ll let them, or their ability to find somewhere new.

Find Ways to Add Value

This is one of those situations in which real estate investors can easily and quickly add a lot of value and equity to a property. With a new owner a non-performing tenant may be eager to work things out. If they start performing the property is worth more. If that tenant won’t work, have a list and real estate agents on call. Find the renter somewhere to go, and have qualified tenants lined up that you can move in right away. You may also add value simply by helping tenants exit. A cash for keys offer, notice of non-renewal, or notice to vacate, can all work. It can even all be done before you actually close.

Finally, make sure end buyers are totally clued in. Make sure they know what they are buying and getting with the tenant. This will preserve relationships, your reputation and repeat business. Put everything in writing.

 

Hurricane Florence just dealt a tragic blow to thousands of people in the Carolinas. Real estate wholesalers are uniquely well positioned to help. Here are just some of the ways you can be of service…

Giving

There are going to be many calls to give financially to those impacted by Hurricane Florence. Many people and business owners will need help for years. Just as there are many still recovering from Sandy and many other hurricanes over the last decade. It can be hard to know how to give and who to give through to actually make a difference, but real estate investors can also give of their time too. They can be there on the ground volunteering. Just be careful not to become a victim in need of help yourself.

Education & Sharing Knowledge

Aside from all of those with families members killed as a result of the storm and injured, tens of thousands of lives are in chaos, and they need information. They need to know what to to about the condition of their homes, how to keep their businesses going, how to stay out of foreclosure, how to survive financially when they realize their insurance company isn’t going payout, and how to sell a damaged home and find somewhere new to stay. These are urgent needs. Using your blog and social media can be a great way to play a very important role in helping them.

Offering Employment & Income Opportunities

One of the biggest and most urgent needs right now is income. Businesses are closed, their cash flow is interrupted, and people can’t get to work. That all trickles down to renters and property owners not being able to pay their bills. Providing the ability to earn, put food on the table and a roof overheads is one of the best things you can give right now. That maybe opportunities for manual labor fixing, cleaning and securing properties. Or it can be recruiting people as property scouts to connect you with distressed homeowners who want and need to sell.

Buying Homes

This is a delicate situation. Don’t be a vulture. Do step up and buy homes fairly and with care and sensitivity. Make reasonable offers, serve people kindly, and they will tell their neighbors. There will be blocks of business to be found for months.

Connecting Those Homes to End Buyers

Then it is just a matter of connecting those homes to buyers in the rest of the world. Domestic and international buyers are all hungry to put their money to work in US real estate, want rehab deals and rental property opportunities. Serve them up.

The Little Guys Have the Edge

While big funds may still have a lot of capital, they aren’t buying homes like they were in 2008. They also aren’t as agile and fast as small real estate investment firms and wholesalers. Armed with transactional funding there is nothing to hold you back from scaling in these markets fast. By tweaking and targeting Facebook and Google Ad campaigns, and with content marketing and email and SMS campaigns wholesalers can reach thousands of those in affected areas, and within just a few days.

 

Why do so many real estate wholesalers fail to get the results they hoped for while others seem to make money so easily with this strategy?

Some seem to leap in, start making big checks fast and then seem to keep making great money with multiple deals each month with ease. For others it can feel like they are just stuck, are still spinning their wheels after months, or just can’t breakthrough from doing a deal or two a month to that 10 plus sweet spot. What makes the difference?

1. Goals

You aren’t likely to get what you really want without tangible goals and effective goal setting. You can’t just have fluffy wishes. Set concrete milestones, and invest in really working them.

2. Marketing

The number one reason real estate investors fail today is probably marketing. You don’t have a business without marketing. If you do one thing - get a good marketing team and hit it hard every month. Make sure you are engaging in a good mix of marketing mediums from mail to email to online ads and more. Commit to quality marketing and staying consistent.

3. Having a Good Lead Funnel

There are lots of ways to generate leads online and get traffic to your web pages. Yet, there can still be a big gap between awesome marketing and traffic generation and getting real leads and conversions that turn into real estate closings and cash. Be wary of blowing money on ads until you’ve got an effective landing, good looking website, and a system for handling incoming leads effectively. One big mistake being made here today is that real estate investors are blindly following gurus and marketers who make big claims without any rational to back it up. They say they offer ‘websites with SEO’. What does that even mean? What do they consider good SEO? How do they know what your best clients are searching for? Be sure to apply common sense thinking, think for for yourself, do actual research and be willing to test different options.

4. Follow Up

You can bring in thousands of good leads by phone, email and social media. It won’t make a penny worth of difference unless someone is following up and closing them. If you don’t have the time, hire someone to take the calls and return Facebook, email and website inquiries immediately. That lead is probably going to keep searching and contacting the competition until they connect with someone. Be the first one to follow up.

5. Taking Action

You can sit in all the classes, go to all the events, and pass by great deals every day. You won’t get paid until you take action. Successful wholesalers are making offers every day. Know how many offers you need to make each day to hit your closed deal and income goals. Don’t do anything else until you make that many offers.

 

We’re seeing more and more billionaires. They can be exactly the type of clients that can completely change your wealth as a real estate wholesaler as well.

Forbes and Fox Business note that Kylie Jenner is set to become the youngest ‘self-made’ billionaire ever. At just 20 years old she has outpaced Mark Zuckerberg, and has already amassed $900M from her makeup line and receives over $100M in revenue from TV show appearances and endorsements on social media.

She’s just one of many newly minted younger billionaires. As with the other members of Forbes’ richest lists, if they don’t make the bulk of money in real estate, they soon find they need it to preserve and multiply their wealth, and celebrity home flipping is becoming even more common. Yet, if they are going to be able flip houses in the fashionable destinations they love most, they are going to need to find wholesale deals.

These can be great clients and end buyers for real estate wholesalers. They have the cash, they are unlikely to nickel and dime you to death as less affluent buyers will do. They can be great volume buyers, and will take on those big dollar properties that can put hundreds of thousands or a million or more in your pocket in a single deal. Bigger deals can even be easier to do than smaller ones for investors. Besides, for the same amount of work, would you rather make 10% or 50% on turning a $50,000 home or a $5M home?

How do you land them? It doesn’t have to be as hard as you think. Make sure you get connected, hang out in the right places, and are highly visible online when they are searching for properties.

If you aspire to become a billionaire yourself, then having billionaire and even millionaire clients can certainly help. Serve them well and turn each one into referrals and more wealthy clients to fuel your real estate business.