Real Estate Wholesaling is Your Ticket to Making Money Regardless of Your Circumstances

Real estate wholesaling, or wholesaling, is one of the most common techniques for new investors to use. The major reason that it is so popular is that it will only require you to put up a deposit, not use any credit, financing, or do any repairs to make money on a deal. How? That is the purpose of this page...

Here is the basic concept: We are going to find a highly motivated seller or fixer upper, we are going to get an offer accepted on the property that represents a good deal, and then we will sell our contract to someone else that is looking for a good deal. Generally, this person that we sell the deal to will usually be another investor.

Since we are making an offer, and then selling the contract, that is why you will not need financing, credit, or do the repairs on the property. This is why this particular technique is so attractive. It is a way to make money using real estate without needing a lot of resources. Real estate wholesaling is one of the most popular techniques.

Many investors think that the hard part of wholesaling is going to be finding the investor that will purchase the contract. The truth is that the hardest part is getting a good deal. Everything in real estate wholesaling depends on your ability to negotiate good deal.

If you have a good deal that is going to make money, do you think that you are going to have a hard time finding other investors that want to make money? Again, the investors is the easy part because they are always looking for a good deal. It is getting the deal to begin with that is had.

How can you find investors to buy your contract? Here are a few ways to find them for real estate wholesaling:

1. Calling the "we buy houses" ads/signs - These are investors that are always looking for a good deal. 
2. Run an ad in the paper - You can advertise how good the deal is and that is exactly why they would call. 
3. Use real estate investment clubs to find the investors - Here is a large group of people that you are looking for. These clubs can be a great way to network to build up a list of buyers. 
4. Use social networking - Sites like Facebook have groups of real estate investors on there. This is the next generation method of finding buyers. Post your deals and see what the investors do. 

The whole point is that there are a lot of different ways to find real estate investors. This will make real estate wholesaling much easier.

When you are making your initial offer to the seller, make sure that you put a clause in there that will allow you to assign the contract. The clause that you want to use is and/or assigns. This will give you the legal right to sell your contract to another person. The way that you use it would be to put your name as the buyer, and then put the and/or assigns right after your name.

Once you have found your investor, you have two choices on how to finish the deal. They are the assignment of contract, and the simultaneous closing.

Here is a table that explains the two options:

Assignment of Contract	Simultaneous Closing
Never take title to the property	Will be in the chain of title
New buyer will see your profit	New buyer will never see your profit
No closing costs	Two sets of closing costs
Typically used for smaller profits	Typically used for larger profits or deals that cannot be assigned

As a general rule of thumb, we recommend that if you are going to make $3000-$5000, that you assign the contract. That way, your profit will not be taken up by the closing costs. If the deal will make more than $5000 or the property is not assignable (bank properties), we recommend doing a simultaneous closing.

You will need to have a title company or attorney closing these deals that is familiar with real estate wholesaling. It will make these transactions go much smoother.

That is very simply the process. The whole idea is that we are going to be paid for securing a good deal and then selling the deal to another investor.

Once you have done a couple of these deals, you will now have some money that you can use to finance other deals that you could not have done previously without having the money. So, even if you do not like this as a long-term strategy, it is a way to get from one part of your business plan to another. This is the power of real estate wholesaling.