HOW TO WHOLESALE REAL ESTATE STEP BY STEP
If you've just discovered this magic, you may be wondering to yourself "what is wholesaling real estate"? This isn't a common phrase that you hear in the news or in general conversations. This article will explain what wholesaling houses means, and give you some basic information about how to wholesale houses.
What is Real Estate Wholesaling?
Real Estate wholesaling is a specialized method for buying in every real estate market. Some might refer to this as flipping houses. The process involves negotiating a discounted purchase price on a property, and signing a contract with the seller. Once the wholesaler and the seller agree and after all the contract has been signed, the wholesaler can assign his interest in the property to a new buyer for a fee.
Buyer of a real estate wholesale deal are typically a landlords or rehabbers. Rehabbers rely on wholesalers to located distressed properties for them at discounted prices so they can focus more on their business model.
Is Wholesaling Real Estate Illegal?
Real estate wholesaling is not illegal as long as it's done correctly. You must have a signed real estate purchase agreement with the current owner of the property. Then can sell your interest to another person for a fee. The fee can be any amount that you and the new buyer agree to.
How to Wholesale Real Estate
Learning how to become a real estate wholesaler can be a daunting task. There are many different coaches and real estate mentors out there who teach different methods of structuring creative real estate transactions. Moreover, the basic process of wholesaling houses can be summarized in 5 simple steps:
Here is the breakdown of the 5 simple steps to follow when wholesaling real estate
Generate Motivated Seller Leads
The ability to generate quality seller leads is where the real estate wholesale deal begins. Execute a marketing campaign that targets property owners that may be distressed (i.e. foreclosure. Probate, and absentee owners).
Motivation is what will drive the seller to sell the property at a discount price. Moreover, without motivation from a seller, you'll find yourself beating a dead horse. This will cause frustration to a newbie wholesaler, and may even drive you to give up.
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