Wholesaling Real Estate – Finding Buyers (Part 1 of 3)

Posted on August 6, 2009 by IC N in Residential
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cannot buy because they have already purchased from you.

If the realtor’s do not 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 realtor’s buyers to buy another realtor’s house and you can make money setting the two up)

An example of one of my clients deals that he ran this way.
1. I called my client about a great HUD deal
2. 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)
3. We had 60 days to close the HUD home so he started calling realtors
4. He found a realtor with a cash buyer that was willing to pay $122,000
5. We assigned the contract (this is a secret)
6. We went to closing and his buyer brought $122,000 cashiers check.
7. 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)
8. I left with my $4800 commission
9. 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.

3. Newspaper ads I do not 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. 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 cannot 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 do not 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.
1. I placed my free list ad
2. I got about 30 responses for the month
3. Found one buyer who has paid me over $75,000 in commissions over the next 3 years on deals I brought him.

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.

4. HUD homes this is my own technique that I started using to get buyers just for my realtor purposes. Watch for a great deal on a or any great deal for that matter, then park outside for a few hours and talk to the people going to check out the home. Most of the areas investors will find there way to the property and you can give them your card and be sure to get there info. Tell them that you run into alot of deals and ask them if they would like you to give them a call when you run into something decent.

A personal example.
1. I went to look at a good HUD home that I was going to buy myself.
2. The neighbor came over and wanted to see the home while I was there.
3. I showed him the home and he ended up buying it from me.
4. I ended up making $2500 in commission on it.

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.

5. Talk to your current buyers buyer typically know other buyers, ask your buyers if they know of anyone else who is buying (let them know you will only call the referral if they are passing on the property). You also might offer to pay your buyer for a referral fee if one of there people end up buying a house from you. This technique also works great if you have a buyer that only wants to buy in a certain area, then you can call their referral if you have a home outside that area.

Personal example.
1. One of my buyers had too many homes and could not buy.
2. I asked him if he knew anyone else who might be interested.
3. He gave me the number to a cousin who was an even bigger investor
4. I ended up selling 3 homes to his cousin this year, and paid him a referral for each one.

Eric Medemar is a Realtor/Real Estate Investor out of Grand Rapids, MI. Eric currently owns 30+ rental properties, and is the creator of http://www.TheForeclosureCollege.com, the program that enables you to duplicate his exact real estate system to begin making thousands real estate wholesaling. You can view Eric’s Blog at http://www.TheMillionairesBlog.com

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