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There are real estate wholesalers, and then there are real real estate wholesalers. Although the old “fake it ’till ya make it” theory may tried and true, the point of that saying is that eventually you’re supposed to stop faking it once you know what the heck you’re doing. But some real estate wholesalers take it to the extreme. They’ll fake it for as long as they can get away with it. Women everywhere continue to put on Academy Award winning performances, yet In the world of real estate wholesaling, the fake won’t fly.

So how to you spot real deal real estate wholesalers? The answer might surprise you…

Old School Real Estate Wholesalers Living Large.

When we think of businesses that don’t rely on technology to get ahead, we think primitive and uneducated. The Flintstones comes to mind, and we envision old Fred eating bront0saurus burgers.

You may be surprised to learn that lots of wholesalers have an old school business approach. It’s not out of the ordinary to find a seasoned wholesaler without a website. Eh? You’re probably wondering how the Sam Hell can on a real estate wholesaler function and succeed in today’s competitive, technologically-dependent world without a website or six? How do they promote their businesses? How do they share information about their businesses with prospective buyers?

TIP: Real estate investing is not a “tech business,” baby! Its a “networking” business. And I’n not talkin’ Cisco. 

The best tech in the world; expensive websites, funnels, software from Guru’s don’t make you rich. Getting to know buyers (like me) makes you rich!

True wholesalers go old school. I’m talkin’ pen and paper, traditional print advertising, bandit signs, Craigslist, and straight up face to face communication. They have an established list of awesome buyer clients, and they know exactly what those clients want – what type of house, what area they want to live in, what their price range is. They rely on communication, organization, and relationship-building. Real deal wholesalers don’t need gimmicky pump-funnel websites with flash graphics and empty corporate speak.

If you want deals. If you want to be a real wholesaler – get out there and do some real work. I used to get in the 1991 Chevy Lumina “Sweet Lou,” armed with a few cigars, a 20 oz Venti BOLD & black from Starbucks, and I would ride neighborhoods until my then fiance would call to tell me it was time to come home. I used to leave at 5AM, and sometimes I wouldn’t come home till 8PM. That’s workin’ people. That’s knowing your farm market.

Next – spend a little money on marketing. I could write a whole blog on how to market, but suffice it say that the old tried and true methods still work. You can also enter your name and email below to get my free list of “100 sure fire ways to find super-motivated sellers.” Marketing works, you just have to be consistent.

The best real estate wholesalers don’t try to sell phony deals either. They keep it real (if I had a dime for every time I’ve said the word “real” in this post), they keep it honest, and they’re straight forward about deals, unlike some rookie wholesalers who think they can talk smack, BS a deal, BS the ARV, BS the repairs, and live to wholesale another day. Uh uh. Ain’t happening. I’ve said it before, and I’ll continue to drive the point home like Miss Daisy. Those who stay true to their word, know their areas, know their numbers and keep it real will get ahead. It’s that simple. True real estate wholesalers aren’t afraid to make $10-20,000 minimum paydays when they know they have a deal that’s gonna make the rehabber $50-60,000.00 BUCKS!!

Look, we’ve all go to start somewhere right? Even I was a newbie once. Even I tried to fake it till I made it. Treat this business like a business and not a hobby, build your network, market great deals NOT crap, and always keep your word – and you too will become old-school at some point.


If you’ve been able to avoid major repairs on your rentals, pour yourself a big ole’ bowl of Lucky Charms, and count your blessings. The odds of having little to no repairs to do on your properties, especially the older ones, are as good as me getting a date with the Queen of England. But don’t get too cocky and comfortable. Sooner or later, a water heater’s gonna go or you’ll need to do some major plumbing or replace a roof. What about a property repair fund for scheduled and unscheduled maintenance?

The question is – are you prepared?

Property repairs are inevitable, no question about it. So if you haven’t started a reserve fund, you deserve a slap up side the head and that “I’m so disappointed in you” look that your parents used to give you when you used your little sister’s beloved Cabbage Patch Doll, Maggie Genevra, for target practice like Sid from Toy Story.  I’m always shocked, however, to learn how many landlords are unprepared for major repairs. I’m always shocked to find that most landlords are living on every penny of the cash flow from their rentals. They’re milking those cash cows for every drop. They think  “it won’t happen to me” or “I’ll have plenty of time to save up”. But if you’re going to be a successful property owner, you have to expect the worst, and be prepared to pay up when problems arise.

Start Your Property Repair Fund, Like Yesterday

If you don’t have one, you’ve got to start a dedicated repair fund, and the sooner the better. It should be set up when you secure your first rental. Put a portion of the monthly rent (I would recommend 10% – 15%) into the fund, and watch it grow.  See where the wind blows you. If you’re swamped with repairs, beef up the percentage. Just remember why the money is there, and keep your hands off of it. You’ll be tempted to spend it on other things when times are good and you’re not being haunted by repairs. But don’t do it. Save, save, save. Trust me, there will come a time when you need that money.

So what about a line of credit? Sigh…..many people rely on it to get them through times of major repair, but many credit lines have been cancelled. Once you start relying on the devil’s plastic, the interest rates start piling up, and before you know it, you’re in debt up to your ears, on your way to a financial meltdown, and you’re looking at years before you’re able to dig your way out of credit card hell.

What About a Capital Expense Budget? 

Capital Expense Budget is the fancy way of saying “oh crap fund”. A capital expense budget is a one-time amount that you should set aside each time you acquire a property to cover major expenses later on. Each time you acquire a new property, ask yourself where the weak points are. What things will need repair in 3-5 years. Are there quick and easy repairs that you can do immediately to increase the property’s value and up the rental fee? Check out the roof, the deck, appliances, flooring, and paint, and do not underestimate the power of landscaping and curb appeal. It goes without saying that a home’s outside the the first thing potential renters will see. The outside will leave the first impression, so if you hesitate to invest in attractive landscaping – don’t.  Hopefully, you have a decent contractor in your corner, so ask him or her to help you check these things out before you make an offer.


You’re smart. So do the smart thing. Be proactive, and prepare for unexpected expenses. Otherwise, you’ll find yourself panicked, desperate, and running around like a chicken without a head trying to find cash in the darndest places. Worse yet, you’ll be banging on the doors of everyone you know, asking for money like some strungout fool….well, just see the picture. And that, my friends, is not a fun place to be. So do your due diligence. Save your dough, and this will save your butt when times get tough.


Funding your real estate deals can be as challenging as finding a red-hair in a haystack. What? That’s not how the saying goes? Whatever. You get the point. When you’ve got a bunch of experience and you’re ready to start looking for private money to fund your real estate deals, you’ll come to a fork in the road. Go right, you’ll work with debt partners, and if you hang a lefty, you’ll find equity partners. Both can be helpful, and both are very different. Money don’t come for nothin’, so one thing is for sure; no matter which way you go, you’re going to pay a price in exchange for debt or equity services.

Debt Partners

Debt partners will lend you the money you need to fund your deals, but you’ll have to pay a designated interest rate, which is discussed up front along with the time frame that you’ll be given for the loan. Of course, they’re going to want to protect their investment, and they’ll do this with either a promissory note or mortgage on the property and may be even of your skin in the game. Here’s the catch. You have to pay the interest rate and return their principal during that agreed upon time frame or they can take your property and leave you “eff’d”. Debt Partners will generally charge higher interest rates, but they require little to no equity. So, all in all, they are the cheaper option, and you’ll get more bang for your buck.

When Should I Use Debt Partners?

Here’s the double banger rule for knowing when to use debt partners. If your deal can be financed by one investor, or if you’re confident you can beef up your property value in record time, run with debt partners. It’s that simple, folks. Just be to cover your ass, and by that I mean be sure you have enough cash to cover the interest, and make sure to pay off the loan by the deadline.

Equity Partners

Unlike the debt dudes, the return is not always established up front with equity partners. Simply stated – they get a piece whatever the property makes. If it generates a crap-ton (yes, that’s a word), their return will be high. If the deal loses, they’ll invest mo’ money to sustain the property. They’ll invest money in exchange for an ownership percentage, which enables them to stay involved every step of the way. Their investment isn’t secured like with debt partners, rather it’s protected by property’s cash flow. This of course is one very simplified scenario. Deals with equity partners (like debt partners) can be structured in a bazliion different ways.

When Should I Use Equity Partners?

If you’ve got a long-term investment opportunity, the equity guys are the way to go, and if your deal requires more than one private money partner, equity partners can be used to pool money.

Don’t Be a Wuss

It’s a given. It’s gonna take more than one shot until you finally get a “yes” from a private money partner, no matter which way you decide to go. Stop bitchin’ and like Soul-2-Soul said, keep on movin’. Keep making those calls and negotiating, and whatever you do, don’t throw in the towel. If you know some common mistakes up front, and you know how to best deal with them, you’ll be better prepared to deal with either equity or debt partners. So listen up…

Build a Solid Rep

Trust is the key to any deal. I’m shocked at the number of letter my private money guys get from newbies asking, “Hey – will you lend me money?” Duh, Dumbass! You, my readers are smart, however. You already know that the way to establish trust is to build credibility. How do you do that? Build a track record of success, stay true to your word, meet payments with current lenders. Once potential investors know they can trust you and their money is safe as cute little kittens, they’ll work with you every time.

Push ‘Em Off the Fence

Well, not literally, although it is always funny to see people fall for some reason. Here’s the thing about investors; they can be wishy-washy, indecisive, and just plain noncommittal. You have to change that up front, right away. All investors must show the money before close. Get an EMD, fees for entity creation, or a reserves deposit as a way for investors to say “we’re in” before close. Make them commit. Don’t wait until settlement for them to back out and leave you with your ____ uh, house in your hand.

Both equity and debt private money partners can help grow your biz. You just have to know how each one works and what the differences are. Remember, money doesn’t go away, money isn’t real and it isn’t hard to come by. It just gets passed from one filthy, e. coli infested hand to another (excuse me while I dip myself in bleach). Stay motivated, stay confident, and do the right thing. Sooner or later, you’ll have all the money you need to do your deals.

Strengths. Everyone’s got them. Problem is, most people don’t know what their strengths are. If you’re unsure of what makes you happy? If you don’t know what really juices you, you’ve got to find out. You can do it today by taking a DISC PIAV Profile Assessment.

So how do you determine what your strengths are, and how can you apply them to your house flipping business? Maybe your strengths don’t even suit you for this business….ever thought of that? Once you’re able to recognize what truly juices you, you’ll be able to use that to your advantage. You’ll be better able to brand your biz, and you will know when to ask for help, because you’ll know where you fall short. And yes, even the most knowledgeable and seasoned flipper will be callin’ S.O.S. at some point. It’s inevitable, even for the best of us.

Do I See a Pattern Here?

When you’re trying to figure out what you’re good at and what you suck at, look back on past successes. What went right? What went wrong? What did you consistently do during those times when you experienced success? Knowing what that key ingredient is may help you pinpoint a strong point. Here’s what I’m talkin’ about…I’ve been flipping houses for more 8 years, and I can say with certainty  that I’ve always stayed true to my word when working with buyers, sellers, investors, and everyone in between. If I say it, I mean it. I’m a man of my word, a man with integrity. There in lies one of my greatest strengths.

Be faithful in small things because it is in them that your strength lies. – Mother Teresa

Another personal strength is my creativity. Its at my core. I love to create. So you can understand why I must get juiced when i walk into a super-crappy house. All I see is “possibility” and a big super-highway of creativity. Conversely, I’m not a detail guy. When it comes to my rehabs, I see all the details in the finish, but I don’t like having to deal with all the details leading up to the finish trim stage. Its bores the crap out of me to deal with plumbing, HVAC, electric. I also hare dealing with accounting, and book keeping. That’s why I farm all that out to other people who get juiced by that kind of stuff.

You Betta Ask Somebody!

Sometimes it’s difficult to know what you’re good at, to see your own strong points. So, why not ask the people who are close to you? However, with that said, I would strongly advise not asking your mother or your father. The answer could go one of two ways – either you’re the perfect child who shines brighter than the ice around 50 Cent’s neck or you’re like freakin’ Eeyore from Winnie the Pooh – a sorry, sad, and pathetic (but huggable) “Debbie Downer” who just can’t seem to get it right (work that crap out in therapy). Perhaps it would be in your best interest to ask someone with a more neutral, objective view of who you are and what you do. Why not talk to the people who work with you? Ask them what you do well, what they respect most about you, why they choose to work with you. For some, this may be an awkward question, but the key is presenting it the right way. Don’t just call a former buyer, for example, and say “hey, what do you like about me?” The person on the other end will think you’re either hitting on them (and we know that won’t end well) or you have major self-esteem issues.  Explain that you’re making efforts to better your service, and improve your business. Tell them you want to know what it is about you and your communciation, organization, or overall business processes that worked for them. You’ll be surprised at how many people will welcome to opportunity to give you feedback. This may be another effective way to identify your formula for success.


Finally, I’m a big fan of taking tests to see what type of people we are, and what really makes our engines rev. Wanna know what makes you tick? Wanna know what would really be a good fit for you in terms of the type of job you’re doing. You need to take a DISC / PIAV test I’ve heard so much good from people who have taken these two assessments – that I’m actually about to take one right now! Do it people. Find your happiness!

Remember, you’re going to have weaknesses. That’s a given. Having not-so-strong characteristics and skills doesn’t mean you’re your own weakest link. More importantly, remember that have weaknesses does NOT mean you won’t be as financially successful in the real estate biz.  What will make you lose money and become less profitable is ignoring those weaknesses.  Deal with them head on, be honest about the challenges you face, and know your strengths. Maybe you’re really organized, or you’re great at networking, or perhaps your enthusiasm is infectious and helps you close the deal every time. Whatever your strengths are, you need to recognize them, embrace them, and put them to good use with each and every house flipping venture you pursue. Know your weaknesses, and don’t be afraid to ask for help. Outsource to the experts when you fall short or better yet, get more training and education in the areas that need work. Follow these guidelines, and watch your house flipping business soar to new heights.

Negotiating. I know, I know. Just the thought of it makes you feel all nervous and uncomfortable inside, your palms start to sweat, you suddenly feel like you should be wearing an eye patch, gold chains, & bustin’ rhymes and the name on your office door should now read, “Slick Rick.” Listen up, when you put on your negotiating hat, you don’t have to seem like you just stepped off the used car lot.

Getting to yes, in negotiation doesn’t mean you have to be sleezy, slimy, slick or any of the other Seven Dwarfs. Huh?

The thought of negotiating is scary, I’ll admit it (at first anyway), but don’t panic. You have to get out of your head and into the moment. It takes time, practice, and a constant reminder of these three tips to become a master negotiator.

Here’s a Can of Shut the Hell Up

If you’re gonna be a good negotiator, you must be a good listener. Now, this is challenging for most of us men (yes, I’m stereotyping, and I’m pretty damn sure I’m right), so listen up. First and foremost, stop talking. Negotiating is not about you. Its not about beating your chest. You have to uncover the needs of your buyer, seller etc., and the only way to do that is to listen. Don’t be thinking about the game, what you’re going to eat for lunch, or the chick you met at the bar last night. Focus! Its human nature to hate feeling like we’ve lost or failed, but (lemme’ let you in on a little secret) someone always wins or loses in a negotiation. That “Win Win Negotiation” stuff is bull-manure! Your job is to make sure your opponent does not feel like he’s lost. Ask open questions that lead the person across the table to believe they’re getting precisely what they are asking for. Try to make them come to your conclusion as if it was there idea. Try to make them verbalize why they should sell their house to you at the insanely low price your offering.

The very best book I’ve ever read (and I’ve read many) on negotiating is, “Getting to Yes,” by Fisher & Ury. What if you learned just two things in this book that could give you the upper hand in every negotiation with a seller? Wouldn’t it totally be worth the $10 bucks you’ll spend – especially if you make $10,000 bucks on your next deal?

Check out the book ——>  Getting to Yes: Negotiating Agreement Without Giving In

Stick to Interests not Positions

When you’re dealing with sellers, know what your max dollar is, but also know and relate with the seller’s interests. Get them to understand that you are the resolutions to their problem. You know in your head, that you’re only going to spend $100,000, and their should be discussion with the seller to focus on this number – but you should help the seller paint what $100,000 grand does to resolve their problem. Plant the seed. Reinforce why you’re the one for them, and when they say they need more money (and they will), don’t budge. Tell them your hard and fast dollar amount again, and have them keep reminding themselves them why they called you. Eventually, they’ll understand the value of you and your service, and the price will get pushed to the back burner.

Invent Options for Mutual Benefit

Gain Sometimes its not just about the dollars. In fact, many times – its not about the dollars. Suppose you walk into Grandma’s house and you discover that Nonna was a hoarder! You’re amongst the mounds of crap negotiating with Jr and his wife, and you’re at a stalemate. Then Jr. pipes up and says, “I just can’t bear to get rid of all this stuff. Its gonna be too emotionally draining to throw all of this in a dumpster.”


At that point I would say, “I’m not sure I can help, but let me understand, are you saying that you’re just too tied to all your Mom’s belongings to throw it away? Its so soon right? I can understand why this would be so hard for you to have to do all of this yourself.”

Then after Jr. stops wiping the tears from his eyes, you say, “What if I could help you get rid of everything? I’m not sure that I can – but what if, I could get the people, and the dumpsters, and the permits? Would that be helpful?”

Not only have you tapped in to pain, you’ve also made Jr reiterate that pain – and most importantly you’ve proposed a possible solution. This makes you look like a hero, and it makes Jr. feel like he’s won. That little move brings “goodwill.”

Negotiating is like a delicate dance. Learn how not to stand on your partners feet – and you’ll find yourself winning more deals.

Is your real estate market is too hot to handle or is it cold as a cadaver on a marble slab? I reluctantly live in the People’s Republic of Maryland (very liberal) – and thankfully we didn’t get hit too hard by the housing bubble. Unemployment in MD is still a few points below the national average, and our housing prices seem to be stable. In fact, Maryland, DC, and Northern VA are the hottest three markets in the country. I can almost hear the U-Haul’s coming, but before you load up the family, the dog and all your worldly possessions, hold up. It doesn’t matter if your real estate markets hot or cold, there are great deals in every market.

Fact is, good deals do exist in every market, you just have to be selective. Remember we talked about quality over quantity? If you’ve got a hot or cold market, this is a great time to apply that philosophy. Despite the overflowing excess we see everywhere (although some of it’s easy on the eyes if ya know what I’m sayin’), less is more in some cases. Focus on fewer deals and only deals that will absolutely bring home the bacon.  This is a finicky market. Buyers want it all and they want it at a low price. That said, you can not wedge yourself into a deal. Every deal should fit like Cinderella’s slipper.
So what deals should you go after to get the sure paydays?

Million Dollar Listing

In those extra smoldering hot-spots (mostly high-end, ultra rich areas) within your hot market, there are people literally waiting for homes to go on the market. We see this in DC all the time…still! A friend of mine just received an offer on his house that included an escalation clause. I haven’t seen that since 2004. Hot houses selling like hot cakes don’t actually have to be million dollar listings – they just have to be in really desirable neighborhoods. Typically, the number of buyers far outweighs the the amount of inventory in these areas. You’d be surprised how many people target neighborhoods they want to live in. They wait until homes in those neighborhoods become available, then they make shockingly high offers just to secure a spot in their favorite hoods. I know you think I’m crazy, but I’m tellin’ ya, its happening in this market. If there’s a super-hot neighborhood or segment in your market (like DC, Northern VA, NYC…etc), you need to know every player in that market; every agent, every lawyer, every title company, every investor, every contractor – and you need to be ready to pounce when you see a deal. Burn a bridge with any of the players above, and you may as well find another sandbox to play in. You’ll be burnt-toast forever amongst the gate-keepers and deal-makers. If however you can get a foot in the door, you’ll find that you can make some CRAZY paydays and margins that exceed your wildest imagination.

This Old House

No not Bob Villa, or that new guy host. Back in the days of greased hair, vinyl records, and of course Elvis, homes were built with one thing in mind; UTILITY. There were no frills. They were built on a much smaller scale with only the necessities in mind. Ranchers were all the rage back in the day. All rooms were on the same floor and one bathroom for the whole family to share (oh, the horror!) But times have changed, and so have the homes. While there are some people out there who still love the rancher style home, most would say ranchers are a dinosaur of past. Your job is to prove them wrong, and fortunately, that shouldn’t be too difficult to do. Ranchers are easy to upgrade to modern standards. Some of the most successful deals I’ve done have been ranchers.

In 2010 I did a rehab called “Gimme Some Moore” A bunch of investors turned the deal down because the bedrooms were small. I took one look and fell in love. Ranchers usually have massive basements – and this one worked particularly well because it had a side entrance that with only three steps down – you were in the basement. We turned the Motha’ out by adding a master suite in the basement. Most would say I was crazy for doing so, but this was no ordinary bedroom. It was massive with a massive walk-in shower for two. Check the pics below.

Condo Vulture

A favorite among trendy homeowners and those want to own on a smaller scale. Builders love to convert old apartments to luxury condos, but it’s important to know which markets are in high demand for condos. In large Metropolitan areas like New York City, Washington, DC, Atlanta, and Chicago, condos are still in big demand, but many are too outdated to appeal to young, hip buyers. I’m talkin’ natural trim and wallpaper borders, laminate countertops, and even carpeted bathrooms (which, btw, is absolutely disgusting).

If you play your cards right, you can find some smoking hot condo deals right now. Here’s the ONLY caveat. Make damn sure that the condo association is fully-funded before you buy, because if there is a deficiency, your end-buyer will not be able to get a loan. Investors all over the country are stuck with deals right now that can’t be flipped because the condo associations are essentially bankrupt.

So no more worries about hot markets, right? Just keep your eyes and ears open, and invest your time and energy in high profit margin properties.  Now lick your thumb, place it oh so confidently on your ass, and say “ssssssssssssssssssssssssssssssss”. Hot markets are where it’s at, baby.

Just because you found the deal, that doesn’t always mean you’ll see the money. When it comes to wholesaling, the biggest worry (other than, “how can I find an avalanche of deals” is, “how do I actually sell the homes that I have under contract?” This is where wholesalers often hesitate to get the ball rolling. This is where any momentum gained is usually stopped dead in its tracks!

TIP: If you are wholesaling real estate, the money is not in the deals you find – the money is in your buyer’s list! You must be actively building a wholesale buyers list at all times. If you are a wholesaler this is job #1 – and its as easy as 1-2-3.

Real Estate Network

The challenge is; how do you put together a wholesale buyers list when you haven’t sold a dad’gum thing? In a word, you’ve got to get out there and meet people like me who are always looking for great deals. You’ve got to build a massive real estate network that includes; other wholesalers, cash buyers, hard money lenders, newbies, bird dogs, mentors, title companies, contractors….and did I mention buyers?

Variety is the spice of life, right? Well the same principle applies to your buyer’s list. You want a list complete with low-end property landlords, high-end property rehabbers, multi-unit buyers, newbies, seasoned cash buyers and the like. You need solid buyers not tire kickers. A lil’ this, and a lil’ that to cover every possible situation.

Suppose for just one minute that you come across a fat-cat buyer like me. We meet, and I show you proof of my $1 million dollar war-chest of cash. I then tell you where I’m looking and precisely what I’m looking for. Ask yourself, how many buyers like me would you need to make you real happy? The moment you find 5-6 buyers like me, you will reach wholesaler nirvana; that rarified category known as, “order taker.” Think about it. I give you my buying criteria, and you simply cast your net out knowing that if you catch one that fits my criteria, you’ve already got a buyer (me) before you even sign the purchase contract! How sweet is that?

BTW, the greatest Wholesaling book I ever read, and the one that launched my investing career is RIGHT HERE! Steve Cook has created more real estate millionaires than any other Guru in the business, and Wholesaling for Quick Cash is the book that started the careers of guys like me, Than Merrill, Preston Ely, Kent Clothier, Shaun McCloskey….and the list goes on! This book is the only guide you need. I’ve read it at least 25 times, and I still get something new each time I read it.

Building Your Wholesale Buyer’s List

So, how do assemble said list, you ask? Believe it not, post on Craigslist for starters. Ohhh, zip it. I know, know….Craigslist can seem like a cluster “f” at first, but it’s actually a great source for running ads. Or, you can put the word out in your local newspaper classifieds with headlines like “Fixer Uppers – Major Discounts – Financing Available.” When investors call (and they will call), be engaging and ask questions. How do they pay for their homes? (Cash is best) Where do they like to invest? What are they wearing? Ok, for real…only ask that last one if she (or he) has a smokin’ hot n’ sexy phone voice.

Tip: The VERY best way to find cash buyer’s is to search your local MLS for recent “cash” sales. Pick a zipcode, refine your search to the past year, and search for houses that settled with cash. Most MLS’s can do this – but you usually have to modify the search fields. This is your never ending GOLD MINE for buyers.

At first, you may find yourself telling investors (often) that you’ll call them back when you have something for them, but in time as you build your list, you will have a potential buyer for each property before you even have the deal under contract. It just takes time, so be patient. And remember, if you have a great buyer’s list, you can always market the deals of other wholesalers to your buyers. I’ve always been a rehabber, but from time-to-time, I do come across deals that I’ll wholesale. When I first started, I didn’t have a buyers list. When I’d come across a deal, I’d simply call the best wholesaler I knew, and we’d work out some split of the wholesale fee. In 2006, I found a deal that he sold for me and we split a $32,000 wholesale fee. All told, I think I had an hour in the deal – and he made one phone call to his best buyer. Not bad. THAT’S THE POWER OF A GREAT BUYER’S LIST!

How About War Zones?

Who the hell wants to invest in a war zone, anyway? Before the real estate bust, people were buying houses in some of the worst parts of Baltimore City, and every other major city in the U.S. These days, most investors have left those neighborhoods for greener pastures. When you’re new to the wholesaling game, you don’t know where you may find buyers or deals – so try everything. Just don’t become known as the guy who only peddles junk! There are plenty of those kinds of wholesalers out there. For now, you can go balls to the wall and start making offers the low-hanging fruit in war-zones. Just don’t be surprised if you don’t find buyers lining up to get a piece of the war zone action.

Turnkey Wholesalers Make Bigger Money!

Rookie investors can become your best customers if you can package up your deals like presents on Christmas. Think of it as turn-key wholesaling. You’re not only providing them a smoking hot deal, but also contact information for a potential lender, and even a contractor or two to do the work. If you’re not doing this for your investor customers, you’re really losing out on BIG MONEY. Start thinking in terms of how you can package up your deal to make it as irresistable as possible for your customers. I get calls all the time from wholesalers looking to make $10K cash – and all they give me is an address and an asking price. I usually hang up the phone and forget the call immediately. Look, if you want to make a huge wholesale fee – at least do some work for the money!

Most wanna-be rehabbers don’t know where to begin, so be their Sherpa. Take the guess work outta the game for them. Provide them with solid purchase, and rehab numbers, provide great pictures, refer them to a hard money lender who already knows the details of the deal, and finally – get them a contractor or two who can do the repairs. Do all that – then you can shout, “Show Me the Money,” like Jerry Maguire, and I promise you –  they’ll keep coming back like Pavlov’s dog to a plate of Alpo!

Are there ton’s of strong cash buyers out there like Craig Fuhr? Hell’s yes! I DO PAY A MINIMUM OF $10,000 CASH for Wholesale Deals. So start looking for those deals and start building your network. Provide great service to your buyers. Prove to them that they need you, show them you’re valuable, helpful, and knowledgable. Before you know it, you’re weak, pathetic, barely-there buyer’s list will be chock full of top-notch buyers’ names, and you’ll be one productive, money-making, wholesale check cashing, SOB, happier than a pig in poop.

If over the last three years you’ve asked yourself, WHAT IS ROBO SIGNING —- this is it!

Open heart surgeon, NFL football coach, OJ Simpson’s defense team. These are what most would consider high stress, high pressure positions. If the surgeon, the coach, and the Cochran team (RIP, Johnny) “f” up, chances are they’re gettin’ a boot in the ass (or a razor-clean slice across the throat in Cochran’s case). Oh wait, that’s right….the glove didn’t fit!  If you can’t get the job done right, consequences are to be expected, right?

Foreclosure Sweatshops.

But who knew that “legal process specialists” shared the same job stress. What’s a legal process specialist, you ask? Just like it sounds…of course. Basically a legal process specialist is someone who sits all day in air-conditioned cubicles preparing sworn affidavits, so lenders can take homes from distressed homeowners. Like Nike’s little Indonesean kids toil away building $100 Air Jordans, these foreclosure slaves build foreclosure files. God Bless ‘em all for their mad-skills!

The legal process specialists are bombarded constantly with reminders of daily quotas, usually 10 files a day, and if they don’t fulfill those quotos, they first receive a verbal warning. Then there’s the infamous written warning (ya gotta love corporate America’s discipline policies). Don’t even think about two written warnings; that would cost them a paycheck. All that stress only to make peanuts. Actually, peanuts would probably be better. Put it this way, Lucy the legal process specialist is probably working a “night job” to make ends meat and put food on the table for her kids.

You don’t have to be a genius (or maybe you do) to figure out that too much pressure will inevitably lead to costly mistakes, so you’d think these so-called managers would quit breathing their stale, coffee-saturated breath down the necks of these hard workers. A recent settlement involving Wells Fargo resulted in the loss of homes, because someone somewhere in some sterile office said “oh crap” when he realized he forgot to check the fax machine for crucial financial documents.

Contrary to what some lenders are saying, the state attorneys general, federal investigators, and state & federal judges say it’s even worse than it appears.  Thousands of families are losing their homes because of errors and in some cases, fraud. Problem is, someone has to have the balls to question the process. Unless they’re challenged in court, most questionable procedures will go unnoticed and unchanged.

What is Robo Signing?

MSNBC (a network NO ONE watches) has been investigating these foreclosure “sweat shops” and intercepting emails from stressed out workers who are coming forward to expose what’s really going on.

“Get ‘em out!” is what they hear at the Wells Fargo in Charlotte, and I would imagine that “Get ‘er done!” is the command at just about any Wells Fargo in West Virginia. Point is, managers are pushing, pushing, pushing like a woman in labor (epidoral please!) to meet quotas without sufficient time to properly review information. Workers are told “no breaks” and “ask me for more when you’re done”.

BTW, are these the white-collar jobs Obama was promising? We need those well-paying factory jobs BACK in America people! (but I digress)

Not even halfway through the year there have already been 575,000 new foreclosure filings (can you say, Cha-Ching?) in the U.S. and over 200,000 homes sold, according to RealtyTrac. Wells Fargo and four other major banks have implemented an agreement (effective earlier this month) to improve the foreclosure process. Banks will have 90 days to synch up with the new guidelines and twice that time to implement them.

More on this story, HERE

It’s a hot topic for sure, and now there’s even more talk about short sales and expedited processes by Fannie & Freddie (who, by the way, sound more like a brand of women’s panties and a rapper, respectively). No disrespect, of course…just sayin’.

New Short Sale Process

For those real estate agents and homeowners awaiting a decision on their short sale offer from Fannie Mae and Freddie Mac, June 15th is “D” day, thanks to new Servicing Alignment Initiative guidelines issued by the GSE that will demand greater focus and speed when it comes to short sales and all-things pre-foreclosure related. Fannie and Freddie are taking measures to minimize response times in attempts to silence the incessant whining of real estate practitioners and to make the short sale transaction process more efficient. The pressure is on the GSE to provide concise information about foreclosure alternatives, and the GSE has no choice but to comply with new deadlines set forth for short sale evaluations. Hence the June 15th deadline. And speaking of deadlines, servicers have 30 days to make a decision after they receive an offer within the short sale program or a completed Borrower Response Package (BRP) through the Home Affordable Foreclosure Alternative (HAFA) program or a GSE program.

What happens if they exceed 30 days? No, they won’t turn into pumpkins (although that alternative would be way more pleasant); servicers will need to give the borrower a weekly status updates (ew), and they will need to shit or get off the pot no later than 60 days post BRP. Say the servicer wants to play lawyer and counteroffer? The borrower has to reply within five business days, and then the servicer has another 10 days to respond back. It’s a reciprocal game of cat and mouse to see who gets the cheese.

In general, Fannie and Freddie, are hearing bravo left and right and getting standing o’s more than Joshua Ledet on American Idol (I’m sorry, but he’s not that great) from brokers and real estate professionals everywhere. In 2011, Freddie Mac added over 45,000 short sales to their portfolio (a 140 percent increase from 2009), and Fannie Mac completed close to 80,00o. Muy impressive, huh? (That’s very impressive in Spanish, btw.)
Bottom line – if you’re facing foreclosure, short sale is your new BFF. If you are a real estate investor looking to make some sweet moola flippin’ short sales….well, now it just got a little easier! The Federal Housing Finance Agency and countless others think so too. Short sales keep clear out the crap, which helps to keep neighborhoods stable and in the end, the market stable.
More on this new process, HERE

What do you think, will short sales actually get faster with these new Govmt. regulations?

Commitment letter shmamittment letter. What’s the difference between Pre-approved vs Pre-qualified? Well for starters, you’re a complete DB if you’re still trying to get a deal using a commitment letter. But pre-qualification letters or a “letter of funds”… that’s a horse of a different color. And a solid Proof of Funds (POF)….well, that’s the Big Red Cadillac of letters, baby! If you plan to go after bank owned and HUD homes and you can’t verify cold hard cash in your bank account, you’re going to need a pre-qualification letter or, at best a solid POF.


Well, other than the fact that you’re trying to compete with guys like me who are showing POF’s of bank accounts holding amounts of cash - you must let the seller know that you give a damn, that you’ve taken the time to meet with a lender, and that you are qualified and for real. Its like opening up your KIMONO and sayin’, “Hey Bud, I’ve got  the money it takes to party.”

Just know that most banks won’t even look at pre-qual letters from buyers making offers on REO’s. They want to see cash in the bank. Ask yourself this…If you’re making an offer with a pre-qual letter from a hard money lender, and I’m making an offer on the same house with a P.O.F. that is essentially a print out of my bank statement….which offer do you think is gonna get noticed?

TIP: If you want to play the REO game, you’ll need a solid POF showing that you have “cash money” to buy. Email me if you want to know where to get a genuine P.O.F. letter.

Now, you can be a rocket scientist, a genius of monumental proportions, the top executive “suit” at some major corporation, but that doesn’t mean you can write. In fact, when it comes to written corporate communications, most people are fish out of water. The key to a solid pre-qualification letter is to use the “ABC” rule. (your lender will write this for you)

A – avoid small talk and conversational information; you may be tempted to use an overly conversational tone in your letter in an attempt to befriend the seller – but don’t. The seller doesn’t care about your experience, funny anecdotes from your past or that your kid scored his first goal in soccer last weekend. Keep the content professional, period.

B – be brief; the seller’s time is valuable, so show in your letter that you recognize and respect this by keeping your letter brief and getting right to the point, quickly. Be sure to state clearly that you are, in fact, pre-qualified for a loan and that the pre-qualification is subject to additional review.

C – be courteous; being brief doesn’t mean being blunt to the point or rudeness. Show your appreciation with phrases and words like please, thank you, and appreciate.

Example PreQual Letter:

To Whom It May Concern:

This is to confirm that Joe Investor has been pre-qualified for a purchase/rehab loan for a single family residential property based on a 65% loan to value appraisal, but with no cash out. Please note that this pre-qualification is good for 60 days from the above date and is renewable by mutual written consent.

As always, final loan commitment is subject to the appraised valuation of the property by an appraiser chosen by our firm.

I appreciate your time, and thank you for your cooperation.


Joe Bagadoughnuts Investor & Hard Money Guy Extrordinaire