Investment Ideas: Salvaging Wholesale Deals

There are a number of ways wholesalers of real estate investment properties may find the deals that keep them going. Ideally, a good investment will be one where an investor can mark-up a property slightly and pass it on to another investor. One simple way to find these kinds of deals is by salvaging previous deals.

When a wholesaler’s property is under a contract, the “inspection period” is used to either sell it or get out of the contract, to ensure his deposit is refunded. During this time, they may market it to their own buyers who are on their e-mail lists and might even permit other investors to advertise their property. The initial investor is usually willing and able to split the profits of a deal with any investor who is able to deliver a buyer, or may require the investor to mark up the price.   

If a bank owned property, there may be less than 5 days to inspect the property and market it to their potential buyers. Here’s the great part: If the investor never secures a buyer, the listing agent will offer it to the public; oftentimes for less than the price that was offered to the investor!

If a homeowner is selling the property, the inspection period can be much longer – over 30 days at times. Yet still, if the investor cannot “flip” it during this limited time and reneges on the offer, the homeowner is back to square one. In such a situation, the homeowner is often willing to lower the price to the next buyer that comes along; this could be you! 

So, that’s how it works. As you can imagine, great savings can be had if an investor can reach a seller at the right time with the right offer This method works especially well with bank-owned properties. If successful, an investor is essentially able to gain on another investor’s loss. Being on top of what is for sale and when an investor has reneged is key to success. 

To get in an optimal position to track sales, get on a bigger investor’s e-mail lists and pay attention to whether the properties offered are sold or abandoned. Take note: public records is another way to track when a property is under contract or not, but this is usually not as timely, and timing is crucial. 

So, stop letting deals pass you by and start salvaging!