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How To Start Wholesaling In 21 Days Or Less

How To Start Wholesaling In 21 Days (or Less)! [Step-by-Step Video]

real estate investing video wholesale real estate wholesaling real estate May 10, 2022

Want to start wholesaling real estate?

In the video below, I'm going to show you the Step-by-Step Process on how to wholesale real estate in 21 days or less without having to spend $1 in marketing and without having tons of experience!

Video Time Stamps:

0:00 - Intro 

0:36  - What Is Wholesaling Real Estate?  

1:15  - 2 Ways To Close Wholesale Real Estate Deals  

2:39 - The Wholesaling Process At A High Level 

4:29 - Step 1: Pick Your Market 

6:18  - Step 2: Find 3-5 Cash Buyers 

7:24  - Step 3: Finding & Filtering For Wholesale Deals 

13:27  - Step 4: Make Discovery Calls Daily To Real Estate Agents 

18:14  - Step 5: Further Analyze The Property 

29:00  - Step 6: Call Back The Agent (Close Call) 

36:52  - Step 7: Send The Offer Terms Via Email 

39:46  - Step 8: Get The Contract, Check It, Sign It, & Send Back To Agent 

42:50  - Step 9: Follow Up With The Agent To Get The Executed Contract 

44:50  - Step 10: Email & Call Your Top Cash Buyers 

49:21  - Step 11: Agree Upon Price With Your Cash Buyer & Assign The Contract 

52:18  - Step 12: Close The Deal & Get Paid $10,000+ 

Note: we've transcribed the video above into this written blog post for those who enjoy reading over watching video

Hey! My name is Alex Martinez & I'm the CEO and Founder of realestateskills.com.

We help everyday people to wholesale and flip houses across the nation. The strategy I'm covering today helped us generate over $12 million in revenue our first year in the game of wholesaling & flipping real estate.

In this video, I'll first cover "what is wholesaling real estate, exactly?"

Second, I'll cover the wholesaling process at a high-level so you get an overall understanding. Third, I'll cover the 12-step Process on how to start wholesaling real estate in 21 days or less in your area.

What Is Wholesaling Real Estate?

First off, let's cover what is wholesaling real estate exactly? What wholesaling is, is when you get a property under contract at one specific price, let's say $100,000.

Initially, you are the buyer on the deal. Let's say you put the property under contract at $100,000, but then you find a cash buyer, typically a fix and flipper that wants to buy this deal at a higher price.

Let's say they want to buy it at $110,000. Now, all you need to do is put that property under contract at one price, and then sell the contract to your cash buyer at a higher price.

If they want it at 110,000, you make the $10,000 difference as a wholesale profit. It's very simple.

2 Ways To Close Wholesale Real Estate Deals

Assignment Contract

There are two main ways to close a wholesale deal. First is through assigning the contract. Let's say you have a property under contract to buy. You can assign those contract rights, which is essentially just a transfer of contract rights from one party to another party.

We do this approach for about 99% of our wholesale deals. We always love assigning because it's so simple.

Double Closing

The second way to close these deals are through double closing. Double closing, essentially, what it means is you close on that property with some funds, typically funds from a transactional lender, someone who's willing to lend funds for 24 hours or up to 72 hours on this deal.

In that example, the $100,000 deal, let's say you brought the funds to buy it for $100,000, but then you lined up the second buyer. You lined up your cash buyer to buy it $110,000.

There's actually two closes that happen. It can happen within the same escrow company, sometimes two different escrow companies. But what's going to happen is you close on the deal at 100,000 and then gets resold to your cash buyer at 110,000.

There's going to be some fees, some closing costs. You're not going to make completely $10,000 when you double close, but you will still make a nice wholesale profit.

That's why I recommend assigning the contract versus double closing, because there are more steps involved. Today, in this process, to make it as simple as possible, we're just going to cover assigning the contract to your cash buyer so you can wholesale it.

The Wholesaling Process At A High Level

Let's cover the wholesaling process at a high level. Essentially we want to do is, number one, find a house that is in a distressed condition, meaning it's outdated, it's stuck in the '70s, the grass is overgrown, there's mold, heck, the house can even smell like cat pee.

Basically, what you're looking for is a distressed house where a first-time home buyer can't move in and get a first-time home buyer loan or a conventional mortgage. It's a house that is distressed so that it needs to go all cash.

Now what you're also going to be looking for is a house that has a seller who's in a distressed situation. Maybe they're facing a foreclosure. They're not able to make their mortgage payments. Maybe they're going through a divorce and they have a lot of memories in the house and they wanted to sell the house quickly.

Maybe there was a death in the family and they got inherited a property. They don't know what to do with it. They just want to get rid of it. They don't want to deal with it.

When we can find a property that's in a distressed condition and the seller's in a distressed situation, I like to call that a double whammy. There's a lot of motivation for that deal. There's a lot of motivation for that deal to go below market value.

Those are the types of deals we're looking for. I'm going to show you today exactly how you can find those deals in your area across the United States.

The second thing we need to do is once you find that deal, you need to get that property under contract. You need to get under contract, hopefully below market value.

That allows you to mark that price up to a cash buyer so that you can wholesale it and make a nice profit and your cash buyer can make a profit from renovating the property, as well.

Once we get under contract, you sell those rights to your fix and flipper, and then you close the deal. What we see across the nation from doing hundreds of deals over the last decade is that the average wholesale fee is about $10,000.

I want you to shoot for that. Some deals you will make more than $10,000. Some deals you will make less. It's totally fine. Just to know, it will average out typically around $10,000.

Now let's get into the 12-step process so you can start wholesaling real estate in 21 days or less.

Step 1

Step number one, what you want to do is pick your market. All right. You want to pick your market. The market you plan on wholesaling in. I got some chicken scratch. I was a C student in English but got an A in real estate. As long as you can read that, we're good to go.

You want to pick the real estate market, you plan on wholesaling again. I get asked all the time, "Alex, should I start virtually wholesaling in real estate, five states over? Or should I start wholesaling locally where I live?"

What I recommend 9 times out of 10 for someone is just start local, start in your city, start in your county where you're located, because it's going to be a hundred times easier to wholesale a house there than if you just pick a random state to start wholesaling in because you heard someone else's wholesaling there.

There are deals in every single market across the United States and there's deals right there in your own backyard. It's what I want you to understand. Pick your market. This takes about one minute.

If you want a wholesale virtually, you absolutely can. What I do recommend is that you have some affinity to a market. Maybe you lived there for five years beforehand, maybe you know real estate agents and investors there already, maybe you bought a house in that particular market.

Then sure, you can start virtually at wholesaling. But know that if you start local, you're going to be able to attend local Real Estate Investors' Association Meetings. You're going to be able to meet face-to-face with cash buyers. You're going to be able to meet face-to-face with real estate agents and sellers at the property.

There's so many benefits to starting local and you know more than you think you know about your market. You probably know up-and-coming neighborhoods. You probably know the bad areas.

You probably know the prices to some degree, good zip codes, bad zip codes, and all that local knowledge will help you be a better wholesaler and help you to wholesale houses faster.

Number one, pick your market. Is it local? Is it virtual? I recommend local. Then let's go to step number two.

Step 2

Step number two is find three to five cash buyers. Okay. You want to find three to five quality cash buyers in your market that are actually buying deals. Typically, these cash buyers are going to be fix and flippers.

We like working with fix and flippers who will buy your wholesale deals for all cash and cash buyers that are buying multiple houses per month. This way you don't deal with a cash buyer who says, "Hey, I buy a house every 6 months or 12 months."

They're not going to be fast to respond to your wholesale deals. They're not going to be the ones willing to pay you top dollar for deals. We want the cash buyers that are hungry, buying multiple deals every single month in your area.

That way you can confidently wholesale 3, 5, or 10 houses every single month.

That's not a roadblock. It's not a hindrance for you at all. One of my last videos, I created a training on how to find cash buyers online for free. I'll put a link here and in the description.

You can check that out. I'll teach you exactly how to find these cash buyers for your wholesale deals in your market.

Step 3

Now let's go to step three. All right. Step three is finding and filtering for deals. Okay. Now, remember what I mentioned.

What types of deals are we looking for? We're looking for houses that are in a distressed condition and a seller who's in a distressed situation. We want to find and filter for these deals.

What I always recommend for anyone is to utilize the MLS. The MLS is the Multiple Listing Service. It's a database of all the houses on the market, in your area, and it's created and maintained by real estate professionals.

According to the National Association of Realtors, about 90% of all real estate transactions that occur every single year happen on the MLS, on market. These are on-market deals. All right.

That means 10% of the rest of the transactions happen off-market. If you want to have the best success and wholesale of house, as soon as possible and consistently do it and predictably do it, I recommend the MLS because there's always new houses coming on the market every single day that are distressed.

Now, majority of houses that will be on the market, they're going to be retail and move and ready for first time home buyer. But guess what? They're still distress, property, and distress condition with a seller and distress situation being uploaded to the MLS in your area every single day.

The best part is you don't have to spend any money in marketing. You don't have to send any letters for direct mail. You don't have to put out any bandit signs.

You don't have to make any cold calls to be able to find and get these deals on the MLS. To get access to the MLS, most states have something called Assistant Access to where if you're unlicensed, you can work with an Investor-Friendly agent and get access to the MLS. If you are licensed already, then you can get access to the MLS in your market.

But let's say you don't know an Investor-Friendly agent and you want to get started today, what's the next best thing you can do to find and filter for these deals on the market?

Well, the next best thing, instead of the MLS, you can use Redfin.com, put that down, Redfin.com, Zillow, or Realtor.com in your area. Okay. These will pull listings. These will pull houses for sale from the MLS and put it onto these websites.

It's not exactly the same thing. There's always going to be more deals, more history, and more data on the MLS. We like to refer to the MLS as the king database. It's something as a serious real estate investor, as a serious wholesaler, you're definitely going to want access to sooner or later. The sooner you do it, the better your business is going to be.

But once again, if you want to start a wholesaling in 21 days or less, you can hop on Redfin.com, Zillow and Realtor, and look at the houses for sale in your market today. All right. I'll give you two strategies, two really good strategies we've been using for 10 years to be able to find these deals consistently.

Day 0 Strategy

Number one is going to be the day zero strategy. I'll explain that and then old listings. All right. One, two. What's the day zero strategy? What are we doing here? We're trying to find houses that have just been put on the market date on the first day, within 24 hours. That's why it's not the day one strategy. It's the day zero strategy.

With that day zero strategy, what you want to do is find and filter all the new deals that were listed on the market. Let's say there's 50 new houses that would put on the market today in your county.

What you want to do is filter through those deals, which houses are in a distress condition that looks like, "Oh man, this needs to go all cash. It's stuck in the '60s, the '70s. It's completely outdated. There's mold. There's water damage."

Those are the houses that we're looking for. Also, if you use the MLS, there's going to be more information about the property. Typically, there's remarks that are confidential for anyone who has access to the MLS.

Sometimes it tells you the seller's motivation and why they're selling. All right. Now in Redfin and Zillow, it will have some descriptions as well the property, even Realtor, too, and what's going on?

It might have the seller's motivation, but a lot of the time it does not. If you just use any of these platforms to find deals on a daily basis, using the day zero strategy, you find 50 new properties, maybe 5 to 10 of those are distressed. Those are the deals that you're going to want to focus on a daily basis. All right.

You just do that alone. You're going to be able to wholesale multiple houses and find these houses and put them under contract every single month. The day zero strategy works really well, because if a distressed house gets put on the market immediately today, and it's going to go to an investor, it's going to go to a wholesaler, it's going to go to a fix and flipper. It's going to go to someone who's bringing all cash. Why not you?

All right. If it's going to go to an investor, who's going to pay all cash for this property? Typically, it's going to go to the investor, who's going to build the most report with the agent. Okay. Speed's the name of the game with the day zero strategy.

As soon as that property is listed on the market, you want to call that agent so that you can tell them who you are, and what your company is about and learn about this property and build rapport.

Old Listing Strategy

We'll get into that in the next step, but also want to tell you about the old listing strategy. With the old listing strategy, if you look at a property now on one of these platforms and you see the property's been active on the market for 60 days plus or 90 days plus, we know that in today's market, there is something wrong with that property.

There might have been litigation, some legal issues, something, a reason why that house didn't sell that house could have been listed at way too high of a price. Now the seller's willing to come down in price.

There's a lot of reasons. If you call in those old listings that are definitely wholesale worthy, there's going to be a problem.

When you talk to the real estate agent, you're going to want to understand why hasn't this property sold for 63 days or 94 days. What's been going on with it, just so I understand?

Sometimes they can bring you a problem. If you can solve that problem for that agent, for that seller, guess what? You can be the knight in shining armor and close that deal and get under contract.

There's other strategies we cover. But just those two alone, you'll be able to wholesale your first house in 21 days or less using those strategies.

Step 4

All right. Now on a daily basis, when we find these types of deals using these platforms, step four is to make discovery calls daily. Okay. Make discovery calls daily to real estate agents.

All right. What you want to do is once, again, if you find 50 new listings that came on the market and maybe 5 to 10 of them are distressed, if you use the MLS, you're going to have the contact information of the real estate agent that's selling that house on the market. On the strategy, we do not target the homeowner directly.

The homeowner who put their house on the market has hired a real estate agent called a seller's agent or listing agent that's willing to sell the house on the market for the seller.

We contact that listing agent directly. If you use the MLS, what's great about it, it will have the phone number, the email for that particular agent so you can call them directly. If you use Redfin or Zillow or Realtor, sometimes it doesn't have all that information.

It may have their name, the listing agent's name, but then you just want to Google that listing agent's name and then find their phone number and their email.

The very least just find their phone number and then give them a call about this particular deal. We call the agents daily. One, we want to get a pulse on the deal. Number two, we want to build rapport with the agents. We want to be professional, and we want to make sure that we build credibility and authority. When you call these agents, you're not just a wholesaler.

This is what I teach all my clients. I recommend for anyone who wants the wholesaler real estate, don't look at yourself as just a wholesaler. If you want to be just a wholesaler, that's really fine. But I encourage you to be a real estate investor.

Someone who not only wholesale but fixes and flips property, buys and holds property and builds wealth through running out the property to other people. If you see yourself as that, then project yourself as that. When you call an agent, you're not just a wholesaler, you're a buyer, you're an investor. That's what agents want to work with.

Agents want to work with decision-makers. If you make yourself a decision-maker on these deals, they're going to want to work with you. All right.

This is a big tip. I see so many amateurs call agents say, "Hey, I'm a wholesaler." Agents don't like that word. Then they say, "Hey, go kick rocks." They're crying. They're wondering why the heck they never get deals.

It's because what you say is very important, what you say and how you say it, all right. On this call, we're building rapport and you're checking in on the deal you're calling on, that lead. Do the photos. Match up with the current condition of the property.

You can ask the agent. Is there anything out of the ordinary about this property that needs renovation? Does it need a new roof? Does it have any crack slabs?

These are significant repairs that you'll need to add to your repair budget when we get to that particular point in time. Then also you can ask this agent questions like, how's activity been on the property? Are there a lot of offers on this property by any chance? Now you can get a pulse on your competition.

They may say, "Hey, we got three offers, but they're all below this price at 150." We've had agents tell us that. You want to ask information about the deal, about the competition, who's in the running. You could have agents say, "Hey, you're the first one to call.

I like what I'm hearing. I definitely want to work with the cash investor on this deal. How about you come meet me at the property at 2:00 p.m. and we make this deal happen?"

That can happen, too. That's where with day zero, the day zero strategy speeds part of the name of the game. Once again, call agents daily. Talk to them about these deals. We're only calling on distressed deals. You're not calling on beautiful brand-new renovated property. That's not going to go all cash. That's not going to go to a wholesaler. You're calling on a distressed property.

Be sure to do this, because once again, a lot of amateurs think every single property they can wholesale. That's absolutely not the case. Once we call the agent, we're verifying the condition of the property. We're understanding more about the property.

Has it been updated or is it in its current state? Do the photos match with the current condition? Are those photos old on the MLS or on the market?

Now, when we end this conversation, you don't have to close the agent. You don't have to give this agent an offer price. It's very important you understand that.

Because a lot of people get really nervous and think they got to throw out an offer and they pull something out willy-nilly that doesn't even make sense, that they're going to have to backtrack on eventually.

Just know, you can leave every conversation, every discovery call you have with an agent, you can say, "Hey Vanessa," the agent name is Vanessa. "Hey, Vanessa, I really enjoyed talking with you. Thank you for sharing so much information about this deal. What I'm going to do is I'm going to get back with my team.

We're going to evaluate this property with all the information we have now. I'm going to be able to get back to you within a few hours and give you a no nonsense, genuine cash offer that we can stick to. Does that sound good?"

I've never had anyone tell me "No." They're going to say, "Yes. That sounds good." Now what you can do is once you end that conversation and you understand, great, I got a hot lead on my hands. I understand everything about this deal. I see the photos. They match up with the current condition of the property. I know my competition. Now what we can do is go to the next step.

Step 5

All right. We can further analyze the property. The numbers we're going to get here are the ARV, the repairs costs, your wholesale fee, and our offer price, also known as the purchase price. All right. Some people may be saying, "Well, Alex, don't I want to analyze every single deal before I call a real estate agent?" You can. But it's not recommended.

Because what's going to happen is you're going to take an hour, two hours, three hours analyzing a property. That's hot. That's on the market. That's going to go do a wholesaler. If you spend that time, two hours analyzing it, then 6:00 p.m. Then you don't call that agent that day.

You wait till the next day to call them. Guess what? Myself, my students, and my clients, we've all called that agent immediately and been able to get that deal under contract.

We call the agent first to verify, is this house even on the market's deal? We call this agent to build rapport with that agent. Because if you just think that a text message or an email will be sufficient in building rapport with an agent, and getting your offer accepted, you'll be sadly mistaken. People work with who they trust and like.

It's so important that we call the real estate agents first. We want to do that once again so that we can further analyze the property. The agent might tell you information about this deal that directly affects the repair costs that you'll be analyzing for, that you would've just had to assume about before actually having a 15-minute phone conversation with that agent.

We analyze the property after we talk to the agent and they're open to working with us on the deal and everything sounds good. This property's distressed and it's going to go to a cash buyer.

Finding The ARV

With analyzing the property, the first thing we want to do is find the ARV. ARV stands for the After Repair Value. The property that we're working on, let's say we're working on one property at a time, that's called the subject property.

Now for the ARV, we need to find comparable properties. Let me give you an example. Okay. If the subject property we're working on is a ... Let's say three bed, two bathhouses, all right, 1,200 square feet. That's the property. That's the hot lead we called on, three beds, two bathhouses, 1,200 square feet.

What we want to do now is find properties that have sold in the last six months, not two years ago, last six months within a half a mile radius with the same bed, bath counts, in the same city, in the same zip code plus or minus 20% of the square footage of this property, so about 1,000 square feet to 1,400 square feet. We're looking at houses that have sold and that are renovated in that particular area.

Because we're trying to find what is the future value of this property we're wholesaling once it's renovated by our cash buyer and once it's resold. Okay. That's important to understand. It's important to understand how the fix and flip business model works so that you can get the largest wholesale fee possible and you don't bring silly deals to cash buyers that they don't want.

We find the ARV. If you can compare apples to apples, you're going to be winning. If you can find other three beds, two baths, and 1,200 square feet that are renovated, then you'll probably be able to find that ARV. This is exactly what we do every single week with our clients. We help analyze their deals all across the nation. We use this strategy to find the ARV, which is so important.

Let's just say the ARV was 300,000, for example, because we found three comps that were at 310, 290, and 300. All right. Now we know that ARV is 300,000. Now for repairs. This is something that no one's great at analyzing for repairs every single time, every single deal. It's always my goal to get within $3,000 to $5,000 of the true repair costs of running this property.

Let's say our subject property was a three bed, two bath, 1,200 square feet, and just need all cosmetic renovation. It didn't need a new roof. It didn't have a crack slab that need repair. All that needed to happen was new flooring, paint, redo the kitchen, redo the bathrooms, and all cosmetic work. Paint interior, exterior, some landscaping, nothing major, nothing constructional that we're not adding square footage to the property.

A rule of thumb you can use to start with and you're going to want to hone this in overtime, if a property needs all cosmetic work, you can use $30 per square foot. All right. Let's say our subject property was a cosmetic fixer. You times $30 times 1,200 square feet, you're going to get an estimated repair cost of 36,000.

You can go ahead and use your repair cost as 36,000 for this particular deal. You're probably going to be plus or minus $3,000 to $5,000 away. But it's important that you understand you don't need to be perfect on your repair estimate because the only person who knows exactly what the repair estimate's going to be on a house is the actual general contractor that your cash buyer is using.

I've been working hard at it for a long time. I can't read minds. I can't predict the future. Don't worry about it. As long as we can get close, we're able to move forward. As you can see, speed is part of the name of the game here. We're not trying to be perfect and take days to analyze a property because good deals go quickly. It's important to get the ARV. It's important to get the repair numbers down and I'll give you a tip.

How we hone this repair number over time is once we start to get deals under contract, we send them to our cash buyers. We can get feedback from our cash buyers on how our numbers look and we can ask our cash buyers, how do you estimate repairs? Now you're going to be able to find the exact dollar per square foot number for each of your cash buyers that you can multiply times the square footage of the property to get the exact repairs every single time your market so you can analyze for repairs just like that, very, very quickly.

All right. Let's keep moving. We get repairs. It's a cosmetic fixer, 36,000; ARV is 300K. Now for the wholesale fee, I recommend always aiming for $10,000 or more. That way, if push comes to shove and you need to negotiate a little bit, you can always shave off a little money off of your wholesale fee. But at least we're starting with a reasonable amount that you'll be happy with on each and every deal. $10,000 is a great starting point. All right, 10,000.

Now from there, we're able to know exactly where we need to offer. What we use now, after doing this for about a decade, we have our own spreadsheets and calculators. We get the exact dollar from out and we can get the largest wholesale fee possible by knowing every single number on the deals.

But essentially what you're doing is projecting what's the profit of our cash buyer going to be, and then making sure it's a profitable deal for them. It's met their criteria of what they want. Once again, in step two, we find those three to five cash buyers. We talk to them. We find their buying criteria. We find exactly what they want.

That when we find deals on the market, we're finding the exact deals that they want and the zip codes that they want and it meets the profit that they want.

The MAO Formula

Once again, we use a lot of different calculators and spreadsheets to calculate this, but I'll give you a simple formula today. That is a little elementary, but will help you get started in a wholesale of house in 21 days or less. All right.

The formula is ARV times 70%, and this 70% is adjustable, I'm about to show you that in a second, minus repairs, minus your wholesale fee. All right. Let's do that math. That ARV is 300K times 70. Let me just double-check my work.

That's 210,000, all right, minus repairs, 36,000 minus the wholesale fee of 10K and let's calculate all that. All right. 164 Is your maximum allowable offer on where you're able to offer in this particular deal where you can make a $10,000 wholesale fee.

Now, here's the caveat to this, 70% of the ARV is very, very low and some fix and flippers will tell you, "Hey, I'm only going to buy it 70% of the ARV minus repairs, minus the wholesale fee." But know that you can go up to 80%. Use that formula with 80%. Today, there are definitely fix and flippers buying at 80% of the ARV minus repairs and minus the wholesale fee.

Let me just show you real quick just how important that is, because at 70% we can offer 164. But if I do 70% times 300 once again and we have 210K minus ... Oh, we want to go 80%, 80% that's 240K minus 36K minus 10K. Been a little messy here. But essentially what's going to happen is we can offer now 194K on that property.

That's a big swing. Okay. What I want you to notice is depending on the formula our cash buyers are using, we can have a $30,000 swing of where we have to put this property under contract and sell it to our cash buyer for, okay. That's really important. When we talk with our cash buyers, they may tell you 70% of the ARV they're willing to buy minus repairs and the wholesale fee.

But keep in mind you get a deal at 75%, 80%, 82% of the ARV minus repairs and the wholesale fee. Guess what? Still send it to them. because when push comes to shove, a lot of these cash buyers are still going to buy these houses at 80% of the ARV minus repairs minus the wholesale fee. All right. That's how we reverse engineer the deal.

Let's just say on this particular deal, we do all the math. I'll put these numbers here. We analyze this deal. We got the ARV. We got the ARV at 300,000. We have repairs at 36,000. We know our wholesale fee is going to be 10K. With all of this in mind, we know we have to offer at 194. Okay. Boom. Now we know our offer price where we need to offer on this particular deal. 194, 80% of ARV minus repairs minus our wholesale fee.

We're doing really good here. Okay. Once again, that's 80%. That's going to be 240K. Now we know exactly where we need to offer, 194K. We can go back to the real estate agent.

Step 6

This is step six. Call back the real estate agent. The same agent we were talking to the whole entire time, call him back. I have to call this the close call. The first one is the discovery call. We're building rapport. We're understanding about the property. We're understanding about the competition.

We'll leave that call saying, "Hey, we're going to go analyze the deal to go review with our team. We'll get back to you. We'll give you a no-nonsense offer we can stick to." Then we further analyze that property. We know exactly where we know to offer. Okay. I'm taking some time explaining this for you. But you'll be able to do this very quickly within 30 minutes on a deal to get these deals under contract and submit offers constantly on these deals. All Right.

Now we know exactly what we need to offer. We can call this real estate agent and discuss the offer price and discuss putting it under contract at that number. If you did a great job of finding a distressed house that needs to go all cash because it's moldy, there's water damage, it's outdated, and the seller is in a distressed situation as well.

There's motivation for this property to sell cash. There's motivation for this property to sell below market value.

All right. Keep that in mind. When you talk to the agent, let them know, check back in with them when you give them a call because they might not remember.

You could say, "Hey, this is Alex again with XYZ homes. We talked a couple of hours ago and I just want to let you know, I met with my team. We're very excited about working with you on this particular deal. We can actually come in on this house today. We can have you represent us and we can offer $194,000 on this deal."

What you want to do, you might have to talk them into your offer a little bit. One thing I always like to say is, "Well, an offer's better than no offer." What I want you to understand is I've had so many agents tell me throughout the years that, "Hey, that's never going to work." Guess what? I still submit an offer and it works. All right.

It's our goal. When we're talking and working with real estate agents and we're using the strategy, it's always your goal to work with the listing agent who's selling the property. What's beautiful about this process, we're not dealing with anything off-market. I'm not telling you to write up your own contract.

In fact, if you write up your own contract, and send it to an agent on a house on the market, you're going to look silly. You're going to look like an amateur.

When we work with real estate agents, they write up the contract for us. It's our goal to call this agent back and have that listing agent write up the contract for you, all right, and represent you as your buyer's agent.

What's really important that you understand is if that listing agent represents you as your buyer's agent, they're going to make twice as much commission on this deal. That's a big incentive for a real estate agent to go with your offer versus another offer. All right.

Once again, it's the goal that the listing agent will represent your offer. They make twice as much commission. Technically they'll become your buyer's agent. Now that listing agent is not open to doing that. The next best thing you can do is ask for a referral from the listing agent, someone they know that can represent you, maybe within their brokerage or a friend of theirs.

Why is that the next best thing, when a listing agent refers another agent to a buyer or sell a property, that agent's going to represent that buyer, for example, and they're going to get a commission.

That listing agent can get a referral commission typically about 25% of their commission. They could still make a grand, two grand, three grand, or even more just from making that referral. That the listing agent is still somewhat incentivized to go with your offer versus another offer.

Listing agent, then a referral from the listing agent. If you can't get a referral from the listing agent, what's the next best thing for you to do, to get an offer in on this property is to find an Investor-Friendly real estate agent that can represent you so you can get your offer in on this house.

Now, one thing to keep in mind, that listing agent on every single house representing you, that's legal in a majority of states, some states they don't want that listing agent to represent you as a buyer's agent as well. What you can do, and typically in those states that broker, there's always a listing broker can then become an intermediary broker or transactional broker so that the broker can at least represent both sides. You can still make it incentivizing for that broker.

No matter what state you're in, ask the agent, they're open to representing you because sometimes they say "Yes," and then they'll say, "I'll just have a friend represent you. I'll just have a referral represent you and they still make it work."

That hierarchy, once again, the listing agent represents you, if not a referral. If not, work with an Investor-Friendly real estate agent that can write up your offers for you, and represent you as your buyer's agent.

You can meet these agents in Facebook groups. Just look in your area, real estate agents, type in your area. Facebook, you can go to Real Estate Investor Association Meetings, just Google Real Estate Investor Association Meeting, and your city name. Then you can attend those. That's where real estate investors hang out. People are interested in working with real estate investors.

Or heck, you can just go on the MLS, Redfin, Zillow, Realtor, and start cold calling if you want. But it's a lot easier to just go to these Facebook groups and say, "Hey, I'm looking to work with an investor from the agent and put in multiple offers every single week. Is anyone willing to work with me?" Now you can start getting warm leads and getting people contacting you.

We call back the agent. We agree upon that price. We agree upon terms. Typically, when we're wholesaling a house or we're competing with other investor offers, a couple of things are important. Typically, this seller is going to want a quicker closing timeframe. For some basic foundational terms that you want an offer typically, like a 14-day close, that means from the day you put your contract, 14 days later, it's going to close.

Then this is really important. Every single contract you're starting out, put an inspection contingency in the deal. Most of these contracts that we use, actually, in fact, every contract I've seen when working with real estate agents has an inspection contingency clause in there. Make sure that's at least seven days when we're dealing on the market.

That inspection contingency says, "You're able to back out of this deal if it doesn't pass your personal inspection." That's very important. That is your backout clause. All right. I don't recommend if you're just starting out. If you're a beginner and you want to start wholesaling, never submit an offer without an inspection contingency clause. Otherwise, you're technically saying, "Hey, I'm going to buy this property no matter what."

It's really important to have that clause there to where a fire happens day two, guess what? You can back out the contract. You're good. Or let's say you're buying a house and there's tenants in there, or you're looking to wholesale this house. You want that inspection contingency to be as long as possible. Because let's say you have only a three-day inspection contingency and the tenants were supposed to move out day five.

But on day four, they tear the house apart. They punch holes in the wall. Technically, you're supposed to buy that house because it's outside of your inspection contingency, given that you didn't have any other inspection contingencies. All right. That's the importance of the inspection contingency and always to work within that contingency. The goal is to wholesale the house before that is over.

If you cannot wholesale the house before your inspection contingency is over, pretty much means you found a bad deal or you didn't find the right cash buyers, just so you know. But if you can't wholesale it within that special contingency timeframe, the worst thing you do is cancel the contract. It didn't pass your personal inspection. You're able to go away, scot-free and go onto the next deal.

All right. That's never the goal. We want to close every single deal we put in a contract, but I just can't stress. How important that is. The inspection contingency will keep you protected. All right. Fourteen-day close, seven-day inspection contingency, there we go. Typically, EMD is due, our Earnest Money Deposit is due within 72 hours of this property being put under contract. It's typically anywhere from $500 to $10,000.

Now, when working with the house on the market, if you do these steps right, you don't have to put $1 into the deal. If you find three to five cash buyers who are buying deals every single month, you can put this property under contract and not have to put in the EMD. All right. Really important that you understand that. You can wholesale this house in 72 hours once you put it under contract and your cash buyer puts in the earnest money deposit.

Once we talk with the agent, we get to that price. Let's just say in this example, the listing agent is writing up the contract for us.

Step 7

What you want to do now is be professional and send the offer terms via email to the agent. Send the offer terms via email to the agent. The agent can put those offer terms in the contract and the agent writes to that contract and sends it back to you via email.

All right. Your offer terms can be what ... I like to make it as simple and clear as possible. We're not writing 20 paragraphs in email. Just say, "Hi, Vanessa. I'm looking forward to working with you. Here are the offer terms for the contract. Whenever you can fill this out, please go ahead, send it back to me. I'll be sure to get it signed and send it right back to you."

In those offer terms, you can put the address of the property, the purchaser name. If you have an LLC, put your name as a purchaser name, your LLC name. If you don't have an LLC yet, just put your personal name. It's always recommended to have an LLC, to have a business if you're operating like a business. But I've had many students, many clients who didn't have that LLC set up yet and wholesale houses under their personal name, and then use the proceeds from their wholesale profits to start their business.

You can do that, too. Either your company name or your personal name, then put the offer amount. Let's say we agreed upon at 194, go ahead and do that. Put the EMD amount. Typically, 1% to 3% can be normal. You can ask this agent, "What type of EMD would you like to see?" They might say 1,000, 3,000, 5,000, something like that. Go ahead and put that down, knowing that if you do this right, you're not going to put that EMD down.

Even if you can't have a wholesaler, put that EMD down for you in 72 hours, you can still cancel a contract if you need to. Not recommended. Some of my first deals I had to put an EMD down. I borrowed that money a decade ago, I was borrowing money to put $5,000, $10,000 down on a property to be able to wholesale it and make $10,000, $20,000, $25,000 for property. I recommend doing what you can if you still need to put that EMD down.

Now contingencies, we make our offer as clean as possible. We only put in special contingencies. Remember at least seven days, then the closing timeframe, 14 days you can put or sooner if your cash buyer's going to close sooner. Then one thing I like to mention in every single email with the offer terms is seller to deliver a free and clear title. This means that you're buying the property with no leans attached to it. The seller didn't have a credit card bill that they didn't pay.

Then now on the property, it says, "Hey, this person owns $30,000 of credit card debt." We're not looking to take over someone's existing mortgage. When our cash buyer buys the property, they're going to own that property free and clear. Seller to deliver it free and clear title. We send that information to them. Just put it in a bolded list, make it very, very clear, send it to the agent.

Then it's their job to go ahead and send you the contract back. Now that we email the agent, the offer terms ... Let me just clean this up real quick.

Step 8

We can go into step eight. Okay. We want to get the contract back. Check it that it's right. Sign it and send it back to the agent. Okay. This is very important. Just sending the offer terms to someone, to an agent, to anyone saying, "Hey, I'll buy your house for 170 or whatever it is."

Don't count that as an offer sent. All right. Those are just offer terms. What we love counting as an offer sent and we've been doing for a decade. This is the most important key performance indicator is how many contracts are you getting back from agents signing them and then sending them back to the agent. Because at that point in time, the only thing that needs to happen for you to get this deal under contract is for the seller to sign that contract.

This is the most important KPI. This is worth its weight and gold. This is always what we're shooting for every single day. We talk about we want to send a certain amount of offers every single day. If you do one a day, what we see is it takes about 15 offers sent to get one accepted that you can wholesale. If you just did one a day for a month, one offer a day right here, signed offer a day. That's 30 offers in a month. That'll get you about two deals a month and you'll make about $20,000. That's what we see.

If you do two offers a day, for example, that'll be about 60 offers in a month and you'll get about $40,000 per month. You can see if you start doing three to four to five offers a day, a lot of our clients and students are doing three to five offers a day and are crushing it, and that's where I want you to get and I recommend everyone gets to go.

Because at this point, once you're sending high-quality offers and a high quantity, now it's just a numbers game and you're going to have a pipeline full of deals and be consistently and predictably wholesaling houses. If we get that contract back from the agent, we check it. We make sure our offer terms are in that and they're correct. Make sure the purchase price is right. Make sure the EMD amount is right. Make sure your inspection contingency is in there. Make sure the closing timeframe is in there.

You're going to sign it. A lot of agents use something called DocuSign, docusign.com. You can sign it digitally. Some agents will make you print out the contract and sign it with wet signatures. They say wet signatures. They want you to print it out, scan it, send it back. You might have to do that. It's a little annoying. But, hey, it's worth it. I always look at every contract as worth $10,000 potentially.

Then send it back via email to that agent. All right. Send it back. Now it's in their inbox and don't delay this process. As soon as that agent sends you the contract via email, check it, sign it, send it back. You want to be the person who's on top of the ball. You want to show this agent that you're professional. You don't want this agent thinking, "Hey, this person's slow or isn't doing what they say they're going to do."

You want to be on top of the ball every single time. This agent thinks, "Man, if Alex or Peter or Stevie is on top of it right now, I can only imagine when we need to close the deal, they'll be just as on top of it. Do everything you say you're going to do. The little things matter. Get back to them quickly, sign it, send it back. All right.

Step 9

Now that we've sent the contract to the agent, what you want to do is follow up to get the executed contract. All right. What does executed contract mean? This means that the seller has now signed the contract, too, because you signed the contract. You sent it to the agent. All that's left is for that seller to sign it. Now it becomes binding. Now you have the property under contract.

This is something to celebrate, because now we can wholesale this house. This house was on the market. But once it's under contract, guess what? You own the rights to that contract. You own the rights to buying that house. Okay. This is very important that we follow up to get the executed contract.

An important question to ask this agent, once you send them back, the contract is when is the seller plan on reviewing this? Or when do you plan on meeting with the seller? If they tell you that, "Hey today at 5:00 p.m., I'm going to get the signing it back to you. Well, guess what? Put that on your calendar and 5:05 p.m. comes by check your email.

If that signed contract isn't in there, that executed contract, get that agent a call and say, "Hey, Vanessa, I'm just checking in. Just wanted to see if that contract was able to be sent I'm. I'm looking through my spam folder. I don't see it yet. Are you able to send that over by any chance? Okay. Great. You're going to be able to get it in 10, 15 minutes, beautiful. All right. I'm looking forward to closing this deal with you."

All right. We want to follow up no matter what. They tell you Thursday at 2:00 p.m., "Hey, I'm going to be reviewing this with the seller." Guess what? Call that agent then at 10:00 a.m. on Thursday. Check-in and say, "Hey, how are we looking? Are we going to get this deal under contract? Anything we need to adjust to make it happen? I've had agents. Let me know that, hey, we just come up a little bit in price, I think we'll be able to make it work, 1,000, 2,000."

I come up in price where I need to enable to get that deal under contract. Even though you've sent a contract, you've signed, it doesn't mean it's a done deal.

It's not under contract until the seller signs it. Don't just start celebrating once you send that contract back to the agent. Celebrate once we close the deal and you make $10,000.

Step 10

Now it's game on.

Now we want to do is email and call our top cash buyers. These are the people that will buy this deal that will pay you for the contract rights on this property, the cash buyers. Remember that's why it's step two.

It's really important. Most people skip this step and then they try and find cash buyers down here. Guess what? You have seven days to wholesale this deal. You run around like a chicken with your head cut off.

You don't know what to do. You're stressing people out. That's no way to run a business. No one wants to work with a stressful. Trust me. I've worked with them. What you want to do is find these cash buyers first so that when we've put this house under contract, we know that it fits their exact criteria. There's a very high likelihood that they want this deal.

What we do is once we have it under contract email your cash buyer. You want to email them the address of the property, and the big three numbers. This is important. You want to email them the ARV, the repairs number. Then also don't tell them your wholesale fee at this point in time. You want to tell them their purchase price with your wholesale fee built-in.

If our offer price is 194 and your wholesale fee is $10,000. Tell them that the purchase price is 204. Okay. Once again, you'll let them know ARV 300, repairs equal 36, and purchase equals 204. Okay. Now, I'll be honest, we ran this at 80% of the MAO formula, a little tighter deal than most. There are going to be cash buyers that will do this. But what you can do is, you send this to the cash buyer.

There's going to be some people that say, "Yes. I'll take it." There's going to be people that say, "Maybe. Maybe I'll take it. I need some more information." There's going to be people that say, "No." No matter what, if someone says "maybe or no," get feedback. What don't you like about the deal? They could say, "Hey, it's too high of a price."

What you can always do is adjust your purchase price. You can amend it. You can ask for a reduction in the purchase price if you provide enough great evidence on why you can do that. You could reduce your wholesale fee as well. If it's your first deal, guess what happens. Most people over-inflate the ARV, and underestimate repairs.

Then what happens is you can't negotiate the deal down because maybe you've just worked so hard with this agent. They're like, "No. We're not going to negotiate the price down." You got to negotiate your wholesale fee down a little bit. Maybe instead of 10K, you make 5k. It stinks a little bit. But, hey, you got to do what you got to do. At the end of the day, you're risking no money to make money in this situation and you're still getting a heck of a learning experience. In the next deal, you'll be able to do better.

What I recommend is this email big three, address of the property, and send any comparable properties that justify your ARV as well to help this cash buyer.

Then what you can do is put any important dates in the contract. When is the EMD due? When's the inspection contingency removed? When is the closing date? Let them know that so that they're not wondering and they have to ask you that.

This is what they want to see because they're professional that buys properties all the fricking time. If you send them all the information that they need, they're going to be good to go. Now send them photos of the property as well.

You can create a Dropbox link or Google Drive link so they can see all the photos. Then also you can let them know the viewing instructions. How can they see the property?

This is something where most real estate agents will allow you to meet up with them at the property or give you access to go view it. Let them know that, "Hey, we can go out, check out the property if you're interested in it.

I just need to coordinate those times with the agent." Or if there's a lockbox code and they allow you to go view the property or the cash buyer, you can let them know that code. Okay.

We send all this information to our cash buyers. We follow up with the phone call and we say, "Hey, I just sent you a deal. It fits your exact criteria. It matches your numbers that you're looking for. I just want to see if you have any questions about it or if you want to talk through it right now."

If they have questions about it, you can talk through the deal with them right now, you can tell them all about it and you're selling them on the deal. We're not really over on flying numbers or do anything like that. But you're making, them feel comfortable about buying this deal. It's what they do. They may have questions about the deal, it's current condition.

Guess what? You've already talked with the real estate agent about the current condition. You've been looking at this deal. You've analyzed it. You know everything about it that they want to know.

What's going to happen is one of your cash buyers is most likely going to want this deal or a couple of them.

Step 11

But what you're going to want to do is agree upon a purchase price. All right. On price and assign the deal. All right. Really assign the contract so they can buy the deal. Okay. Let's say one of the buyers agrees to 204.

You have to go buy it. The next step is to assign the contract. Remember what I said about this? Assign the contract is when we transfer the contract rights from one party to another party and you get paid an assignment fee, also call it a wholesale fee, consulting fee for that assignment process.

In this deal, you'd make $10,000. What I encourage you to do in any state you're in that you're wholesaling in with real estate agents. When you get that contract back, read through that contract. I don't care if you need to go to Starbucks, get four shots of espresso and sit down and read through that contract. It's pretty straightforward. But what I want you to look for is there any language in the contract around assigning the contract?

What's important to understand is that every contract by nature is assignable. I mean, you can just bring your own assignment contract, have your cash buyer sign it. Then you can assign the contract rights. Every contract is assignable unless, in the contract, it's stated that it is not assignable. What's important to understand that in every state, every city, even where a contract says, "It's not assignable."

You can still assign that contract. You just need all the parties to agree. Okay. For example, we wholesale and flip houses and buy and hold property in California. We use the California Association of Realtors contract.

We put a property under contract with that California Association of Realtors contract. In that contract, we've read through it. It says, "You cannot assign this deal unless you use the Assignment of Agreement Addendum and the seller and you and your other buyer, the cash buyer, signs this Assignment of Agreement Addendum, then you can assign it."

Okay. Those instructions on how to assign it within that particular contract. Once again, read through that contract so you can understand, does a contract say, "I have to do something to assign it specifically in this contract or does it not say anything about assigning the contract?"

If you're in a state where it doesn't say anything about assigning the contract, then what you can do is in the link below, I'll include our assignment contract for you that you can use to assign it.

Just click the image above and you'll be able to download the free resource!

This is for any states where there isn't any language about assigning the contract within that contract. I know I'm getting a little wordy.

But what's important to understand is does the contract you're using have any language about assigning it and saying, "Hey, you need to do X, Y, and Z to do it and follow those instructions to assign it." If the contract doesn't say anything about assigning it, use our Assignment Agreement and get it checked by from an attorney as well, local in your market.

I recommend for anything you use online, always check with a local real estate attorney. We're going to be able to assign the contract.

Step 12

Once we do that, we can close the deal and get paid. This deal will close. When it closes, you can do two things. You can negotiate a deposit from your cash buyer when they take over the contract rights. When you assign the contract, the transaction won't be closed yet.

Let's say there's a seven-day inspection contingency and you've done everything I've told you to do. You put the property under contract. You found the deal, called the agent, did the close call, analyzed everything, you put under contract. The day you put under contract, you email and call your top cash buyers. Someone says they want it the next day. They look at the property with their team. Cool. They want it.

You assign that contract. Guess what? Day three, they take over the property. They pay the earnest money deposit. They have the contract rights now. You can negotiate a deposit. You could say, "Hey, half of this wholesale fee, once I sign is due." You can negotiate $5,000. You can say, "When you close a deal, you can pay me an additional $5,000 to make the $10,000 wholesale fee." Okay.

We've also done it where we just trust our cash buyers so much. We just say, "Hey, it's an extra 7 days. Just pay us the full 10 grand when we close. All right. It's totally fine. I'll sweat off our back." Just know you can do it either way, but it requires a lot of trust. It requires you to build relationships with your cash buyers.

I can't stress enough how important it is to build relationships with cash buyers, and how important it is to build relationships with real estate agents because that is the glue that sticks everything together.

It's the glue that makes everything easier. Okay. Once we assign it, now you're closing the deal and you're getting paid $10,000. All right. This is the same exact process. This 12-step process is how you can start wholesaling in 21 days or less. This is what I've been able to help and teach a lot of people on so that they can wholesale houses every single month consistently.

So far, the soonest I've taught someone has been about 10, 14 days where they've been able to do this from not knowing anything about investing into real estate.

Real Estate Skills Free Training Video

All right. We covered those 12 steps and you're probably going to want to re-watch this video again. What most amateur wholesalers do is they'll watch a YouTube video. They'll go in one ear out the other.

But what I've done is I create a training that you can check out that directly goes along with everything I mentioned in here, so that you can check it out and stack rocks in your favor, stack the scales in your favor. All this doesn't go in one ear and out the other. I'm going to keep talking about on-market deals. I'm going to talk about why there's a blue ocean of deals on the market.

All you need to do to check out this training it's for free is go to realestateskills.com/training. I'll put that link in the description as well.

Pro Wholesaler Program Free Training

You can check that out. Totally free. It's about 39 minutes and we'll go in-depth on a lot of this stuff.

All right. Now, remember, you can also download the Assignment Contract. I put it in the description.

How To Start Wholesaling In 21 Days Quick Recap

Just to recap this, I want you to understand if you want to wholesale your first house, don't expect to send one offer and get under contract. Don't expect that you're going to be able to send one offer and wholesale that house.

Okay. What I want you to understand is it typically takes about 15 offers sent. Offers, what we consider as offers sent is when we get the contract back from the agent. We send it back to them. Only the seller needs to sign now.

It now takes about 15 of those to get one deal. I'm telling you this now so you have the right expectations because most people are unhappy when their expectations do not meet reality. When people have the wrong expectations and they think they'll submit two offers, two contracts, get a deal, it ain't the case.

But if you say, "Man, I'm going to listen to Alex. I'm going to send one contract a day. That is my goal. To get that contract back, to sign it, get it to the seller so if we can keep on moving forward."

One a day, you'll send 30 offers by the end of the month. Guess what? Something great is going to come out of that. You are most likely going to get a deal. If not, you'll be able to refine and learn so much more about this process.

Probably in the next two weeks after that, you'll be able to get a deal and you don't need to pull a rabbit out of a hat. You don't need to send 10,000 mailers for this.

You don't need to go out at 2:00 a.m. in the freezing cold weather and put out bandit signs to do this. You don't need to make one cold call. All right.

What's important about this is every single real estate agent here wants to pick up random phone numbers. A real estate agent only gets paid and closes the deal when they close the deal.

They're as incentivized as you to actually close this real estate transaction. This isn't a cold call. They're expecting phone numbers to call their cell phone. They're warm. They're hot phone calls.

Final Thoughts

All right. This is how you start wholesaling real estate in 21 days or less without having tons of experience, without having a real estate license, without having to do any type of cold calling, direct mail marketing, you don't got to drive for dollars. You don't have to do any of that stuff.

You can just hop online and do this all here, and you can do it locally or virtually guys. All right. That's it for today's video, please subscribe, hit that notification bell, and we'll let you know when the next content's coming out.

I hope you guys enjoy this. Once again, this was Alex Martinez with realestateskills.com. Our motto is to leave no one behind in wealth creation.

I hope this excites you. Let us know in the comments below if you're able to wholesale any houses using the strategy if you have any questions and I look forward to chatting with you!

Talk to you soon!


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