7 Myths About Wholesaling Houses
March 5th, 2021
There are 7 common myths about wholesaling. Believing these myths can slow you down, or stop you from starting in the first place. Don’t let them...
Myth 1: It takes a lot of money
When you structure deals properly, you don’t own or manage the house, so the risk is minimal and you don’t need any money.
Myth 2: Mistakes are magnified and costly
With wholesaling, you aren’t fixing up houses or making repairs. You are essentially flipping the contract. And, when you follow the easy steps below, you don’t use any of your own money!
- Step 1: Find a deal
- Step 2: Get it under contract
- Step 3: Find a buyer
- Step 4: Assign your contract to the new buyer
- Step 5: Close on the deal
- Step 6: Cash your check and celebrate!
Watch this video with Jerry Norton. In it, he shows you how to wholesale houses with no money down (then check out other videos on the channel where you can watch Jerry do live wholesale deals).
Myth 3: It’s illegal
Wholesaling is not illegal as long as you follow the laws in the state you are wholesaling. The proper way to wholesale without violating licensing laws is to make offers in your own name and then assign your binding and legal contracts to a new buyer for a fee. Keep in mind that assignments are not usually enforceable. In other words, if your cash buyer flakes out on you then you are ultimately bound to the original terms of the contract. Follow the rules and you are good to go!
Myth 4: It’s time consuming
Like all good things, you get out what you put in and this is true in real estate. The more time you put in, the more offers you’ll make, the more deals you’ll get, and the more successful you will be. When comparing the different ways you can make money with real estate, wholesaling is by far the easiest and fastest. For example, you don’t have to manage income properties and deal with difficult renters. And, you don’t have to manage contractors during a fix and flip that could take months. All you have to do is find a property, get a contract, assign the contract, and collect your fee which normally takes 2 to 4 weeks. Not bad for a $5,000+ check!
Myth 5: There are no deals
There are ALWAYS deals. You just have to know how to find them. There are lots of resources for finding houses online. Some popular ones are Zillow.com, trulia.com, realtor.com, and Redfin.com. In order to find houses on these websites you have to know the key words to use when searching. Some popular ones are DIY, as is, cash buyers, and needs work (just to name a few). Click HERE to get a list of the top 20 keywords to use on Zillow.com!
Another way to make finding houses even easier is to use Jerry Norton’s Flipster software. If you haven’t heard of Flipster, it’s a cloud based platform that helps you organize, streamline and automate all the steps to wholesaling houses. It also comes with dozens of lead types. To learn more, Click Here.
Myth 6: Everyone is doing it
So what if everyone is doing it, there are still plenty of deals to find and buyers to flip them to. There are thousands of areas to look for deals and enough deals for everyone! And let’s be honest... the majority of people who say they are wholesalers aren’t getting out there and making offers. They are sitting at home. Be a go getter and make offers!
Myth 7: There are no buyers to wholesale to
Fix & flippers (rehabbers) are ALWAYS looking for new houses!! Fix & flippers want to focus on remodeling houses. They don’t want to put in the effort to find houses, compare comps, and negotiate contracts. They want to focus on remodeling houses and reselling them. They love wholesalers who do the hunting for them!!!
Check out this article where Jerry Norton breaks down how to find cash buyers and what to say to them.
There you have it friends... 7 wholesaling myths debunked! Hope you got some clarity and are ready to dive into wholesale real estate. If you want more info on wholesaling, then check out Jerry Norton’s e-book Making Money in Real Estate.