I Made $17K on My First Wholesale Deal — Without Lying to the Seller

All right, what is going on everybody? We are live on the Painless Flipping Podcast. I'm here with Chaim. What's up, brother?

Good, good afternoon, Nathan. It's good to see you.

It is good to see you. Hey Chaim, so the reason why we're meeting today is because we were talking a little bit. We've known each other for a little bit through some of the coaching communities we've been a part of. And you let me know about a deal that you recently just did where you made— was it your first wholesale deal?

It was my first wholesale deal that I actually wholesaled. Yes.

Okay. And how much did you make on that wholesale deal?

It was $18,000, $17,000 to be exact, $17,475, close to $17,500.

Oh my gosh. So you made, uh, you said around— sorry, something was happening in my ears. You said you made what, $17,000 around there?

$17,500, between $17,000 and $18,000.

That is amazing. Now you've been doing— how long have you been going at wholesaling for?

Um, I haven't been in wholesaling. I've been in real estate for 12 months, exactly a year. Okay.

And what would you say— did— but you've known about wholesaling for how long?

Would you say? Yep. Since I started, I knew flipping and wholesaling. Okay.

But you've, you went more towards the flipping route, correct?

That is correct. Yes.

So tell me, tell everybody, since this is your first wholesale deal, what made you decide to wholesale this one versus flip it?

So the reason I decided to go into flipping was I just couldn't handle my personality. I just couldn't handle dealing with agents, getting a contingency, tell them I want to close on it, get people in. And they ask me who is coming in, why they're coming in. It was kind of a lot of shady things. I mean, it's not bad. It's okay for someone who can do it, beautiful. But I couldn't. So that's why I joined the flipping side of it. So I bought myself rehabbed. And that particular property, we wanted to flip it. It was listed for $200,000. We came across it back in August. I worked with my wife, she reached out to the agent and we gave an offer. We use quick estimates, we gave an offer for $140,000. She came back, $200,000 it is, we're not lowering it anytime. We followed up again in September, then in October, then November, we follow up every 3 to 4 weeks.

Good for you.

And it came December, November, mid-November or so, we looked it up and we say, hey, it's expired. So we called up the agent, we had the number, we said, we see the listing is expired. Would your client still be interested in selling the property? She said, yeah, let me run it through the client. She came back, what's her offer? We said $140,000. She said, no problem, $140,000. Let's write it up. We got a deal. So she listed it back at $200,000. We locked it in for $140,000. I went down there and I had a look at it and I decided I got to be at $93,000 to $95,000. It doesn't work. So no shame. That's what we do. We go in. Sorry, man, we got to be at 90, 95. Hey, sorry, I can't work. I can't work. I can't work. I still had it on the contract. My 10 days that I always put in was still within, and I was talking different exits. I needed the deal. I needed to make some money. So boom, it flashed in my mind because you always come up in the coaching and you always says that we can do reverse wholesaling, you call it, right? So basically having the buyer and then find it for him. So that basically solves all my problems. So I called in a guy. I usually have 1 or 2 guys that I pay $50 for a visit to go to the property since it's a virtual market.

Okay.

They go there, they get me a video, they tell me what's going on. So I know they do flips here and there. So I asked them, hey, how's it going? He said, I'm dry, I need something. I said, okay, beautiful, no problem. I have a couple of things I can't close on everything. So do you want to have a look at it? He said, with pleasure. So I gave him the address and said, listen, I'm not a wholesaler. I'm not. You give me the number, I'll let you know if we can make it work. So I gave him the address and he ran the numbers. He came back to me. I can do $160,000. I said, that's beautiful. You know, I'm at $140,000. He's at $160,000. We can do $20,000. Okay. And he said, I want to go down to the property. He goes down to the property, comes back, the basement has to be dig down, underpin, blah, blah, blah. I gotta be at $130,000. I said, okay, let me think about it. So I went back to the agent and said to the agent, listen, I understand you can't do $95,000. Let's do $112,000, $110,000, $112,000. She came back after a day, we got a deal at $112,000. So that was the first thing. So I had this buyer at $112,000, at one $130,000. I was at $112,000. And then I was working with a title, with a title. They made it really easy. They work with all the— I know you're a big fan of reaching out to them. So boom, I just went to the title that I usually use. They told me they can do my— instead of doing a wholesale fee, they can do a— how do they call it?

What would it be? A consultation fee?

Yeah, exactly. So basically it's not— it's an unassignable contract. So the agent didn't know anything until she got the HUD. And she didn't even know. She didn't even know when settlement came. She didn't even know because they always look on their side, right? They always look with the money they stay with. Then I made a separate contract with the end buyer.

Nobody knew anything.

It came to closing. Everybody closed nicely. And as a matter of fact, the agent texted me yesterday. She told me, hey, I have another deal. Are you interested? Nice. So basically it's a wholesale deal. Everybody's happy.

This is the way, I mean, That's amazing.

Yeah.

So, so yeah, yeah, I appreciate you, you letting me know. It makes me really happy to see that you saw success. So just so I can understand, so this buyer, you already knew this guy? He's— he'd been taking pictures for you since you don't live in your market, it's a virtual market. So you reached out to him because you knew him already, right?

That is correct. I knew him and I asked him, hey, do you buy properties? Do you flip? Do you do anything? He said yes, and I'm dry, I need something. Beautiful. And I'm probably going to do the same thing now. Like, we're doing acquisitions in-house, so I come across properties that I have to let go because they don't fit. So I'm planning on putting 10, 15, 20 people in that need properties today, tomorrow, and just move it up to them.

Amazing, amazing, painless way to do it, right? Especially if you come into things that don't meet your criteria, right? Like, you give it to them and they can let you know what they're willing to pay. And that's exactly what happened, right? He told you what he could pay, then you got it lower, then he went and saw it, and then you even got it— you had to renegotiate. But you got it done.

That is correct. Yep.

No flips. No, you didn't have to pick up a hammer. You didn't have to hire any contractors. It was just—

I'm in the wrong business, Nate. I'm in the wrong business, Nate.

Yeah.

Trust me, this is the business to be in. I mean, no, I'm kidding. I mean, you can do it all. But yeah, to the folks out there, I mean, who are looking for the first, right? Just don't be afraid. Just pull the trigger. Go for it.

I love it, man.

There's no other way to do it. You gotta believe in it. And go for it.

That's, that's exactly right. So, um, and you said that this, your buyer was able to pay you separately from a wholesale fee. So you didn't technically assign it to them. You were able to get him to pay you, was it through an invoice or outside of the contract?

So I'm not sure how they do it, but basically it's, it's, I do a standard agreement of sale with the end buyer, the property for $130,000. I send both contracts to title and boom, they get a HUD. The end buyer becomes the buyer in my place. The seller and agent are on the seller side. I'm consultation fee and that's it.

I love it, man. Yeah. I'm not sure what the title company— I know there's a lot of different things you can do, but it seems like the title company took care of you. They were able to make that. Yeah. That's amazing.

Wow.

So tell us, so you originally didn't want to get started wholesaling because you said that you might, you felt maybe a little shady or maybe dishonest. Is that what you're saying? The way that people usually go about it.

Yep, that's correct.

Can you elaborate on that? Because I think a lot of people when they get into wholesaling, they kind of feel like that, but no one really talks about it. Tell us what you mean by that.

So the reason people feel like that, because me as a flipper, I call up an agent, the agent asks me, are you a wholesaler? I don't want to talk to wholesalers, right? So people get intimidated. That's number one from being a wholesaler. I mean, I look at it, I went to sleep that night, I felt great. I mean, me as a flipper, I would love to have 2, 3 guys asking me, what would you pay for that property? And I give them the number and you lock it in at that number. I mean, you know what that means? I do, we do acquisitions in-house all day long, right? I mean, bring for someone a property for the number they want, it's beautiful. It's the best thing ever. So by using your method, by reverse wholesaling, having a few people looking for properties is beautiful. I mean, there's, It basically solves all the issues.

Yeah, because if you don't have a buyer for a property, you don't know who to ask, you kind of feel like you're almost lying to the seller, right? Like if you're like, oh, I can buy your house when you really don't know, you don't know who's going to buy it. But if you can find out what a couple of your buyers will pay before, then when you go and make that offer, you feel extremely confident, right? You feel really like, oh, I have someone at $160,000.

I'm coming from there. I tried wholesaling when I started the business before going into flipping. I tried, I locked in something. What was it? It was listed for $90,000. I locked it in at, I believe, $78,000 or $75,000. So it's too close to the listing price. I had it, I had a few people looking at it, nobody needed it. And then the agent was kind of getting the feeling that I'm wholesaling it. It was kind of, yeah, I mean, it still works. It's great. And no harsh feelings. It's amazing. People who can bring properties for flippers, that's amazing.

Yeah, I think the way traditionally people wholesale, especially when they're getting started, is they feel uncomfortable, right? Because they do get deals that maybe aren't the best and they try to sell them when nobody really wants them. But if you can know what a buyer will pay, you feel extremely confident, and you realize you probably got to be a lot lower than what you probably normally thought you had to be, right? You got to be a lot lower. But when you're new, you don't really know, right? You're just like, well, let me just try something.

And the only— I mean, there is nothing— there's no difference between you and the newcomer, between me and the other guy, between Jerry and all the other people. I mean, everybody has the same mental faculties in order to exercise, so they just have to go for it. Exercise it, strengthen it, get your first deal and get it moving, right?

Exactly. And a lot of help out there. Yeah, and we talked about it a little bit before, like we all put on smiles, we all talk like we're doing good, but it's, it's a struggle sometimes, right? Like we all have to wake up, we all got to make the calls, we all got to make the offers, we all get rejected, right? I get rejected. There's nothing I'm saying that's really any different than what you'd say. Like, where agents are saying no to our offers, but it's the people that are consistent The people that are working and making the offers and doing it the right way, the ones that win. And I'm assuming you've seen that, right?

I mean, I can't add anything. You just, you just said it. I mean, I was looking, I believe way, way, way back. I believe almost 8 to 9 months you were active on the Facebook pages and you put a whole morning thing. You don't feel like getting up, but you're still going to do your morning affirmation and everything. Yeah. I mean, I saw it. You probably don't even know that I've seen it, right? But it makes a difference in other people.

So, man, wow. No, thanks. I appreciate you saying that because look, man, in the world that we live in today, everybody wants to just put their best foot forward and just show all the wins they're having, right? Everybody wants to talk like everything's— but it's not always like that, right?

Yeah. I mean, I'm always telling my wife, and that's an issue out there because, uh, when we do, when we do, um, video clips and, and coachings and everything, we always bring up like my side, right? I just came up and I explained everybody, okay, I made $18K, wow. But they don't know I worked for it like since this, right? So we got to make sure we put out there, yes, there is a grinding stage. We got to keep on, got to be consistent, and it's coming. The home run deal is around the corner. You have to keep on, be consistent, call up, know that it's around the corner, and you will get it 100%.

Bro, you said it. You said it better than I could have said it.

That is true.

So for everybody that might be feeling like, hey man, I've been doing this for a long time, I'm not seeing results, you got to keep going. And you got to keep working hard like Chaim.

I mean, yeah, so yeah, I appreciate it. I appreciate it you bringing that up, but yeah, we got to put some attention to that as well. Of course, there's a buying stage and everybody can make it.

Exactly. So Chaim, is there anything you want to leave our listeners with before we wrap up for today? Anything else you want to say?

Yeah, so I would say all the help and the resources are out there. You will get to it when you need it. That's the whole thing. You will get to it. Is it title? Is it a contract? Is it information on how to do it? Is it sub-to? Is it creative? Is it anything? All the information is out there. You will find it when you need it. Just keep on going.

You said it beautifully, brother. Well, thank you for your time.

Thank you very much. It's good talking to you too.

Catch you later.