Wholesale Real Estate

A good way for anyone interested in real estate investing without putting down huge sums of money is through wholesaling real estate contracts. Wholesale or Contract Assignments are a way for anyone to control the real estate property for sale to someone else.

Everything in Real Estate is about control and rights to do something with it. A common way to control the property is through option to purchase or through actually having a purchase contract with ability to assign the contract to someone else.

This is how it works:
A typical scenario involves you finding a property that will be favorable to investors. Favorable meaning that owner will carry, there is a huge upside potential, or the deal is structured so that the investor will profit immediately. Once you find this property through advertising and/or marketing, you can either put it under contract with minimal amount of money as deposit or obtain a option to purchase with minimal amount of money.

If the property is under a sales contract, your goal is to find an investor that is willing to pay you a finder's fee and purchase this contract from you before the due diligence period runs out. A good way to increase the due diligence period is to have a clause in the purchase contract that states that with additional deposit amount, you are able to extend the due diligence period for a certain amount of days.

If the property is under a option to purchase contract, your goal is to find an investor that will purchase this property before the option expires. Once you find the investor, you exercise the option to purchase and then assign the contract to the investor for a fee.

Of course no investor will purchase any property if it does not make financial sense. Meaning: it must make money and be profitable.

A typical real estate contract assignment will cost anywhere from $2,500 to $50,000 depending on the price and the profitability of the contract. Therefore, if you are good at networking and finding properties for sale at a good value, this is a easy way to make quick money with very little risk at all.

A good resource to find wholesale investment properties is Action Investor Network. We have hundreds of members, both Financial Investors and Property Investors. So if you are starting out in Real Estate wholesale and would like a way to post your wholesale deals to other investors, take a look at Action Investor Network.

Good luck!