Analyzing Your Wholesale Deal YOUR LOGO YOUR PROGRAM

Analyzing Your Wholesale Deal YOUR LOGO YOUR PROGRAM NAME ™

Here’s what we’re going to cover • What is wholesaling • Risks associated with wholesaling • How to present your offer to a homeowner • Why sell and deal with cash buyers • How to analyze a wholesale deal • Contracts, agreements, wholesale deal examples RAISE PRIVATE FUNDS ™

What is wholesaling RAISE PRIVATE FUNDS ™

What is wholesaling • The definition of wholesaling— When someone puts a distressed property under contract with the intent of assigning that contract to another buyer for a quick profit. You do this by marketing this home to another buyer after a home owner accepts your offer • Benefit’s of wholesaling—If your starting out in real estate and don’t want to work in the rental properties/tenants or renovate business then this strategy might be for you. • Simple to learn— Because you aren't renting or buying the home it doesn't’ require an extensive back ground in renovations or property management. Your essential skills are negotiations with sellers and marketing to a cash buyer • No cash or credit required— Because you aren't buying the home there is no need for cash (other then your deposit cheque) or credit to make a profit with wholesaling • It’s in high demand— There is no shortage of real estate investors that are looking for deals to purchase from wholesalers RAISE PRIVATE FUNDS ™

Risks associated with wholesaling RAISE PRIVATE FUNDS ™

Risks associated with wholesaling • Reward’s out ways risks— There are very few things that can happen in regards to a wholesale deal falling apart. The return you can make on a transaction out way the risk(s) • Need to do volume— Because this strategy might not pay you as much as flipping or building houses for re-sale you will need to do more volume of deals to make the same as purchasing fewer homes with another strategy. (Know your goals) • End buyer backs out— Generally speaking if your assigned your contract to another investor and they back out for some reason you might be on the hook to close on that home. To prevent this qualify your buyer and collect fee up front • Can be considered a “grey area”— Because the different Provinces, security administrators and lawyers differ on what is “legal and illegal” with wholesaling this can be considered a grey. Mostly because some believe you need a realtor licence to be dealing in real estate sales. • Having a lender with cash— To avoid “getting stuck” with you buying a deal if your investor backs out be sure you have a lender of your own who can step in if you need to close the deal. Always be building your network of investors. RAISE PRIVATE FUNDS ™

How to present your offer to a homeowner RAISE PRIVATE FUNDS ™

How to present your offer to a homeowner • Scenario #1— While property is under contract along with your schedule A (which gives you access to show the home and assign) bring your potential buyers and contractors to view the home. Seller knows this information upfront • Scenario #2— You tell the seller when the OTP is written that you work with many different investor/partners and sometimes instead of you closing on the deal in your name your investor/partner might close on it instead in their name. • Scenario #3— Letting the seller know you may buy the home personally in your name, in your corporation (for tax purposes), your spouses or in another partners name. • Explaining the Schedule A— To make sure the deal runs smoothly, using one of the scenarios above you need to explain what the schedule A is and why your using it. • Schedule A saves time— One of the main reason for schedule A is so when you assign the property to someone else you don’t need to come back and re-write a new offer in full. Schedule A gives you authority to assign to someone else RAISE PRIVATE FUNDS ™

Why sell and deal with cash buyers RAISE PRIVATE FUNDS ™

Why sell and deal with cash buyers • Dealing with cash buyers — For the same reason as a seller benefits from dealing with you purchasing cash, is why you want to sell to cash buyers. They are able to close quickly if needed, no appraisals, no credit checks • Cash buyers know there numbers— Most cash buyers know there numbers including the renovation costs. They make decisions quickly as they are always on the hunt • They understand the process of wholesaling— Because most cash buyers are in the business of real estate, they understand how a wholesale works. They aren't your typical investor who’s dabbling in real estate or has done deal • Collecting your assignment fee— If you can, collect your assignment fee upfront at the time you fill out the paperwork and assign over the OTP to the investor. In case they back out later for some reason they forfeit their assignment fee • Always be building your buyers list— ”Your network, is your net worth”. Use Google contacts to build your cash buyers email list. Add investors from networking, social media, Kijiji, real estate events, etc. • Wholesale email—Include comps, property description, photo’s of property, city assessment, reno budget, approx. profit RAISE PRIVATE FUNDS ™

How to analyze a wholesale deal RAISE PRIVATE FUNDS ™

How to analyze a wholesale deal • You need to know the comparables— As with analyzing any investment property, you need to start off by assessing the recently sold comparables. • Your only expenses— Your time, deposit cheque ($500 -$1, 000), and lawyer fee to close! • What is the initial offer— This is the most crucial piece. The lower your purchase price, the higher your fee. Includee one number in your email to potential buyers. Offer written at $200, 000, assignment fee is $10, 000. Selling deal for $210, 000 • Creating “spread” for you— Assignment fee’s don’t need to be 5 -10 k. Having an offer written at $. 60 or less gives you negotiation room to the end buyer if you need it. • Using the right tool to analyze— Use the wholesale analyzer spread sheet to show potential cash buyers • Following up until it closes— Things happen and deals fall apart for various amounts of reasons. Make sure you keep in touch with the seller and buyer until the deal closes to make sure everything runs smoothly RAISE PRIVATE FUNDS ™

Contracts, agreements, wholesale deal examples RAISE PRIVATE FUNDS ™

Contracts, agreements, wholesale deal examples • OTP— Have a skilled realtor at your initial meeting with a home seller so you can write an offer right there on the stop • Schedule A— Make sure you explain what the schedule A is using the previous slides and scenarios given. You want your seller to understand everything in the offer. • Assignment of OTP— You want to have this contract and the original OTP present when you meet your end buyer to sign and collect the assignment fee. • Working with a good lawyer— A good lawyer who specializes in real estate law and is familiar with assignments will be of huge benefit to you and your business. RAISE PRIVATE FUNDS ™

Here’s your action items 1. Download Schedule A— Download this document and save it in your real estate wholesale related folder on desktop for future reference 2. Download Assignment of OTP— Download this document and save it in your real estate wholesale related folder on desktop for future reference 3. Find a real estate lawyer— Ask around in your real estate network for a few referrals to a couple of real estate lawyers RAISE PRIVATE FUNDS ™

When your marketing for deals know that wholesaling is one tool on your belt you can use RAISE PRIVATE FUNDS ™