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Joe: Hi, everyone. It's Joe Crump. Welcome to my video blog. I'm sitting on the back
porch of my house here, and what I'm going to do is go through questions that you guys
have sent me, read them and give the answers and hopefully you'll learn some stuff from
this process. Let's get going. Joe: This first one is from Dan Cassidy. His
question is: "One of my main questions is, should I buy
newer homes (2 to 5 years old) in pre foreclosure that don't need a lot of fix up, i.e. carpet
and paint, etc. and try to either rehab them or do a quick flip and make $3,000 to $5,000
on the deal? My idea of a perfect quick flip would be to have my buyer bring funds to closing
and do a simultaneous closing. Should I gamble on this and risk losing my $1,000 or earnest
money?" Joe: First of all, don't risk any earnest
money. You never need to use earnest money in a deal. You never need to put up any money
in these deals and you never need to use your credit. This is going to be a recurring theme
through everything I teach and I want to make sure that I get it out right at the beginning.
Joe: Regarding going after pre foreclosures, they work and there are people that are motivated
sellers and you can make money on them and yes, you can make $3,000 to $5,000 bucks.
You never have to go to closing, though. You can make that money simply by assigning a
deal to them, by taking that property over subject to the existing loan or on a land
contract that's assignable, or take a purchase agreement that'll allow you to buy that property
on terms. Joe: As we go through these videos, I'm going
to get you more information about how to buy on terms. We'll go into some of that in specific
detail. You never have to put up earnest money and you never have to put up credit to make
this stuff work. Joe: You don't necessarily have to go after
pre foreclosures. There's a lot of people out there who want to sell their property
who most people wouldn't consider to be motivated sellers, but they'll still sell their property
under the terms and conditions you need in order to make a profit. Remember, you don't
have to take title to a property to have control of that property and be able to have ownership
rights in that property in order to be able to turn around and sell it.
Joe: You say your idea of a perfect quick flip would be to have your buyers bring funds
to closing. Like I said, you don't have to go to closing - get the money before you assign
the deal. Use the assignment form that I've given you in a lot of my programs just to
assign that deal to them. Let THEM take it to closing, that way you can have the money
up front. Joe: One of the things that I see a lot of
is that people come to me and say, 'Let me take this property through closing, then I'll
pay you' 'Well, no, I've got six other investors that are interested in this property. I'm
going to take the money that's going to come first. The first person that comes up with
the money gets the assignment, and then they close the deal.' Hopefully that helps.