We just bought 3 houses right next to each other in a small town in PA for $50K all in ... We had them cleaned out, and spent 3 days cleaning them up nicely (they were pretty rough) ... They need a bit of work to get them "rent ready", but we are offering them on seller financing to some Buy and Hold Investors I know for $160K ... And what's crazy is that ... to them ... that's a GREAT DEAL!!! ... Because once they're rented, they'll be bringing in a combined $2300/month ... Well over the 1% rule 💪... Such a great video, Jerry! Always love learning from you. 😊
Just out of curiosity, did you pay the 50k in cash upfront? If so, when you seller financed, did you get the 50k back as down payment or are you going to take a while to recoup that with a smaller down payment from your buyer?
@@starwarswannabes285 Hey friend! Yes, since I left this comment, we have actually pretty much finalized this deal ... We borrowed the 50K from a Private Money Lender to get the deal done ... That included the cost not only to purchase the properties, but also to clean out a couple of the houses, get the utilities turned on, etc (no repairs, no rehabs - just making them walkable) ... We then owner financed (seller financed) them to an end buyer AS-IS for 170K - Creating a 120K net profit spread in equity ... We got a 15K down payment, which we used to pay down some of the 50K underlying loan (from our Private Money Lender) ... So now the underlying loan is 35K ... We are using the $1K/month mortgage payment from the new buyer to pay off the underlying 35K still left (at 12%) ... That should take about 3.5 years ... Once the underlying loan is paid off - because of how the loans are amortized - we will actually have about 145K in equity still owed on our seller financed loan to the buyer (not just 120K) ... The cool thing about this deal is the buyer agreed to a 5 year balloon (meaning they have to pay off the remaining balance before the 5 year mark) ... So if all goes according to plan ... We will probably actually make 145K in profit on this deal (not just 120K) when they cash us out at some point within the next 5 years ... Give or take. :) ... Hope that helps!
Thank you, Jerry. You really are a flipping genius. I have been studying your videos and investing in your seminars and they really are helpful, and they make the most sense!!
Jerry you’re a flipping genius. This video is so informative and concise. Straight to the point and explains everything clearly. I have a property under contract to a flipper right now, but it’s a little late to find a diff buyer, but now I know. Thank you!
jerry how did you get 244,000 for the landlord buy price we should be at. I did 282,000 - 20,000= 262,000 - 10,000 which is the repairs and i got 252,000. where is the other 8,000 going ?
Thank you Jerry, you are such a great instructor, you seem to simply these strategies to my understanding. I have not been in this field of study, so totally new to all the strategies and math wrapping my head around has taken me forever to digest. You are a Flipping Genius!!
Question: based on the landlord calculation, how would you determine ARV to be 365k with a 10k rehab budget? Is this intuition acquired by experience? Or is there a rule of thumb to use to reduce ARV based on reduced rehab level?
Thanks for these gems!💎Diversify your approach to calculating wholesale offer prices in real estate. Relying on a single method may lead to missed opportunities. Continuous learning and adaptability are key to success in this dynamic market!
Do we use ARV x .70? or ARV x .84? I've heard that .70 isn't what investors are using today. Which one should I use? How would I know what the Investor is going to use when figuring out how much to offer the seller?
Hey jerry I hope all is well, I got confused on a certain part and if you have time to explain I would appreciate it, i understood the Flippers Buy Formula but when you started to talk about the landlord paying more for the same deal why did the “ ARV” change for the same deal, I understand the landlord doesn’t want to put in as much work for the property so the repair cost isn’t as high, but where did $365,000 come from when the formula had only 10,000 for repairs
I understand the Flipper formula but I'm struggling with your example for the landlord/buy and hold. Based off your example, I keep getting an as is value of $355k plus $10k to get an ARV $365. Or use the original As is value of $350k and add $10k in repairs= ARV $360k. Take either and x 80% right? You get either $292k for the first example or you get $288k for the second. I've been ripping out paper trying to understand how you got to $282k. I've ran the formula as much as possible inside and out🤯. PLEASE HELP
its super unclear but what I gathered is that for landlords the 365,000 is the as is value not the ARV. So the formula would be: as is value x 80% - renovation fee = buy price So plug in the numbers he mentions: $365,000 x 80% - $10,000 = $282,000 I think
Hey Jerry, can my partner send you a deal she has in Georgia. It's in pre foreclosure. Auction date is Jan. 2nd. Seller owes 9-10k back mortgage. Premarital property. Wife is in the property with 2 kids and on drugs and won't leave willingly. He owned the property years before he married her. If the property is owned by someone else, then cans she be evicted legally?? From my understanding, in GA he can't just evict her because she's his wife. We definitely need help with this one. This may fit your criteria.
Can someone help with the novation strategy formula: If the seller wants $350k(which is the as-is value) I would minus 8% & minus 40k wholesale fee, which would equal buy price. The buy price would be for the cash buyers? $350k-8%-40k=$282k
I’m just starting off wholesaling real estate here in Chicago I found some cash buyers that are willing to work with me if I bring them deals. I’m looking to jv these deals with a wholesale starting out how would I present a deal to my cash buyers? Would I be the same information I’m getting from these wholesalers that are working with sellers? Sorry if this is a confusing question. Need helppp
Hey Kelly I’m just getting started with wholesaling as well and I am stuck trying to figure out how to get the right arv’s. Have you gotten the gist of it yet? If so can you please help me?
Hey Jerry, lets say I have the deal locked up at 210k and buyer agreed to buy at 230k, giving me a 20k assignment fee. Does the buyer spend over 230k at the closing table due to closing costs?
You should already have factored into your wholesale price, repairs, and closing costs, then add your wholesale fee. That way, Your Buyer will never have any. Unexpected surprises. Nobody wants to pay more than what’s expected.
Big Question w/ the Flippers example: If there was a property that had an as-is value of $350k, how would you get that seller is to sell for $210k? They are missing out on almost $100-150k... I know there are several factors like how outdated or distressed the home is or how badly the seller wants/needs to get rid of the property, but it seems like all of the stars in the universe would have to align for a seller to accept an offer where they know they are losing out on hundreds of thousands of dollars. What am I missing?
You have to be sure to find motivated sellers, and or distressed properties. Solving the sellers problems and helping them to realize that it will cost them more money in the long run to hold on and just hope that it sells, especially if it needs repairs and or upgrades/updating. It’s important to know what the seller is trying to accomplish, income to an understanding of how it would be worth it to them to sell for all cash!!! Cash is King! Financing, you have to wait and hope that it goes through, and especially right now with the rates being high and lending criteria and requirements, being more restrictive and tighter. Cash is guaranteed.
Okay real quick, I have 2 houses sent to me from the property owner, I was trying to wholesale one of their houses and someone got it the day before me , he sent me 2 homes saying I could give him a price before it’s listed! How do I come up with a price for non listed homes?
Often times, sellers don’t have the money to put into a house to get it ready for market standards. A novation agreement works in these scenarios. You put the property under contract, file a mechanics lien on the property and then complete the rehab and everyone gets paid at closing.
@@wholesalingwithlenny does the fact that you have it under contract make it so that they have to sell and the lien is against them and not you since it was under contract at the time you filed the lien?
Yes, that’s correct, because once you know what your buyer is looking for, then it’s easier to find the right house. If you find a property and put it under contract, then you are pressed for time, and your rushing to find a buyer, who may or may not want that house and or location
I think because the flipper is paying the closing cost since you are reassigning the contract to the flipper instead of closing on it. Best guess. Lmk please if you found the answer elsewhere.
Question: based on the landlord calculation, how would you determine ARV to be 365k with a 10k rehab budget? Is this intuition acquired by experience? Or is there a rule of thumb to use to reduce ARV based on reduced rehab level?
@@FlippingMastery got it, so if I am pitching to a by and hold investor, would it be wise to assume they're not going to spend as much on rehab and reduce ARV 20%?
@@markbeal5834 - or better yet, find your buy, and hold Investor, and figure out their formula. Ask them what is their buying criteria/buy box? Let them know it will save you time and save them time, so you’re not just sending them any and all deals hoping it’s something they want.!!
![How To Find Cash Buyers For Wholesaling! [FREE]](/img/1.gif)
We just bought 3 houses right next to each other in a small town in PA for $50K all in ... We had them cleaned out, and spent 3 days cleaning them up nicely (they were pretty rough) ... They need a bit of work to get them "rent ready", but we are offering them on seller financing to some Buy and Hold Investors I know for $160K ... And what's crazy is that ... to them ... that's a GREAT DEAL!!! ... Because once they're rented, they'll be bringing in a combined $2300/month ... Well over the 1% rule 💪... Such a great video, Jerry! Always love learning from you. 😊
Flipping genius Jason!
I'm learning from the best ;) @@FlippingMastery
Just out of curiosity, did you pay the 50k in cash upfront? If so, when you seller financed, did you get the 50k back as down payment or are you going to take a while to recoup that with a smaller down payment from your buyer?
@@starwarswannabes285 Hey friend! Yes, since I left this comment, we have actually pretty much finalized this deal ... We borrowed the 50K from a Private Money Lender to get the deal done ... That included the cost not only to purchase the properties, but also to clean out a couple of the houses, get the utilities turned on, etc (no repairs, no rehabs - just making them walkable) ... We then owner financed (seller financed) them to an end buyer AS-IS for 170K - Creating a 120K net profit spread in equity ... We got a 15K down payment, which we used to pay down some of the 50K underlying loan (from our Private Money Lender) ... So now the underlying loan is 35K ... We are using the $1K/month mortgage payment from the new buyer to pay off the underlying 35K still left (at 12%) ... That should take about 3.5 years ... Once the underlying loan is paid off - because of how the loans are amortized - we will actually have about 145K in equity still owed on our seller financed loan to the buyer (not just 120K) ... The cool thing about this deal is the buyer agreed to a 5 year balloon (meaning they have to pay off the remaining balance before the 5 year mark) ... So if all goes according to plan ... We will probably actually make 145K in profit on this deal (not just 120K) when they cash us out at some point within the next 5 years ... Give or take. :) ... Hope that helps!
@dr.jasonbaca - what's your email / FB? I'd like to add you to my cash buyer list as I'm also in PA.
TY Jerry
I appreciated how you applied different calculations to get the exit and maximum offers for the Seller and Cash Buyer.
Thank you, Jerry. You really are a flipping genius. I have been studying your videos and investing in your seminars and they really are helpful, and they make the most sense!!
Jerry you’re a flipping genius. This video is so informative and concise. Straight to the point and explains everything clearly. I have a property under contract to a flipper right now, but it’s a little late to find a diff buyer, but now I know. Thank you!
Jerry, you are a Flipping genius. Thank you for the 5 Day Challenge
Just getting started on my journey, appreciate all you are doing!
jerry how did you get 244,000 for the landlord buy price we should be at. I did 282,000 - 20,000= 262,000 - 10,000 which is the repairs and i got 252,000. where is the other 8,000 going ?
Probably commissions and fees
Appreciate the free info 🔥🔥
Thank you Jerry, you are such a great instructor, you seem to simply these strategies to my understanding. I have not been in this field of study, so totally new to all the strategies and math wrapping my head around has taken me forever to digest. You are a Flipping Genius!!
You are very welcome
Whole lot of gold in this vid. Thank you sir!
Thanks once again Flipping Master!! Keep the Hits coming. DRS Real Estate Investments in the DC area.
Jerry, you are a flipping genius. Thank you so much for making the learning process so much easier so I can implement my knowledge!
Thanks Jerry!!! As usual, you're a flipping genius!!!
Question: based on the landlord calculation, how would you determine ARV to be 365k with a 10k rehab budget? Is this intuition acquired by experience? Or is there a rule of thumb to use to reduce ARV based on reduced rehab level?
Well where is the extra 6000 going in the buy and hold formula example. I keep getting 250,000
You’re the flipping man, Jerry!
Thanks for these gems!💎Diversify your approach to calculating wholesale offer prices in real estate. Relying on a single method may lead to missed opportunities. Continuous learning and adaptability are key to success in this dynamic market!
🙏🙏🙏
Jerry, you are a flipping genius!
Jerry, you are a flipping genius.
Yo boss thanks for breaking it into a simple way of understanding step to the transaction
Thanks Jerry, You are a flipping genius!
Do we use ARV x .70? or ARV x .84? I've heard that .70 isn't what investors are using today. Which one should I use? How would I know what the Investor is going to use when figuring out how much to offer the seller?
I love you jerry and the help u give to community
Great video Jerry, you are a flippin genious!
Jerry, you are a Flipping genius 👏 😊
Jerry you are a flipping genius. Thank you for the class.
Jerry, You are a DYNAMIC FLIPPIN Genius. I really need this video. Thank You
Hey jerry I hope all is well, I got confused on a certain part and if you have time to explain I would appreciate it, i understood the Flippers Buy Formula but when you started to talk about the landlord paying more for the same deal why did the “ ARV” change for the same deal, I understand the landlord doesn’t want to put in as much work for the property so the repair cost isn’t as high, but where did $365,000 come from when the formula had only 10,000 for repairs
Because if the landlord only does a small update, the value doesn’t go up as much as a full renovation
Just started studying a couple days ago, I appreciate you taking yah time out to answer ! 🙏🏽
u are a flipping genius jerry
This is called, underwriting, right? Running numbers/analyzing/comping a property along with an exit strategy? Asking for clarity..
Correct
Jerry you are a flipping genius! 😁
You are genuis. I wish there would be some way to ask you questions directly because my mind is full of questions
Fasttrackwithjerry.com
Thanks again Jerry, You Flipping Genius you!
JERRY! Your a flipping Genius
Love your videos.
You're a flipping genius 😎
Thanks!!!
Jerry u are a flipping genius, great informative video as always…..
Check In - December 13,2023--19:32-- Soon Enough
Team Jerry! 🔥🙏🏽
I understand the Flipper formula but I'm struggling with your example for the landlord/buy and hold. Based off your example, I keep getting an as is value of $355k plus $10k to get an ARV $365. Or use the original As is value of $350k and add $10k in repairs= ARV $360k. Take either and x 80% right? You get either $292k for the first example or you get $288k for the second.
I've been ripping out paper trying to understand how you got to $282k. I've ran the formula as much as possible inside and out🤯. PLEASE HELP
its super unclear but what I gathered is that for landlords the 365,000 is the as is value not the ARV. So the formula would be: as is value x 80% - renovation fee = buy price
So plug in the numbers he mentions: $365,000 x 80% - $10,000 = $282,000
I think
Really great video, I appreciate it
FLIPPING GENIUS
Hey Jerry, can my partner send you a deal she has in Georgia. It's in pre foreclosure. Auction date is Jan. 2nd. Seller owes 9-10k back mortgage. Premarital property. Wife is in the property with 2 kids and on drugs and won't leave willingly. He owned the property years before he married her. If the property is owned by someone else, then cans she be evicted legally?? From my understanding, in GA he can't just evict her because she's his wife. We definitely need help with this one. This may fit your criteria.
Hey brother I have cash buyer in GA I’m in Astro flipping let’s connect and close this deal.
What is the benefit to a seller to do novation vs just listing with an agent?
Can someone help with the novation strategy formula:
If the seller wants $350k(which is the as-is value) I would minus 8% & minus 40k wholesale fee, which would equal buy price. The buy price would be for the cash buyers? $350k-8%-40k=$282k
Nope
$350 is the as-is market value you sell to a retail buyer. $282k is what you contract with seller
Im not sure about the retail buyer formula. first you say minus 8%, but with the numbers you subtracted 98%?
Thanks Jerry!!!
I’m just starting off wholesaling real estate here in Chicago I found some cash buyers that are willing to work with me if I bring them deals. I’m looking to jv these deals with a wholesale starting out how would I present a deal to my cash buyers? Would I be the same information I’m getting from these wholesalers that are working with sellers? Sorry if this is a confusing question. Need helppp
Hey Kelly I’m just getting started with wholesaling as well and I am stuck trying to figure out how to get the right arv’s.
Have you gotten the gist of it yet? If so can you please help me?
Hey Jerry. What is the best app or software for cold calling or texting blasting for free. To start up. Can you make a video thanks
Hey Jerry, lets say I have the deal locked up at 210k and buyer agreed to buy at 230k, giving me a 20k assignment fee. Does the buyer spend over 230k at the closing table due to closing costs?
You should already have factored into your wholesale price, repairs, and closing costs, then add your wholesale fee. That way, Your Buyer will never have any. Unexpected surprises. Nobody wants to pay more than what’s expected.
How did you estimate the repair cost?
Where do I get the excel sheet for the average of the art on the realtor and zillow arv
Big Question w/ the Flippers example: If there was a property that had an as-is value of $350k, how would you get that seller is to sell for $210k? They are missing out on almost $100-150k... I know there are several factors like how outdated or distressed the home is or how badly the seller wants/needs to get rid of the property, but it seems like all of the stars in the universe would have to align for a seller to accept an offer where they know they are losing out on hundreds of thousands of dollars. What am I missing?
You have to be sure to find motivated sellers, and or distressed properties. Solving the sellers problems and helping them to realize that it will cost them more money in the long run to hold on and just hope that it sells, especially if it needs repairs and or upgrades/updating.
It’s important to know what the seller is trying to accomplish, income to an understanding of how it would be worth it to them to sell for all cash!!! Cash is King!
Financing, you have to wait and hope that it goes through, and especially right now with the rates being high and lending criteria and requirements, being more restrictive and tighter. Cash is guaranteed.
Hey Jerry, someone told me you're flippin genius.
😂 I try
With your novation calculation is that 92% enough for realtor fees, closing costs and the concessions we are seeing more of in todays market?
I was thinking 88% but haven’t completed one to have a good proof of concept.
Okay real quick, I have 2 houses sent to me from the property owner, I was trying to wholesale one of their houses and someone got it the day before me , he sent me 2 homes saying I could give him a price before it’s listed! How do I come up with a price for non listed homes?
Great video
Jerry forgive my ignorance. Why would a seller agree to a novation instead of just listing it themselves?
Rule #1 about wholesale real estate:
Never try to get in the head of the seller
You sell convenience and certainty
Often times, sellers don’t have the money to put into a house to get it ready for market standards. A novation agreement works in these scenarios. You put the property under contract, file a mechanics lien on the property and then complete the rehab and everyone gets paid at closing.
Thank you so much for the responses. This helps a bunch and make so much sense!
@@wholesalingwithlennyyou explained that well, do you do any mentoring?
@@wholesalingwithlenny does the fact that you have it under contract make it so that they have to sell and the lien is against them and not you since it was under contract at the time you filed the lien?
I’m still confused on calculating exit price when selling to a landlord. Can someone clarify like I’m 5?
Find out what the rent price is first.
Rent price x 12 months
-taxes & insurance
Ex. $1200 rent X 12 months = $14,400
$14,400 - $2000 (tax) - $1000 (ins)= net annual profit
$11,400/.12 = $95,000 (price rental investor will pay)
$95,000-$10,000 (wholesale fee)
= $85,000 offer price to seller
The .12 is 12% cap rate that most rental investors are looking for to purchase a deal.
So in Wa are buyers buying in the 60-70%? Or is it 70-75%?
Every market and buyer is different, some will buy at 80%.
Does this mean you don’t have to comp?
Ask your buyer. They’ll give you every number you need.
By the way Jerry, you’re flipping genius 🙏
Does anyone know how he's coming up with $244,000 @7:19 ?
Is the Instant Deal Analyzer not working for anyone?
My support team would be happy to help with that! Please reach out to them at: support@flippingmastery.com or (888) 958-3028
nice
So basically I need to find cash buyers before I even get properties ?
Yes, that’s correct, because once you know what your buyer is looking for, then it’s easier to find the right house.
If you find a property and put it under contract, then you are pressed for time, and your rushing to find a buyer, who may or may not want that house and or location
Anyone willing to mentor I am highly motivated and ready to go or I may need to watch this 50 times or so till it clicks 😂❤
That is also me right now lol
Get on bigger pockets great community for new investors
why don't we factor closing costs into this?
Was this answered?
I think because the flipper is paying the closing cost since you are reassigning the contract to the flipper instead of closing on it. Best guess. Lmk please if you found the answer elsewhere.
Jerry The Goat 🐐 I Filled Out The Application For Your Flipster Course. When Should I Expect To Get Started? It would be a honor !
That Was Fast ! Thanks I’ve Been Studying You For A Year Now. I’m definitely appreciative for all you taught me.
Jerry, you are a flipping genius!
Question: based on the landlord calculation, how would you determine ARV to be 365k with a 10k rehab budget? Is this intuition acquired by experience? Or is there a rule of thumb to use to reduce ARV based on reduced rehab level?
No real data. Just the idea that a rental rehab is valued lower than a flip rehab (typically 20% in my case study)
@@FlippingMastery got it, so if I am pitching to a by and hold investor, would it be wise to assume they're not going to spend as much on rehab and reduce ARV 20%?
@@markbeal5834 - or better yet, find your buy, and hold Investor, and figure out their formula. Ask them what is their buying criteria/buy box? Let them know it will save you time and save them time, so you’re not just sending them any and all deals hoping it’s something they want.!!
Jerry you are a flipping genius
Jerry, you are a flipping genius!
Jerry you are a flipping genius
Jerry you're a flipping genius!
Jerry you are a flipping genius