CHAPTER 6 Benefits and Risks of Wholesaling s of Wholesaling As with any investment venture, wholesaling can be profitable, but it’s certainly not without its risks. Let’s first look at the positive aspects.
BENEFITS
Wholesaling is a good option for anyone who wants to start real estate investing.
There are a few reasons for this. As far as investment options, the risk is lower with wholesaling. It also serves as an experiential learning opportunity to help you understand how finding, evaluating, buying, and selling properties works. Further, you can do this as a side job — learn how transactions work, figure out your system to decide on deals and keep track of all related information, and get your marketing plan set up, and you’re pretty much good to go.
You don’t need to put up much of your own money.
As previously discussed, when you assign the contract, you’re selling that contract to the buyer, not the property itself. It’s the situation I discussed earlier — using the B-to-C transaction to pay for the A-to-B contract. And unlike flipping, you don’t need to do anything to fix up the property. At most, you’ll put down an earnest deposit. Double-closing requires a little more money, because you’ll actually be closing on the first property. But don’t forget, you can get that money from a variety of places (banks, private investors, 40
Powered by FlippingBook