I want to be honest with you guys, wholesalers have a terrible reputation!
In more recent years, wholesalers have developed a poor reputation because there are literally thousands of horror stories where wholesalers have backed out of deals or took advantage of someone.
My heart is to put an end to all of that and show you guys there is a right and a wrong way to to do business.
In this Simple Guide, we’re going to dive into how to build up your reputation by building relationships with other investors and lenders, how to market your brand and how to build a positive online presence.
Let’s get started!
Building Your Reputation
Real estate is all about relationships so having credibility and a good reputation is huge and sometimes you will have to make decisions that will cost you money to save your reputation.
Here’s a personal example…
We have a buyer who has bought a lot of properties from us and he was having a conversation with another investor about wholesalers they trust in Indianapolis. The other investor had just gotten ripped off by another wholesaler and our buyer referred him to us and said, “The only wholesalers I trust are Brett Snodgrass and his team.”
That meant a lot to us because there were times I had to tell this buyer things that would hurt him as an investor.
For example, he really wanted to buy a particular property. It was a very nice property but I had to be upfront and tell him that although the property is very nice, there is a super messy eviction going on. I wanted to give him a heads up so that he didn’t run into any messy surprises after purchasing the property.
There were also times I had to send money to him because we had promised to clean out a property but our cleaning guy was unable to get to the property in time.
Even though it costed us a couple extra thousand dollars to cover the property clean up, it made our relationship with that buyer stronger and now how he’s more likely to buy five properties a month instead of three because he trusts us.
Reputation is king in this business so don’t be afraid to go the extra mile even if you lose money because trust me, it will pay off in the end.
Here’s another topic that gives wholesalers a terrible reputation…backing out of deals!
Never back out of a deal no matter what!
Many wholesalers out there will just put $10 down for earnest money so in the worst case scenario, if they have to back out of the deal, they’ve only lost $10.
When I hear those type of things, it leaves me with the impression that the investor is selfish and all about themselves.
Here’s why…
Yes, the investor only lost $10 from backing out of the deal however think about how much the motivated seller is will lose.
They’ve lost time, excitement of selling their home, they’ve lost their moving arrangements and everything. Backing out of a deal leaves your motivated seller in a bad situation when it’s our job as a wholesaler to serve them by purchasing their property to them out of their situation.
So yes, you the investor is out $10 but you have let your motivated seller down and you must take those types of things seriously.
Networking with Sellers, Buyers, other Investors
Along with your reputation, branding is huge in real estate and networking with other investors is huge.
Real Estate Investors Association meetings are where all the investors hangout and I’ve met many buyers at my local REIA meeting.
So always attend your local REIA meetings because you never know who you’ll meet and what you’ll learn.
I wish I would have learned about the importance of attending these meetings because I didn’t start attending until I was seven years into my business.
Now we host a monthly meetup where we teach other investors how to wholesale properties which has allowed us to strengthen our brand and credibility in the wholesaling community.
Just think about it…
If you attend a college class, who do you feel is the smartest person in the room about that particular subject matter?
Probably the professor.
If you are teaching something, people look up to you as an educator or an advisor. Even though you actually may not be the smartest person in the room about that subject, you appear to be because you are standing in the front of the room talking about the subject.
That’s why we teach wholesaling. Plus we enjoy teaching and helping others.
People ask us, “Well why would you want to share your secrets?”
Well there’s really no secrets and I believe that if you give enough back, you will receive and now people are asking us to speak and give presentations which is all branding for Simple Wholesaling.
Marketing Your Brand
In my first seven years of business, I didn’t really have a brand and I had a couple companies with terrible names.
My first business, Kaylin-n-Kompany, which was named after my daughter but it was a pain because I had to explain the name to my title company every time I was closing on a property.
Kaylin is my daughter and that’s awesome that I would want to name a company after her but like what the heck? It was a terrible idea and I just didn’t know any better.
The second company was Indiana Luxury Homes, Inc.
Now-a-days I just sit and think about what did I do with most of my day back then. Did I just sit around and come up with the dumbest names possible for my business?
Yes, it would have been a cool name if I was selling million dollar mansions but I was selling $30,000 houses!
So a few years ago, I decided to keep things simple because I hate complicated things, and that’s when Simple Wholesaling was born and I decided to run with it and brand that name.
Building a Presence Online
It’s important that you utilize your social networks to build an online presence for your wholesaling business.
There’s Facebook, LinkedIn, Twitter, Snapchat, BiggerPockets, Instagram, YouTube, the list goes on.
BiggerPockets is the Facebook of real estate investing so I would strongly recommend branding yourself by asking questions, answering questions, posting properties.
It’s critical that you network on these sites with a giving mindset by constantly asking yourself, “How am I going to give?”
Before stepping into your REIA meetups and onto BiggerPockets, keep this in mind.
Don’t constantly suck information from people so be intentionally about adding value to conversations and discussions as well.
If you ask a question on BiggerPockets, make sure you answer two questions on there.
Give twice as much you would ask.
Fostering Relationships with Lenders
Although branding is extremely important, sometimes you have to pay your dues as well in order to build up a solid reputation.
People want experience, including lenders.
Checkout this scenario…
I’m a lender and an investor wants to buy a house for $100,000. So let’s say they were going to wholesale the property and they have a buyer who couldn’t come up with the money until two weeks later. So I say yes and lend them the money for two weeks but I’m going to charge them three points ($3,000) on the loan and 12 percent interest.
Now some people would hear, three points and say what a crook!
Some people would hear 12 percent interest and freak out but if you really equate 12 percent interest for two weeks, it honestly isn’t that much if you do that math.
So sometimes you have to pay your dues. I’ve paid 2 points, 3 points, 4 points, 15 percent interest and I’ve even paid 18 percent interest.
You just have to get your foot in the door with your lender and then once you build that relationship by doing a few deals with your lender then you can sit down with them a negotiate your interest rate because now you have skin in the game.
Don’t worry about some of those rates and risk losing your deal especially if you have a good deal on the table.
Build a solid relationship first, negotiate later.
Where Do You Go When You Need Help?
So if you’re brand new, I would recommend finding someone who has walked down that road before.
I have a business coach. Now although he hasn’t walked down the wholesaling road before, he has walked the road of building a business.
And don’t just send them an email saying, “Hey, I’m a new wholesaler, can you help me?”
Check out of previous Simple Guide to learn the best way to approach someone for help.
If you’re in a different market and you’re reading this, please reach out. Humbly speaking, I probably know the top wholesaler in all of the major markets and they are always looking for deals opportunities to partner on deals, I can help link you to the right person.
So if you guys needs help and you’re in Indianapolis or any surrounding areas, you can send your deals to us and we would love to either buy it or partner on it with you.
There also lots of resources and recommendations on our website as well.
Conclusion
Although we talk a lot about wholesaling strategies such as lead generation, networking, finding buyers, closing deals and the list goes on, I just want to stress the importance of having a good reputation because once your reputation is tarnished, your wholesaling business will end rather quickly because no one will want to do business with you.
So as we continue to share wholesaling and business strategies, keep servanthood at the front of your business.
If you approach your business with a heart of servanthood, your reputation will mirror that and your business will flourish.
God bless!
