FYI, there is really no legitimate way to document a complaint against a wholesaler.  As licensees, we are required to disclose EVERYTHING.  In fact, when I went to real estate school a while back, all 3 of the states I am licensed in begin by telling students that the most important thing to do as a licensee is DISCLOSE DISCLOSE DISCLOSE.  They drill it in your head.  I've seen plenty of people fined, suspended, and revoked due to non-disclosure.  Unlicensed wholesalers don't have to… That said, I'm not saying unlicensed wholesalers are bad.  I just happen to be required to abide by rules.

I've said this again and again, I empathize with nobody who sends their money to the "selling firm".  Always send your money to a title company in Florida or a title company / attorney in other states.  If you are a sophisticated investor, the first thing you ought to know is where to send your money safely. 

LAWSJS:  I mentioned earlier about your #2.  Sometimes we allow investors to see inventory we haven't closed on yet.  This would be titled still under the old seller and not us.  However we never send one out that we don't have control of. 

LAWSJS:  Things to watch out for:

• Unlicensed wholesalers
• wholesalers with no inventory…if they send you an address, cross reference it on public record to see if they own it.
• Those that have you wire escrow or deposit money to them or their firm.  Never ever ever ever do this.  Google Demetrius Mathis in Georgia.  He used to read these boards. 

I'll defend #2 a little.  As a wholesaler, our buying/selling entity is the same for all of our properties.  Once we have a secured deal in place with the seller we make it part of our "available inventory".  So even if you cross reference the owners name, sometimes it will still have the current owner and if we closed on it, it still takes 2 weeks to record our name in public records.  So that isn't ALWAYS accurate….However, we never send out inventory that we do not control.

I don't know where you can find licensed wholesalers.  There isn't a directory of those people here in the states.  I don't know many.  In fact, my competitors in my market are unlicensed.  Probably why we get a bit of their overflow.  We are licensed, we have our own funds, and that's just the way we do things.

Texas Cash Cow is correct on the lending side.  Private money does not get reported to any type of credit bureau.  There would be no history for a conventional lender to look at.

LAWSJS:  So you had a painting quote marked up over 600%?  I've seen a lot of shady things in my career but I can't say I've ever seen a markup like that unless it was a tangible trading ripoff or selloff. 

Bottom line is that there are thousands and thousands of licensees and wholesalers in the U.S.  It is your choice as an international investor to come here and make friends.  I am on the ground and consider myself a very innovative thinker and strategist.  That said, it took me almost 5 years to create what I consider my perfect team for my business.  Again, I am local, and I still went through 10 property managers before sticking with the same one since 2007.  My lender for U.S properties resides in California!  He lends FL and NJ, both my marketplaces.  Hands down he is better then anyone I have worked with in my backyard.  My partner?  He's a foul mouthed, frugal, arrogant, punky, pretentious jerk…but he allows me to make the decisions and has a very creative mind in the real estate business.  The team is what makes me money personally and professionally. 

LAWSJS and all those looking.  Why don't you just look for licensed brokers who are also wholesalers?  They exist.  Not many, but they do.  I love giving investors the peace of mind knowing that I have their backs in a sale.  I have to or I lose my license.  If I lose my license, I lose my business.  If I lose my business I lose my houses and money…And if I lose my money, then girls won't like me anymore!  So see??  I have more to lose then those without licenses.  We value that and honor our responsibilities.  Well, at least most of us do

Jay:  LLC's are included in that deed restriction too for the most part.  Unfortunately some of the houses we buy have 60 days flip restrictions on them.  Mostly B of A stuff.  I hate it

WorldInvestor:  I totally see your point.  I have said in previous posts that wholesalers and brokers in other countries are what I classify as "generations". 

1st Generation:  Distress direct.  Distress could be buying direct from banks, short sales, courthouse, etc…

2nd Generation:  They purchase from 1st generation wholesalers and typically can bring small volume (oxymoron!) and negotiate a lesser fee from 1st Generation wholesalers.

3rd Generation:  Ripoff

I don't agree with upfront fees the same way I don't agree with paying my workers until their job is done.  Same concept.  Perform, make me happy, and I'll gladly pay you.  Keep in mind, a fee is not a "ripoff fee".  They are doing a service for you to minimize your research time.  If you don't want to pay a fee, get to the 1st generation wholesaler yourself.  If you can't, then you pay a fee.

You mention Section 8..Why, because they pay higher?  True, but keep in mind, the housing authority won't pay the landlord more then fair market rent, which is appraised at about 10% above current averages these days.  I can't remember what Section 8 limits are in FL as I don't have the chart in front of me, but I just did one in New Jersey.  On a 2 bedroom unit in radius, Section 8 has a max payment of $1100 per month.  In reality, after inspections and rental analysis, they will pay $950.  The max doesn't necessarily mean that is what they will pay.  I see a lot of marketing material with crazy high ROI's using the maximum Section 8 allowance.  THAT is overstated in 99.99% of cases.

If no addresses can be provided, it is likely they don't have inventory.  It's done all the time.  Inventory isn't as easy to get as it may seem.  The competition is fierce in Florida right now on the sub 150k market.  Cash local wholesalers dominate.  Reputation is EVERYTHING in buying the distressed asset class.  We help investors like you…not hurt you.  We lay things out on a silver platter….Some just charge higher fees.  I tell everyone I meet…My profit is 8-10%.  That is 8-10% above our acquisition + Rehab.  I don't go below 8 no matter what.  I can't afford to.  If investors don't like it, then they don't buy from me.  It's ok, that's business.  Our inventory sells.  I sell at below retail…but not for 20% below retail.  It's just not realistic. 

TERRIBLE INVESTMENT!!  Everything investors buy in Florida is terrible unless you use me as your wholesale source!!!    Kidding Kidding..

In 2003-2004 I was the marketing arm for a contractor where we built almost 100 homes in South Gulf Cove and Rotunda, located in Pt. Charlotte.  Good thing you are by the hospital!  Lots of old people in FL!  Port Charlotte experienced the same decline as Cape Coral did.  The homes we built in Port Charlotte, we sold for about $250,000 in South Gulf Cove and $180,000 in Rotunda.  Those homes are now $120k and $100k or so. 

Yes, city water and sewer is a huge plus.  However well and septic is a way of life in much of Florida.  Septics last years and years with maintenance.  The biggest problem with septics is tenant occupancy number according to health department recommendations, and tenant education.  We have all of our tenants watch a 15 minute video of "how to care for your septic".  It works like a charm and our average pump out is 1.3 years.  But good for you in buying city water and sewer. 

Would love to have the address, but  you say you are on a main road?  Why would you do that?  Traffic?  I hope you meant OFF a main road.  Based on your square footage, I would guess your rental will be $800 to $850.  If your home was built in the 1960's, you have no drywall issues.  Drywall issues were in 2005-2007 new construction. 

Kyler:  See you in Boca Grande Pass for the Tarpon Tournament this year.  I have a mako that I take out with a couple buddies every year… I had a 5 footer last year only to get nailed by 2 hammerhead sharks about 10 feet below the boat.  Although disappointed because I fought the tarpon for 90 minutes, it was an awesome sight watching 2 mammoth sharks eat this tarpon in 30 seconds.  Talk about an adrenaline rush!!

Jay:  What are your "better markets in Florida"?  I'm curious since you don't invest or lend here.  I'm assuming you mean major metro markets?  Miami?  Tampa?  I really like Tampa's multi-family market, not single family market as much as I do Fort Myers or Cape Coral single family market.  I know your thoughts on Lehigh.  I bought a house in SW Lehigh almost a year ago for $48,000.  Minor rehab needed, about 3k worth.  Current value or what I could get retail right now is $70k…and that's a cash buyer price.  I think $100k values in SW Lehigh by this time next year.  Financing buyers are already in the 80's.

I just bought 5 lots in a row in Florida.  Cheap but in areas where home prices are skyrocketing.  Thinking of 2014 for selling or building.  Maybe even early 2013 so homes can be ready come season time.  That would exceed expectations.

Those looking to diversify into something else, multi family is going crazy right now and will continue to do so.  Get yourself a stable 9% Cap and sit on it for a bit.  Add value in a year or 2 by updating kitchens/baths….Investors are so caught up in Cap Rates in the teens.  To me, this is a waste of time because those almost always exist in ghettos.  In multi family commercial, you will get outbid, no doubt if you base your bid on a higher cap rate in a marketable area..  The market is trading at 8-10% Caps in good markets right now for C-Class.  Higher Cap means higher risk…Lower Cap means lower risk.  Just historic.  This is why the MF market is trading in different Cap Rates when buying Class A, B, or C.  New Construction (A-Class) trades at a MUCH lower Cap Rate then C-Class.  Get a good agent and buy a 6-9 unit building.  They are flying right now and rental rates expected to rise.

FYI, when shopping commercial / multi family, if you calculate anything less then 40% of your gross income as expenses, you likely don't have all the info.  ..Important to get it and that is typically done in due diligence.

Richard,
Thank you and you are correct I do not understand certain international things in financing.  I rely on people like you to school me on it so it can improve my business.  Since this is a forum, why don't you enlighten us on what these things are.  Probably good for the investors on this board to know also.  Thanks so much

Commercial is a whole new game.  Your Cap Rate (commercial), which is different from a Net ROI (residential) is calculated using more detailed formulas.  It is important for you to understand how this works or a property manager can rip you off.   NOt saying they will, but it exposes you to weakness if you don't understand the deal.  We do a lot of multi family commercial.  I don't typically do retail or office.  I am more big on multi-family.  There are some great deals out there.

Aegis has only had to take back 1 property in 2 years.  Considering their volume that is very good.  My brother is the main underwriter of most of the deals.  He doesn't trust anyone else, not even in his own office to ensure least amount of risk.  He's a stickler but they run a very good program there.  If you aren't leary of every deal as a private lender, you will fold very quickly.