|Are you familiar with the term daisychain in real estate?|
Basically it’s when a supposable “buyer” takes your contract, marks it up in price, and then goes out and markets that contract as if it were his own.
This is exactly what happened to one of my younger team members.
He was so excited about getting a property under contract, he went against my advice and chose to commit to a property. When he went out to wholesale it, it wouldn’t move.
I had to step in and take control of the situation.
I had a colleague share it with a targeted list of qualified buyers that could actually put this property under contract, even in a tight margin scenario like this one.
Everything was going great until an ill prepared newbie investor, who had all the right intentions of selling this property, got involved.
This poor girl had no support or guidance in any shape or form.
It turns out a seasoned investor brought her into the business and threw her into the pit without any sort of armor to defend herself.
She did EVERYTHING wrong. She even placed the property on Facebook marketplace with the address clearly exposed to every unscrupulous so called wholesaler out there.
Sadly many of these vultures started marketing it to anybody that would listen to them – increasing the price to whatever they thought they should earn.
One idiot marked it up and over stated the properties value by two hundred thousand.
If this ain’t the wild west of wholesaling I don’t know what is.
I took pity on this young woman, personally called her, and personally explained how the many components of this business should be operated to be effective and profitable.
Although she was very eager to learn, her dismal start in wholesaling was a result of poor (more like nonexistent) mentorship.
Because of her unintentional mistake, a bunch of my friends and colleagues reached out asking if this was my property that everybody’s pitching out.
This poor property was being prostituted by every dirty scoundrel that could get their hands on her.
Today was a day of intense laughter and regret and sorrow all in one. Mostly for my young apprentice who chose to break one of the cardinal rules of real estate investing which is stick to your numbers and only go under contract if those numbers are solid.
My young apprentice learned the hard way, but I don’t believe he will ever make this mistake again!
|Committed to your success,|
Ernie “Eliminating Real Estate Pimps” Vargas | The Probate Fox