The mls stands for multi listing service. It is a system that sales agents use to post up properties and sell through other agents that have access to the system. This system is very valuable to investors as it is a great place for inventory as Realtors run into a lot of opportunities and post them on there.
It is said that there is no good deals on the MLS. This is 100% incorrect. What is true is that there are good deals on the mls, its just they move so quick by the time you see it, it is already under contract. So lets say you find a deal to flip on the mls, how would you go putting it under contract?
First of all, when you go after deals on the mls you need a Realtor to represent you. Typically your Realtor will require you to give him/her a check for $1k or more as what is called earnest money. This money is the same as the $1 consideration you must give the homeowner when putting a house under contract. It is just, with Realtors they have a higher expectation on what that number is and because of that they ask for more. Note that there is no law saying that the number has to be $1k. In essence it can be $1 to $1m. Its just Realtors don’t take you seriously as a potential buyer if he earnest money amount is not reasonable to them.
This being said, if you just came back from some real estate investor training and you tell a Realtor you want to put houses under contract with $1 they will not want to work with you. My point here is Realtors actually hate working with investors. Especially newbies… people that never flipped before or have the money to buy at worst case. This being so you must work in every way to not fall victim to that image. As soon as you do that agent won’t work with you anymore.
With that said, know who you can do the $1 consideration with and who you can’t. Homeowners that you meet yourself don’t have a standard expectation of what to expect as earnest money and because of that $1 is fine with them. When working with Realtors, in their world they are accustome to $500, $1000, $5000, $10000…. Simply ask them what they expect of you to put down as earnest money and match their expectation to move forward.
Once you submit your offer, send over the earnest money check to your agent and get a contract back from the sellers agent you now officially have the deal under contract. If you plan to flip the property by selling the llc, make sure to read my how to on it. Other then that you are all set to go and flip the property.
Like my write up? Want to learn more on how to wholesale houses? I invite you to look into my how to wholesale for quick cash training video. As always, if you didn’t learn anything from the video just email us and we will gladly refund you 100% of your money.
To your continue success,