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Investing Strategies

Risk-Free Wholesaling: 3 Easy Ways I Protect Myself

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holdingExpert, Chris Chico, doesn’t understand why other investors get stuck with analysis paralysis. When it comes to making money in the real estate industry, he’s all about taking risks – as long as you use the right protection. And today, Chris is going to tell us his 3 favorite methods of protection when he’s playin’ the field.

But first…why are we buying what he’s pitchin’?

Up to Bat: Chris Chico

Chris Chico is a successful real estate investor from Florida who specializes in wholesaling – both locally and long distance markets. Over the last two years, Cris has successfully flipped 116 properties and generated over $1,452,108 in profits.  Rarely does he ever personally inspect any of the properties that he flips or meet with any buyers/sellers. In fact, most of the markets in which Cris operates are located thousands of miles away.

Cris Chico is indeed one of the pioneers of Virtual Wholesaling, and he is consistently closing deals each and every month all across the United States.

Now, Let’s Play Ball

Me:  So, Chis, what is your secret to protecting yourself when taking risks? How do you avoid analysis paralysis?

Chris:  I like to explain this to my team using a little Babe Ruth analogy…

I tell them how Babe Ruth once earned the title,” The King of Homeruns”… But, what most people don’t realize is that he also has the record for the most strikeouts. You see, to have the record for the most homeruns, he had to swing the bat more so than anybody else.

I look at making deals the same way. I want more than just a couple deals at a time under contract. To me, if I only have like 3 deals contracted, then we are striking out – we are missing opportunities and we’ll never know how many homeruns we could’ve made. Instead of just having those 3 solid deals, I’d rather have 5 deals under contract (even though I may have to back out of 3 and end-up with 2 that actually closed).

If I am batting 100%, I am not being aggressive and taking enough chances as I should be. The way I do my deals, I am never having to put money up so I won’t lose it. Why shouldn’t I take the risks and lose some?

I have an agreement with the seller that the deposit is not due until after the inspection period, and it is not me who is going to put up that deposit – it’s the buyer.

My inspection period is 10 days, which is equal to 15 days when you put it in business days. If you had something under contract for 30 days, that would be 45 days in business days. To the seller it seems like a quick close, but you are allowing yourself plenty of time to do the deal.

So to avoid paralysis analysis, I protect yourself by:

  1. Using the buyer’s money for deposit. You will never have to make a down payment this way. The seller’s only recourse will be the deposit and you can walk away with zero liability.
  2. Having the seller agree that the deposit isn’t due until after inspection.
  3. Allowing yourself an ample timeline using business days.
Do It To It! Immediate Action Steps

Juggle more deals and look at them all as opportunities.

Take Risks and don’t think “too much” about deals and get stuck in analysis paralysis.

Protect yourself by (1) using the buyer’s money for the deposit, (2) making the deposit due after inspection, (3) calculate days in business days.

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