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Written by : Gino Dorning
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what's up everybody welcome back to my youtube channel thank you for tuning in and in today's video i'm going to show you how to set up an llc for your wholesaling business so make sure you stick around to the end of the video so you know how to set up your llc for your wholesaling real estate business also if you're not already subscribed make sure you go down below hit the red button and subscribe to the channel it helps me reach more people and impact more lives so i'd really appreciate it if you go subscribe other than that let's get right into the video all right so today we're going to be talking about how to set up an llc for your wholesaling business now what is an llc an llc is a limited liability company now can you wholesale real estate through your personal name yes you can you can wholesale real estate through your personal name but it is better to have an llc and here is why an llc is a layer of protection it's away from yourself it's a layer of protection for yourself if somebody comes after you they're going to be suing your company not your personal self and here's the second reason why an llc is so good to use if you are under the age of 18 and llc is the ticket to be able to work and do things like you're an 18 year old if you have an llc with a member on it that's over the age of 18 you are 18 years old basically you can conduct business under that company as if you are an adult not a minor so if you want to wholesale real estate under the age of 18 all you need is to create an llc with someone over the age of 18 and now you can sign contracts and do deals so that is why an llc is so great now to create a limited liability company an llc how are you going to do that now there is a way to do it that is more cost effective but you have to apply to be your own registered agent with the state and i don't really like going down that road you save a few bucks but it's not worth my time to go down that road it is only going to cost you a few hundred dollars a couple hundred dollars to do it the way i create llc's step one to create an llc you're gonna go to a website like in corporate dot com or just google create an llc and there's a bunch of different websites you can use to create an llc personally in the past i have used incorporate.com also you can use legalzoom i know people that use legalzoom to create llcs but personally i like incorporate.com now once you go to incorporate.com you're going to fill out a bunch of information it's super easy to do just go through the process and fill out all your information and then pay for it and then they will create you an llc the beautiful thing about incorporate.com and websites like this is they renew your llc yearly for you you pay yearly they do all the work to renew it so you don't really have to worry about a thing so that's what's super amazing now it will take a little bit of time to get your llc back from a website like this it will take a little bit of time to get your llc back from incorporated.com but once you have your llc paperwork then you can move on to step two step two is to go to irs.gov and submit your llc information in order to get an ein number you need an ein number which is an employee identification number now why do you need an ein number the reason you need an ein number is that's what you use in order to open up a bank account under the company so now you have your llc you registered at irs.gov your llc and you got your ein number now it's time to go to the bank and use your ein number to open up a bank account under the company now once you have this bank account open you are able to start conducting business and doing transactions taking money in bringing money out paying for things out of this company bank account and boom you are all set up you have your llc you have your ein number you have your company bank account and you are ready to rock and roll now you're probably asking yourself do i need an llc right off the bat i'd rather save the 200 rather than spending the 200 to create an llc i'd rather spend that 200 on marketing to try to get my first deal you are on the right path you're thinking smart because you don't need an llc unless you're under the age of 18 to do your first deal i do recommend if you are on a super tight budget two forget about the llc for your first couple deals and just try to get those deals save the money to spend on marketing after you do a couple deals i do then recommend to get an llc for your protection you want that layer in front of you you want to operate through a company not through your personal name as you keep doing deals so yes you can get your first couple deals without an llc but then i highly do recommend creating a company there on and as you start doing more business you'll realize oh i should create a company for this i want to separate my income i want to separate my income for my taxes this company is different than this one let me create a new company and over time you will create more companies currently i have four companies that i have for limited liability companies for the different businesses that i run uh whether that's personal like this education youtube stuff or affiliate marketing and then i have my wholesale business and then i have different llc's for flipping because i have money from from different sba loans that i've gotten from the government in those companies so you can get more sba loans too if you have multiple companies that are showing income and showing that they're doing business or they're showing a deficit of business they're showing a loss then the government will loan you money to get you on your feet with these sba loans that have been coming out so having multiple llc's can be an amazing thing as well when when government gives out money like the small business loans that they've been giving out due to kovid you're able to you know collect more of that money and leverage more of that money if you have more companies and that's what i have done but overall that is how to create an llc let's do a quick recap so an llc is a limited liability company how are you going to create one you can become your own registered agent with the state and do everything manually to to create your llc and save some money you're only going to save like a hundred bucks i don't think it's worth it so what i do to create an llc just google create an llc any of those websites can create them for you i personally use incorporate.com incorporate.com they'll create it for you and then they renew it every year so you don't have to worry about a thing other than paying for it now once you have that llc paperwork back from a website like incorporate.com you're going to go to irs.gov submit your llc in order to get an ein number an employee identification number once you have that ein number you're going to take that to the bank and open up a bank account for your company using that ein number and boom you are ready to rock and roll you have your llc you have your ein number and you have a company bank account and now you can start conducting business under the llc super amazing super easy to d
Thanks for your comment Rocio Valdivieso, have a nice day.
- Gino Dorning, Staff Member
do you want to start wholesaling real estate in 21 days or less without spending one dollar in marketing and without having to have tons of experience hey everyone my name is alex martinez i'm the ceo and founder of realestateskills.com and we help everyday people to wholesale flip houses across the nation so this strategy alone i'm about to cover today it helped us generate over 12 million dollars in revenue our first year in the game in real estate first off what i'll cover today is what is wholesaling real estate exactly i'll cover the wholesaling process at a high level so you understand and then number three i'll cover this 12-step process on how you can start wholesaling real estate in 21 days or less in your area first off let's cover what is wholesaling real estate exactly well what wholesaling is is when you get a property under contract at one specific price let's say one hundred thousand dollars and initially you are the buyer on the deal so you put the property under contract at one hundred thousand dollars but then you find a cash buyer typically a fix and flipper that wants to buy this deal at a higher price so let's say they want to buy it at 110 000 now all you need to do is put that property under contract at one price and then sell it sell the contract to your cash buyer at a higher price so if they wanted it at 110 000 you make the 10 000 difference as a profit so it's very simple there's two main ways to close a wholesale deal is through assigning the contract so let's say you have a property under contract to buy you can assign those those contract rights which is essentially just a transfer of contract rights from one party to another party all right this is a pretty simplistic approach we do this for about 99 of our wholesale deals we always love assigning because it's so simple the second way to close these deals are through double closing double closing essentially what it means is you close on that property with some funds typically funds from a transactional lender someone is willing to lend funds for 24 hours or to up to 72 hours on this deal so in that example the 100 000 deal let's say you brought the funds to to buy it for a hundred thousand dollars but then you lined up the second buyer you lined up your cash buyer to buy it at 110 000 so there's actually two closes that happen it can happen within the same escrow company sometimes two different escrow companies but what's going to happen is you close on the deal at 100 000 and then gets resold to your cash buyer at 110 000 and there's going to be some fees some closing costs so you're not gonna make completely ten thousand dollars when you double close but you will still make a nice profit that's why i recommend assigning the contract versus double closing because there are more steps involved and so today in this process to make it as simple as possible we're going to cover signing the contract to your cash buyer so you can wholesale it so let's cover the wholesaling process at a high level all right so essentially what we want to do is number one find a house that is in a distressed condition so meaning it's outdated it's stuck in the 70s the grass is overgrown there's mold it smells like cat pee basically a house where a first time home buyer can't move in and get a first-time home buyer loan or a conventional mortgage right it's a house that is distressed so that it needs to go all cash now what you're also going to be looking for is a house that has a seller who's in a distress situation so maybe they're facing a foreclosure they're not able to make their mortgage payments maybe they're going through a divorce and they have a lot of memories in the house and they want to sell the house quickly maybe there was a death in the family and they got inherited a property they don't know what to do with it they just want to get rid of it they don't want to deal with it right so when we can find a property that's in a distressed condition and the seller's in a distressed situation i like to call that a double whammy there's a lot of motivation for that deal there's a lot of motivation for that deal to go below market value and so those are the types of deals we're looking for and so i'm going to show you today exactly how you can find those deals in your area across the united states the second thing we need to do is once you find that deal you need to get that property under contract right you need to get under contract hopefully below market value that allows you to mark that price up to a cash buyer so that you can wholesale it and make a nice profit and your cash buyer can make a profit from renting property as well once we get under contract you sell those rights to your fix and flipper and then you close the deal and what we see across the nation doing hundreds of deals over the last decade is that the average wholesale fee is about ten thousand dollars so i want you to shoot for that so some deals you will make more than ten thousand dollars some deals you will make less and it's totally fine just know it will average out typically around ten thousand dollars now let's get into the 12-step process so you can start wholesaling real estate in 21 days or less step number one what you want to do is pick your market all right you want to pick your market the market you plan on wholesaling in and you know i got some chicken scratch i was a c student in english but got an a in real estate so as long as you can read that we're good to go so you want to pick the real estate market you plan on wholesaling in and so i get asked all the time alex you know should i start virtually wholesaling in a state five states over or should i start wholesaling locally where i live and what i recommend nine times out of ten for someone is to start local start in your city start in your county where you're located because it's going to be a hundred times easier to wholesale a house there than if you just pick a random state to start wholesaling in because you heard someone else's wholesaling there there are deals in every single market across the united states and there's deals right there in your own backyard that's what i want you to understand so pick your market this takes about one minute if you want to wholesale virtually you absolutely can what i do recommend is that you have some sort of affinity to a market maybe you live there for five years beforehand maybe uh you know real estate agents and investors there already maybe you bought a house in that particular market then sure you can start virtually wholesaling but know that if you start local you're going to be able to attend local real estate investors association meetings you're going to be able to meet face-to-face with cash buyers you're going to be able to meet face-to-face with real estate agents and sellers of property so there's so many benefits to starting local and you know more than you think you know about your market you probably know up-and-coming neighborhoods you probably know the bad areas you probably know the prices to some degree good zip codes bad zip codes and all that local knowledge will
Thanks Luna your participation is very much appreciated
- Gino Dorning
About the author
I've studied public finance at SUNY Cortland in Cortland and I am an expert in political philosophy. I usually feel grumpy. My previous job was hand sewer I held this position for 26 years, I love talking about butchering and furniture building. Huge fan of Bam Margera I practice wakeboarding and collect film posters.
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