Author Archive
Handling Fear When Talking to Motivated Sellers
Posted on September 7, 2016 byFear… the word that has the ability to conjure up all sorts of emotions in a matter of milliseconds. A natural emotion we all experience. It is quite natural to assume you may have to deal with it when working with property. After all, we are talking about assets that can have several zeroes on the end of their price tag. Fear can be a healthy thing to keep us in check!
Arguably though, the majority of us will do almost anything to avoid being in a fearful state. Oh sure, some of us embrace it but usually it takes some maturing to reach that point to ‘confront’ fear.
So how does this relate to Sellers?
Usually we will take something like fear and make it a very, very big deal. New investors deal with this all the time but so do a lot of experienced ones. When talking with a Seller, there are all sorts of things we create in our minds to be afraid of. Some examples are as follows: Read More→
How To Build Credibility With Buyers – Part 3
Posted on August 1, 2016 byIn the last two posts, we talked about building credibility with Buyers. We have covered four steps so far. Last month, we talked about the importance of having a real deal and doing your own due diligence as key points. This month, we will talk about how to continue creating credibility and maintaining it for the lifetime of a deal.
Step 5: Maintain Open Communication
In a world where social media dominates and text messaging is overused for serious matters in my opinion, almost if not every Buyer I have met over the years prefers phone communication or in person when it’s time for real things to happen.
For most deals, we are talking about tens if not hundreds of thousands of dollars. Millions for the even bigger players. It is quite reasonable to assume that at some point, people want to talk to another human when doing a deal together. This is step 1 of what I call ‘real communication’. Talking to a real person on the phone achieves magic that an email or text rarely can accomplish. Read More→
How To Build Credibility With Buyers – Part 2
Posted on July 11, 2016 byLast month, we started by talking about a couple of basics that are an easy way to start setting yourself up for success with Buyers. Step 1 was Confidence and Step 2 was having an Online Presence. Both of these steps are key because people make first impressions as fast as you blink your eye these days. How you present yourself as an individual first is paramount. People do business with people they know, like and trust. The first two steps address this directly. Let’s continue with the next steps:
Step 3: Have a Real Deal
It may sound counterintuitive but if you have been in this business for a while, you know there are people that literally sit at home or work, get an e-mail from another investor, do zero due diligence if they even read the e-mail and then just click the forward button to their Buyers.
This is a fantastic way to kill your credibility in one shot using the miracle of technology. What makes it worse is there are times where the deal is not even under contract with the person sending the wholesaler the email. Then as a ‘trust everyone is doing the right thing’ investor, you forward that to your Buyers. I lost track long ago of Buyers that ‘do not like or see value in wholesalers’ because of this very thing. Read More→
How To Build Credibility With Buyers
Posted on June 5, 2016 byBuyers… a wholesalers best friend. A lifeline. The reason why we make the money we do with a smile on our face. However let’s face it, many wholesalers are fantastic at shooting themselves in the foot in this area. Even experienced wholesalers run into more challenging Buyers that while qualified to buy, are hesitant or even downright against buying from a wholesaler. Or they are just so picky that the time spent quickly feels like it is not worth the effort. These are not the easiest of hurdles to discuss. And even if they are willing to buy, how do you structure things to ensure you actually can close and not end up on the short side of the stick? (i.e. Buyer walks right before closing)
A few simple steps will make this hurdle much, much easier. We’ll cover two this month: Read More→
The Infamous Daisy Chain… Can It Work?
Posted on May 2, 2016 byIf you have Buyers that are experienced, they know the drill. A wholesaler gets a deal and pushes it out to their Buyers list. Then all the wholesalers on that list send it to their Buyers with some marking up the price. And then the next level does the same. And somewhere in there are the bird dogs that literally do nothing but press the forward button thinking ‘easy money’. Problem is the Buyer is on all of these people’s lists. Depending on the timing, he may see the lowest price first or one much higher. Or maybe the Buyer is not on the primary wholesalers list so he never sees the original deal.
At this point, the Buyer naturally goes to the lowest price wholesaler to get the deal. But if that wholesaler doesn’t control the deal, then the relay of information from wholesaler to wholesaler begins. And more often than not, inexperience or greed or dishonesty shows its head. You’ll find few cash Buyers are stupid so they pick up on this and walk from the deal. People can sense when something is up and all it takes is one less than confident conversation to kill the opportunity. Read More→
Always Have More Than One Deal Going!
Posted on April 4, 2016 byRemember being in elementary school? If it was anything like mine, sometimes a classmate would get in trouble and the teacher would make him write ‘sentences’ for punishment. Remember? Write such and such sentence 25 or 50 or eek! 100 times! It was like being sentenced to prison. It was very painful when one was young but we oftentimes got the message…don’t mess with the teacher.
So let’s bring that back for a moment. Repeat after me…
I shall always have more than one deal going…
I shall always have more than one deal going…
(Repeat as long as you need to until you never forget it…)
It’s such a simple lesson! But far, far too many times I see this happen with wholesalers, especially new ones. You work on this ONE DEAL so hard and do everything in your power to make it happen. And it is a sincere effort as well where there is rapport and legitimate effort being made to get it to the closing table. Then at the last second, the unthinkable happens…it falls apart. Seller suddenly changes their mind. Even worse, it’s for a legitimate reason such as a health issue arises. And the Seller is very apologetic and you know they aren’t making it up. Still the deal is dead, at least for the time being. Read More→
Your Power Team Represents You
Posted on March 6, 2016 byAs professionals we’ve heard it said that it is absolutely imperative that you have a really solid Power Team. A Power Team is composed of several individuals. Some of the most common in Real Estate are closing attorneys, loan officers, contractors, insurance agents and appraisers. These are all key people to any given transaction and any one of them can make or break a deal so it’s important to have ones that understand what you are doing, are on your side and have lots of quality experience.
We have had the privilege of working with many people along the way with varying levels of success. Some of these people have been nothing short of outstanding. On the flip side, let’s be honest, some are a bit of a nightmare to work with. As a result, we have learned to never underestimate what they can mean for your business. Let’s take attorneys for example.
A solid closing attorney is a critical part of your Power Team. We have literally had Sellers that were ‘on the edge’ about whether they should work with one of these ‘We Buy Houses’ people but were given an extra dose of comfort by our attorney. On the flip side, we thought we had an attorney that was on our side once literally talk down to a Seller. Sadly, it killed the deal. That particular deal was a renovation that was good for at least 50k…down the drain. Talk about a hard lesson in choosing your Power Team! Read More→
Four Steps to an Incredible 2016 Wholesaling
Posted on January 31, 2016 byRecently I did a meeting where we discussed what a wholesaler needs to do to have an awesome 2016. After giving it some thought, it’s really quite simple. Only four steps are needed and doing these four things consistently will make a huge difference in how much success one has. Let’s get right to the four steps to an incredible 2016 wholesaling!
- Marketing – The lifeblood of your business. No marketing, no leads. It is a requirement above all else. While there is a plethora of free marketing ideas as well as paid ones, the key is to do them consistently week in, week out, month in, month out. If this is a constant, leads will be a constant. Very simple yet a major pitfall of most investors out there.
- Networking – You have to get out and meet people, preferably in person. However, if you are wholesaling virtually then this is not always feasible to accomplish. Most wholesalers tend to be local so if that’s you, get in the car and go meet people at meetings! And not just REIA meetings but other types of Real Estate functions, general business meetings and even non-Real Estate related meetings. You simply never know where your next opportunity will come from whether Buyer or Seller. Networking can never be underestimated! Read More→
Consistency – A Wholesalers Trusted Ally
Posted on January 4, 2016 byAdmit it…this may be a familiar story to you. You learned about this money maker called wholesaling, did a few deals and made good money, celebrated and then told everyone how awesome this business is.
But then the dark time hit…
Leads dried up. Phone calls have slowed down. Market dynamics may have shifted. The list could be endless. Bottom line, all of the sudden the euphoria of making money quickly and easily has been replaced with concern and worry about what’s going on. All of a sudden your dreams coming true seem distant again and going the wrong direction…perhaps very quickly.
Or maybe the story goes like this… You learned about wholesaling and got excited about it. You did marketing one or two times, talked to a few people but nothing quite panned out. Maybe even three or four times. You got discouraged and decided this wasn’t for you. Read More→
Co-Wholesaling: Legit or Problematic?
Posted on December 7, 2015 byLots of real estate courses out there talk about the subject of co-wholesaling or JV’ing. (Joint Venturing for short) It sounds simple enough. If you are new, work with someone experienced to do business together that seem trustworthy. If you are experienced, work with people you know and trust. You can market their deals for them and hopefully bring them a Buyer. It’s very simple so what could go wrong?
In a word: Everything
If there is one topic that I think is one of the most scathing I hear from Buyers, it’s co-wholesaling. It ranks right up there with off base renovation estimates. How can something so simple be so problematic?
Let’s take a look at the issues so you can see how to avoid these pitfalls and have more success with this underutilized subject. This is a simple subject as long as you get it right. Read More→
The Most Commonly Missed Items On Rehab Estimates
Posted on November 8, 2015 byWe’ve all been there. We go through and estimate repairs on a property and miss something. Sometimes, that something may be minor however it could be quite significant. This tends to happen when the rehabs are larger in scope or have a structural or foundation issue that needs addressing. I don’t usually see wholesale courses that teach how to address these sorts of things when dealing with these points beyond generalities. However, generalities is usually not going to get this done right and does little to build confidence in Buyers.
While Buyers of course are expected to do their own due diligence, it has more than frustrated countless Buyers when wholesaler numbers end up being way off due to this common ignorance. I thought I would take some time to outline some common figures for our market for a variety of these often overlooked items. Take this and adapt it to your area and this will give you a solid starting point. Read More→
Estimating Repairs as a Wholesaler
Posted on October 20, 2015 byA common scenario…
You find a deal and the Seller is motivated to sell. You walk through the property and notate everything you think the property needs. You come up with some quick estimates, do some negotiating with the Seller and get the property under contract. Woohoo! Your blood is flowing. It’s time to sell it. You send it to your Buyers list and you have interest. Things are looking good. Buyers check out the house. The excitement then dwindles…
The reason? Repair estimate is too low. In some cases, very low. Before you know it, you are getting few offers and the few you get are simply too low…
Does this sound familiar?
This story plays out several times per week in our office from wholesalers that send us deals. The reality is, it is common for wholesaler repair estimates to be low. The majority of wholesalers I meet have never rehabbed a property. Selling to a rehabber is one of those things where it is best to walk in their shoes before trying to sell to them.
‘But wait, I don’t want to be a rehabber!’ you may be thinking. That’s ok, you don’t have to be. The solution is simple yet overlooked by the vast majority of wholesalers… Read More→
