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Welcome Back to the Discount Property Investor Podcast Episode 7! Thank you for sharing some time with us today. In this episode, the hosts talk about selling the DEALS. This episode is really focused on buyers and building your buyers list. The hosts also touch on how to market your deals (contracts to purchase properties) to the buyers so you can get paid for your marketing efforts. There are tons of ways to market your deals and the hosts touch on several ways that they market their deals to their own buyers in this episode. Start building your own buyers list today so you can sell your deals fast. For more great tips explore https://www.FreeWholesaleCourse.com
Thanks for tuning in.
David: Welcome back discount property investors, we are your hosts Mike Slane and David Dodge, todays episode is going to be touching on selling your contract as well as building your buyers list. So, check us out, discountpropertyinvestor.com, if you haven’t already subscribed to our e-mails in the top right-hand corner, you can subscribe to the e-mails. Also, check out the freewholesalecourse.com, there will be a link to that course on discountpropertyinvestor. One thing that we probably haven’t mentioned in previous episodes. If you need to reach us, you can reach me at David@discountpropertyinvestor.com and Mike@discountpropertyinvesteor.com as well.
So today we are going to jump right in and talking about selling our contracts, selling our deals, you know — to our cash buyers as well as give you folks a couple of tips on building your buyers list. So Mike, do you want to take the lead on this one?
Mike: Sure, so selling the deal. Let’s talking about where we have gotten so far. So far you are trying to wholesale a deal, so you have got some marketing in place, you are taking phone calls, you’re making offers, you are writing contracts, and now you finally have a deal under contract — wow deer in headlights what do you do? You either got to close that thing, come up with some money, or you got to sell it.
David: That’s right.
Mike: So our favorite option obviously is selling the deal right away and being able to cash a cheque. So let me just make this very clear. You do not need a website to get started in this business.
David: You do not need a website to get started in this business.
Mike: It is one of those things that — it is fun to play with, it’s fun to make it look cool and look good, it’s not going to —
David: It’s not necessary.
Mike: Absolutely not.
David: Do we recommend having a website? Absolutely. But you don’t need it.
Mike: That’s not day one stuff.
David: Don’t let that stop you — from getting out there and doing deals. Oh, I don’t have my website built. It’s bullshit.
Mike: Don’t worry about it. What you need is a property under contract. If you are still listening and still following along, then hopefully you are doing that and you are closer to getting one under contract. So once you have done that, you have basically got to sell your property. We do it in very much the same way that we purchase our properties. There are only so many ways that you can advertise so — we do the same things like we talked about in our previous episode on — marketing. We can do online ads, you can do bandit signs, you can do direct mail, you can do networking, and — I will delve a little bit into each one of those then.
Mike: So online it’s the same thing, Craigslist all those free places that you can post your — ads, you have a property for sale now; say you have a property for sale, motivated seller. The bandit signs, I thought I was buying houses? Same thing, you can put three bedroom, 2 bathroom, motivated seller, must sell.
David: Or 30,000 under market, must sell, three two.
Mike: Put them around the — intersections that are kind of around that house is the best way to do it. Some people I know go a little bit further out and —
David: I have been seeing more and more of these bandit signs for selling their deals. Obviously, there are tons of them out there for — we buy houses call me. But just to go off on a slight tangent here. There was a bandit sign for a house that I saw next to one of my rentals last week. I called it, I actually knew the guy just from being another wholesaler. Now I am marketing the deal for him, helping him to seal that deal. It’s called a co-wholesale. If I am able to sell this deal for him, then we will make a couple of grand. Just from calling that sign, so those signs do work. Bandit signs. Next will be direct mail.
Mike: So direct mail is another one people don’t think about. If you have a property in an area that is heavy with cash buyers and you are having trouble selling it. You can ask a realtor or if you are licensed you can go on to the MLS, you can pull data and actually see all the cash transactions.
David: You can do it on list source as well.
Mike: Can you? I didn’t know that. So anyway, you can go and you can find people who have purchased properties for cash in an area surrounding your property. Pull up their information and send them a letter saying, hey I got this property here, this is ten grand less than what you paid for your last one, give me a call if you are interested.
David: Send them a postcard with the picture of the house on it. Just big bold found that has the details. Hey, this is the address 3:2 I’m selling it, call me. I mean don’t overthink this stuff guys it’s not that hard. Direct mail does work. Direct mail for us is kind of a last option for selling.
Mike: We don’t do a lot no.
David: We don’t do a lot, now — have we done it in the past? Yes. It’s a great way to do it, our other friend Mike — he does a lot of direct mail, but he is doing a lot more multi-families so for him that works better. So — direct mail definitely works. Networking would be number four here. Networking is always a great way to sell deals. It’s always a great way to build the list. So I am going to kind of combine networking with building the list. That’s actually number four and number five on our list as far as — how we go about selling our deals. So — go to your local R.E.I.A’s like we had mentioned in previous episodes. Go to meetup.com, we are not affiliated with them but it’s just a great free resource to find these groups, these investor groups, or — these what we like to call R.E.I.A’s. You can meet all these other investors. Now, if people are going to these R.E.I.A’s, they are obviously either interested in investing or they are already investing so — they are your perfect cash buyers. So when you go to these R.E.I.A’s, get as many business cards as possible, take that information home and put it into an excel sheet, or even if you write it down or whatever. But organize that information, call these people, e-mail these people and ask them, hey what kind of properties are you looking for? I am going to do some marketing to try and help you find some deals. What would you be interested in? What can I send you? And just build your list that way.
Another way to build the list is whenever you are doing your other sources of marketing, let’s say you are posting ads on Craigslist or Bigger pockets, or Backpage or eBay classifieds or whatever the online source may be, when you get phone calls coming in, record that information. What’s the name of that person? What’s their number? See if you can get their e-mail. And, if they are interested in your deal great, see if you can sell it to them, you will make some money. If they are not interested in that deal for whatever reason — ask them, say I am a wholesaler, I am a cash buyer — we should work together in the future. Maybe this deal doesn’t work for you, what are you looking for? All you need to figure out is a couple of things, are they looking for rehabs? Are they looking for rentals? How much are they willing to spend? And where do they invest? You could get into way more detail, but that’s really the main stuff.
Mike: I would say the entity of this business is constantly looking for a property and you are constantly looking for money, and by money I am talking about — your end buyer on this one. So you are always looking for those things if you are not really doing the business. So — again it is all these online — all the advertising methods if you are collecting that information and adding them to your buyers list. It is constant churn, sometimes people are buying, and sometimes they aren’t. So you always got to find that next person who is ready to buy and what they are looking for.
David: Now the beauty of building your list is the more people that you have on your list, the easier it is going to become to sell your deals. So, we always like to collect at least an e-mail and a name, and obviously if we can capture a phone number if they call we will capture that as well. I have only been doing this business for a little over a year, been in real estate for nine or ten years as a passive investor, which you heard in episode number one. But, as a wholesaler, I have only been doing this for about a year, but I have really focused on building my buyers list. Of course, partnering up with Mike here, he had a way bigger list than me, so we have kind of merged those lists together. But — we have — not at this point we can easily e-mail our deals to our buyers. So instead of us putting it out there on bandit signs or online ads which we still do of course. We can actually deliver that deal straight to the inbox of our investor, of our cash buyer. We are also — we also have a text message list. There are tons of services out there that you can subscribe too and you can import your database, your list of phone numbers, and you can text that information out. So, whenever we text or e-mail that information out — it will have a picture of the property and the key matrix of that property, then a link back to a website where they can go see more pictures and get more information. Obviously our phone number on a contact form.
At the beginning of this episode, we said you do not need a website. That is so true, you do not need a website, you can post it on Craigslist, do bandit signs, however — if you have a website it is going to make it a little bit easier, it is going to be easier to manage your —
Mike: You don’t need a website and all. If you are e-mailing out the deal — if you post your property to Craigslist, you can e-mail that link. Same thing with a text.
David: There is a fellow in our market and that’s what he does.
Mike: So you really, really don’t need to be web savvy, really don’t need a website —
David: It’s a good point.
Mike: He does plenty of deals. So don’t get hung up on stuff like that. You can still leverage technology without being super tech-savvy.
David: It is a very good point, Mike. I stand corrected.
Mike: Alright, so what about selling the deal? So then we can talk about showing the property — this is also something that — you hopefully didn’t get into this business to be an agent and actually show properties.
David: That’s not why I got into this business, I’ll tell you that. I got into this business to make money.
Mike: So — one of the things we like to do, we always put that we can put a lock box on the property. This way —
David: I push for that Mike. When I am out on an appointment, I get a property owner contract, especially if it’s vacant, I just say hey, I need to get in here with my contractors and or my inspects, I’m going to buy it as is of course, but I still need to do my own due diligence. So I am going to get in here with my contractors so we can do the inspections. Do you mind, if we put a lockbox on the door, I will even give you the code, if it’s the only key so you can access it as Mr. and Mrs Seller?
Mike: And that — similar approach. What I’ve actually found I’m more comfortable with is saying, oh yeah I just need to get my contractor through just to confirm my numbers. But, you don’t want to actually have to come back out here with me with the key and meet me. And for closing we are going to have to deal with transferring the keys around, if we just go ahead and put the lockbox on with the key now, we don’t have to worry about it. What code would you like?
David: Oh I love it, what code would you like? I like that.
Mike: You set the lockbox code —
David: To give them the power
Mike: Exactly. It’s their lock box, it’s their property still.
David: If they say, you know I am not really comfortable with that then — instead of just saying OK no problem. My next objection handling to that is can we put it on the back door? That way people can’t see it when they are driving down the street. Very rare that we will get a motivated seller — especially a motivated one — that isn’t willing to do the lockbox on the property.
Mike: Right so you get the lockbox so that you don’t have to meet all the sellers or all the buyers out there when they want to go look at it. If you are doing other stuff of if you have a full-time job still, you can’t get out there constantly to show the person the property so —
David: Who wants to do that anyway?
Mike: Exactly. You don’t want to have to drive out to the property ten times —
David: Sometimes we will have a hot deal and we will have thirty or forty people that want to walk through a property.
Mike: Surprisingly sometimes, it was a one-bedroom —
David: It’s crazy, some of these deals, they shock me. But regardless, I don’t want to have to go meet thirty different people at a house — that would take me two weeks to do that. Driving there, showing them — so put a lockbox on it. If you are capturing their name, their phone number, and their e-mail when you are building your list, you have information about them anyway. We recommend just putting a lockbox on the property and — allowing your buyers to go see it.
Mike: So obviously don’t post the lockbox online, make them call you or email you so you get their name, phone number.
David: Very good point. If you are doing Craigslist ads, do not put your lockbox on the ad. Make them call you, but that also opens up some doors to — kind of introduce yourself to this investor, this cash buyer. Then build your list by getting information, hey – sir, are you interested in this property? No problem, we have a lockbox on it, let me get some information from you, and then I will give you the code. Then it opens up the door to getting the information. Where do you buy it? What kind of investments, how much are you spending? So on and so forth.
Mike: I am going to go ahead and say that — it is not a terrible idea to meet some of your buyers out there either.
David: No, not at all.
Mike: When you are new —
David: If you have time to do it, go do it.
Mike: Go build rapport — people do business with people — yeah we sell houses but it’s a people business.
David: It is a people business.
Mike: Again, you have to get to know these people, especially if it’s going to be somebody maybe a repeat buyer it’s great to — for them to see you be the face of your company for them.
David: That’s a really great point.
Mike: You are building a relationship with them. Anyways.
David: If you are busy give them the code, if not — go meet um, that’s a great point. Because then you are going — they are going to get to know who you are. That face to face is super valuable, very good point so. Why your deal is not selling is our next topic here folks. Why your deal wouldn’t be selling? There are really only two reasons that your deal isn’t selling in my opinion. One would be price.
Mike: Two would be the price.
David: Two would be price, — no two would be you are not marketing enough. So — it’s the audience right. So one is price, two is the audience. Mike had a good point, price, and price. Price is obviously going to sell a deal, if it’s a good deal, price. But if only five people see the deal — that’s not enough people, not a big enough audience. So — this is the marketing business folks; we have said it several times in previous episodes. You’re marketing to get the deals, you are marketing to motivated sellers to get the deals, you then have to market that deal to the cash buyer. So by building the list, it makes the marketing very easy. If you can send an e-mail out to 500 people or 5000 people or whatever, that’s easy. It’s going right to their inbox; they get the deal, that marketing has just been simplified. But if you are new to the business, you need to get out there, you need to market, you need to post ads online, you need to do the bandit signs, and you need to go to R.E.I.A’s.
Mike: Really good point and I guess I kinda overlooked that because I assumed that — when you get the deal you are hustling to sell it. So you are posting an ad everyday on Craigslist.
David: Multiple ads, two to three ads a day. If you want to sell it you got to get it out there.
Mike: You are networking, you are doing the work. I mean you are basically picking up the phone and call —
David: To me and you it’s a given, but to a new investor — it’s a good point.
Mike: Here is another selling — I didn’t even think — we didn’t even touch on this one. So Craigslist you posting ads — for rent ads. Call for rents around your rental property or around the property. Hey, would you be interested in buying a property — three doors over?
David: The guy who has the rent down the street, he probably has more than one house for rent, he’s an investor. It is a very good point, we also will call people that have fore rental, properties for rent rentals, make them cash offers on their deals. But to your point, if someone has a property in the area that they are renting, they are already an investor, and they may be a good buy for you, absolutely.
So what to do next. In the event that you are not able to sell the deal, Mike, what are the next steps?
Mike: There are only two options, you got your contract in place, you can walk away from the deal, you can tell the seller that because of this I have found during my inspection period, due diligence, this property doesn’t actually meet my criteria. So I can’t close on it, sorry. That option is no fun, right?
David: That is the no fun option. It happens; sometimes the due diligence will open a can of worms that you don’t want to proceed with.
Mike: So your other option is to re-negotiate. Basically say hey Mr seller, I — through due diligence I have found this property needs a little bit more work than I expected, in order for me to close on it, I am going to need to come down on price $5000, $10,000, whatever number it is you know you can get someone in to purchase it. Or I am going to need five more days to inspect it and 5000 off. You are going to re-negotiate your terms of the purchase contract, get yourself so more time, get yourself a better price so you can remarket your property say — go back to the buyers who look at it and say hey, would you be interested in this if I could sell it to you for three grand less?
David: Negotiation or re-negotiating it’s really just open season out there folks so — what I like to do, just like Mike said, to re-iterate. You can re-negotiate your terms; you can re-negotiate your costs. So, what we do say we have a property — just throwing out some random numbers that we have on our contract at 60 and we are marketing it at 70. 10,000 spread. Let’s say we get a cash offer ad 58,000. The guy says I will buy this tomorrow 58,000 let’s do it. However, we are into the deal at 60,000. So, we would lose two grand if we did that deal. So what we would then do is we would go back to the seller and we would say listen, we have found our partner, remember that partners approval CYA clause, we have found our partner, he’s ready to go — however based upon this criteria, you can bring up that maybe you underestimated your repair cost or you overestimated your NRV. You can say based on these figures, we still want to move forward however, I need to get it at a little bit of a better price. So if you can drop that price down to 55 or 53, we can still make 5-8 grand on that deal, or whatever those numbers would be by re-negotiating down, knowing we have a buyer lined up at 58,000. So re-negotiate, exit, those are your two options. If you have to exit, obviously that’s maybe your only option. But before you exit the deal, always try and re-negotiate, always ask for more time, always ask for a better price. Because, again as we said earlier, whenever you send up a contract and they have signed it, they have already mentally cashed that cheque. So if you have to give them a little bit less money — so be it. Usually, they are ready to go.
Mike: They are ready to sell it usually. Again — expect people, they are not going to be happy about it. I mean oftentimes they may get upset with you.
David: You’ve got to have a spine in this business.
Mike: It is what it is, you got to keep powering forward.
David: They may not be happy with you, but — at the end of the day, you are still going to be helping them out, you are still taking the property off their hands, if they are motivated to sell — they are going to get a little bit less money for it so be it, but you know.
Mike: They’re still probably going to shake your hand after the deal is done.
David: I’m sure.
Mile: Then if you say thank you for helping me, hopefully it helped you out. Most people are going to be happy with the fact they were able to get rid of that problem.
David: Whenever you are faced with an individual versus on the phone, situations are always different. It is easy to get mad at someone on a phone call or through an e-mail because context is not always conveyed properly. In-person when they get that check everything changes.
Mike: Let’s talk a little bit about action items today. If you have a property under contract, hopefully, you are out there putting up ads like David said, more than one time a day.
David: Multiple times a day.
Mike: Put out the bandit signs, find buyers in that area, do the direct mail, network, tell people about your deal. If you don’t have a property under contract — market a property.
David: Good point.
Mike: So here’s how you do that though. You absolutely have to have permission from the person who has the property. So go out and network, find another wholesaler, say can I help you sell that deal, I am trying to get started. You have to get their permission — not just the permission but get a JV agreement. A Joint venture agreement in place.
David: Freewholesalecouse.com. We have an example of a joint venture agreement. Again folks, very simple, one page, big font, it just lays out the fact that — you are going to be joint venturing with another individual, another wholesaler to help them sell the deal, the terms of that will be laid out in the contract.
Mike: Just for that deal. The reason you need that is because you cannot market a property for someone if you don’t very equitable interest. So this joint venture gives you that permission and it spells it out for you. Even if is your best bud I think it is important to get joint ventures in place, just because as things change — get a joint venture. Get that joint venture than just start doing the same things we just said. Start marketing that deal.
David: Figure out what they are already doing and supplement it. Do what they are not doing. If you already have a small buyers list — e-mail it out to that list. If they are not doing bandit signs but doing Craigslist posts, maybe not try to overwhelm Craigslist with more of the same posts, go and do some bandit signs. But Mike you have a very, very good point. If you don’t have any of your own deals, contact the local wholesalers, go to R.E.I.A’s and meet them. Ask if you can help them sell their deals. If someone comes to me and says, Dave, I have a buyer for one of your deals, fantastic. That’s less marketing that I have to do to sell it. I am more than happy to split that deal with them for bringing a buyer. So whenever you go about building that relationship with these other people. They are not going to — most of them are not going to be upset that you want to help them; they want your help, great. Do you want to help me sell this thing? Fantastic, let’s split it. Bring it
Mike: Most of them, sometimes you meet some people who don’t want help and that’s fine. Keep storming forward. So that’s basically all we have for today. So to get started in wholesaling, make sure you check out the discountpropertyinvestor.com and see all the properties we currently have available, check out the while to freewholesalecourse.com, there you will find that JV agreement and — some links to all the of the stuff we have mentioned during the show. Next week we are going to be talking about closings. So how to get your deal through closing, and we are going to end on a quote. Dave, do you want to rest the quote for this week?
David: Absolutely. “We are not here to have power over people; we are here to empower people.” Thanks, folks.
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