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Today, David Dodge joined by his good friend Justin Van Riper. In this episode, David and Justin talk about how he got started in Real Estate, how he got involved in this business, and the reason why he goes full-time in wholesale. Check this out if you want to learn more about Real Estate.
Things that will cover in this episode:
- Who is Justin Van Riper?
- How he got started in Real Estate
- Why Wholesaling in Real Estate
- Justin Van Riper’s Course
- What is Reverse Wholesaling
- Tips on how to W
- How to find a motivated seller in your area
- How to get a deal
- Tips to the newbies
- and so much more
You can connect Justin Van Riper on Social Media:
Justin Van Riper Course:
All information about Just Van Riper:
Services mention in this Episode:
Justin: Good man, hey thanks for having me.
David: Hey thanks for coming on the show man. Thanks for coming on. I haven’t seen you around town lately, but I do get your emails and I see that you are doing deals so that is awesome. Let’s talk a little bit for those who are new, most of our listeners are new, just a little bit about your history and how you got involved in real estate investing. The reason I want to start there is: a lot of our listeners have jobs and they maybe don’t invest yet or they’re doing it part-time and you, like me, are full-time at this. Let’s talk a little bit about what you did prior, how you got invest- or how you got involved in real estate investing and then what it was that made you go full-time.
Justin: Sure, yeah so as far back as I can remember, all the way back to high school, I knew I always wanted to own my own business of some sort, so I- you know, always had that. I went to college, got a degree in business management for that you know, for that sole purpose essentially. When I was in college, I had a mentor and he owned like 80 duplexes in Columbia, Missouri. I know you’re familiar with Columbia but- so yeah he owned like 80 duplexes there.
David: What was his first name?
David: I don’t think I know him, okay go ahead.
Justin: He was an older guy but yeah, so he owned like 80 duplexes, he also owned a business and so after college, I ended up working for him. You know, basically I was a sleep tech, a registered polysomnographic technologist, if you wanna be technical with it. So, I worked for his company for a while and I had saved up enough money where I was looking at all my current expenditures, and at the time, I had a couple roommates and everything. I just didn’t spend that much money. You know, I was like a year and a half out of college or something like that and so I was like this is the time to do it. I have been researching and that’s basically how I really got started is: I would just go onto every website I can find, and I would just read every article and learn more and more and more, and I was like, you know, I really want to do this. You know, I always had this goal to own my own business. This is the time to do it, when I don’t have like a family to take care of, my expenses are really low so I had to research a bunch and I was like: I’m going to go ahead, I’m going to do it and I made a decision what you know, it’s certainly not for everybody but I knew that I had a year’s worth of money saved up, but I made the decision that I was like, I don’t want to do this half-heartedly so I just- I quit my job and I started in real estate. It’s a good thing I did have it while-
David: How long ago was that?
Justin: What’s that?
David: How long ago was that?
Justin: That was like 10 years ago.
David: Okay, cool so you’ve been doing this full time 10 years.
Justin: I have been doing it full-time for about 10 years now.
David: Damn. That’s great. That’s awesome.
Justin: Yeah, and it’s a good thing I had that yearly- that years’ worth of money saved up because it did take a while for that first check. It took a while, I did a fix and flip, I actually did 2 in Florissant so they’re kind of lower [inaudible]. I think I might have made- it was about 12 thousand I think on the first one, but it took like six months.
David: The first fix and flip you did?
Justin: Yeah, the first fix and flip yeah, so I didn’t wholesale that one. But yeah, I did a couple fix and flips, but yeah, that’s kind of how I got started, going back to that original question. Like I’ve always just wanted to own my own business and I had a mentor that was into real estate and then I just started doing a ton of research on my own.
David: So, I’ve always known you as a wholesaler.
Justin: Yeah, so I’ve done about I don’t know, probably close to a dozen fix and flips throughout the years. I haven’t done one in a long time, but I was doing a couple every year, just kind of like on the side but yeah, my main has always been wholesaling for sure.
David: Got it, got it. Okay, very cool. So again, I’ve seen deals from you, I think I bought deals from you. I know that I’ve definitely joint ventured deals with you. I think the first deal I did was with you bro. I think you did- I think I did my first wholesale deal with you.
David: Actually, I’m positive I did. Did you know that that was my first deal?
Justin: I did- I didn’t know at the time but I did, you know, I think you told me afterwards.
David: Let’s talk about that real quick guys.
David: So, this was a deal- I remember this. So, I had been trying to wholesale properties for two-and-a-half, 3 months on my own and I’ve had no luck, I was this close to the finish line right, on a couple of them and they didn’t really pan out and I hired a coach locally here, his name is Joe. I love Joe, I always give Joe plug, and Joe taught me how to market and basically changed my whole perspective on wholesaling and real estate investing you know, direct to seller, get the seller on the phone, find the motivation, make offers and go from there and Joe helped me get the marketing out, but once I had the marketing, the phone started ringing right, and I’m running all these appointments super eager, just ready to fail fail fail, cuz I’m like, the quicker I screw up 10 of these things, the quicker I’m going to get one, right? And that was kind of my mindset and I had this guy that owned two or three- I think, no he owned three properties and I contracted them all individually and I started marketing these properties and I marked them I marked them up quite a bit and then Justin came and said: hey, I’ll pay you that, like full price and I’m like: hell yeah, this whole wholesaling game is what’s up. And then he marked them up like another 10,000 or something like that and all said and done, I think we each made 12 grand on those two deals each.
Justin: Yeah, I think that’s what-
David: It’s been 4 or 5 years at this point but wow, so Justin said I’m going to mark these up, I’m going to pay, and he had a buyer and that kind of goes hand-in-hand with what you’re working on now, buyer first wholesaling, right?
Justin: Absolutely, yeah, and that’s what happened in that situation. So, I mean that’s what I’ve been doing for a long time and that I- teaching other people to do the same is that it’s all about having buyers, at least in my opinion. It’s huge to have that because I just work with other investors, other wholesalers and so of course you know, you advertise that property and I already knew that I had it sold before I even contacted you, I was like you know, I already have this thing.
David: I know the guys buying in this neighborhood and he’s bought similar size and square footing condition based on my pics. He knew, guys, that his buyer wanted it. So, I think the spread was so healthy that- or you knew before you even contacted me that what he was buying and you saw what I was asking and I remember you didn’t haggle me down at all. In fact, you were transparent, and we ended up making more by just splitting the deal. But again, I think it opened up my eyes in the beginning too because you know, I had gotten deals to the finish line but didn’t cross over. But I was also chasing these people that they weren’t motivated and once I started marketing, you know, once I got a motivated seller on the phone, I realized what a motivated seller sounds like. It didn’t sound like anything I had heard in the previous three months, so I realized the problem was me not talking to enough people, you know, doing 20 or 30 minutes of cold calling every night’s not going to cut it unless you’re willing to wait 6 months for a deal right? I wasn’t doing six to eight hours a day right or whatever, but once I started sending mail and doing some other things: bandit signs and whatnot, the phone started ringing and at that point, I started saying: oh man, I can now hear the motivation when that motivated seller calls. I can identify it very easily and that was one of them, where they were just like: make me an offer and I made him an offer like, fifty cents on the dollar minus repairs and they were like: we’ll take it, and I was literally like: what? Like okay, let’s go! So- love that. Justin let’s talk a little bit about your course, right and guys, I’m going to have all the show notes and links, Justin’s bio, all that information over at DPIpodcast.com/Justin. So, we’ve eliminated a lot of letters in our old website, now it’s the abbreviation: discount property investor- DPIpodcast.com and then /Justin, you’re going to have links to his course. He’s actually going to give you guys 5 days for free which is phenomenal and then some of the other information in file that we have on Justin will be over there. Let’s go ahead and talk about the course.
Justin: Yeah, so basically it kind of revolves around that strategy. You know, I was doing the advertising to sellers and I was doing quite a bit of that and I was- to the point where I mean, I was spending my 10 grand a month in advertising and you know, I didn’t own a huge company or anything. So, it was like, if I weren’t getting deals out of it then, you know, I was in trouble. My overhead was so high and so I was like: man I have these buyers, how can I switch this up? How can I kind of you know, keep my revenue where it’s at or at least close to where it’s at while you know, drastically cutting down on my expenses and that’s why it all kind of dawned to me you know, there’s so many wholesalers. It depends obviously what market you’re in but as you know on our St. Louis market, there’s properties that are advertised constantly you know through Facebook groups, just through you know, email text blasts, like all the time. So I was like: inventory is really not as big of an issue, and I knew that if I went with the strategy, I might be you know, like leaving a little bit of money on the table cause if I’m working directly with the seller, you know, for instance the deal that we did: I could have made $24,000 myself instead of you know, splitting the 12 with you- or splitting the 24 with you, each making 12, but I knew I was gonna make you know, maybe not quite as much but I also knew that my overhead was gonna be drastically lower and so I just started like, tweaking. I mean, just constantly like, what’s working? what’s not working? until I just- you know- Essentially, I came up with this exact system on kinda how to do this. It’s also called reverse wholesaling and buyer first wholesaling, where- the cool thing that I do with them too is a lot of times when someone’s reverse wholesaling, they’re gonna send ads out to people that buy properties and they’re going to say: hey, what’s your criteria? Well, one way that I kind of like, tweak that too is I kind of told them what I could provide them. So instead of them saying: yeah, I only want these areas and then trying to find something- I knew the properties that I could get a lot of very easily and so then at that point, I would advertise to the buyers and you know, just tell them: hey, here’s what I can provide. I can provide you know, 10% on a lot or you know, whatever the case maybe. I can provide you these properties at 75% of ARV, you know, whenever I was advertising at the time. And they would contact me and then say: great you know, I’m interested let’s do it, find me some properties. So, then it was just as simple as you know, going on to these Facebook groups, talking to other wholesalers and just basically connecting the two pieces. [inaudible] So anyways, I just continued to tweak and tweak and tweak it, and I’ve been wanting to come out with a course showing other people because I truly believe it’s the easiest way to get into it. I don’t have to talk to you know, a ton of sellers for every deal that I get. Like I’m literally working with sometimes just one buyer. That’s, you know, one or two buyers that are filling up my whole inventory and then I’m just [inaudible] so I think it’s very easy for people to do. And so I was like: I want to be able to share this with others cuz I know that they can have success with it and I know that there’s not a lot of other people that are training, you know, this way so- during this quarantine it gave me an opportunity where I was like okay, I wanna do this for a while, this is perfect. So yeah, I basically just went through everything that I tweaked and done over the course of the last 10 years to come up with you know, the system that I essentially used myself.
David: Man, I love it. So, let’s break this down for everyone that’s listening or watching. So typically, when we wholesale right, the traditional mindset, the traditional education says we are going to learn how to market to motivated sellers or- and/or we’re going to trade our time to reach out to the sellers directly. Now, this is traditional wholesaling, this is what I teach in my book: The Ultimate Guide to Wholesaling Real Estate. This is what we definitely are- have taught in previous episodes of this podcast. Learn how to market to motivated sellers so your phone starts ringing and/or dedicate time to cold calling, cold texting, door-knocking, networking, whatever it might be to reach out to these you know, suspected people on your behalf, it’s either you pay to get your message in front of them and they call you or you spend your time and energy to get your message in front of them, right? However, that might be. From there you try to locate the motivated ones like I was saying earlier and the more you do, the easier that will become cuz you’ll hear it. If you’ve never heard of a motivated seller on the phone, you won’t- you don’t know what that sounds like, but basically it sounds like I’m calling for help like: come out and help me. It’s not: oh, I’d maybe sell it for you know, what Zillow says, you know, it’s not- I don’t need to sell but for the right price-. That’s not motivated, motivated is: I’m moving next Tuesday, and I don’t want this house sitting here vacant, I owe x, can you pay me that? I don’t know, let’s see if that works, right? That’s what ‘motivated’ sounds like. So, you get those motivated sellers on the phone, you locate the ones that are motivated, you make offers to every single one of these people though right? Knowing that 99% of these aren’t going to work. It’s a numbers game and you get that one under contract, then you take it to the marketplace, you email it out, you take it to somebody like me or Justin if you’re in our market and we help you sell it, the deal gets done. Justin’s got a whole new approach, which is really cool. You had mentioned earlier reverse wholesaling also known as buyer first wholesaling, it’s the same thing, right? But you’re flipping the script so instead of you spending a ton of money and or time to locate the motivated seller which you may or may not have a buyer for. Instead, you go and you find the buyer’s first and that’s awesome. So, you are doing lots of- and I’m sure in your course you’re going to teach a lot of strategies on how to locate these people and what you know, what you need to do to market to them, but you locate them first. And then what you do is you find other wholesalers who have deals or you spend your marketing dollars knowing you have a buyer already in specific areas or by specific criteria, am I right?
Justin: Yeah, yeah absolutely and the kinda cool thing about it is that you know, there’s this new shores of properties and once you sell one property for someone, like I know your team will reach out to me sometimes if you guys don’t have a buyer cuz you obviously have a very big buyers list yourself but-
David: But not all buyers are on there and buyers come, and they go you know and it’s like, you know just having a bigger reach helps. So yeah, absolutely, we’ve done several JV’s with you over the last few years.
Justin: Yeah, so you know, I work with it and other wholesalers, they just- they always come to me and they come, and they get something. Sometimes they’ll do it before they even get a contract. They’re like hey, I’ve got this seller that’s you know, looking to sell for x price. And you know, we’ve got a good enough relationship that they don’t worry about me trying to cut them out or anything. Like they literally won’t even have a contract yet, but they’ll say: what do you think about this? Do you have somebody?
David: Yeah, text you an address or a picture or two and just say: hey what do you think? before and that helps a lot of people know what they need to be making their offers at. I mean, that’s- we do that a lot too you know. You can’t legally market it, but you can text a friend right? You can just say: hey, I’m looking to buy this. They may be a partner of yours essentially so love that, yeah. So, you get people reaching out that way. You probably get quite a few deals from other wholesalers cuz they’re already doing the marketing but then again, I’d imagine you do some of your own marketing that’s going to be specific to your buyers.
Justin: To what the buyers are looking for. You know, I definitely have plenty- I’ve done plenty of that in the past, but I really haven’t a lot recently.
David: There’s enough inventory out there to where you don’t have to spend. How cool is that guys? The reason I said that you would- are spending cuz I know you had, right? I ran into you at a mastermind- shoot, it’s probably been 6-8 months ago at this point, maybe longer hell. But you were saying yeah, I just did a $10,000 drop or $15,000 drop and I was like damn you know, we spend a lot but not that much at once typically, you know it’s 5,6,7,8 something like that so I was like wow, that’s great, and you were like, yeah, we’re just going for the big ones you know, we’re just trying to do the 20, 30, 40k ones and all these little ones we’ll get to at some point, but I’m not chasing them. And that’s another thing that I learned along the way is when I quit chasing deals Justin, and I just said listen, I don’t need to buy that house however, I will buy it for this. The mindset that I had was very simple, it’s just like less is more, if you don’t like my offer no problem, we’re going to follow up with you, but we’re not going to call you in three days asking, you know, if you know, if we can do something cuz we know the motivations not there. And what happened when I changed my mindset to quit chasing deals and leads is that they would start chasing me. Oh, well can you come up a little bit? well maybe but I’m not coming up 40,000, right? I’ll maybe come up 3000, 5000, right? We’re 25 grand apart, you come down 21, I’ll come up 4, and that’s just kind of my whole mindset on it and ever since I did that and I quit chasing leads, the business has made more money, I’ve worked less and I’ve been happier, right? But the only way that you can do that and chase less leads is by having a consistent amount of leads coming in or in your case, knowing that if anything comes across your desk that meets criteria of buyer 12345, you can get that done, right?
Justin: Yeah, absolutely.
David: Love that. So, guys if you’re listening, understand this is the marketing business, Joe taught me that, my coach, back in the day, right? You got to do a lot of marketing, you got to spend time if you don’t have money to get your message out there, right? And once you come across that motivated seller, come talk to a wholesaler or put it on your own buyers list, you can get that done or in Justin’s case, learn who the buyers are, save yourself the money. He no longer spends money on marketing at least as of this episode and now he’s just joint venturing. He’s basically joint venturing with two people. He’s got his motive- he’s got his motivated buyer, which you don’t hear that term very often right? Most of the time. you refer to it as a cash buyer, but he’s got a motivated cash buyer. Say, hey Justin, anything in this zip code that’s 850 square feet or more and it’s got three bedrooms or whatever that might be? I want it. So, then all he does is- he’s already on all the email lists guys, he’s been in the game 10 years so that’s a big tip right there, if you’re new, get on all the local buyers list of all the wholesalers and investment companies because then when you do find that buyer like Justin has, it’s so easy to just connect the dots. So, we talked a little bit about his cash buyer, motivated cash buyer then he just finds guys like me that just say: hey I got this deal, I don’t even know if I can sell the damn thing. Mark it up 5 or 10 grand and just get lucky and Justin may come in and say: We’ll pay you full price plus 20 and get the deal done like he did with my first deal 4 and half, 5 years ago. 5 years ago, 5 and a half years ago, it’s been a minute. So, I’m just very passionate about this Justin. I’m glad to have you on today man, this is great. So, tell us a little bit more man, I don’t need to be taking all the talk time here.
Justin: No, you’re fine. The crazy thing about that deal too is that was not high-end property either, the properties that we-
David: I remember it was two properties on College Avenue in Jennings, and if you guys are not familiar with St. Louis, Missouri, Jennings is like, C-D neighborhood, it’s not like terrible by any means. Definitely not like great schools and it’s definitely lower income, a lot of Section 8. I have a bunch of properties there. I’m not ashamed of it, not saying anything negative about that area, it’s just not the best part of town, right? And I had them under contract at 12 and you sold them at 24 and there’s two of them, hence 24 thousand and I think I had marketed these at like 15 or 16 grand from 12, and you were like sold. And then you were like: hey, I’m going to- we’re going to do something- I didn’t know anything about it at the time, you were like: I’m going to sign this over to this guy, which you had to basically disclose the profit and I was like: holy- it was like, I’m just going to say it, I was like: holy shit, how can he make more than me? I’m the one who got the contract on it. But luckily Justin’s a super cool dude, he’s like: we’re just going to split this man, we’re just going to split this and yeah, we each made 12 thousand. Crazy, 2 houses, first ones. So you were doing the buyer first marketing or wholesaling 5 years ago.
Justin: Yeah, and there’s a couple points I guess I wanna make on that too. I think you’re absolutely right when you said a good tip for someone is: even if you’re not doing deals yet, maybe you still have a full-time job, maybe, you know, you’re planning on starting this in 3 months, whatever, get on every single buyer’s list that you possibly can. Go on to Google and search for your area, so I’m just going to use St. Louis as an example, say we buy houses for cash at St. Louis and you’re going to see a bunch of other wholesalers are gonna come up on there-
David: The people that are paying. Think of this Justin, if somebody is paying Google to get a sponsored ad, that means that they’re spending money on marketing. That means they’re buying and wholesaling, so it’s like, get on those people’s list immediately cuz they’re doing the most volume. I didn’t mean to cut you off but yeah, do a quick Google search, that’s the easiest way to find the people that are in your market that are sending out deals. The second way I would approach, would be: go to Facebook and find the local groups. It’s that simple.
Justin: Absolutely, so it’s funny that you say that cuz that’s the main things that I teach essentially at my course. When you’ve got this buyer who wants the property, those are pretty much the two strategies that are the most important. It’s the Facebook groups and getting on you know, the email and text blasts. And if you’re in a big enough market, there’s going to be a lot of inventory just by simply doing that. And even if you know, you’re not ready to get started yet, at least you’re gonna have an idea of like, what properties are selling for so then when you go to do it, you can say: oh, I remember in this ZIP code, this property sold for this price and now the seller is asking this for it. This could be a good deal, you know, I could get something out of it. It’s just important to do that because you’re just gonna- you’re gonna know your market, you’re also going to see how these more experienced people are advertising properties like what are they kind of highlighting? you know, stuff like that. So, I would highly recommend, you know-
David: Yeah, it’s good to know your market. Get on the list guys, I tell that to all my students: get on the list, see what other people are doing and you’ll see people that you know, like me or like Justin or- I can name 30 other St. Louis investors that do- they do deals consistently and their successful at it. So, it’s like, you don’t need to go out and learn, just copy what everyone else is doing. We’re getting a property under contract, we’re taking it to the marketplace or email or text. We’re getting it out to as many people as we can, right? and we’re trying to make a spread on that but in the end, it’s a win-win. Somebody’s selling, somebody’s buying, we’re getting paid. Triple win, win win win. It’s so incredibly simple. So, get on these lists, see what they’re doing, look at the verbage they’re using in their emails and just do it similar. I mean, a lot of people overthink this but like sometimes the deals- and you’ll probably agree with this but sometimes the deals that sell the fastest have the least amount of information, right? I don’t need to go in and take 200 pictures and I typically do take a lot cuz I don’t like to go back, I’m lazy. So, I’ll usually shoot 70 to a hundred pictures on average of a property in and out. But the ones that typically sell the fastest are just like asking price, ARV and repair estimate, and a phone number. We’re talking three lines, not even a paragraph really and as long as you provide adequate pictures or a link to them, people can see it, they can call, they can schedule a time to go view it or even make you an offer, and that’s it. It’s so incredibly simple. So, Justin, let’s talk about some of the- and I don’t want to give away too much guys, cuz again, I really want to drive you guys over to DPIpodcast.com/Justin where you can learn about his course and actually get access to it for 5 days for free. But I want to talk about just some of the strategies here. We got to give value as well here about you know, some of the strategies that you would teach people to go out and find those buyers, right? If they’re going to do buyer first wholesaling.
Justin: Yeah, so one thing that I teach is- that I fully believe in, is you go out and you find the buyers- okay so this is huge right here- out of state buyers, David I’m sure you would say the same thing, out of state buyers pay more than local buyers. Almost a 100% of the time.
David: Now, if you live in California or New York or Texas, that may not be the case. But if you live in the Midwest or 46 other states, that is true. Absolutely, we’re in Missouri guys, Justin lives down the street from me, right? So, we have a very very good market for investors, meaning the returns in our area are extremely high compared to other markets. So, 100% agree with you Justin, not arguing with you, I’m agreeing here. If you find someone that doesn’t live in our state, especially if they’re on the coasts, you know, they could buy five or six properties for the same amount of money that they may have to spend on one in their own market, so love that one. Huge tip, huge tip.
Justin: Yeah, and you’re exactly right, so if you’re actual market is in California, one thing I would maybe consider is virtual wholesaling, that’s one option. I mean, there’s some other hurdles that you have to get through with that and you can make some really good spreads if you are in California, working in the California market. So, you might not get as many deals but you can get some that have much larger spreads.
Justin: Definitely not saying it’s impossible by any means to wholesale in California somewhere like that.
David: No, not at all, but it’s going to be easier to get out-of-state people in our market so that’s great. And really a lot of the markets, most of the markets, right? If you’re anywhere in the Midwest, absolutely, try to find an out-of-state people. Have you had any luck pulling list of cash buyers? I know like, I use Propstream to run all my comps and to pull my list. I don’t do a ton of buyer marketing at this point cuz I did it years ago and built my list and I’m to the point now where I don’t really necessarily you know, need to build it cuz I got guys like you that have the buyers that I don’t, right? but if you are new- you’re brand new and you decide: hey, I want to do some buyer first wholesaling and this is the beginning, lists- let’s talk about that. You have any inside- any pros, any cons?
Justin: So, there’s a couple things with that. First off, I kinda mentioned this earlier but I think this is huge. I’ve done this in the past where I’ve you know, marketed to all the cash buyers, everyone who had purchased property in the last-
David: Buy a list off of like, I think Listsource sells them. I know Propstream does and I think the other really big one is REWW.
Justin: And so, I mean, I’ve definitely done that in the past and what happens is: you get a ton of buyers that call you back. I mean, cuz most people who have purchased one property, and you can even sort it by purchased multiple ones but anyways, purchased one, most of them want to purchase more, they just do. So, you will get a ton of people that will call you but what happens is most of the time you’re saying: well, I want this particular zip code at this price. They’re very specific.
David: Yeah, which is fine, but if you have 30, 50, 300 people calling with these different criteria- and I’m going to just take the- I’m going to cut you off here, I apologize in advance, but that creates more work and that’s probably where you’re going with this right? Now all of a sudden, I got 50 buyers that want different things and yeah, maybe that’s good but maybe not, maybe it’s not good to do that. So yeah, I just want to hear your advice on this.
Justin: Yeah. So, what I like to do instead, especially as you mentioned, St. Louis, quaint market for like a hash club so what I would do- I.ve done a couple different things in the past. I’ve done my ROI so I’ve done essentially, we can offer properties consistently and I will say this too, I will say: I’m only looking to work with people that are serious, that are going to purchase more than 10 properties this year. I can provide you with at least 10% projected ROI. You know, you’ll have a contract, you’ll have all this. I can give you referral’s I guess for contractors, property managers, all this. But I’m very specific with the buyer that I’m looking for. So, I don’t let the buyer kind of like dictate everything. I give the exact criteria that I can provide and if you’re interested, then at that point, you have to sell me that you’re going to be a good person to work with me.
David: All right, so he’s taking the same principle guys that I just talked about with chasing the motivated sellers and he’s applied it to motivated cash buyers. He’s not chasing these people anymore, right? And that was what I just described, cuz that’s what I had done in the beginning is: I went, and I bought a list and I sent a simple little letter just saying: hey, I’m Dave, I’m buying in the area. I’m not trying to sell you anything in this postcard or in this letter however, if you are looking to buy, here’s a URL or here’s a phone number, let’s connect, maybe I can get you a deal. And it worked, but it created a lot of work because again I got all these people calling that say: hey, I only want the southside of 63131 and I only want the northeast side of 63024 or whatever and I don’t buy two bedrooms in this zip code, only three, but in this zip code, I’ll buy two. And before you know it, you got 75 different things that you’re trying to keep track of and it’s a pain in the ass and it creates more work and instead what he’s doing is he’s saying: listen, I don’t really care exactly what you’re looking for but this is what I can provide, does it fit your requirements? and if it does, let’s work together, and now all I need is a name, a phone and an email, we don’t even need to talk about all the little knick-knacks.
I’m just going to send you deals, and the ones you don’t like, archive them, delete them. The ones you want, pick up the phone and call me and we’ll do a deal right?
Justin: Yeah, absolutely and a lot of them like, I will work with them even if they say, yes, we have that conversation and they say you know, yeah, I’m looking to purchase at least 10. Yes, it’s you know, [inaudible] or whatever, it’ll be as simple as them literally saying: go out and find me something. As soon as I do, which you know, a lot of times I can literally do in an hour that day. I can go on in an hour do that, and I can be like alright, here’s what I got and I’ll send you know, I can send that property or properties or whatever to them. I contact- one thing I guess I do wanna say beforehand is you know, for- to be able to send it to kind of these buyers, the couple things with this are: you always want to be upfront with the other person, especially other wholesalers.
David: Yup, I like the transparency approach big-time. Tell- I like to tell everybody what I’m doing, even the seller, you know. I’m gonna wholesale it and I do plan on closing on it. I’ll tell him you know, I’m gonna market this property, but I’m going to close on it regardless or I’ll just tell him straight-up: hey, I can’t buy it, but I maybe can help you sell it. Do you want me to market it? If they say no, then that’s their problem. And I’ll just circle back in 2 months, hey you still own it? You ready for me to help you? I’m only going to get paid if you get paid, oh you are? Did I not tell you that the first time around you idiot, let’s do this, right? And that’s how it is, you gotta be real with people, you gotta be transparent. You don’t want to be rude, I was kidding there when I said it that way, but that’s the mindset that you got to have right? Love it, love it.
Justin: Absolutely, and a tip with that to go along with exactly what you’re saying, you can do this with the actual homeowners, you can do this with another wholesaler like when I partner with another wholesaler. You design the simple option contract with them, the option contract binds nobody. Nobody has-
David: And it’s my favorite tool in my belt.
Justin: Isn’t it great?
David: Literally. We just- we did three wholesales last week- closed on 3, 2 funded last week, 1 funded Monday but 2 of the 3 came from option agreements, which most wholesalers would have walked away from that, there was very little equity or they weren’t willing to give us a great deal and we just said: hey, let’s just try it and we made 8 grand on 1 and 9 grand on the other, that people wouldn’t- you know, not home runs by any means but guys if you- who could use an extra eight or nine thousand right now? Probably everyone listening to this, you know, like literally that’s a lot of money and if you’re not an investor and haven’t done this before, that could be months and months and months of your current salary, depending on your situation. I mean, that’s a lot of money and these are deals that we converted from people that we didn’t think was a deal, we used an option agreement. So, if you’re not familiar with the option agreement, will you explain that to people real quick?
Justin: Yeah, so basically in the option contract that I use has specific verbage in there that states this, that we’ll get to in a second. But let’s say you know, you’re the other wholesaler seller, this would be what I would say to you, I would say: hey, the numbers- especially if you’re just a homeowner, I’ll just say to you: hey, the numbers aren’t going to work for us personally however, you know, I’ve been doing this for a long time, and I have a very large network of other investors. So, what we could do is we could sign an option contract for this price that you’re wanting to get for it, and I will go ahead and I could then send it to some of these investors that are in my network. I’ll tell them and there’s specific verbage and I’ll show it them and I’ll say: if you find a buyer before I do, then this option is automatically-
David: Non-exclusive, love it.
Justin: Yeah, non-exclusive.
David: I tell them that too man. Non-exclusive meaning, I only get paid if I help you, and if you find somebody else, all I ask is that you tell me. Just keep me in the loop. I have no intentions of doing anything but helping you. I don’t plan on suing you, you know, I’ll even say that, like there’s no reason. Basically, I only get paid if I can help you and if I don’t help you, at least I tried and you don’t have to pay me to try. I mean, it’s a no-brainer, anybody, and everybody- if you explain an option properly, there should- there’s no reason that they wouldn’t want that. Unless they didn’t want it on the MLS and that was part of your strategy, which again you get to be very transparent with people about. But yeah, I think it’s great man. Option contracts are awesome. I don’t know if you have one in your course, we have one available for free at the freewholesalecourse.com, so if you guys want an option agreement, go check it out. We have a free one that we’ve been giving away for five years, had over 10 thousand people take our course at this point. freewholesalecourse.com, get yourself a free option contract. Love it.
Justin: It’s huge and it’s so great. I mean it literally like- the only thing it does is it gives them access to all of those buyers. All those buyers that you spend a lot of time and money to get, it gives them access to it so – when I’m so you know, stuff through the option and I’ve been very transparent, I’ve had so many sellers that are like, they had multiple properties and are like: I can’t even tell you how much of a lesson that you’ve been, like you were able to you know, sell these properties for us. And I’ m like this is awesome cuz I mean-
David: Oh, you’re under promising and over delivering when you close on an option every time, if you know, assuming that you explain it properly because you know, when I go, when I say: listen, there’s no guarantee but if I don’t try, how are you going to know? And you don’t have to pay me unless I do something and typically, I’m going to make money on top. I mean, it’s like a no-brainer for the seller, right? As an investor, I never want to be a motivated seller ever, right? But in the event that I become one, anybody that brings me an option that’s non-exclusive, I’ll sign it, I’ll sign 50 of them cuz it’s like why not? right? Like go out, market it and see what you can do. It is what it is. So, I love the option agreement, great tool. Very cool, very cool. Justin, tell me about what’s next. So, you know today is May 13th, this episode will publish in about two weeks towards the end of May, you know, we’re in the middle of this Covid thing, I guess we’re kind of- hopefully coming off the back end of it at this point but as of today’s episode, as of us recording this right now, if it’s live, it’s live, of course, but the podcast: 2 weeks trailing. Everything’s still shut down, we’ve been shut down for 7 weeks, maybe going on even eight weeks at this week, maybe? I think it’s 8 weeks and we’re just getting ready to open things up but what do you foresee is going to start happening with the market and are you going to start doing more marketing for motivated sellers? Are you going to stick to where you’re at with just the co-wholesaling of the wholesalers and the buyers that you got?
Justin: Yeah, as far as where it’s going, honestly, it’s anybody’s guess on you know, what’s gonna happen. I mean, everyone can make their predictions and if anyone, you know, had it exactly right, you could make a ton of money.
David: Right and I know you don’t have a crystal ball, I was just curious on what your opinion of kind of where it’s going. You know, I think there’s going to be a flood of houses, but I don’t think it’s going to be right away. And again, this is just my opinion, I think that we’re looking at 6 months before we see this flood because you have the deferments which could easily get extended if there’s another wave right? and you know, depending on how much longer people are going to be out- some people are making more money on unemployment than they were working. And you know, it doesn’t mean they’re going to put that towards their mortgage, but it just goes to show you like, there’s a lot of people out there that are really not looking to get back to work. They’re happy with this current situation. So, I was just kinda curious on where your mind was that- with that?
Justin: Yeah, and I do agree. I mean, I think lender guidelines, that’s gonna be another factor that will be, you were saying, in my opinion, it’s the same thing, it’s going to be delayed until we actually see the real effects from all of this.
David: Doesn’t mean you can’t start building that big ass funnel now though guys with your marketing and motivated sellers. You find somebody that’s somewhat motivated today and in 6 months, they may be very motivated and that’s kind of how this business works. Marketing, follow-up, follow-up, follow-up to a deal, that’s it, it’s that simple.
Justin: And I would definitely tell people: don’t be scared right now to try to do deals cuz you still can. I mean, you said you guys closed-
David: We did 3 deals last week.
Justin: Yeah, 3 deals. I mean, they’re still happening guys so, you know, you don’t need to-
David: The retail markets been hot man.
David: Properties are selling, like rehabbed one’s- nice properties. You know, that- not you know- people that I know or my team, we sold a couple in the last 4, 5 weeks. I think we’ve sold three in the last five weeks that are retail, all of them have sold within about a week. Some of them have had multiple offers, you know the guys over at 3 doors I mean, they’re a mastermind. They’ve been selling a ton of them, multiple offers same-day type things. So, I mean, the retail market is doing really well but again, the lender guidelines may come into play here if somebody hasn’t received a paycheck in 2 months. It may slow things down but again, who knows? We’ll have to see.
Justin: That’s without open houses too, you know they have all these properties-
David: That’s without open houses too man.
David: I forgot about that, I saw a meme this morning, it was like talking about that. It was like: I sold 10 houses this weekend and had no open houses, you know, it’s like that’s kind of unheard of but wow, that’s really really cool man. Well Justin, leave us with some parting words, you know, if you are new to this business, obviously go check out all things Justin at DPIpodcast.com/Justin simple domain. Again, I’m going to have a link to his course. I’m going to have his bio over there and all the places that you can find Justin online like his socials and whatnot. But if somebody is new to this, what would be your advice to them? Like where would they start? and what should they focus on?
Justin: So it’s funny, I actually- when I very first started in wholesaling, I partnered with a guy who did pretty big volume- first name: Chris.
David: Chris Kay?
David: Yeah, I love Chris.
Justin: No no no no.
David: Different Chris, doesn’t matter, doesn’t matter. Go ahead.
Justin: Anyway, yeah so he did a lot of volume and so when I first got started in actual wholesaling, I basically was doing this from kind of the beginning. And over the years, I’ve tried so many different things that didn’t work or whatever but that’s how I even got started, is to find other wholesalers.
David: Totally agree.
Justin: Yeah, to try and help them out.
David: Hire a coach or go partner with people and do the dirty work right? Go run the appointments, go do the drive-in for dollars, hang the bandit signs, do what they don’t want to do so you can get partnered in on the deal so you can see how it works because the funny thing is, once you see how simple it is, you’re done. You’re going to go off on your own, you’re going to be able to do it by yourself but if you don’t have the funds to hire a coach, just go partner with some other wholesalers or other investors in your area. Hiring a coach, I think’s going to be the quickest way because you’re paying not so much for education, even though that may sound contrary to what you think of coaches, you’re really paying for two things: you’re paying for speed and accountability. That’s what my coaching program consists of as with most others is we’re going to get you there in 1 or 2 months versus 6, and we’re going to hold you accountable and if you fail, it’s not because you didn’t act with what the program says, it’s because you didn’t act with what needs to happen, you didn’t do anything. So, love that that. Get yourself a coach or go work with other people. And again, that’s how I got started, I’m sitting here talking to one of the first guys that I did a joint venture with in the beginning and I learned- you basically introduced me to an assignment agreement. I didn’t know what the hell that was but now I use them weekly. Love it.
Justin: Yeah, it’s crazy that someone like, you know, yourself or myself I mean, we’re open to- you know, if you’re willing- if you just want to ask questions, you know, constantly. You know like if you’re, I don’t know, I guess I’m not wording this correctly. But if you’re willing to like, say: I’m going to- how can I help you? to another, you know successful investor in your area.
David: It changes the dynamic completely.
Justin: It does, and you do what you can do to help them. You’re going to see how they do what they do, and they’re going to be a lot more likely to, you know, kinda help you out.
David: When people say: hey, I want to pick your brain. Nope, how does that benefit me? But if somebody says: hey, I’m down to come to the office and cold call 4 hours a week, I’m like: perfect, do you want to learn the business? Let’s go do some deals together. You are showing me that you’re committed to doing something. You know, hey I’ll go hang your bandit signs if you can bring me on some of your appointments. Great, come to the office, pick up two hundred of them, let me know when they’re all out and next appointment I get you’re going to be on it with me. I’m not going to say no to that. You’re helping me help you. And when people just want want want, it changes the whole scope and that’s where the coaching comes in. It’s like, I’ll do it, but I’mma have to charge you for it, otherwise, it’s going to be a waste of my time to teach somebody that may not even want to do it you know? or has the action in them, the massive action to go actually do it. So, love it guys check out Justin Van Riper. He’s the man, local St. Louis legend, he’s been doing this for about 10 years, buyer first wholesaling is a brand-new course that he just launched. He’s gonna give you guys 5 free days, go check it out. You can get all things Justin as well as the link to the course and find him on socials over at the podcast website: DPIpodcast.com/Justin. Guys, we are going to sign off on that note. Justin, thanks again for coming on the show, grateful to have you and know you as a friend. Until next time, signing off guys!
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