Your opinion on Bird Dogging/Deal Scouts

Buying & Selling Real Estate
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Your opinion on Bird Dogging/Deal Scouts

Jose Guevarra
Real Estate Agent · Mira Mesa, CA · Member since 2014 · 218 posts · 49 votes

What's opinion on Bird Dogs/Deal Scouts? Is that a good way to break into REI? Is there a demand for quality bird dogs?

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Katherine Wolff Grote
Real Estate Agent · Manchaca, TX · Member since 2012 · 5 posts · 4 votes
12y

I think quality bird dogs are awesome....however, if I might offer a couple of suggestions based on our own personal experience...make sure you are getting your own leads. Meaning don't bug investors with leads that are on the MLS. Here in the Austin area we've had a couple of people call us offering us leads that were already listed. Here's the thing....we've already seen those and so has every other serious investor in the area. Additionally, getting properties off the MLS here in Austin is difficult - at least for flipping purposes. Find a way to get qualified leads yourself, either through direct mail to sellers or connect with a couple of good wholesalers. This way you'll have access to leads not already on the market. Just my 2 cents. :) Good luck and happy investing.

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  • Joseph Murders
    Real Estate Agent · Burnet, TX · Member since 2011 · 44 posts · 2 votes
    12y

    @Jose Guevarra

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  • Katherine Wolff Grote
    Real Estate Agent · Manchaca, TX · Member since 2012 · 5 posts · 4 votes
    12y

    I think quality bird dogs are awesome....however, if I might offer a couple of suggestions based on our own personal experience...make sure you are getting your own leads. Meaning don't bug investors with leads that are on the MLS. Here in the Austin area we've had a couple of people call us offering us leads that were already listed. Here's the thing....we've already seen those and so has every other serious investor in the area. Additionally, getting properties off the MLS here in Austin is difficult - at least for flipping purposes. Find a way to get qualified leads yourself, either through direct mail to sellers or connect with a couple of good wholesalers. This way you'll have access to leads not already on the market. Just my 2 cents. :) Good luck and happy investing.

    2Reply
  • Jose Guevarra
    OP
    Real Estate Agent · Mira Mesa, CA · Member since 2014 · 218 posts · 49 votes
    12y

    Thanks for the suggestions. What are some pain points with working with bird dogs? Where do you find them? How do you manage the leads? Do you see redundant leads? How can you save time finding or managing lots of bird dogs?

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  • Katherine Wolff Grote
    Real Estate Agent · Manchaca, TX · Member since 2012 · 5 posts · 4 votes
    12y

    Most of the time people call us to bird dog. We really don't go out looking but we do make sure to let people know that we love "referrals". We also mention to the various subs we work with that we pay bird dog or referrals if they come across an owner who wants/needs to sell. Redundant leads haven't really been a problem unless, as I mentioned earlier, someone calls us with a "lead" off the MLS.

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  • Engelo RumoraBusiness Member
    Investor · Toledo, OH · Member since 2013 · 4k+ posts · 2k+ votes
    12y

    Our best deals were brought to us by bird dogs.

    I always look at establishing relationships with a few bird dogs in each town we are looking at buying in.

    Once they know your criteria and that you have the capacity to buy quiet a few houses your phone wont stop ringing.

    We pay a $1,000 them commission whenever we buy something.

    Thanks.

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  • Justin B.
    Lakewood, OH · Member since 2013 · 193 posts · 60 votes
    12y

    Talking to a rehab/investor over the week I asked the same question, and I got the figure 5%, pretty good to me.

    0Reply
  • Jose Guevarra
    OP
    Real Estate Agent · Mira Mesa, CA · Member since 2014 · 218 posts · 49 votes
    12y

    Sounds like bird dogs have their use. Do you think a website would make finding/dealing with multiple bird dogs make it more efficient? What features would the "ideal" bird dog app have? Here's some that I can think of:

    1. Rate bird dogs or lead statistics (closed vs unclosed)
    2. Check if a lead (home address) is already listed in MLS
    3. Bird dog basics and guidelines (educating new bird dogs)
    4. Pay bird dogs through app
    5. Forum
    6. Find new bird dogs in your area
    7. List your personal criteria for good leads
    8. List details of lead (address, why owner is selling, in forclosuer,etc)

    What do you guys think? Would anyone here be interested in helping me test this app?

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  • Bill Gulley
    Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
    12y

    Is it a good way to start out......?

    Opinions? This is going to be very touchy without being offensive.

    Whose opinions? I won't start with (or probably mention at all) the opinions Realtors in your area may have.

    If you are a member in a LLC and your contribution or duties are to locate deals, that's fine, you are acting in that entity's best interests, working and sharing in profits.

    If you are an independent type running around taking deals to buyers then you need to look at your state real estate laws carefully. If you are facilitating the sale of real estate for compensation based on that transaction, who does that? Realtors, agents/brokers who are licensees. What's the intent of the law?

    There are a few states, GA I believe is one, that has loopholes big enough for a birddog to walk through, but the intent of licensing laws is to regulate who presents RE deals to others.

    So, if you aren't in an entity as I mentioned chances are good that you're acting illegally or at least contrary to the intent of state law.

    What do you think the opinions would be of most Realtors who got a license and are trying to play by the rules?

    Next, I can tell you that other RE professionals, closing agents, attorneys, appraisers or any other who operates under any license to work in RE will have similar views.

    Now that you have established a great reputation with other professionals in your market area, let's move on to other difficulties.

    Like getting paid. If a buyer incurs an expense in acquiring a property, directly related to that transaction you may be in violation of loan settlements, cost disclosures, tax claims as to the true basis, the accounting requirements for settlement and could get sideways with TILA issues. If you're paying undisclosed costs outside of settlement to acquire a property you're probably in violation of law and the IRS Code.

    If you can't operate in the sunlight you shouldn't be doing whatever it is.

    The whole business structure and idea of getting paid to find RE deals is an underground activity in most eyes looking upon your activity.

    All that negative stuff can usually go away if you work in an entity or even if you are in several entities just doing your job. That's entirely different.

    If you can be a good birddog you should be able to learn just a tad more and do things on your own, or flip a contract. IMO

    Loopholes in state laws won't help much with opinions or reputation.

    Move on up, join the operators and investors in RE. :)

    0Reply
  • Tim Soto
    Realtor · Ventura County, CA · Member since 2012 · 126 posts · 61 votes
    12y

    Hi Jose,

    I know a few investors who use Bird Dogs as part of their team. Knowing how to find and evaluate off-market deals for an investor will go a long way and build credibility.

    Kindest regards,

    Tim

    0Reply
  • Rachel H.
    San Antonio, TX · Member since 2009 · 3k+ posts · 1k+ votes
    12y

    This is more of a generic question than anything — it can vary from individual to individual. If you are good at finding leads and doing research, it may be a viable route.

    Though, you probably want to investigate this a little further as it pertains to your area. Try talking to folks who are doing what you want to do and see if it's right for you.

    If you decide to pursue it, keep in mind you'll be passing on deals to others which may be tempting to tackle on your own. Get the experience first and stay focused on your immediate goals until you can pursue your future ones.

    Hope that helps!

    0Reply
  • Account Closed
    Orlando, FL · Member since 2013 · 165 posts · 62 votes
    12y

    I am not familiar with California law. In Florida if someone pays you a fee for selling property, you need a Florida real estate license. Which means if you referred someone to a property and they did not pay you the fee they promised to pay you, you would have no legal recourse.

    http://www.biggerpockets.com/forums/51/topics/65558-selling-homes-without-a-license-is-a-3rd-degree-felony

    Here is an article from BP letting us know that this is a felony in Florida. If you are considering starting a website and becoming visible birdogging, I suggest you get a real estate license.

    http://www.biggerpockets.com/blogs/3840/blog_posts/33599-why-you-want-a-real-estate-license

    There is no downside to having a real estate license. There is a lot of downside to earning your living by doing something that is a violation of your state law. If you want to birddog, be sure it is legal in your state. How can you do that? Call the real estate license people. In Florida , that would be the DBPR. It is a similar agency in California.

    Good luck.

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  • Dick RosenPro Member
    Property Manager · Gilbert, AZ · Member since 2009 · 1k+ posts · 451 votes
    12y

    @Account Closed

    I don't argue what your saying and I believe there are many other benefits to being licensed. But the way that a lot of wholesaler/Bird dogs get around this is by taking the process a step further and getting the property under contract. Then sell the contract, assign the contract, close and sell the property, anything but a referral fee for a lead. To me a bird dog expecting referral fees is not really in the business.

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  • Jose Guevarra
    OP
    Real Estate Agent · Mira Mesa, CA · Member since 2014 · 218 posts · 49 votes
    12y

    @Account Closed @Dick Rosen

    Thanks for your input. I believe another way of getting around those laws is having the bird dog become an independent contractor under a REI/Realtor firm.

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  • Dick RosenPro Member
    Property Manager · Gilbert, AZ · Member since 2009 · 1k+ posts · 451 votes
    12y

    @Jose Guevarra

    As an independent contractor under anyone... still makes a bird dog / referral fee improper and in most cases illegal.

    0Reply
  • Charles Morgan
    Investor · El Paso/Socorro, TX · Member since 2012 · 365 posts · 75 votes
    12y

    Texas law is similar in that getting paid a fee is against the law if you do not have a license. However many do as @Dick Rosen says in getting it under contract then assigning.

    1Reply
  • Jose Guevarra
    OP
    Real Estate Agent · Mira Mesa, CA · Member since 2014 · 218 posts · 49 votes
    12y

    I would appreciate it if you could take a few minutes to fill out our Bird Dog (Lead Scout) survey! The results will be published after the 100th entry. Thank You! https://www.surveymonkey.com/s/88PHVXQ

    0Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    12y

    @Engelo Rumora

    We shoot what the bird dogs point out and retrieve, and then give a nice pat on the head and a treat.. a great bird dog is worth their weight

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  • Bill Gulley
    Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
    12y

    I'm not surprised at all that people dealing in real estate cheat, pay people under the table, decide what's best for them and ignore laws. I am surprised that people admit or encourage such activities with such open disregard for ethical conduct. My take has always been that if someone is willing to cheat or bend the rules on one aspect of their dealings the question I ask is what other areas of business are they willing or even motivated to cheat at? True colors show through when someone suggests that it's okay to cross ethical lines and they simply can't be trusted. :)

    1Reply
  • Engelo RumoraBusiness Member
    Investor · Toledo, OH · Member since 2013 · 4k+ posts · 2k+ votes
    12y
    Originally posted by @Jay Hinrichs:
    @Engelo Rumora

    We shoot what the bird dogs point out and retrieve, and then give a nice pat on the head and a treat.. a great bird dog is worth their weight

    lol that's funny

    I have a few great guys here in KC that flood my inbox.

    Its hard to believe how some investors struggle to find great deals.

    Thanks

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