Michael Quarles: The "As Is" Process of Podcasts 77 and 81

Homeowner · Rio Linda, CA · Member since 2014 · 38 posts · 11 votes

Good Morning BiggerPockets Community,

Where would I find blog(s) explaining "wholetailing?" I want to understand the process from obtaining a list through closing escrow. After taking advantages of many BiggerPockets resources including reading the Ultimate Beginner's Guide to REI, I thought learning the skills of "wholesaling" was the best way for an inexperienced person such as myself to enter the RE Investing world. It seemed many of the components were needed for the other strategies. However, after listening to Michael Quarles on Podcasts 77 and 81 discussing the strategy of selling "as is" I have begun to consider this as another option.

As easygoing and fun as the interview was, I have several gaps in my understanding surrounding what steps I need to take in order to make this plan work. For example, what infrastructure do I need to set up since I work a full time job? Would Google Voice be useful as a “lead capture” system? Gaining a better understanding of some of the reasons someone would respond to a yellow letter or postcard vs. listing the property with a real estate agent would help me to see the duplication/turnkey built into the plan.

Thanks in advance for any assistance from the BiggerPockets community which is greatly appreciated.

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Bill Gulley

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

11y

@Anne Jamesundefined

Yes, I can be frank, or anyone else you want me to be, if I can get a very important message across to you.

Nowhere on BP are the basics of real estate available to study. This is a social site, while we all give this site an educational aspect, it is not designed to fully educate anyone in the real estate profession, we go directly to strategies, methods or avenues of types of transactions. The emphasis is on "investing" which mostly involves acting as a real estate operator without having a great deal of capital at risk.

In this arena, what people here want may vary, but basically they want to find ways of making the dream come true, to make money. Very common goal, everyone needs to eat, everyone wants to succeed, most have limited financial means or just no money to invest.

Ask yourself why you are here.

Many think they are getting an education.......no, you're getting information.

Example: If an Army medic were to tell you he used a plastic bag to treat a soldier on the battlefield for a sucking chest wound, did you actually learn how to treat such a wound or simply that a plastic bag might be used? Can you identify that type of wound? Are you prepared to give other aid to that victim from the results of injuries or complications that you may inflict by attempting to use a plastic bag or in treating that victim? Do you know the best way to transport that victim? Is the victim in shock...what do you do?

Okay, I could go on, but you should get the picture.

In that example, incompetence can get someone who can be saved, killed!

Incompetence in real estate won't kill anyone, not that I know of unless you drove them to suicide, but you can very well inflict damages, social and financial damages that can wreck lives, cause hardships, loss of money, loss of time, reputation and inflict psychological and emotional damage.

I don't care if you have a room full of attorneys, you can have a string of business entities, a Recorder's Office full of Trusts, any disclaimer you might dream up, bottom line, you can and will be held personally liable for gross incompetence and illegally dealing in real estate. There is no such thing as a quiet real estate transaction, eventually what people do will surface. Incompetence, if your dealings are just a bit rough around the edges, you might get by, as they become more significant, the greater the likelihood you'll be held to some accounting, to the point of going to prison.

Yes, people go to jail from dealing in real estate, most you never hear about. Ever hear a guru say he had to pay a huge fine to some agency to stay out of jail? No, I didn't think so.

Screw ups in real estate can be illegal or be tortious conduct, half the people on social real estate sites (probably more) don't know what tortious conduct is! Better look it up! Your screw ups can be intentional (worse case) or unintentional (still bad), it won't matter.

PSSST! Want a real secret about public real estate internet sites?

Closer......

All kinds of people are on them.

Some are very knowledgeable and well educated, they understand the laws and ethical standards as professionals and they contribute for various reasons, but.....

You also have those "old timers" stuck in a time warp, "this what I did in the 70's, 80's or 90's". follow these guys who failed to stay current and they can lead you down a path of destruction!

Then you have instant success types, they are making (more like taking) money, they may or may not know what they are doing is considered unethical in the industry or illegal, but they don't care.

You'll also find those preying on newbies, "let me help you" careful, that pat on the back just might hold you back. There are good coaches and mentors and bad ones.

The theory of a mentor and mentee goes back before Christ. The idea of the old master teaching the younger the trade while profiting off the back of the intern is very much alive and well today in real estate.

Then, there are a few outright crooks, sharks, predators and authors selling ideas or taking your money for very little in return, if anything.

Last, but not least, we have the newbie experts who really want to be a guru, less than 10 years in the industry is still a newbie unless they have professional designations that indicate a greater degree of expertise, like attorney, CPA, MAI, CCIM, ALC, CPM, or maybe a CRS. Too bad thee is no certification for gurus, at least accredited by any professional association other than perhaps by each other.

Now, here's how you'll benefit from all these types:

You have to have a BS Meter!

In real estate, you really need to know who shoots straight, gives valid and good information and is creditable. You need to spot the BSer, the half truths, the near misses of the truth and the outright lies and BS.

If I could duplicate my BS Meter for you, I would! But, I can't, you have to build your own!

To build one, you need to know what is and is not acceptable, what is or isn't ethical, what is or even can be illegal, that means you must know the basic aspects of real estate....period. Then, it becomes a people skill, reading people and understanding their motivations, what's in it for them. Always look to this angle, because what is in it fr them can be a price too high to be paid.

Your BS Meter will take you through the shortest path to success, keeping your reputation intact and allow you to lead others. Lose your reputation in real estate, if you can survive, you'll just be seen as another bottom feeder.

So, why are you really here?

Best of luck :)

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Todd Schwehr
Springfield, IL · Member since 2012 · 5 posts · 1 vote
11y
Your familiar with his "buy sell flip fix" podcast on iTunes? Would be a good place to start. He goes into granular detail on several podcasts and answers 5 invested questions sent in at the beginning of each show. But it sounds like they market to equity owners and then just list it on the mls.
0 Reply
Aaron Mazzrillo
Investor · Riverside, CA · Member since 2011 · 2k+ posts · 3k+ votes
11y
First off, I'd like to address the most important obstacle you are stuck behind. That is, trying to understand the "Why" of anything is the job of an out of work, hippy philosopher, not a real estate investor. I hear all the time, "Why would someone do that?" My answer is always the same, "I don't know, and I don't care. They just do. And I hope I'm there when they do it!" Why do some people yell at other drivers? Why do some people dye their hair? That's just what some people do. They are the angry drivers and hair dyers.
Ron LeGrand said it best, "Some will. Some won't. So what! Whose next?"
If you open a restaurant, would you ask every person, "Why are you eating here?" that walked through your door? No. You'd just sell them a meal and happily take their money. Don't waste your time on the "Why?." I've been doing this for more than 10 years and you just need to know that some will and some won't. For those that won't, so what! Whose next? We don't make money off the don't wanters. They are not our customers.
I don't use Google Voice so I have no opinion on the quality of that service. You could certainly get another cell phone or another line to your house installed with a voice mail box. There are probably less expensive/free alternatives like Google Voice, but I'm from the answer every call live if possible camp. There's a hot lead you paid a lot of money to get to call you. I wouldn't let that go to voice mail where he/she has time to cool off waiting for you to get back to him/her.
2 Reply
Gilbert Dominguez
Investor · Chicago, IL · Member since 2015 · 677 posts · 309 votes
11y
First understand the reasoning behind why Wholesalers are needed, in what way are they useful, what is the demand for wholesaler, and what are the benefits of using a wholesaler?
The word, "Wholesale" implies quantity and discount. Well, there are some wholesales that in effect do deal with large quantities of properties but on the whole they do not really provide such a large quantity of properties and most people interested in buying from wholesalers are not going to or interested in buying large quantities of properties.
Next and this is very important to realize and that is that most so called wholesalers do not own the propertied they offer for sale. What they own or have for sale is simply their contract and right to purchase a property at a discounted price. We say discounted because a property is valued according to the current market value of the property. However you may not be buying a property that has any true market value other than what is called, " turn key " properties. This means the properties exist in livable condition and have renters in them so that you have the rents as a source of income derived from the buildings.
There are turn key properties and properties that only have a potential such as distressed properties or properties that need repairs and are not in livable condition.
You have to distinguish between properties a wholesale owns and has the right to sell and properties a wholesaler does not own and only has a contract to purchase therefore only the right to assign their contract or in essence transfer the contract rights to you.
Let us define, "Wholesaler" again: A person or entity(company) that buys houses or buildings in quantity and offers them for sale at discounted prices.
If you are a person while enough or allot of money and can buy allot of houses and sell those houses at discounted prices then you are a true Wholesaler. However you can be a person without much money and cannot buy allot of houses or even one house. What do you do if you have no money to buy a house?
You can get a seller to sign a contract with you for you to buy their house. You will need to know how and why a seller would sell a house to you at a discounted price. You will need to evaluate the house's true value but at least know what your maximum offer for that house would be. This would be based on what a buyer would offer for that house. So then you have to know what a buyer's , your buyer's criteria would be to want to buy that house by buying your contract to buy that house at the price you have negotiated. Know that you will not be the one to buy the house so you should be honest with the seller and let them know that you have a list of buyers you will be taking the contract to and be assigning the contract to the buyer. In this manner the seller will know that at least you are in contact with and know people that would be interested in buying their house. In many cases you would want to have a list of buyers who have the cash to buy the house immediately. However you may know of a buyer who does not have the cash but does have the wherewithall to arrange to buy the house through other than full cash means. For example:
part cash and part financing or full financing. There do exist loans for people to do both purchase and repairs and can get the finance to do both.
If you choose to work in this field your job or service will be to obtain the house at a substantial discount so that you can offer a buyer what will be regarded as a good deal.If you do not have the money to buy the house then the most you can do is contract to purchase the house for a given amount of money then work to sell your contract , called contract assignment to an end buyer.
The better the deal you can offer the more likely you are to find a buyer willing to commit to pay you for your work and contract assignment.
How do you determine what should be your offer price or purchase contract price?
You need to determine what the market price would be for the house you are dealing with meaning what is the current price for that particular house in good living condition.
You will need to know how to determine as exact as you can be about the repair cost if their are repairs to be made or updates etc.
You will need to determine how much work, how many hours, you will be working to put a deal together and come up with a charge to add or place on your contract should that be all you have to offer. Of course if you outright buy the house at a substantial discount you will need to be able to determine what you should add to your cost of buying the house in order to make it worth your while to sell it.
These are some of the basics and the rest you will need to learn as you involve yourself in the business. You can work to educate yourself on the subject. You can reach out to those already in the business, you can attend real estate investment association meetings in your local area, ask questions , listen and work to gain what you need to know about the business and of course you will learn more as you start to put deals together which you will want to sell.
Dealing in real estate is a regulated business so you should familiarize yourself with the laws, rules and regulations. It might help to consult with a real estate attorney in setting up and operating your business.
2 Reply
Anne James
OP
Homeowner · Rio Linda, CA · Member since 2014 · 38 posts · 11 votes
11y
Hi Todd,
Thanks for the information regarding "buy sell flip fix." An iTunes Store search yielded no results for this podcast. Is this the actual podcast name?
0 Reply
Anne James
OP
Homeowner · Rio Linda, CA · Member since 2014 · 38 posts · 11 votes
11y
Hi Aaron,
Thanks for pointing out the possibility of overthinking while missing the opportunities at hand. Have a great day.
0 Reply
Anne James
OP
Homeowner · Rio Linda, CA · Member since 2014 · 38 posts · 11 votes
11y
Hello Gilbert,
Thank you for the detailed response on wholesailing. Your comments were helpful regarding advising the seller of others making the actual purchase.
0 Reply
Bill Gulley
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
11y
Originally posted by @Anne James:

Good Morning BiggerPockets Community,
Where would I find blog(s) explaining "wholetailing?" I want to understand the process from obtaining a list through closing escrow. After taking advantages of many BiggerPockets resources including reading the Ultimate Beginner's Guide to REI, I thought learning the skills of "wholesaling" was the best way for an inexperienced person such as myself to enter the RE Investing world. It seemed many of the components were needed for the other strategies. However, after listening to Michael Quarles on Podcasts 77 and 81 discussing the strategy of selling "as is" I have begun to consider this as another option.
As easygoing and fun as the interview was, I have several gaps in my understanding surrounding what steps I need to take in order to make this plan work. For example, what infrastructure do I need to set up since I work a full time job? Would Google Voice be useful as a “lead capture” system? Gaining a better understanding of some of the reasons someone would respond to a yellow letter or postcard vs. listing the property with a real estate agent would help me to see the duplication/turnkey built into the plan.
Thanks in advance for any assistance from the BiggerPockets community which is greatly appreciated.
Congratulations! This post inspired me to actually listen to this podcast, that is only the second time a forum post has led to a podcast that I listen to all the way through! Just over an hour and a half of some good stuff with Michael. No, I'm not going to podcast 81.
I can't really answer any of your questions as podcast 77 doesn't seem to apply to any of them. Can you be more specific?
Infrastructure? What do you mean? Modes of communication, a case of yellow letters, a car, business cards......what?
I'm not touching Goggle Voice, just don't know what you want to accomplish with it.
Why people respond to mailings? That begins with a target market. Why they answer or call, I guess you hit a mailbox where the owner is thinking about selling. Depends on what you say, but, the perceive selling the house quicker, making more without a Realtor and having further marketing time or interruptions .... that's their initial thinking.
As to what you need to do, you really need to learn some real estate basics before you jump into systems, methods, ploys, angles or strategies. Can you identify your market, can you actually value a property, do you understand what to do when you hit title issues or an encroachment or some easement? Do you know anything about what lenders require, because what they require effects the marketability of a property.....that is, unless you think you're going to limit your market to only cash buyers.
Michael has good stories, he's a master, but.....his bouncing his earnest money check 30 years ago as a kid, well.....he was a kid and secondly, that was 30 years ago! It makes for a funny story, doing that today, as an adult could actually lead to some jail time!
You need to learn some real estate basics before trying to deal in real estate today. Good luck :)
0 Reply
Anne James
OP
Homeowner · Rio Linda, CA · Member since 2014 · 38 posts · 11 votes
11y
Originally posted by @Bill Gulley
"Congratulations! This post inspired me to actually listen to this podcast, that is only the second time a forum post has led to a podcast that I listen to all the way through! Just over an hour and a half of some good stuff with Michael."
Good morning Bill,
Thank you for responding to the post and I'm glad the time invested resulted in "good stuff" with @Michael Quarles"... No (and Low) Money Down." I was surprised to learn a couple of the strategies mentioned are part of my real estate acquisiton experience. I purchased my first home with a FHA loan and helped to build my current home.
When I think of infrastructure, its gaining knowledge and developing essential skills which could be assembled into a process. Because of the way I approach life, understanding the "what" surrounding a task helps a great deal in grasping the "how." Thanks in advance for your thoughts. Have a wonderfully productive day!
1 Reply
Cody Alexander
Real Estate Professional · Bakersfield, CA · Member since 2014 · 205 posts · 87 votes
11y
Originally posted by @Anne James:

Hi Todd,
Thanks for the information regarding "buy sell flip fix." An iTunes Store search yielded no results for this podcast. Is this the actual podcast name?
Hi Anne the podcast is actually "Buy Sell Fix Flip", those last two words were reversed.
That search should come up instantly in iTunes, but he also has them on his website BuySellFixFlip.com. Hope that helps!
0 Reply
Bill Gulley
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
11y
@Anne Jamesundefined
Yes, I can be frank, or anyone else you want me to be, if I can get a very important message across to you.
Nowhere on BP are the basics of real estate available to study. This is a social site, while we all give this site an educational aspect, it is not designed to fully educate anyone in the real estate profession, we go directly to strategies, methods or avenues of types of transactions. The emphasis is on "investing" which mostly involves acting as a real estate operator without having a great deal of capital at risk.
In this arena, what people here want may vary, but basically they want to find ways of making the dream come true, to make money. Very common goal, everyone needs to eat, everyone wants to succeed, most have limited financial means or just no money to invest.
Ask yourself why you are here.
Many think they are getting an education.......no, you're getting information.
Example: If an Army medic were to tell you he used a plastic bag to treat a soldier on the battlefield for a sucking chest wound, did you actually learn how to treat such a wound or simply that a plastic bag might be used? Can you identify that type of wound? Are you prepared to give other aid to that victim from the results of injuries or complications that you may inflict by attempting to use a plastic bag or in treating that victim? Do you know the best way to transport that victim? Is the victim in shock...what do you do?
Okay, I could go on, but you should get the picture.
In that example, incompetence can get someone who can be saved, killed!
Incompetence in real estate won't kill anyone, not that I know of unless you drove them to suicide, but you can very well inflict damages, social and financial damages that can wreck lives, cause hardships, loss of money, loss of time, reputation and inflict psychological and emotional damage.
I don't care if you have a room full of attorneys, you can have a string of business entities, a Recorder's Office full of Trusts, any disclaimer you might dream up, bottom line, you can and will be held personally liable for gross incompetence and illegally dealing in real estate. There is no such thing as a quiet real estate transaction, eventually what people do will surface. Incompetence, if your dealings are just a bit rough around the edges, you might get by, as they become more significant, the greater the likelihood you'll be held to some accounting, to the point of going to prison.
Yes, people go to jail from dealing in real estate, most you never hear about. Ever hear a guru say he had to pay a huge fine to some agency to stay out of jail? No, I didn't think so.
Screw ups in real estate can be illegal or be tortious conduct, half the people on social real estate sites (probably more) don't know what tortious conduct is! Better look it up! Your screw ups can be intentional (worse case) or unintentional (still bad), it won't matter.
PSSST! Want a real secret about public real estate internet sites?
Closer......
All kinds of people are on them.
Some are very knowledgeable and well educated, they understand the laws and ethical standards as professionals and they contribute for various reasons, but.....
You also have those "old timers" stuck in a time warp, "this what I did in the 70's, 80's or 90's". follow these guys who failed to stay current and they can lead you down a path of destruction!
Then you have instant success types, they are making (more like taking) money, they may or may not know what they are doing is considered unethical in the industry or illegal, but they don't care.
You'll also find those preying on newbies, "let me help you" careful, that pat on the back just might hold you back. There are good coaches and mentors and bad ones.
The theory of a mentor and mentee goes back before Christ. The idea of the old master teaching the younger the trade while profiting off the back of the intern is very much alive and well today in real estate.
Then, there are a few outright crooks, sharks, predators and authors selling ideas or taking your money for very little in return, if anything.
Last, but not least, we have the newbie experts who really want to be a guru, less than 10 years in the industry is still a newbie unless they have professional designations that indicate a greater degree of expertise, like attorney, CPA, MAI, CCIM, ALC, CPM, or maybe a CRS. Too bad thee is no certification for gurus, at least accredited by any professional association other than perhaps by each other.
Now, here's how you'll benefit from all these types:
You have to have a BS Meter!
In real estate, you really need to know who shoots straight, gives valid and good information and is creditable. You need to spot the BSer, the half truths, the near misses of the truth and the outright lies and BS.
If I could duplicate my BS Meter for you, I would! But, I can't, you have to build your own!
To build one, you need to know what is and is not acceptable, what is or isn't ethical, what is or even can be illegal, that means you must know the basic aspects of real estate....period. Then, it becomes a people skill, reading people and understanding their motivations, what's in it for them. Always look to this angle, because what is in it fr them can be a price too high to be paid.
Your BS Meter will take you through the shortest path to success, keeping your reputation intact and allow you to lead others. Lose your reputation in real estate, if you can survive, you'll just be seen as another bottom feeder.
So, why are you really here?
Best of luck :)
3 Reply
Anne James
OP
Homeowner · Rio Linda, CA · Member since 2014 · 38 posts · 11 votes
11y
Originally posted by @Bill Gulley:

@Anne Jamesundefined
... Nowhere on BP are the basics of real estate available to study ... Many think they are getting an education.......no, you're getting information ...
Incompetence in real estate won't kill anyone ... you can and will be held personally liable for gross incompetence and illegally dealing in real estate ... to the point of going to prison ...
Screw ups in real estate can be illegal or be tortious conduct ... Better look it up! Your screw ups can be intentional (worse case) or unintentional (still bad), it won't matter ...
In real estate, you really need to know who shoots straight, gives valid and good information and is creditable. You need to spot the BSer, the half truths, the near misses of the truth and the outright lies and BS.
If I could duplicate my BS Meter for you, I would! But, I can't, you have to build your own!
Your BS Meter will take you through the shortest path to success, keeping your reputation intact and allow you to lead others. Lose your reputation in real estate, if you can survive, you'll just be seen as another bottom feeder.
Hi Bill,
Thanks for the willingness to share information :).
I did look up tortious conduct and now understand good intentions which have gone astray provide no relief for damages inflicted if the plaintiff can prove their case.
I'm on track to retirement in six years or less. I want to develop another income stream in real estate in a legal, ethical and competent manner. Instead of the Bigger Pockets Community, a different resource will be used to acquire the basic aspects of real estate. As suggested, I will be on the lookout for credible persons as I continue gleaning valid and good information while building a serviceable Meter. I am enjoying a good reputation and have no desire to become "another bottom feeder" in real estate due to a lack of integrity and/or incompetence.
Best wishes for your ongoing success!
0 Reply
Anne James
OP
Homeowner · Rio Linda, CA · Member since 2014 · 38 posts · 11 votes
11y
Hi @Cody Alexander
Thanks for the assistance with the podcast name as well as @Michael Quarles web address. Have a wonderfully productive day!
0 Reply
Bill Gulley
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
11y
Great, glad to hear it Anne!
Saying "if they can prove their case" that's usually easy to do in real estate.
Bogus sale contract, caused the seller to take it off the market, lost prime marketing time = proving a financial loss. So does implying a sale and having a seller incur expenses getting things in storage, I've even seen meal eaten out as they can't cook at home after moving things out, motel bills as well.............as long as that seller acted in a prudent and customary manner based on the information they received and could reasonably rely upon, they win!
Seller's rights before buyer's rights.
I happy to hear your attitude! :)
0 Reply
Franklin Romine
Visalia-Fresno, CA · Member since 2009 · 1k+ posts · 863 votes
11y
Originally posted by @Aaron Mazzrillo:

First off, I'd like to address the most important obstacle you are stuck behind. That is, trying to understand the "Why" of anything is the job of an out of work, hippy philosopher, not a real estate investor. I hear all the time, "Why would someone do that?" My answer is always the same, "I don't know, and I don't care. They just do. And I hope I'm there when they do it!" Why do some people yell at other drivers? Why do some people dye their hair? That's just what some people do. They are the angry drivers and hair dyers.
Ron LeGrand said it best, "Some will. Some won't. So what! Whose next?"
If you open a restaurant, would you ask every person, "Why are you eating here?" that walked through your door? No. You'd just sell them a meal and happily take their money. Don't waste your time on the "Why?." I've been doing this for more than 10 years and you just need to know that some will and some won't. For those that won't, so what! Whose next? We don't make money off the don't wanters. They are not our customers.
I just woke up. This is powerful information. I needed it. Everyone listen.

Frank
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