All Forum Posts by: Cornelius Garland

@Abraham Cisneros Congratulations on starting. Many new wholesalers feel uncomfortable starting. Having a script to follow is important so you have a flow to follow. You don't want to sound like a robot, but it's a good starting point so you're not saying "uhh" or have awkward pauses on the phone.

Here are a few points I'd emphasize:
Start by asking the seller if this is a good time to talk after a brief introduction. You don't want to sound too formal but you want to sound pleasant.
Then you can transition to asking them about the property condition. It's important to ask them about this because you can use this as negotiating power to ask for a discount without seeming like it's coming out of nowhere.

Get them to talk about the roof, the flooring, the paint, the carpet, the HVAC - ask when the last time these things were updated.

It's also important to control the direction of the conversation by asking questions, but the seller should do the majority of the talking.

I'd also take time to get good at generating comps / cash offers. This is one thing that many new wholesalers struggle with. In order to identify if the seller is motivated or a tire kicker, it's important to know what distressed properties are going for in your area. You can do this by practicing comping out each lead you generate, even if the seller is cold. It may take you 30 minutes to an hour to generate a cash offer for one property, You want to get so good at this that you'll know instantly if you've got a deal or not. The seller's asking price determines if you have a deal or not - they can say they just had a hip replacement and all these other seemingly-motivated reasons why they're selling. In actuality, the only thing that matters that comes out of their mouth is if they want to sell for 50 cents on a dollar.

Also, do not be afraid to ask the seller questions that might seem inappropriate. For instance, "Do you have a loan payoff". Or "What are the tenants paying for rent?" I use these questions to gauge the seller's cooperation. If they're apprehensive about answering these questions then you know their motivation is lower than a seller that freely provides that information to you.

I wish you much success with calling. Orlando is a good market. Also, if you're finding those sellers to be too stubborn, Jacksonville and Tampa are also both great markets in Florida.

Yes, leave this house alone, especially since it's so far from you. This is the type of thing that can take the wind out of your sails. Chasing properties with no potential is a waste of your precious energy. Typically, I look for 20 or more homes sold in the last 30 days, so only 2 homes sold in the last year is not a good sign of any retail or cash buyer activity in that area. You're not missing anything by skipping over this one.

Typically, 3 times or if I notice a dramatic drop off in response rates between month 1 versus month 2. For instance, if I received a .5% response rate in month 1 and month 2, I only received a .1% (not 1%) response rate then I won't mail the list again to potentially risk only getting a handful of leads.

@Joe S. Yes, I do. I'll keep the same mailing list for a quarter and then change it. Also, I spread out my mailings. I don't deliver all 6,000 mail pieces at once. I use my mailhouse to evenly spread them out through the month so I'm getting leads consistently rather than all of them within a few days after my maildrop. Usually, 1500 will get sent out each week. 

@Doug Smith You're welcome, Doug. I am sort of obsessed with this because hiring has been a thorn in my side for years. I feel like I finally hacked it at least in my company. I do like the Meyers-Briggs framework because it's both accessible to employees and employers. I have turned down employees for job positions in my company but many of them thank me because I showed them about 16 Personalities. I think incorporating this, DISC, Kolbe, and a few other tests can allow us to make perfect hires each time. More awareness on this subject is needed, though. I appreciate your feedback. 

Thank you for breaking this down. I will definitely look into both, and it sounds like Kolbe will work best for me as I like having natural problem-solvers in my company. If they cannot be somewhat autonomous then I am essentially babysitting employees. Great input.

@Celestino Moreno This does not sound like a deal, especially if you're looking for your first one. The reason is that it's a mobile home in a rural area. How recently are the two homes sold?

If you're having a hard time generating comps then your cash buyers will, too, and most of them will pass. There might be something here but at a cursory glance, it does not appear to be.

@Thomas Garnett Good day, Thomas. @Allan Smith's numbers are spot on. I'm in Charlotte, NC and here, it takes 6,000 direct mail pieces to land one contract/deal. Here is why: Direct mail response rates are much, much lower than cold calling and cold texting. However, the leads are warmer than other marketing channels. You can expect a .5% to 1% response rate. You'll likely get a 1% response rate on your first mailing and it takes my team 45 leads to close one deal with direct mail. On your first time mailing your list, you can expect a 1% response rate, but it will never be this high on subsequent mailings. It will decrease each time you mail the same list - 

Month 1 - 1% - 60 leads generated (On a 6k record list)

Month 2 - .8% - 48 leads generated (On a 6k record list)

Month 3 - .5% - 30 leads generated (On a 6k record list)

Month 4 - .2% - 12 leads generated (On a 6k record list)

By month 3, I'm already thinking of pulling a new list. I've observed these trends since I started. For a new wholesaler, direct mail is not the best option right now because of the costs. Also, these leads are valuable. If you're new to wholesaling, you're essentially practicing on valuable leads. My vote for you is to practice getting familiar with talking to sellers by cold calling or texting sellers then once you and a deal by doing this you can execute a direct mail campaign.

One caveat I'd like to mention is that your list matters even more in direct mail than other, more saturated, marketing channels. If I remember correctly, @Jerry Puckett targets probates and does not have to send thousands of mailers to get a deal. Jerry, feel free to chime in and correct me if I'm wrong. I learned the fundamentals of direct mail from you on the forums over 8 years ago.

Direct mail got me my first deal in 2015 and it isn't going away. Actually, I think now is a better time for it since we have other affordable marketing channels. When I started, cold calling was only for the top wholesales with large budgets. Typical rates were $12 - $20 per hour. Also, skip tracing was a very manual process. We would have to go on Upwork to find assistants to skip-trace each one manually through TLO or Microbilt. It was a pain and not cost-effective. So up until a few years ago, many wholesalers were stuck with a few marketing channels like direct mail and door-knocking to generate motivated seller leads.

Now, since skip tracing is very affordable, it has opened up other marketing channels like cold calling, bulk texting, voice broadcasts, and ringless voicemails. This may make it appear like it is not effective since others aren't talking about it as much.

You can get a deal by sending out 3,000 mail pieces to absentee sellers if your targeting is right by going to distressed zip codes and focusing on cheaper properties. However, I found that 5,000 mailers are a sweet spot. This will generate anywhere from 25 - 50 leads. It's taking me 45 leads, on average to close a deal with direct mail. This figure has held true for my company for years.