All Forum Posts by: Matt Turcutto

UPDATE (for anyone that cares):

I wanted to give an update for everyone that followed along. I did not listen to the few nay-sayers telling me my market is over saturated and no deals were to be had. Instead, I trusted the voice that said keep going. I ended up sending letters/postcards to my list of 1,000 homes 6 different times. The results were that I got two houses out of the deal.

The first I sold and closed last week. We rehabbed it and I learned a TON I didn't know I didn't know. Quick and dirty: We bought for $490,000, put $30k into it and sold for $647,000. Made a gross profit (after real estate fees, closing costs, and any other possible expense) of $83,000. We put $90,000 of equity into the deal, so I consider that a WIN with a capital "W." Overall, we held the asset 3.5 months. Annualize that return and we made out like bandits. 

The second we bought four weeks ago and completed rehab this week. Stagers are coming in over the weekend and we'll be ready to list by next week (haven't decided if we're waiting unit Jan 1 to take to market). We bought this for $360,000, put $25,000 into it and are planning on selling for $470,000. Minus expenses and closing costs, we're hoping to make $45,000. We put $100,000 of equity.

Not as good as the first, but this was a much smaller and quicker rehab. I made the $25k stretch much farther than the $30k of the first flip and the lessons made in the first were implemented in the second. I feel much more at ease with achieving the second's numbers. 

To anyone thinking about jumping into the business, just do it. Spend $5,000 in marketing and no matter what market you are in or where you want to invest, I can with almost 100% certainty say you will make it back at least tenfold. The number one thing I would do is mail a smaller list 6 times rather than a larger list once. If I learned anything from this post its that one needs to be patient and wait until the fifth or sixth mailing before they can get excited about the inbound calls. 

Cheers! and happy flipping!!!

(PS- Big shoutout to the Podcast that actually gave me the courage to get off my @$$ and do something)

My direct mail campaign recently uncovered a lead. For the record, I'm in California. Here's what I found by talking to the lady that called me and what I found on title:

Man buys house with Wife 1. Man has daughter, Daughter 1. Man and Wife 1 gets divorced. Wife 1 records Quitclaim (or the like) renouncing any interest in property. Man owns mortgage and property as sole name as a married man as his separate and sole property. 

Man marries Wife 2. Man, Wife 2, and Daughter 1 live in home together. Real Estate Market crashes. Man completes successful loan modification of negative amortizing first and begins drawing on second. Man dies suddenly without will and property is not held in trust.

Wife 2 gains custody of 16-17 year old Daughter 1. Wife 2 continues to pay mortgage(s) and lives in house with Daughter 1. Bank calls and says loan mod is coming to term and payments are about to go way up. Wife 2 gets my postcard in mail and calls me. 

Wife 2 forgets she has an unrecorded joint tenancy with right of surviorship agreement. Records agreement. 

Now for my question. The house is not worth what (deceased) Man owes. Is Wife 2 responsible for the mortgage? If we work with the lender(s) to obtain a short sale, will this negatively affect Wife 2's credit score? She wants to purchase a home out of state to be with her family and I can help her out, but we both want to make sure this won't negatively affect her. 

Thoughts?

 What offer is that? Driving for dollars?

@Aaron Mazzrillo Alright. You've convinced me to work on my type. I'll look at Jerry's stuff and may consider investing in him. I'm also buying that letter book and am refocusing my list. You are correct. I've lived in South OC my whole life and we've always gotten the realtor comp sheets (I used to hang them on doors in high school for family realtor friends for extra money). People in my area are wise on home values. 

Several people tried to get me to invest in Riverside County and I truly believe Riverside is in for a good appreciation bump in the next few years, but after talking to people like you I decided long ago I should go after the areas I want to invest in long-term and in the areas I know like the back of my hand. For this reason, I want to stay in South OC. I wouldn't mind owning rentals in South OC and I know the area super well. Why learn a whole new market just to get out of the market in a few years as part of my long-term strategy? I'm just trying to figure out how to work the South OC market most efficiently. 

If you truly want to go after the tuna in OC, why don't we partner up? I have access to money and the drive to get deals. If you can bring the deals it may make sense to work together than to not "give too much more info cuz <you're> looking to catch a tuna" in my town. DM me if interested. 

@Account Closed This is really good stuff. I think the last letter I send to my "NOD" list will include some of this language. In the future, I think I'm going to give the absentee list a try since the area I want to target is more affluent.

@Jay Hinrichs I did subscribe to Property RADAR in the past and actually canceled it. I attended one courthouse auction to see what it was like. I tracked the homes and found at least the houses I saw sell on auction weren't a killer-smashing-hit-it-out-of-the-ballpark deal. Plus, I don't have millions of my own money. I have to raise private equity and the private equity can act fast (a day or so) but typically wants to leverage with hard money as to boost cash on cash returns. 

@Cory Binsfield I'm focused on marketing like a wholesaler and flipping because I have a network with money who trusts me. I want to use the good 'ol OPM until I can build up my own cash to buy long term assets and escape the good 'ol rat race. 

@Carlos Altamirano I have not tried online marketing yet. Honestly, I've started about a half dozen websites on various subjects over the years and the whole process of running and managing a website exhausts me. I'd rather stick a fork in my eye than focus my time on SEO & SEM (although I do know there's much value in both). 

The problem is I obviously don't see too much value in SEO or SEM else I'd pay to outsource it. I'm simply too cheap to outsource which is probably why I've only had a mediocre brokerage career and find myself back at working for the man. 

I guess in short, my wife and I have allocated $5,000 to building my flipping business and I've exhausted half on a crappy list with an apparently crappy type. 

Would you advise me spending the remaining $2,500 on better letters/list or on SEO/SEM?

@Brian Egr Perfect advice. Thank you. I didn't even think of removing my last name. I know that will be something I immediately do and will have benefit day 1. I have already gotten the hilarious voice messages calling me all kinds of names. Coming from commercial real estate sales, I was not phased by the name calling and angry calls but when someone googled my name and ended up talking to my boss and the head of the company, I knew something had to be done differently. 

Thanks for the encouragement. I think I'm going to finish the campagin I set out to do, and I will try one more time to mail to a new 2,300 absentee owners list 5 times (postcard, letter, letter, postcard, letter). If I continue to achieve dismal results, I will hang my direct mail hat up and try to buy from wholesalers. 

@Andrew Johnson This is very true. My day job is in the commercial realm. I don't know how to combat this very valid objection. In fact, as I mentioned earlier, the first mailer I sent misspelled my website. One of the calls I got was someone who tried getting to my website but couldn't. They then googled my name and found Wind Water, the company I work for. They called the line and spoke with someone about me who had no idea I had this side business. Long story short, it went all the way up to my boss which provided for an awkward conversation. 

Is there a way to overcome this? Should I even try? Am I better sticking to selling commercial buildings? Literally these are the questions I'm asking myself which is another answer to why I posted this post on BP to begin with. Any advice is greatly appreciated. 

Maybe because I have really good SEO on my commercial sales side, I choose to outsource the direct mail to wholesaler? This does kill me though, but maybe I need to admit defeat on the direct mail side and focus more on what I can succeed with.