All Forum Posts by: Burt L.

A married fellow was experiencing some difficulty with the master bedroom so he went to see the family doctor. The doctor replied that he could certainly remedy the situation, and to save the man the difficulty of seeing another doctor he would provide two separate estimates.

In the first estimate, the doctor showed how he could save the man a considerable sum by performing three simpler procedures for a total of $12K. But for the larger sum of 30K the doctor could perform a single more invasive, expeditious procedure. He suggested the man go home and discuss the estimates with his spouse. A week later the man returned and the doctor asked what they had decided. The man remarked that it was decided they are doing a makeover on the kitchen. No profanity, etc. was used in the making of this post.

In a mentoring program, I seek the one-on-one communication that takes one beyond the pages of printed materials. This is a people business and the typed page isn't so easy to convert to buyer and seller interactions. I seek the one-on-one that helps when within a deal, and how to market and get the deal.

It may be accurate that those have reached the level of an advertised program no longer have time for one-on-one communications and have moved to a businessplan of volume and are no longer actively "in the trenches". Robert Hanson points out that the methods used two years ago don't work in the current market.

I would like to be as strong a self-starter as Jerry Puckett who learned wholesaling largely from the forums, but I"m not as good as converting text to a cohesive and well-ordered plan. The forum works spectacularly well for specific questions, though I"m not so sure I can learn an occupation entirely from the threads/articles. I'll also likely lose some sellers by saying the wrong things and believe a mentor can help me funnel more deals through to completion.

About contacting an attorney -I do have access to an attorney who owns a local title company and has said he works with many buyers, if I can find the deals.

Jon Holdman points out that I'm confusing finding a mentor with paying for a mentor; it seems that mentors who receive payment are usually disqualified, which reminds me of a thread with M. Poe about altruism. I do admit to confusion on this.

I don't know that this post of mine adds much to the converation - other than to say I do seek the one-one-one piece as I don't think I can learn seller interactions entirely from text and that I'm am less concerned about the contractual side with buyers and seller.

A couple of wholesalers I"ve also considered are Michael Quarles (national) and Michael Jake (local). It sounds like there is more to consider and I"m open to suggestions, and would like to avoid getting caught in a crossfire about compensated mentors. It sounds like once the mentor advertises, they are no longer effective. I would like to rely on altruism, but in the heat of a deal when communication is important, I think it can work if the mentor is invested as well.

I appreciate the replies provided. Wholesaling mentor programs do get a bad reputation, but fortunately I only need to find a single good one. An individual needs to perform their due diligence before forming any professional/contractual relationship and that is what I'm trying to accomplish in asking how I can best perform this on a wholesale mentoring program.

Of course, I'm also open to specific recommendations on these mentor programs. I read again and again that a person needs a mentor to move ahead and that the opportunity cost of taking the wrong actions, wheel reinvention, or not taking action usually far outweighs the cost of an effective program.

Joshua Dorkin - the courses I've taken haven't been related to wholesaling, but include John Schaub on rentals, Bill Bronchik on partnering, and Susan Lassiter-Lyons on joint venturing.

My previous investing career consisted of rentals - three-plex, duplex, single fam, mobile home. I had to sell all of them due to a mysterious disease that consumed my real estate resources in identifying and resolving it; I am starting over and lucky to be doing so. That issue has since been surgically resolved and I'm lucky to have had the equity to fall back on that I had. So I'm a real estate retread, and just as stuck as a newbie and know enough to know I need a mentor and a business plan thats not cash intensive beyond the marketing costs - which are still substantial.

Thus I'm doing my best to find a "Prince among the Frogs" and ask how to perform my due diligence on wholesale mentor programs, and for recommendations on any that have stood out for others. I know there are some poor ones out there, but I seek not to focus on that.

In looking for a wholesaling mentor, there are many things to consider and I don't know how to weigh the relative importance of different criteria - and I'm sure I've overlooked some items.

A few of the different items I"ve identified so far are their accessibility, what marketing costs to expect, what the profit split is vs. the cost of the mentoring, the mentoring contract itself, experences of past mentees, and whether the mentor has experience in my local market.

The websites usually seem quite promising about ones future lifestyle to come, but having paid for a couple of trainings in other real estate areas I"ve become a little more discriminating. There are very skilled wholesalers who market their mentoring abilities nationally and I also don't know how important current knowledge of the mentee's market is.

What might I be overlooking, and how important is local market knowledge or having the mentor have a financial state in each deal in order to sustain their attention and availability? I also have to be careful about being marketed to by marketing pros - been there, done that...... I confess.

Yes, I also appreciate the view from the other side of the mentor contract. Making an agreement involve a set number of deals instead of being time-based is an excellent idea. It likely won't involve a single template for deals as there will probably be sub-2's and sandwich lease options, depending on the situation. So maybe the mentor would need to "hold the handle bars a little longer" and have a larger number of deals/situations and I would certainly benefit from more deals together. Conversely, I may be more than ready to stop splitting deals - I just can't know now- but having the option to extend or depart sooner is wiser.

The idea about sharing marketing costs on a continuing basis seems like a very good one. Wholesaling is marketed as not requiring cash, but large mailings etc. have real costs. I dont like to sound too corporate, but there are real synergies in sharing marketing costs.

Some say to find the part of transactions you are best at, and partner with those who are good at the other parts - though I think I've seen some differences of opinion on that.

I appreciate the discussion and different viewpoints given on mentoring. I should probably spend additional time in the mentoring forum too, though I don't see mentoring in the learning articles section. I'll bet its here somewhere, in addition to word searches.

I respect the presumption that one offering a program isn't forthright; I've seen many threads here where a program was offered and the automatic response was very negative toward that person, until others who had participated in that program added their more positive experiences. Skepticism is natural, especially in real estate matters.

What if the assumption was that this was a honest person instead? I have done much due diligence and am entirely satisfied, and have known the person for years, seeing his wholesale deals, and which actually have meat left on the bone for flippers, holders etc. What might I want to consider before entering into such an agreement?

I wasn't clear that it would be a student/mentor situation for a year, and the upfront fee is $1,500. I would be working with him, and not as a FICA employee. I have no experience wholesaling, buyers list, or marketing experience. I could pay a local RE attorney to draft contracts.

It also comes back to a hot and often unresolved topic - whether half of more deals is better than all of a smaller amount. I can tell you that almost any amount of deals is better than what I have now. Having one to give you a kick in the pants from time to time is hard to place a value on. This individual also has extensive local markets knowledge, which can't be obtained from a national program. I've been dinking around with education too long and can't afford my current pace any longer. I think there's a John Wayne quote to this effect.

His credibility really isn't in question for me, just how I could structure this to do better. I see again and again that negotiating is the best paying activity of all activities. Before I was to go into a deal for a year with an "old pro", I have one opportunity to improve the deal, how might I do that - assuming his is an honest and productive program. We would split deals for a year, and as said by Jerry P. above, I might be a competitor after that. He had agreed the first deal would be all mine, as a confidence builder of sorts. I respect the natural skepticism towards people unproven at BP.

I only get one bite at the apple before making an agreement. I suspect I won't get to meet his buyers, or get a copy of his rolodex, but don't expect to.

I can go to work for local, experienced wholesaler who does a high volume of deals and wonder what I should consider upfront. Deals would be split for a year, and there is a modest fee to start. Like others have written, I'm not as good on the buyers list and contacts side of this, but realize that sharing half of the deals for a year isn't a small amount either. Essentially, all this is already in place, but I would have to develop my own buyers list to go out on my own eventually.

Although marketing approaches evolve, I know the most common ones used are yellow letters and bandit signs. There will be direct communication on an ongoing basis and I submit lead sheets and we would work on the ones that could provide a profitable deal for buyers. I realize I can't be a "lone-wolf" at this and that a coach/mentor is very useful.

Of course I want to know if a person with reasonable motivation can make a living at this, but I"m sure there are some things that I should consider, but don't have the benefit of experience in this. What might I be overlooking - before making a years written agreement?

At this point, all I'm looking into is working directly with sellers as a wholesaler. If it is approved by the brokerage, there is the issue of whether being a broker turns off sellers. Some have said it does and some says it doesn't. Maybe its all in the presentation made to sellers.

I would also be frustrated if another professional were attacking without being able to cite substantive authority. Those who become overly emotional are often trying to cover up something. Of course a brokerage only has to say that "its not their policy" to do certain transactions. More experienced brokers may receive more latitude after establishing a history of revenues, which carries additional weight.

I appreciate your replies. I hadn't spent time with the specific Real Estate Commission Positions as it's the brokerages' interpretation of the Positions thats takes precedence for a broker. I may be getting caught in the "You can't do that" mentality that seems to hang over the real estate downturn in general.

My specific problem is whether I can do wholesale contracts with sellers directly, in addition to not being able to do Sub-2's, sandwich lease options, and being instructed to avoid mortgage wraps. I only know that its alright to wholesale Hud's and MLS properties, which is getting thin.

It was helpful to learn here that direct mailings don't require disclosures, but that contracts do. This is consistent with the Commission position on disclosures. One poster who was making disclosures required in his state - said that his response rate dropped quite a bit after making disclosures in his mailings, though.

Its also good to learn that even making a license inactive may not be enough to be able to do deals that brokers can't do. Its more important to determine what type of transactions I am going to do, and whether they are within the guidelines.

There seems to be alot of fear and misinformation, which may help keep some brokers strictly on the retail side while avoiding real estate investing. I"m somewhat "feeling my way in the dark" in a field I don't have the benefit of experience in.

Thanks for the inputs.

I obtained my Agents license (broker in colorado) to do fix and flips, but have had some medical/financial setbacks and am not in a position to wait six months or so for the cash flows of fix/flips.

I am beginning to look at wholesaling directly with sellers as the local MLS doesn't have the opportunity that it earlier had, and I don't have a strong desire to do short sales or be a retail broker. I do like access to the mls, being able to see properties' listing histories, doing comps, seeing interior finishes online, and viewing property without needing a chaperone of sorts.

This probably boils down to what type of transactions I will do. Brokers in Colorado aren't allowed to do owner carries with sellers, or sandwich lease options, to name a couple, and it interferes with direct marketing for wholesales due to the required disclosures that come with being a broker.

As to the CPA license, I havent been in public accounting for some time now, but the 80 hours of continuing education every two years helps me to keep up with tax law and other related financial topics. It also helps in obtaining financing, but may put me at risk in working directly with sellers. Another local broker who holds a CPA license I've spoken with says she needs an additional signed disclosure with each client to show she isn't providing financial services in the capacity of a CPA.

There are many restrictions on agents/brokers and it seems that those who don't have a license have so many more business avenues available and don't have to turn people off by making broker/realtor disclosures when acting for themselves as an investor.

Many people mention being an unlicensed assistant, and I do have a friend with a brokers/agents license who doesn't use it or even have MLS service, but I wouldn't want to put his license at risk, if it would put him at risk through my working directly with sellers.

What is the general "breaking point" for when a person should make their license(s) inactive? If previously sounded like a good thing to have when I had the ability to buy/rehab/sell from a stronger capital position. MLS deals for wholesaling are more rare now and working directly with sellers seems to be more viable now.