All Forum Posts by: Stephen Chatto

@Dell Schlabach

 - You can see my response to this above.   It is towards the top of the 4th page of comments.   

Here is a Copy and Paste:

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19 Northcourt Lane - The ARV is 225k - Solid number because the house JUST SOLD after my buyer got done the rehab. 225k * 0.7 - 157.5k. Now I need to Minus out my repairs. Again I don't know what the heck the buyer is going to do to it. I know know that the rehab is complete he spent about 60k on repairs. so 157.5k - 60k =97.5k. NOW I need to take out my fee. 10k sounds great. so now my MAO is 87.5k.

I offered this man 115k. We made 10k on the deal and sold it to a cash buyer for 125k and CLOSED in 3 weeks.

So IMHO the formula is BS. Plug in the ACTUAL rehab value and the ACTUAL ARV and the MAO is not correct. That's a 25k Swing OVER MAO.

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@Richard C.

I don't think that anyone is saying lock up any deal at any price. What I am saying is that if you rely on MAO your are really Low Balling People, and that is not fair if not worse. It will be harder to be competitive in the market, and you are wasting a lot of time.

No one is saying Lock it up at any price. Know your market, know the cash sales, know what the cash buyers want, and lastly use common sense when making and determining the price that will work. What I am saying that MAO is is very rarely the "Max Allowable Offer".

FYI - I have had 3 deals that for some reason I was not able to move in as a wholesale over the past year.  Who knows why.   Guess what I closed on all three of them.  

@Christopher Goldie

- I know my market :) I looked at the cash sales.  I talk to investors all the time.  

-This house was totally move in ready. A bit dated but nice.   We now know all fixed up and sold for 225k...   how much do you think a move in ready dated house would sell for?  It would be a guess, but a lot more than 125k I had it out there for.  

-If the house didn't sell for 125k I would have purchased it for 115k and sold it retail AS-IS. 

-I had a buyers open house and had about 25 buyers show up and multiple offers.  

-ALSO.. It helps to see what amounts the cash sales are at. That is much more effective than a guess at MAO.

@Shaun Reilly

 - I have yet to sell a deal to a buyer with hard money.  I see investors with cash ready to be deployed and so much private money out there, people using hard money are having a heck of a time being competitive unless the are direct to seller.  

@Richard C.

I feel that the information I provided was of value, and I have no issue sharing that Karl is the man who helped me in learning these lessons.   I don't mind giving credit where it is due.  

@William Johnson  

Concrete Examples.   Sure.

Myth #1 and #3 - The deal I have scheduled to close on 3/23.  I have been fighting Karl on state contracts and realtors for a long time.   I finally decided to get agents involved and an agent brought a BUYER.   This agent was awesome and doing a great job getting the deal CLOSED.  She is getting paid a 2% commission from the BUYER.  I have been fighting the state contract thing.  So now Myth number 3 was not working in my favor.   We need to convert from a 2 page contract to a 13 page state contract and convince the seller to sign.  If I had used a state contract in the 1st place this would not have been an issue.   So use real deal contract and work with realtors and you will make more money.  I can give the address AFTER we close on 3/23. 

Myth #2 and #4 - 19 Northcourt Lane - The ARV is 225k - Solid number because the house JUST SOLD after my buyer got done the rehab. 225k * 0.7 - 157.5k. Now I need to Minus out my repairs. Again I don't know what the heck the buyer is going to do to it. I know know that the rehab is complete he spent about 60k on repairs. so 157.5k - 60k =97.5k. NOW I need to take out my fee. 10k sounds great. so now my MAO is 87.5k.

I offered this man 115k.   We made 10k on the deal and sold it to a cash buyer for 125k and CLOSED in 3 weeks.  

So IMHO the formula is BS. Plug in the ACTUAL rehab value and the ACTUAL ARV and the MAO is not correct. That's a 25k Swing OVER MAO.

I didn't advertise ARV or Repairs on this one - The add was still in my Craigslist Account.

Hope that helps.   I think I answered everyone's questions!  

Sean Terry gave it away to everyone in his academy.  

I think Joe McCall Sells it...   I don't know.  I used Sean Terry's Because it was free as a member.  

Podio - Zapier - IFTTT

Va Virtual Assistant (s)

Employees

Standard Operating Procedures

Just off the top of my head.  

Hire a full time VA? At least you can train them and they can use some intelligence.

I was dabbled in this last year with an intern.   There were a lot of email's back from agents that now needed to be dealt with, and that was about 50 offers we strategically sent.   If it is haphazardly done you may burn a few bridges in the local market.  

I would love to here if someone is successful with this type of spam offer thing.  

From the agents I have talked to any offers they get on properties that are site unseen and have not even had a phone conversation with the person making the offer are considered junk.

I have had offers on my properties Site and Unseen and as a Seller I will not accept them.  But that's me.   

@Victoria Nellon

PODIO!   Podio is the BOMB as far as automation!  PODIO is FREE.

I love AUTOMATION.   

Podio allows me to customize anything, And Set up work flows to make things happen and the lead go through a system.   A friend of mine who is really good with it has it set up so that with a click of a button Podio will create a PDF Contract ready to go.  It plays nice with many other programs through Zapier too.   

I am started with the Sean Terry app suite and started customizing from there and increasing automation.  I hear Joe McCall has a good app suite.   

It's Pretty Insane IMHO.

Can you tell I like Podio?   

@Devan Mcclish If double closes were cheap, that would be one thing.   They are expensive in PA and NJ where I work..   We had a 20k spread and netted 13k after the double close.   That was the last time we did that :)  What are the Typical Costs in TN for a Double Close?