All Forum Posts by: Steven Leigh

@Jason Hopkins It can't be right that your sellers were happy with the deal. Wholesalers only take advantage of poor old ladies who don't know any better, right?

I'm just kidding. Great job closing the deal! Remember to invest some of the profit back into your marketing and keep growing your business!

@Candy Geo Awesome job! You stuck it out through a very tough deal and made it work.

I was told early on by a mentor that you will learn so much faster by jumping in and making every mistake in the book than you will by reading books and waiting to "learn it all first." I couldn't agree more, and I think you'd probably have a similar opinion now too.

The lessons you learn from these early mistakes really stick with you, and you'll probably never make them again. But more importantly this first deal tested your resolve, and you found you that you are a warrior!

Keep pushing through, as sometimes the second wholesale deal is actually harder than the first. Just keep your foot on the gas, put some of your profit back into marketing, and keep growing your business.

@Justin Lloyd Wholesaling and buy and hold are both great strategies. There are positives and negatives to both. There are many great reasons NOT to wholesale, including that it requires a lot of work and pushing outside your comfort zone, but don't fall for all this garbage about wholesaling being illegal or that you will get sued, etc. 

There are many successful wholesalers who are honest, hard-working people who are not only in it to make money, but also to help people. I'm always upfront with my sellers and my buyers. I had a seller receive a call from the city recently checking up on me because their property popped up in a craigslist ad (which I posted). This seller said OF COURSE she knew what I was doing with the property, and told him he should leave me alone because I'm a good guy who is trying to help people! Does that sound like someone who is tricking the sellers? In fact, when we closed, she gave me a hug and had tears in her eyes she was so happy to be rid of her problem property.

The truth is, many investors don't like wholesalers. Some of it is because there are a lot of bad wholesalers who do things the wrong way, and then make a bad name for investors in general.

But the other truth is, many investors don't like wholesalers because they see us as competition who steal the good deals and jack up the prices. Of course, the smart investors realize that wholesalers do all their marketing for them, bring deals to them on a silver platter, and they simply pay us for doing it. Those are the ones who get my good deals. The whiners and complainers get removed from my buyers list.

And lastly, many investors don't like wholesalers because they work their butts off doing a rehab that takes many months of work, lots of capital, etc. and make a profit of $20,000. But a really great wholesale deal can sometimes make a wholesaler $30,000+ in profit with just a few days work!

Wholesaling is not for everyone, because it does take drive and hard work, but the rewards are worth it, and don't let other investors talk you out of it because chances are they have their own prejudices and motivations. Remember the old saying, "Never ask a barber if you need a haircut."

@Christian Kenworthy Okay, so your criteria is pretty good. How many have you mailed, what kind of mailer are you using, and how many calls did you get?

In general, the MLS is a TERRIBLE place to find wholesale deals. If people have gone to the trouble to put their property on the MLS, they are generally not going to take the kind of steep discount you are going to need as a wholesaler.

The way most wholesalers find motivated sellers is by marketing such as direct mail, craigslist ads, driving for dollars, etc.

I don't know who these people are who are "killing it" on the MLS as wholesalers, but I don't know a single wholesaler who is using the MLS for deals on a consistent basis.

The one place I could see maybe making the MLS work is looking at expired listings that didn't sell. These are people who might be looking to make a deal at a low selling price, but there are so many realtors who pounce on these as well, that you probably have quite a bit of competition.

Here are a few data points. I don't know if they apply quite as accurately to probates, whether they would be higher or lower, etc. but this gives you a ballpark idea.

This is based on typical yellow letters. Postcard response rates are generally lower.

Response rate for yellow letters: 4% (on average)

So if you mail out 1,000 yellow letters, you could expect about 40 calls.

On average, it takes about 40 calls to get 1 or 2 good deals.

So if you are mailing 320 per month, on average you would expect to get a good deal within about 4 months. You could get lucky and get a great lead within the first month, or you could get unlucky and have it take a lot longer.

The main thing is to just keep plugging away at it. Maybe supplement your strategy by trying some other free or cheap marketing ideas, like driving for dollars or bandit signs (check local regulations).

It sounds like you've got a pretty good system down, so just keep repeating it until you get some good results. Once you close a deal, put at least 20% back into your marketing and then keep doing that so that you can continue to grow.

Keep posting as you go, or you can PM me if I can help you at all.

Do you mean you found the tax delinquent list? Congrats!

Here's some criteria to get you started:

- Filter out commercial, industrial, vacant land, etc.

- Delinquent for at least one year, maybe at least 2 years depending on how they calculate, and what that does to your numbers.

- Filter by the areas you are interested in. Often you can filter by tax districts. You'll want to look at the GIS map on the site or find a map of the tax districts. Then you can filter the areas you want.

- $2,000 or more owed in total back taxes. Anything less than this and it might just be that they are late.

- If the have a total assessed value, you might want to filter out anything lower than say $20,000 or $30,000 depending on your area. I generally don't filter out on the high end, but you can.

Here's an article on filtering in Excel: http://www.gcflearnfree.org/excel2013/filtering-data/1/

That will get you started. Look at the results that are left and see if there is anything else you might want to subtract. Good luck!

And what @Paul Amegatcher isn't telling you is that the other wholesaler was me! :)

Just kidding. Nice grab, Paul.

Agree with the posters above. I forgot to mention the most important point:

Do your own due diligence!!!

I seriously do not understand why investors complain so much about wholesalers who get repair values wrong or price the house wrong, etc. Why aren't you doing your own due diligence????

Personally, I would NEVER even consider buying a property without running all of the numbers myself, inspecting the property, estimate repairs, and everything else. 

My point with getting on a lot of lists with wholesalers is you get a lot of deals coming in, then you can evaluate them with your OWN methods as to whether or not they are a good deal. Then it doesn't matter whether the wholesalers are "good" just that they are sending you deals.

They all have tradeoffs:

Tax delinquent: VERY good response rate per lead, but the list can be hard to obtain and may take a lot of work to filter through it. Sometimes it's free on your county website, sometimes you have to call the county and jump through a lot of hoops.

Searching online websites: Not sure what you're searching. County website? Seems inefficient. Zillow? Even the FSBO properties are probably way overpriced. Make offers on them, sure, but don't expect miracles. People who have taken the initiative to post even a FSBO are probably more motivated by price than the typical seller that wholesalers look for, which is someone who needs help and doesn't really know what to do.

Craigslist: Some wholesalers have good luck with Craigslist, and you might be able to find good deals if you JUMP on them when they are first posted. Set up an account with IFTT to filter out by certain phrases (like -arv -http -www) so that you get rid of some of the wholesalers' ads and then it will email you any results that match your search but don't those phrases. This way when you get an email there's a chance it's a possible deal.

Direct Mailing: The most expensive option, but the most reliable over time. It's not always the best way to start, and it's a numbers game. For every 1,000 mailers, you'll probably get about 40-50 calls, which will likely result in about 1-2 deals on average. Mailers will cost you about $500-700 per thousand. 

I'll add one:

Driving for dollars: This is probably the best way to get started. Drive around neighborhoods and look for distressed properties, code violations (paper on the door or window), vacant houses, etc. Then go home and look up all the addresses on the county website and mail to them. Vacant house where the mailing address is the same as the property? GREAT LEAD! Find the owner and you may be the only one marketing to them. Use a service like beenverified.com or just see if you can do whitepages.com or Facebook and find them.

Here's a great article on driving for dollars:

https://www.biggerpockets.com/renewsblog/2013/05/0...

Good luck!