In the wholesaling world, patience and perseverance can truly go a long way. While you can look forward to experiencing a lot of quick wins, there will be times when a deal can take months to close and can put your patience, perseverance, and creativity to the ultimate test. If you persevere, however, you will be rewarded handsomely.
For rockstar rhino Andrew Lucas, giving up is not in his vocabulary. Case in point: he never gave up on a deal even if it took him 8 months to close. Determined to help the seller out, the go-getter from Columbia, South Carolina did all he can to make things happen. While the transaction took longer than usual, he was able to accomplish two awesome things: help the seller out and get rewarded for his efforts.
If you’re faced with a challenging deal that’s taking longer than you anticipated, today’s episode is for you. Andrew’s story will not only teach you about patience and perseverance but also how to pick yourself up when facing unforeseen setbacks. No doubt an inspirational episode so don’t miss it!
- Hold by Steve Chader, Jennice Doty, Jim McKissack, Linda McKissack, Jay Papasan, and Gary Keller
- Flip by Rick Villani, Clay Davis and Gary Keller
- The One Thing by Gary Keller
The Deal That Took 8 Months To Close With Andrew Lucas
I’m super excited for you guys to join us. We love Rhino nation and all of our readers. Thank you for being with us. For those of you that this is the first time you are tuning in to this show, I want to say a huge welcome to each one of you. For those that are new, I also want to say that we will be talking about wholesaling real estate.
What is wholesaling? Wholesaling is simply the art of finding a deeply discounted property that you have so many different options to do, but what the options all have in common is you are able to make big profits. Whether you choose to fix and flip it, keep it as a rental or assign it to another investor, that is your option. The whole point is if you can in your market learn to find deeply discounted properties at $0.40, $0.50 or $0.60 on the dollar, you can make great money in real estate.
That’s what we are going to be talking about because we have a rockstar Rhino tribe member. His name is Andrew Lucas. He’s from Columbia, South Carolina and he’s going to talk about a deal that took massive imperfect action and relentless follow-through because it took eight months to close this deal. He’s going to explain why it took this long, but he stuck with it and it paid him a great little payday. We are going to talk about that. Without saying any more, let’s bring on our guest, Andrew Lucas. How are you?
I’m great. Thanks for having me. I’m super excited to be here. It’s an honor. I’m super excited to talk about this because so many times we talk about the quick win or we talk about the biggest deal. This will be a great podcast because there are a lot of these deals mixed in with the quick wins. The ones that you can close within twenty days. This was eight months. Let’s break this down. First and foremost, tell us a little bit about yourself and what got you into wholesaling.
I’m in Columbia, South Carolina. I’ve been here all my life. I stumbled into real estate straight out of college. I’m tired of paying all those landlords their rent. In 2007, I had a job and I went to the bank. I said, “Can I buy a house?” They were like, “Absolutely. You are breathing so you can have a house.” “I’ll do it.” That was easy. It turned out I got a $342 check when I closed on that house. No money down. That was actually plus money down. That worked out well. I ended up renting out the bedrooms to roommates, and then I moved out a year later renting. I ended up getting some rental properties for the next twelve years or so.
Do you still own that first rental?
I sold it because the market is good. Twelve years of owning it. It was a good time to go ahead and let it go. There were a couple of houses here and there. We had gotten up in the twenties of residential rental properties when I found wholesaling. The MLS was getting tougher to find properties. I had a full-time job at the time and I had no idea what it was.
BiggerPockets podcast, I come to Wholesaling Inc podcasts. The BAM. I’m sure you’ve heard that podcast you mentioned plenty of times, but it attracted me. It got me there to the Wholesaling Inc tribe and Tom Krol’s infectious personality. That’s where I learned wholesaling. That was a few years ago when I started with the podcast. I wholesale properties. I didn’t know what it was, but I bought some and I was doing it. I have a full-time job. I was a hotel manager. I was doing this on the side.
Did you find success doing that on the side? That’s a crucial thing that a lot of our readers want to do. Can I get into real estate doing it part-time? Can I do it on the side? There are so many individuals who think you have to go all-in or nothing. There’s no toe-dipping. You either jump in or you jump out. Is that true?
No. We were successful enough. For our second rental property, I hand wrote a letter. I found a person who had owned the house by passing it down, and that’s how we got our second property. It’s just like what you teach, but we were successful. The whole point of the rental properties is we have three kids. When the third one was on the way, my wife was going to quit her job. That was going to be paid for by our passive income from our rental properties.
Our rental portfolio was successful and she was going to go home. We stay at home and figure out what she wanted to do a little bit. I know she wants to stay at home. Wholesaling came along and I said, “Why don’t we both make our own jobs.” We’ve decided that we were going to be all-in on wholesaling. I quit my job. She quit her job all within two months of the Asheville Summit.
That was such a great event because of incredible people like yourself, and the whole room was filled with incredible people.
We’re very successful part-time in it with rental properties. We were not wholesaling, door-knocking, or calling people. It was a lot of writing a letter and getting a house. Another year or two later, we might find one on MLS. It was ten years but that’s what we were doing and it worked. Wholesaling has been a rocket ship. It’s a different mindset but this is our job. I think you could do it either way and we are proof of it. You can do it how you want to do it.
When somebody is retired and doesn’t want a job, it’s a hassle to have a rental property.
When you say part-time, let’s break it down to even a little bit more granular. When you say part-time, to everyone, that definition could be you can make with 2 or 6 hours a day? What did part-time look like to do a deal? What did you feel like you had to do? From your experience, what was part-time for you?
When we first started, I had no kids. I wasn’t married yet. I was dating my fiancée and we’re engaged. We would work on it on the weekends. We were painting houses and doing that sort of thing. Fast forward a couple of years, part-time became we are not painting any houses because we have children and we are not doing it on the weekends because we want to spend time together as a family. That part-time turned into having a good team. Solid real estate agents that were letting us know when things on MLS look good, and then friends and contractors that were doing the work.
Part-time got even part part-time. Because you have a place, it got even less.
We then go full-time.
Being an entrepreneur full-time equates to sometimes where people are like, “I’m replacing my job 40 hours.” That may not be the case. Right out of the gate, it could be when you go full-time, you want to get that momentum going. Sometimes it would be 50 to 80 hours. It could be a ton more hours, but it’s for the fact that I always tell people, “Instead of making someone else rich, you can make yourself rich.”
If you are going that route, it’s not to say that you have to. It’s not to say that if you work for someone, you are less than others. That’s not the case, but if you want to make this work and become an entrepreneur, you might at the beginning. In fact, the best thing to do is go all-in and go super hard to get that momentum going super quick for you.
We made it because you can make the business how you want it. We don’t work on the weekends. At 5:00, I don’t answer phone calls from investors, the closing attorneys and stuff. It just has to wait for the kids to go to bed, then go back after 8:00. We make it how we want it now.
Let’s go right into the meat and potatoes. Let’s talk about this eight-month relentless follow-up and follow-through to see this deal to closing. Let’s break it down to a high level. Where did you get this lead? What kind of market? Was it direct mail, cold calling or door-knocking? What did it look like?
This was our very first direct mail Rhino postcard. It was not the first mailing. We took a list of about 9,000 and it was absentee.
It’s the absentee owner like a high equity list. People that had equity in their home but didn’t necessarily live in the home. Where did you get that list?
We got that originally from ListSource, which does not provide South Carolina data anymore.
For the audience, when you are a member of the tribe, you get the biggest discount you can ever hear of for ListSource. You get those for next to nothing. We worked our tails off for that because that’s a source that we can go grab. South Carolina sounds like it has chosen not to be a disclosure state. They don’t disclose that info. I’m assuming that’s what it came down to. They can’t access South Carolina stuff.
It has changed. There’s a law put in place and I don’t know exactly but you are not supposed to use public records for marketing. ListSource said that they are not doing it anymore.
Let’s go with this. You get the absentee owner list. You are sending it out through a postcard. It’s the tribe postcard, a very plain basic postcard. You send it out there. What did it sound like when you initially got the phone call from t what would be the motivated seller?
Mrs. Martha was done with it. Her husband passed away years before, and this was a rental in a condo complex that had seen its ups and downs. The complex was starting to turn around but in that, they were raising her bridging fee. She was done with it. The renter had moved out. She was managing it herself. For me, I look at rental income as great income, but when somebody is retired and doesn’t want a job, it’s a hassle to have a rental property. That’s how she sounded.
You can tell there is motivation right out of the gates. Talking to this individual, you knew you could find a way to serve and help this individual.
We could tell it right away. She’s a super sweet lady. We hit it off. Great rapport on the phone. Thankfully, we had great rapport because we lasted eight months of talking.
What happened during the eight months? This is what I like to hear. This gets difficult because then maybe they are thinking, “This is Andrew’s fault. It’s not closing and Andrew said he could close in 30 days.” Was she aware of what was going on that was slowing the process? Let’s talk through what was it. What was holding up this process? Was it you? Was it things that had to do with the home? What held it up for eight months?
There was a little title issue but that was pretty simple. That was a little name change which we got from her husband’s passing. That would have held it up, but what held it up was it was listed as a mortgage, but it’s more like a line of credit. One of those cash fast type places. America General, I think was the name of it, but it’s a financial service retail branch like a payday loan. They had opened that up years ago and then paid it off. They didn’t owe any money but that company had since closed its doors and sold to another company, which had since sold to another company, and then again. It was four different companies.
On their end, did it seem like they still had debt owed to them even though they didn’t?
Struggles are not here to take us down. They’re here to make us stronger.
There was no debt. Nobody could see any debt but also nobody could see a finale. They couldn’t see the closing. They couldn’t see anywhere that they should do anything because all these companies had changed hands. Essentially there was no record of it.
Were you able to work with the final company? The third company that purchased it? Were they like, “We’ll get you something that says you owe nothing.” What do you do at this point?
That’s exactly what we were trying to do. We say, “She doesn’t know anything,” but it was trying to get to the right person. We couldn’t do it. They wanted to speak to her. Even though we want to get the attorney to do it, they wanted to speak to her. She’s older. Some of this was on her trying to get to the right person. She gets tired. She didn’t want to be on the phone for an hour, get on hold, and then go call the next person and the net person.
There were a lot of emails going back and forth. I believe we got the same sheet of paper from these companies at least ten times where they were satisfying a mortgage, but it wasn’t the correct mortgage. They would say, “Mortgage is satisfied. Send it to the attorney and the county,” but it wasn’t the right mortgage number and it wasn’t the right lender because they didn’t know what they were doing either.
We are trying to educate these companies on what they need to go back and do. After a lot of persistence and finally, Mrs. Martha was like, “We are going to do this.” I met her at the new company’s branch. The company that had bought the company that bought the company, whatever. In their lobby, we said, “We are going to figure this out and we are not leaving.” We sat there and they called somebody who called somebody. We finally got to a person that can make a decision and could fill out the form. All it takes is somebody to say, “I’m going to fill it out.”
Here’s something crucial, eight months. You probably had already assigned it, a cash buyer. There are two questions. First and foremost, when it’s taking this long, are you thinking, “I’m going to figure this out?” Are there points and moments where you are like, “I’m not following this anymore.” What’s going on in your mindset? What’s going on with you during this eight-month process? Are you losing hope or are you like, “No. I’m going to figure it out?”
I’m glad you asked that question because if we hadn’t had a CRM in place, something that would keep reminding and say, “This is still pending. This is still out there.” If I hadn’t had my wife looking at that saying, “You need to finish this,” I would have given up a long time ago.
What about the cash buyer? I’m assuming you’ve already assigned it. Is he sitting there thinking, “What the crap is going on guys? I have some earnest money down. I don’t even know what I’m buying. I don’t even know when it’s going to happen.” Did he stick through with this through the thick and thin as well?
He stumped through, thankfully.
That means it was a deal.
The deal got better and better as the months went on.
The appreciation went up and up.
He ended up buying two other properties from us within eight months. We are in contact and he would bring it up and say, “What about this deal?” When we finally got down to it, I told him, “You don’t have to buy this one if you don’t want to.”
It’s because the deal has changed. Now it’s significantly better.
The deal has gone up significantly. We have assigned two others to that condo complex. We have one that somebody is owner financing from us. I would have been very happy if he didn’t want to go through, and if I could have gone and signed it again.
What was the reality? Was he like, “No, I can see the appreciation too. I want it.”
He’s like, “I’m buying this right now because it’s a screaming deal.”
He stuck through with it because it’s a deal. The market is still getting better. It’s going up in appreciation. He’s loving this more and more because it’s locked in a rate eight months ago, which was a beautiful thing for him and maybe not so much for you. What ultimately turned this over? You go down to this office. You sit there, “I’m not leaving until I get this done.”
Here’s what we do, Rhino nation. There are deals out there that are not easy and you have to figure them out. It’s not just like reading this and being like, “That’s an eight-month deal.” No. It’s the process. It’s the steps. Pay attention to what he did and what he was willing to do. He went down there with Mrs. Martha and sat in the place’s office and said, “We are not leaving until we figure this out,” and it got the deal done.
This is what it takes to be an entrepreneur on some of the deals out there. Not everything is easy peasy lemon squeezy as Tom always says. It’s not that way. Sometimes you got to figure it out. That’s entrepreneurship. Knowing that when trouble, trial or challenge comes, it doesn’t mean giving up, surrendering, turning around and going back. It means we are going to have to approach it from a new angle. We are going to have to look at this again and approach it from a new angle. This is what Andrew was doing for eight months. He found out that a trial and struggle came up, and that he needed to approach it from a new angle. As he did that, he was able to get the right paperwork in place and bring this to closing. Is there anything you want to add to that now that I said some of those things?
Ask for help. Ask for people in your network, people in the wholesaling business, and around the business in your community to help.
No. You hit it on the head. There are deals like this out there that people had given up on. I could have easily given up on it. We have come across other deals where the wholesaler or the buyer has given up because it was too much work. That seller is still a seller and maybe even motivated more once it’s fallen out once. I would say when there are issues and trials, that’s what we are here for. It’s to solve problems.
When people say, “What’s the definition of entrepreneurship?” They’re like, “Someone that owns their own business.” I’m like, “It is so much more than that.” If they told the real definition of entrepreneurship, people would be like, “I don’t want anything to do with that. Did you hear that?” That’s exactly what it is. It’s knowing that there are going to be a ton of struggles, trials, and challenges, but those struggles, trials, and challenges have helped each one of us entrepreneurs become someone better, become someone more, and become someone that we are meant to be. They are not here to take us down. Those struggles are here to make us stronger. I truly believe and we say this all the time talking about Tony Robbins, “Life is not happening to us. It’s happening for us.”
We have to have the mindset that life is happening for us. If you broke your arm and you are going to be out of commission for six months, sometimes we think, “Pity me. Why me?” You can look at it and say, “There’s something to be learned here. There’s a lesson to be learned here. This is not a loss. We are either winning or we are learning. What do I learn from this experience that’s going on? How’s this happening for me?” You’ll find out that some of our greatest gifts, blessing and lessons are learned from our struggles. Let’s do this, Andrew. What did this turn out to be? You get the right paperwork. You get this done eight months later. The buyer is now jazzed. He’s like, “I can finally close on this deal.” What did you put the homeowner contract for and what were you able to assign it for?
We contracted it for $27,000 and then assigned it for $33,500. It was a net $6,500.
That’s $6,500. You know what’s going on, Andrew. Hold on one second. You know what’s coming. We got the victory bell ring for Mr. Andrew Lucas. Hold on. I’m ringing that bell two times. That is for the eight months of relentless follow-up and follow-through that most people would walk away. They would say, “This isn’t worth my time. This is not going to happen.”
Here’s what you looked at. Mrs. Martha still needs someone to help her through this process. Most likely, you didn’t think about the money and the deal. You didn’t think about that now that it’s been eight months this $6,500 is $10 an hour because of how many hours you put into it. You simply thought this person still needs my service, help and guidance. You walked her through the process. To you, my friend, my hats off. That’s awesome. We love ending our episode with two questions that are killer and that are good for mindset, in general, to still inspire and motivate our readers. What I want you to do is share with us a good book that you’ve read or a game-changing book that you absolutely would recommend to anyone reading this.
The book that changed my mentality of real estate from it being my retirement plan, which is where we started, to it being a business was the Hold by Gary Keller. One of my agents, we bought a house and we were thinking of retirement. Those first few houses, that was retirement for us. Thirty-year loans and we’ll have them later. She gave me that book and it completely changed the way we saw real estate and turned it into, “Wait a second. This is a business. This can be something we can do now. Why are we putting this for retirement?”
I love Gary Keller’s books. When you say this, I’m sitting here smiling from ear to ear. He has that book. What’s brilliant about it is the fact that you want to learn how to do rentals. He wrote a book that is literally one word. It’s called Hold. What’s funny, and I don’t know if you’ve seen it. He also has a book for fixing and flipping. It’s called FLIP. He also has another book that’s mentioned often by tribe members, and that is The One Thing. It’s being focused on one thing so that you could exceed at a high rate. Great book.
Looking back, there’s so much knowledge that you learned through your process. I call it “My mess is my message.” We go through and we mess up so many ways and it ends up being this incredible way of helping others. Some of these individuals that are reading this are at the beginning stages. They are where you were years ago. Looking back, what would you tell them that you would do differently? What do you wish you would have known that you know now that you could pass on to these individuals?
It might sound cliche but it’s not. It’s true. It is to ask for help. Ask for people in your network, people in the business, and around the business in your community to help. I will tell a quick story. In the house we bought, my first house, I didn’t use a real estate agent because I didn’t know that it was free as a buyer. I just went. The selling agent got 6% and I got no help.
I was dumb at that point or whatever, but there are plenty of people that are in the same boat. Once you get into it and if you haven’t asked questions or haven’t talked to people in your market and seen what’s going on, you will make the same dumb mistake, and there’s no reason for it. I always say, “Collaborate with somebody. Find an accountability partner. Find somebody that’s in the business to ask questions.” You don’t pin them down for half an hour and peg him with questions, but when you have a question, reach out. You are not an island.
What’s hard is those individuals’ time is going to be very limited. Asked them, “Can I take you to lunch?” Those individuals can buy their own lunch. They can spend their own $10 and use their time how they need to use it. It’s like you said. It’s not pinning them down for a half-hour, an hour or suggesting, “I will buy your lunch.”
Those individuals can buy their own lunch. They don’t need lunch bought for them. It is simply when something pops up. I love that you are saying this. Most times what’s hard is a lot of individuals are asking questions before they have even taken action. A lot of the stuff that they are going to receive and answer, they are not even going to implement anyway. A lot of the stuff that they are asking, they are assuming that they need to know this information, and 99% of the time, the questions that they are asking aren’t even the right questions because they are things that will never happen.
Get out there. Take massive imperfect action. Let that lead you to a result and let the result inspire your question to an individual. Two things I learned that I want a couple with what you said because this is so brilliant. Two things I learned from my mentors are coupled with what Andrew shared. It’s not asking how but asking who. I love that he said, “Ask someone.” Someone is doing it. Ask them the question of how to do it. Don’t ask, “How can I do this?” or “How do I do this?” Simply ask who, “Who’s doing it so I can couple myself with them and find out instantly?” R&D is not research and development. It’s rip off and duplicate. Go out there and rip off and duplicate. There are so many people doing it.
The second one is our quality of life rest upon our quality of questions. If you want a great quality life, you better have some great quality questions. I couldn’t say anything more. I felt like all I did is coupled with what you were saying. What you shared in this show was brilliant. I love it and your relentless follow-through is something everyone needs to hear. In entrepreneurship, the deals don’t come easily. Some deals take a long time, but you did it to help serve Mrs. Martha. I know she’s probably forever grateful for an individual like you that would see it through.
I appreciate it.
Andrew, thank you so much for being on this show. If Tom was on here too, he would be like, “Thank you so much.” For both of us, I’m going to have to say it. Thank you for being on the show and sharing so much wisdom and value with our Rhino nation.
Thanks, Cody. Have a good one.
Thank you. Rhino nation, what an incredible episode. This is something that you are going to want to read over and over again so that you can pick out those gold nuggets that Andrew shared with each one of you. You can get out there and simply take massive imperfect action and get one step closer to your first deal or your next deal.
If you need a little bit more assistance or more help building your wholesaling business, head on over to WholesalingInc.com where you can book a call with our team. We would be glad to start the conversation and see if we are a fit. If so, we’ll introduce you to the tribe and get you going on your journey. Take care, guys. We’ll see you in the next episode.
- The One Thing
- Be sure to join the Wholesaling Inc Facebook group
About Cody Hofhine
Cody Hofhine, a multiple Inc 5000 Business Owner. Co Founder of Wholesaling Inc. the #1 Real Estate coaching program across the nation. Co Founder of Joe Homebuyer the leading Real Estate Franchise. A successful Real Estate investor/mentor and sought after Speaker.
Cody has coached over 3 thousand students on how to successfully Build their Real Estate Business through his real estate training as well as help individuals perform at their highest levels with his one-on-one mentoring.
Cody used his background in sales to quickly build multiple 7 and 8 figure Real Estate Businesses that all start on the foundation of clarity or Vision and Purpose.
Cody loves being with his family and doing crazy tricks behind a boat.