Posted on: May 07, 2020

Ever wondered what the most successful wholesalers are doing right now to keep up with the ever-changing times? Wonder no more!

In this episode, our very own REI Radio coach, Chris Arnold, talked to Mr. TTP himself, Brent Daniels and shared the shifts they’ve made to ensure they retain momentum and stay profitable even during these unprecedented times.

Chris Arnold has been active in the real estate arena for almost 15 years now. Based in Tulum, Mexico, he’s been doing wholesaling virtually and is considered one of the most successful wholesalers in the industry, having done over 2, 500 deals through radio ads alone!

If you’re experiencing a substantial decline in wholesaling revenue, this is one episode you can’t afford to miss. Chris not only shared simple, practical, and easy to implement tweaks, he also gave a clear insight into the mindset that has made him one of the best in the industry!

Key Takeaways

  • What disposition means
  • How they shifted their technology on the disposition side
  • What they added in their email blast system
  • How to deal with tech-deficient sellers
  • Three different ways to do video video walkthroughs
  • What “Zoom open houses” is all about
  • Other cool tools they’re currently using
  • Two things you can’t get wrong if you’re a wholesaler
  • What the “helpful heart” approach is all about
  • Two kinds of buyers right now
  • How they built back their VIP cash buyers list
  • Why they are building up their lenders list and making warm introductions
  • The power of pain and how it has shifted their mindsets

RESOURCES:

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Episode Transcription

Brent Daniels:
Woowi! Welcome to the Wholesaling Inc podcast, America’s number one podcast for new real estate investors, where we know that finding discounted properties is the most proven path to financial freedom. I am your host, Brent Daniels, and I am telling you, if I can do it, so can you. This podcast is going to be absolutely on fire because I’ve got one of the Wholesaling Inc coaches, one of the top wholesalers around the country, Mr. Chris Arnold with me from Tulum, Mexico. Chris, how are you buddy?

Chris Arnold:
My man, hanging out with you, you know it’s going to be good. We’ll bring some value and we’re going to have a good time, like we always do.

Brent Daniels:
That’s right, and we’re going to get right into it because we had a conversation about, what are the top things, the top shifts, the top tactics, the top hacks, so to speak, of what we need to do on the disposing side of our business. We’re going to go through the top five shifts. Chris is going to go through his top five shifts, and we’re going to get right into it, because I think it’s really important right now. Guys, more than ever, this is like our time. This is our time for sourcing real estate opportunities, which that’s essentially what wholesaling is, is sourcing real estate opportunities.
We need to have quality conversations with distressed property owners, but now more than ever, it is all about really, really, really building up and strengthening our disposition side. If you’ve never heard that word before, if you’re brand new to wholesaling, basically it means, what is your exit strategy with the opportunities that you uncover? And because this is the Wholesaling Inc podcast, we’re talking about wholesaling this property. We’re talking about putting a property under contract and selling that contract to a ready, willing, and able cash buyer. Chris has done this thousands of times.
He is running his business completely virtual from Mexico, from Tulum, Mexico. If you’ve never seen it, Google it. It’s worth the Google, it’s absolute paradise, but let’s go because this is a huge strength for you, Chris. You guys have really built an incredible team, but not only that, you’ve built it to the point where you can move and shift quickly. So let’s talk about that. First, let’s break down the five things, the five tips that you would give or five steps that you would give to everybody, let’s start with number one.

Chris Arnold:
Yeah, so, we know there’s two challenges right now. There’s the challenge of getting motivated seller leads and that entire arena of, I’ve got to get deals executed. But we actually are hearing that the bigger challenge is, okay, now I’ve got a deal, now I’m facing the bigger hurdle, which is the disposition. My ability to resell this property to a cash buyer on the other side. We’re obviously a virtual company by nature. Luckily, we live in virtual world. So, when this whole thing hit, we made all these shifts in about a two week period because we just took our virtual mindset and pushed it further virtually than we ever had. I think that did give us a leg up to be able to pass this value back down to you guys who might not be as familiar with the virtual world. So, let’s go through these. These are the five shifts. I was just talking about my director of disposition on this and she crushed it on these five things that we shifted.
Number one, we shifted our technology. So let’s talk about specifically how we did this on the disposition side. What we were getting feedback on was the investors were not wanting to go out to the properties anymore. I can’t go out because I don’t want to get my family sick, whatever it is, I’m not leaving my house. So, the first thing we did was we started embedding a five to six-minute walk through video of the house into our email blast system. Whatever you want to use, constant contact, get response, you name it. Now, we did not know how they were going to respond. The question was, are they going to buy a house based off a five to six-minute walkthrough video?
We sent the first one out and Brent, we closed it and we made 23,500. I was talking to, today, if I fast forward two weeks, I asked my disposition, I’m like, “How is this still working?” Because I get texts like, we sold two today, we sold three, we just did one for 30 a couple of days ago. She goes, not only is it working Chris… In my opinion, she’s been doing this five years. She goes, they’re starting to love it. Love it.

Brent Daniels:
Oh, I believe it.

Chris Arnold:
[crosstalk 00:05:46] buying houses off a video. Now, the big thing that people ask is, well, what about the inspection side, needing to get into the house? And so remember, I also think it’s important to provide an inspection report. I’ll pause there just for a sec, if you’ve got a question before I keep pushing this.

Brent Daniels:
Well, I think it’s really important. And what we did in our business is, we started reaching out to our cash buyers with that question, “Hey, do you buy property sight unseen?” I think that’s such an important question to ask your cash buyers. And then the followup question is, if they say yes, then you say, what do you need from us to make a smart decision? And every single one of them said video. Every single one so far has said, I need a walkthrough video. I need of everything. Everything ugly, everything terrible. It doesn’t have to be an hour long, but I need to really get a good idea of what I’m up against here from a rehab standpoint, through these videos. So I think it’s absolutely critical. Now, are you using just an iPhone? Are you having the sellers do it or are you having your acquisition managers do it?

Chris Arnold:
Yeah. So, there’s a few ways to get these videos. If you’re dealing with the seller that’s tech savvy, you can actually have them do the video walkthrough, which means you never have to enter the house. Of course at the house is vacant, you can go do it yourself. We’re talking about properties that are owner occupied. If they’re tech savvy as well on top of that, which is really cool, you can utilize Zoom and do a recorded walkthrough where you can guide the seller. Like what’s that over there. Can you explain that? Actually go to the right and that gives you more control over the video doing it completely virtually.

Brent Daniels:
That is genius

Chris Arnold:
And thirdly, if they are what we call tech deficient, which our sellers, primarily that might be over the age of 50, just not comfortable with it, we deliver a tablet to their door, turned on to the video where all we got to do is pass it through to them, and we’re like, just push this button and go. They record, they bring it back, we can watch it. If we don’t like something, we just send them back to do it again. So, between those three methods, there’s no reason that you shouldn’t get the inside footage of the house. But let me give you one more. We talked about embedding the video into your email blast. The other thing you can do is if you can get access to the house, if it’s vacant and you like to do group showings, what we’re now doing is we’re doing Zoom open houses. So now you can get multiple investors on Zoom bidding on the house as you’re walking them through and maintaining social distancing.

Brent Daniels:
Absolutely-

Chris Arnold:
Isn’t technology amazing?

Brent Daniels:
Oh my gosh. It’s so incredible. I never even thought about using Zoom for that. It makes perfect sense. Is there a paid version of Zoom that you use or is it free?

Chris Arnold:
There’s free versions that you can use, which is great. And then there’s some paid ones. I think my team sets it up in under like 20 bucks a month. It’s cheap. [crosstalk 00:08:43].

Brent Daniels:
Yeah, I think so.

Chris Arnold:
-40 bucks, something cheap, I can’t remember. Now, the other tool, they’ll bring up tools, that’s been really cool Brent, is Rehab Estimator Pro. We found this out and implemented it immediately. I want you to think of it this way, we know there’s two things you can’t get wrong. You can’t get the ARV wrong or you’re going to screw up the deal and you can’t miss do the rehab repair amount that’s needed. If those two things are wrong, you’re in trouble. If you get those two things right, you’ll be okay. So, Rehab Estimator Pro was developed to be able to do the rehab estimate, walking through an app, just pushing buttons like dropdown, and it’s giving a very accurate repair amount within under 13 minutes.
So, here’s why this is important. Two ways you can use it. We pull up the video of the house we got, we pull up the app and as we go through the video, we just click the buttons on the app. And by the time we finished the video, the app tells us what the repair amount is going to be, and then secondly, we send that nice professional printout to the cash buyer. So now they’re getting a video and they’re getting an actual printout of the rehab that needs to be done, which makes them more comfortable because it’s more professional than just a video.

Brent Daniels:
Incredible. I’ll tell you what, Chris, this has taken it to the next level. Not only just letting them know that you understand what repairs need to be made, but also, it upgrades you as a true professional. If they have all this data and they have the video, they can make a decision that fast and that’s why you’re having success selling that. So what was that, Rehab Estimator Pro?

Chris Arnold:
Yeah. Rehab Estimator Pro.

Brent Daniels:
Is that a website? What is it?

Chris Arnold:
Yeah, you go to the website and right now, because I was talking with the owner, you know how people are given some pretty cool discounts. The owner’s actually giving 70% off monthly, longterm once you’re locked in. 70%, I was like, that’s a heck of a deal. So yeah, really cool. If you want to go check it out, go to rehabestimatorpro.com, look at the system. Again, I love it, it’s a great fit, but with 70% off, that brings it down to-

Brent Daniels:
Do they have to use a coupon code or something?

Chris Arnold:
Yeah, it’s REI Radio, not case sensitive, and that drives it down to like 29 bucks a month. Isn’t that cheap?

Brent Daniels:
Oh my gosh. That’s a must have, dude. I’m going to get that today. That’s incredible. And send that with them, and now it’s almost like they’ve walked through the property and wrote it all down themselves. That’s incredible.

Chris Arnold:
Here’s the thing, everyone’s going to pick up on the video thing here pretty quickly if they have it. So, we’re just trying to stay ahead. If everyone’s sending video, we’re going to send a video and a really cool professional report to go along with it.

Brent Daniels:
Incredible.

Chris Arnold:
So one step ahead every time of what everyone’s doing in the market. That’s shift number one, technology.

Brent Daniels:
Yep.

Chris Arnold:
Ready for number two?

Brent Daniels:
I’m ready.

Chris Arnold:
We had to shift the way that we approach the sale with the investor. What we have found is, we’ve had to move over to what we call a helpful heart approach, a coaching approach. Again, you got to realize the investors out there will see you as an expert, as a wholesaler, having particular data, having an understanding of the market, and what my disposition director, the person who sells these properties to the cash buyer is doing, is really having heart-to-heart about fear, the emotional side, what the future holds.
And because she’s not just getting in there and just talking about the sale and the numbers, but she’s switching it over to a helpful heart. Like, what are you feeling? She said that kind of hand-holding right now, the investors, and changing that approach has been really effective of helping people cross that line. Because people get stuck for three reasons. We know this based on external, internal and philosophical. The external side is the numbers, but are you attacking the internal and philosophical things that your investors are wrestling with before they buy? And we started actually taking the time to do that, and that’s when our conversion started to increase.

Brent Daniels:
Incredible. So you’re just asking them like, how are you feeling? What are you thinking is going to happen? What’s your strategy?

Chris Arnold:
We’re consulting them. We’re being their coaches and their counselors and their confidants about what’s going on. When you think about it, it’s common sense because they just need to talk it out and to put language to how they’re feeling. It’s surprising how effective that it’s actually been. So, the point being is, you’re shifting your approach in how you’re communicating with your backside investor.

Brent Daniels:
I love it. And not only that, one, it’s going to build a really strong relationship for the future, but you can uncover and really see, wait a second, these people might be 50/50 on this deal. They might back out of this deal in a week or so. I need to make sure that I understand if they’re really, really committed to their business, really committed to purchasing this property, really committed to completing this transaction, because I’m seeing it hasn’t happened in our business. The cash buyers that we’re working with have completed every single deal that we’ve put under contract with them, but I’ve been hearing that people are canceling contracts at the last minute, that they can’t get financing or something happened.
I feel like the news changes the mood of our business every single hour. I think it’s really important to get in there and really understand what is going on inside their mind, what is their fears, what is their anxieties, and can you help them with that, or is maybe right now not the right time for them to purchase this property, and I’ll go with that second offer that I got. That’s huge.

Chris Arnold:
Absolutely. And people, you got to realize, as an environment around the world are just naturally being pushed to a place of being more vulnerable. That’s what pain does. We’re all willing to go to a level of conversation because we all have this bond as an entire world of going through the struggle together. Struggles bond people together, which creates a deeper, more vulnerable conversation, which normally doesn’t happen in a regular environment. It’s powerful.

Brent Daniels:
And that really goes back, Chris, to your thing and the Rehab Estimator Pro and the video, that if you can give them all the tools to make a really smart decision, there’s not those underlying thoughts of, well, maybe I don’t know something about this property, or maybe this isn’t the right decision. You’re giving them all of the data that they need to make a really smart decision from a mental standpoint, but then you’re going one level deeper and you’re seeing emotionally, do they still want to be in this business? Do they still want to purchase this property? Do they find optimism in what’s going on? Or do they think that the sky’s falling? I think that that is a powerful, one and two. What’s number three? Let’s keep building this momentum.

Chris Arnold:
We had to shift the type of buyer. Let me break this down for you. So, everyone has their buyers list and on that list, they have what we call your VIP buyer. Those people that tend to just buy a lot from you. We all love those buyers. On our world, that was about 50. We have a list of 20,000, but we got 50 bread and butter that just love us and we love them. So, we lost in a fell swoop about 40 of them for two reasons. I’m not doing deals right now because I’m going to sit on the sideline and see what happens a month or two. They’re savvy. And number two is, I can’t manage my rehab cruise and go ahead and get the option or the risk of getting sick and bringing that back home to my family.
So we started processing like, oh my goodness, how do we overcome that objection? And we were trying to overcome all those objections, and then we realized, wait, there was 10 buyers over here that have no problem doing deals right now. And then you understand there’s two buckets of buyers right now. Those that have numerous objections and those that have no objection. So, the mentality was, we got to build that VIP buyer list back up to 50, with 40 fresh new VIP buyers that we didn’t have before. So rather than trying to overcome 10 objections, what we did was go ahead and find people that had no objections when they were coming in. Now, who is that? I’ll tell you who it is, they’re new buyers. They’re new because this is what they’re thinking, the big dogs have stepped out, this is my time to get some momentum.
I’m newer, I’m willing to take a little bit more of a risk. I might’ve brought in a handful of properties, but I’m going to get in the game right now because all of the competition is out of the game. And so that’s actually the avatar or demographic of the new buyer that we’re seeing. They’re newer, they’re a little bit more green behind the years, but they’re hungry to get in the game and they don’t care about what’s going on, they’re buying properties. And Guess what? They’re buying properties at great prices [crosstalk 00:17:32]

Brent Daniels:
That’s what I was going to talk about.

Chris Arnold:
-newer.

Brent Daniels:
Yeah, that’s it. We adjusted 10 to 15% lower on our numbers for everything. The deals we’re giving out now, I couldn’t have given to anybody a month ago. There’s no chance. Sellers that wanted 400 now want 300. The sellers that wanted 180 are now taking a hundred thousand. It’s incredible. And because of that, you pass that savings along to the buyers. And I’ve seen just a little bit, we’ve been averaging 27,000 a deal, now it’s at $30,000 a deal because of that, but most of that percentage, most of that discount is going to our cash buyers and they are really happy. They really are. And especially for somebody that’s either starting out or have done a couple, they’re like, oh my gosh, I’m actually getting these deals that I’m texting and emailing about that usually went to somebody else because it’s sold too fast because I took a little bit longer to respond. They’re now getting these deals and they’re taking advantage of it and I think it’s huge. Yep.

Chris Arnold:
Yeah, absolutely. So, you got to shift your backside buyer that you’re marketing to and better build that list. So you ready for number four?

Brent Daniels:
Real quick. I just want to make an announcement because I think it’s a huge amount of value. Chris has just started his YouTube channel, guys. You need to get in there, like and subscribe it. It’s going to be absolutely phenomenal. Chris is a staple in this industry. You could tell just from this conversation that we’re having now that he knows his stuff. Not only that, he has an incredible heart for giving instruction. He’s not going to educate you, he’s not going to entertain you. He’s going to give you instruction on how to succeed, especially right now during this. So definitely check it out. Is it under Chris Arnold?

Chris Arnold:
Yeah. Real Estate Coach.

Brent Daniels:
Chris Arnold, Real Estate Coach, beautiful. So definitely check that out if you’re watching this.

Chris Arnold:
We’re going to cover everything, man, to do with business, with wholesaling, with real estate, to running a virtual company. It’s just like all these years I’ve been in, 15 years, it’s time for me to really step out and start to put into communication the principles that have gotten us where we’re at as a great company.

Brent Daniels:
Guys, he lives in Tulum. He’s that guy, he’s the only guy that you know or have heard of that’s truly transitioned his business to be the guy that sits on the beach all day and wears flip-flops. I don’t even know if he’s wearing pants right now. He’s living the life that a lot of people I have desired and thought about and has an incredible amount of really great content to give you guys. So definitely check that out. Number four.

Chris Arnold:
All right. The next thing is shifting with the finance. That’s a big one. First, was the wave, was, I had a deal and the financing partner, the hard money lender I had pulled out. That’s what we started hearing, right?

Brent Daniels:
Yap.

Chris Arnold:
Like, oh my gosh, they just pulled funds on me. The second thing was, I’m now ready to do a deal and I can’t find anyone that’s willing to fund it. So the next shift that we did was, we went in and we made sure that we built a list of lenders that are currently lending right now, and the second thing is not only do we give that list, we’re making introductions. So just like we replaced the buyer’s list, we replaced the lenders and guess who the lenders are? They’re the ones that are newer to the game. You’re starting to catch on, on what the shift in demographic is.
They’re going the same thing. The big boys that I’ve been competing with that have been doing lending, were in Dallas-Fort Worth for 10, 15 years have stepped to the sideline. I launched my lending company two, three years ago, this is the time for me to pick up market share. And so, they’re more than happy to lend on properties, but the problem is, your cash buyers out there are not doing this research. They’re just going, well, the ones I work with aren’t lending, so I don’t know what to do. And your responsibility, being a great wholesale and a company is to provide the resources that your cash buyers need by providing them a list and warm introductions. Once we started doing that, boom, all these things have just kept the momentum going. It’s just another thing that keeps that flywheel spinning. And that’s been a critical thing is shifting our mindset around the financing [crosstalk 00:21:53]

Brent Daniels:
Incredible. And what is typical now? So here in Phoenix, I’ve seen, oh you only had to put 10% down and they’ll give you the financing at like 10 or 12%. Now it shifted to put 30% down and they’re still at about that 12%. I would expect the longer that this goes, the interest rates go up. But as of right now, that’s where we’re at. What is your market and what is what you’ve been hearing around?

Chris Arnold:
It’s a good question. My team manages that. I philosophically understand the shift that we made, but I don’t know what specific terms have actually changed.

Brent Daniels:
And maybe they’ve been the same.

Chris Arnold:
But that makes me wonder, I’m going to call my disposition when I’m off and find out. I’m curious if it’s shifted. But I do know that they’re using them, right?

Brent Daniels:
Yeah.

Chris Arnold:
We’re doing deals and they’re using those lenders, so it must not be too bad.

Brent Daniels:
And I think it’s important when you are adding cash buyers to your database, as you’re having those conversations, that they understand that they have to put more into these properties. So that might adjust the prices that you go after, the list that you go after. I think is absolutely critical to have conversations with your cash buyers and find out if they’re buying sight unseen, find out what the requirements are for that, and then, find the areas and the properties that they want to buy and cater your efforts towards that. Some people call it reverse wholesaling. I just call it, being a smart wholesaler and finding out what inventory people are looking for. So, definitely have those conversations, definitely find out what they’re buying, definitely connect with the private money, hard money lenders in your town, and make sure that their lending, and see what their guidelines are. See what they’re looking for so that you can further educate your cash buyers. What’s the last one, Chris. This is on fire, man.

Chris Arnold:
Come on, man. It’s a shift in thinking, and before you go, oh, he’s going to the ma- No, let me tell you what’s happening. The question that’s being happening is, is this our future? All the shifts that we’ve just made, our mentality and our thinking has been, we have just actually not taken a step back, but we’ve taken a step forward in our evolution of how we run our company. We would not have pushed these ideas and move to this virtual model at the level that we had if we haven’t been pushed by pain.
If the market hadn’t come in to really require us to correct and to shift. And now guess what the question is, why haven’t we been doing this all along? That’s the shift in thinking, that is the power of pain. That is the mindset that looks at struggle and things that we go through and the sense of suffering and understand, my gosh, I’m about to get super smart. We’re about to grow at an entire level and yes, it’s going to be painful, but can you imagine what it’s going to look on the other side, because we just moved at a rapid pace in the sense of our thinking, growth, creativity and ideas. I think we’re looking at the future of wholesaling.

Brent Daniels:
Oh, a hundred percent.

Chris Arnold:
That’s an awesome shift in thinking.

Brent Daniels:
A hundred percent. And it’s beautiful because it’s putting a magnifying glass on all the cracks in our businesses, or all the cracks in the processes that we have. We’ve been cleaning things up and cleaning things up, and it’s stuff that we knew and we just pushed it to the side because we were doing deals. It’s funny, we’re still doing deals, we still have the same amount of time in the day that we usually do, but all of a sudden now we’re working even harder, and the efforts of that…
It really comes top down. It starts with me, it goes to my lead manager, it goes to my acquisition managers and disposition. And it all comes back to, how much can we squeeze out of this time right now? And how many little errors do we have in our business that we can clean up so that we can just keep building and building and being consistent and making sure that we can provide as much value to the home sellers, the distressed property owners in our market, but on the flip side, make sure that we’re matching them up with real, active cash buyers that are looking for deals right now. People are looking for deals.
I am telling you, this is the time. Wholesaling Inc, Rhino tribe, this is the time, do not slow down. If you’re on the fence about getting into wholesaling, I am telling you, our contact rates for calls has doubled. Our leads have doubled. The deals are coming through. We’re getting great relationships with our cash buyers, our attorneys, our escrow officers, and we’re just building these relationships stronger.

Chris Arnold:
Yeah, absolutely, man. So those five shifts on the disposition side have helped us to maintain momentum. In my opinion, that’s why we haven’t seen much of a drop in revenue for us on the backside. I was just getting ready get… You know that, like bracing for impact? We just pulled the numbers for March, and we’re looking at it, and it’s like, it was a great month for us. Again, we can have this conversation 30 days, but I believe right now, it’s like, we don’t need to shift anything else, really. We’ve set the stage on all of these changes. There’s more other ones that we’ve done, but now it’s just riding it out and making sure that we do it effectively. So, now it’s more execution. It wasn’t crazy to do these mini shifts on the virtual side. When you look back and go, that’s just took a couple of weeks to change those things. We’re good, let’s keep going.

Brent Daniels:
That all comes from your leadership skills. That all comes from you having that good conversation with your team and getting on the same page. Don’t let the distance, if you work from an office or if you’ve got some people that you don’t see every single day, get on a Zoom, get on a FaceTime, get in front of them, pick up your phone, answer your text messages. Right now is the time to over-communicate with your team, to over-communicate with your cash buyers, over-communicate with any of your past leads that you’ve had that had a long timeline. Those timelines are shortened now. So you’ve got to get after that. Guys, listen, Chris is known as the REI Radio guy. He gets a ton of his deals from the radio. If you’re interested in that, definitely check him out. You’ve got a page? Where should they check you out?

Chris Arnold:
Yeah, wholesalinginc.com/reiradio. Again, wholesalinginc.com/reiradio, for radio right now, which is highly dependable. I’m loving radio and stations are negotiable.

Brent Daniels:
And stations are negotiable, that’s absolutely incredible. Well, Chris, thank you. Those five shifts are absolutely incredible. Guys, none of this matters unless you take action on this. This is just a step-by-step. Make sure that you take this seriously and you make these shifts. This is what the top of the top of the top, when it comes to wholesaling companies are doing right now and they are thriving. So make sure that you take this. These are not suggestions. This is a prescription. So make sure that you take action on it.
I love you guys, stay tuned to the Wholesaling Inc podcast. We’re going to keep coming out with the absolute best when it comes to what to do right now during the Coronavirus situation. We’re going to stay in front of this and we’re going to share with you everything that’s working, everything that’s not working anymore so that you can keep building momentum in your business. We love you guys. Chris, you’re the man. Thank you so much for being on, and guys, as always, I encourage you always to talk to people. See you guys.

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