Posted on: October 28, 2020

In the wholesaling world, there is no shortage of creative strategies you can look into to generate more leads. And in today’s show, you’ll learn that apart from radio, there are two ingenious strategies you can use that’s basically no-competition!

In this episode, REI Radio’s Chris Arnold talked to Paul Lizell. Together, they dissected two no-competition strategies Paul has been using to get more leads and be a step ahead of the pack.

If you’re in the lookout for new, effective, and highly innovative wholesaling strategies you can try, this is one episode you just can’t miss!

Key Takeaways

  • His background and how long he’s been in the game
  • What the MLS is
  • A breakdown of his MLS strategy
  • How he keeps up with all the negotiations
  • Their average deal size off MLS deals
  • What an online auction is and how you can get the process started
  • How to pull a deal from one of the auction sites
  • How often he’s in a bidding war with others
  • Number of properties he bids on to find a deal
  • Where people can find him to learn more about his strategies

RESOURCES:

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Episode Transcription

Chris Arnold:
Welcome to the Wholesaling Inc. podcast. I’m your host, Chris Arnold. Excited for you to join us today. I’ve got something interesting in store for you. You know, as long as I’ve been around with the tribe, I love to ask people, “What are you doing as a strategy to generate motivated seller leads?” I find that I hear 90% of the time these foundational funds. I hear ringless voicemail, text blasting, cold calling, pay-per-click, and direct mail.
And so, I always like to bring somebody on that’s going to give a strategy. I want you guys to be able to hear some of the other strategies that are out there. So maybe you can maybe maneuver in a direction in which you’re not doing something that’s saturated, got a lot of competition today. So if you’re plugging in today, this is what you’re going to get by the end of the show.
I am interviewing a good buddy of mine, Paul Lizell. We just hung out in Florida last week and I started talking to Paul and he brought up two strategies on finding deals that I haven’t really heard many people talk about. So if you stay tuned in today by the end of this, we’re going to break both of these strategies down. Not just introduce you to them, but also give you the nuts and bolts of how they’re working. So let’s get into the meat, Paul Lizell. What’s happening, buddy? Welcome to the show.

Paul Lizell:
Hey, Chris. Thanks for having me on, man. I appreciate it. It was great catching up with you last week.

Chris Arnold:
Yeah, man. So Paul’s got a little interesting background. I want you to give us a snapshot. But this is somebody that has done deals from a virtual standpoint at a level most people haven’t. And so, tell everyone a little bit about your background, Paul. How long you’ve been in the game and about your business.

Paul Lizell:
Sure, absolutely. So I started real estate investing back in 2001. Bought my first fix and flip. It was a HUD property back in Norristown. Then I partnered with a guy. We picked up for 295. We put about 4,000 into it, sold it for 69 about two months later. So they’re pretty good. 30K. Split it up 15K each. So I decided, “Hey, this is pretty here. Let me get into this fix a flip thing.” So I started doing a bunch more. Into the 2008 financial crisis, doing great. Got hammered then and decided to pivot and switch.
So in 2009, I switched from the just almost exclusively fix and flip with an occasional wholesale to basically just almost all wholesale and occasional fix and flip. And dabble with owner financing, which we’re going to talk about later on too. But that model switch and I went from more of my local area, Pennsylvania. I’m from the Philadelphia market, Pennsylvania and New Jersey. I started buying all over the country. It was all bank owned properties when I was buying. A lot off HUD Home Store.
And I started buying on online auctions like auction.com, Hubzu, Xome, Hudson & Marshall. And before it was Xome, there was something else. And that was just Nation Star mortgage decided to create their own auction company because they were sick of selling everything through auction.com and I’m not getting any revenue. See, I switched that model and we bought 44 to 50 States over the years and [crosstalk 00:03:59].

Chris Arnold:
Hey, 44 out of 50 States. I hope you guys caught that. I think Paul, again, people say I’m a virtual wholesaler. That means they might work in a couple of areas. Paul is, I think, the purest virtual guy that I know that’s out there. I mean, 44 out of 50 States is huge.

Paul Lizell:
I agree. I totally agree with what you just said there too, because I know a bunch of other guys who with Apple they’ll do in two or three markets on the virtual wholesaler. Well, you are a virtual wholesaler because you are virtually doing it by opening it up to the whole country.

Chris Arnold:
Yeah. So that’s why you want to stay plugged in because Paul’s doing something that’s unique and truly pushing this. So let’s jump in. Let’s break down this first strategy, a strategy using something that everyone’s aware of. But again, Paul, I like to talk about radio as the marketing channel everyone knows about, but no one’s using. I’m going to say the same thing about the MLS. The multiple listing service is a resource, is a way to find deals that everyone knows about. But how many people do we know that are actually utilizing it to find deals? So, let’s break down your MLS strategy on how to find a deal. Step one is what?

Paul Lizell:
So step one is, obviously, pick the targeted markets you want to be in and if you’re new or you want to start in your local area. So if you have access to the MLS or you know an agent, somebody in your family or friends that’s an agent, have them start sending you listings. Now, you’re to target certain things. What we target is bank REOs. A lot of times we’ll target 90 days or more based on the market.
Now, they’re getting harder to find because of the way the market is. But you’re going to target those items. You’re going to target estate sales and then fixer uppers. But you want to get into something that really needs a bit more work, for sure. And you’re going to target them. We send them to our VA. Our VA then looks at the properties, pulls comps on them and then sends them to us. We find out what our maximum allowable offer is.
We use all the formulas we use and we start bidding off that. We send low ball offers. We get yelled at and nasty emails at times from agents. But most of them come back and say, “This just isn’t going to work. Will they count on us?” We get quite a few. The most that we get is estate sales and the REOs.

Chris Arnold:
Okay. Let me rephrase that just so we heard. So number one bank REOs. Number two, estate sales. And number three, fixer uppers. If I’m in the MLS and I’m like, “Well, how do I target those?” Break that down real simply is that keyword searches in the MLS. How do you target those?

Paul Lizell:
The keyword search is in the MLS. And they’re going to pull it off the agent remarks, or what’s putting it in some of the major headings there. Because most agents will put in our fixer upper, or there’s a checkbox you can put in there for fixer upper and they can do that on their end the agents can. And every MLS system is a little bit different. But for the majority of them, they have those options there. You’re just doing a keyword search.
So state sale as is. You’re looking for those types of things. You’re really targeting specific ones. And you want things that are age. You can almost go to 120 or 180 days in the market and also to pull things off there. But you’ll find out a lot of times is those are properties end up needing to be short sales because they’re over leveraged. Or you have people that are just unrealistic with their sales price.

Chris Arnold:
Okay. So you do a keyword search. Do you do the timeframe? Say that timeframe one more time again. How far back?

Paul Lizell:
For a bank-owned property, we target 90 days and greater as far as based on the market. For ones that are non-bank owned, we’ll look at target even more, 120 or more. And if you find things over 180 or 240, you got ones that you really want to go after. [inaudible 00:07:29] motivated.

Chris Arnold:
Any there key criteria outside of the keyword search and the base? And again, of course, the market. Anything else that we need to understand on that?

Paul Lizell:
No, that’s pretty much it. We have our target markets. So we’ll hit certain counties. We have probably about five counties that we target per each of these. And then we do this, of course, in San Antonio market too. We’ll target a couple in that area. And then in Tucson, Arizona, I have an agent that does all that for me. He does all the scrape. He does all the heavy lifting and then just bring it to the ones that say, “This one’s good. This one’s good. This is not.” That type of thing. He only brings me stuff that’s good. Yeah.

Chris Arnold:
Okay. So now I’ve got a list of properties that fall into those three categories the way I search. What’s step number two after that?

Paul Lizell:
So once you get that, then you’re looking at you just making the offers. And our VA writes the offers for us. We give the proof of funds and everything. She emails them, CC’s us on it. So then generally, we’ll get a response from that agent and then you’re going to say-

Chris Arnold:
The email offers to everything that pops up on that list. Does it matter?

Paul Lizell:
It looks good. That matches to our criteria, right? We’ll go through things that are like, we’ll that’s a train wreck. This property needs so much stuff. It’s just going to be really hard to do it. Or it’s in an area where I’ll try to avoid things to have hills going into the house, because you’re always going to have water issues. Or you’re on a main road. People don’t like those things. So we’ll avoid those. And that’s the visual look on it and seeing pictures and things like that. So we’ll X those off. And the rest of them we’ll making offers on. So yeah, we do a lot of blanket offers.

Chris Arnold:
Okay. And what percentages of the list that you pull do you feel like you end up putting offers on?

Paul Lizell:
About 15% to 25% in general. 15% to 25% is what we pull from.

Chris Arnold:
15% to 25%, if that criteria. That’s good to understand as we’re listening what percent should have the same amount. Now, your VA sends blanket offers. How does that VA determine the price that offers should be like? What’s that system there?

Paul Lizell:
So we do that. So that’s me and my disposition manager. We get together with our numbers, and then we send an email to her, tell her. We give all the property addresses and what the prices we want to offer on. And then she just-

Chris Arnold:
Oh, okay. [crosstalk 00:09:40] you and your business partner sitting down, filtering through figuring out the best 15% to 25%, right? Fits your criteria. Then you’re determining, “Hey, we should come in or this offer.” So you’re doing those on that 15% to 20%. Send it over to the VA. And then the VA submitting offers for you. I got that right?

Paul Lizell:
That’s exactly right. Yeah. So we first started this before the market got real hot. We’re meeting about once every two weeks. Then we tried it once every week, because these properties were gone pending so quick. Now we’re doing it two … We have two meetings a week, pretty much. Like a Tuesday and a Thursday we’ll meet and go through the properties and quickly get the offers out there. Because, otherwise, we were losing out on so many just because the market’s hot.

Chris Arnold:
And how many offers do you feel like then you’re roughly sending out a week or month?

Paul Lizell:
About 100 to 150 per month on average is what we send out.

Chris Arnold:
And of that, what is the KPIs of … Out of every 100 offers you send, what’s the KPI on contracts, deals, et cetera? What can you expect?

Paul Lizell:
Generally, that one. Really that’s what it’s coming into. It’s not [crosstalk 00:10:41].

Chris Arnold:
Okay. So one out of 100 offers?

Paul Lizell:
Yeah, exactly. It’s a low percentage, right?

Chris Arnold:
The cost to run the system I’m sure is not very high. [inaudible 00:10:50] big profit margins.

Paul Lizell:
Exactly. This is where it changes everything because we’re getting into we don’t have any marketing costs. The only time cost is the VA. Right? What she calls $5 an hour. So it’s not a whole lot of money. And plus we utilize her for other things. It’s a lot cheaper than doing pay per click. It’s a lot cheaper than doing the direct mail and all these other sources.

Chris Arnold:
Okay. Absolutely. So once the offer’s submitted from the VA, what happens after that? What’s the next? Again, mass offers being sent out. Walk us through the end of that system. What’s it look like?

Paul Lizell:
So I’ll give you a sample and we just got under contract here. So it was one it was marked at 90,000. It was this state sale. We started offering it at 65. And we finally met at 73 as the purchase price on that one. So we went back and forth a couple of times with the agent. That was between emails between me and the agent going back and forth after the initial process was started. We locked it up, and now we have people go and looking at the lower 80s here.

Chris Arnold:
Okay. So how are you keeping up with all of these negotiations? Because this seems a lot, 100 being sent out. Again, an agent has to respond so that means you’re literally getting 100 responses then. What is the system to make this efficient so you’re not just responding to offers all day long?

Paul Lizell:
It’s a simple Excel spreadsheet. So when we get a response back and they usually hit this all. And if they don’t hit us all, I’ll just forward it to the VA. And then I’ll just mark on a spreadsheet no, no, no, no, or pending. It’s under contract already, or they have higher offers. We let them know where our highest best offer is. So it’s pretty quick. Believe it or not, it’s pretty quick. Those offers come. We make that count in the offer. We’re getting at it usually within 24 hours.
So it doesn’t lag real a long period of time. And we know right away, and especially in this market, whether it’s going to be accepted or whether they’re just going to take those other offers. Most of the time they’re going to take this other offers because they’re generally homeowners, right? As compared to news coming in as investor.

Chris Arnold:
Okay. So anything else with this system that we need to understand? Seems like it’s maybe about a four to five-step process.

Paul Lizell:
Yes.

Chris Arnold:
I like it. It’s pretty simple, pretty straightforward. But anything I didn’t ask, it’s like, “Oh, and you got to remember to do X if you want to run the system”?

Paul Lizell:
No, but there’s occasionally. Like you said, you can have some fall through the cracks where you don’t get a quick response from the agent. So you just have to do your follow-ups. Just do a follow-up, if you didn’t get a quick response. Sometimes they’re on vacation or sometimes they just are slow. So if you don’t get a response within 24 hours, you just hit them with an email again. Just a reminder and you give them the whole offer again. But usually, I got to say 90 plus percent of the time they’re responding to it pretty quickly. Almost immediately sometimes.

Chris Arnold:
So your goal then as a marketing channel is to do about one deal a month off of this?

Paul Lizell:
One deal a month off this, yeah.

Chris Arnold:
Kind of that. And what’s the average deal size off of a deal on the MLS? Again, we’ll say that the average around the countries maybe around eight to 10,000 for a wholesale deal. Again, you’re in a lot of markets. Is this a channel that’s producing a good solid deal, or MLS margin’s tighter?

Paul Lizell:
It is. So the margins are between 7 and 12 so far on average on these, which is pretty solid. It’s counting your average cost per deal. And the way I look at it, I don’t have any marketing costs. I know the only marketing costs might be if we are sending postcards out to resell to another investor, right? To basically wholesale the property. So we don’t really have any marketing or costs in general stuff.
The profitability is pretty goodness. It’s just more time-consuming, I guess, in some ways. But it’s a quick, simple process. It’s one I think you should always do in any market. A lot of people think, “Hey, the market’s so hot. I can’t find anything on the MLS.” You can find deals on MLS always. Don’t get me wrong. When the market is slow, it is easy. You can shut everything else down and just pick up deals off the MLS and the auctions like we do. But when the market’s hot, you never want to turn it off. It’s always a good source.

Chris Arnold:
[inaudible 00:00:14:43]. It works in season, out of season. Works year after year, regardless of what’s happening. Buyer’s market, seller’s market. It doesn’t matter. Just stick with it.

Paul Lizell:
And you can do a lot with it. And it gives you options to this perspective that you can pick up, especially when a market slows down a little. You’ll be able to pick up more deals subject to keeping the existing financing in place maybe keep some of these properties as rentals. So, that becomes a good option. I used to do more of that when the market was slow. And now it’s just like they all want cash or they want a mortgage if anyone out of it. It’s hard to do that subject too right now.

Chris Arnold:
Great strategy, man. Again, super simple. If you’re listening and you’re like, “I don’t have a lot of money to spend, but I’ve got time,” get access to the MLS and look at running a process like this. But what I love and what I hear you saying, Paul, is it’s a great, consistent process to produce one deal a month. And as I look at the overall system, you’ve got a VA doing the work. I’m sure a lot of this you can outsource more than one. So I think it could become something that you build that’s a lot more hands off if you wanted to push it.

Paul Lizell:
Oh, totally. Totally.

Chris Arnold:
Yeah.

Paul Lizell:
So yeah. It’s easy to do hands-off. This is probably one of your better methods to do hands-off

Chris Arnold:
Absolutely. Okay. So let’s go to number two. First one was good. Again, I don’t hear a lot of people talking about it. Number two, mark your strategy that Paul wants to share with you guys today is online auction, right? So what is an online auction? And again, let’s start with step one. How do I get this process going?

Paul Lizell:
So, I’ll give you first all the companies out there that we buy off of. Obviously, everybody knows of auction.com. That’s one. Then you’ve got xome.com, X-O-M-E. And then you got hudson&marshall.com, very small outfit in comparison to the other ones. Then you’ve got Hubzu, which is pretty large. Got RealtyBid, another smaller one. Auction Network. And of course, you got the HUD Home Store too. I like an online auction where I could bid on anything, anywhere in the country. HUD Home Store’s a little bit different. You do have to have a local agent representing you there. But it’s still great source. I love the HUD Home Store. Buy them there.

Chris Arnold:
Okay. So it sounds like there’s quite a few different websites to get access to. Now, once you have access to those sites, what does this work? Are you getting updates sent to you? Are you on there watching? Like what’s the process to actually pull a deal off one of these auction sites?

Paul Lizell:
So I’ve been buying from them for a really long period of time. So I get updated lists every week. I’ll get weekly lists. And in Xome’s case, they’ll give you like three to four emails a week because they’ll have different auctions coming up at different times. Midwest auction, Southeast auction, Northeast auction and all that kind of stuff, Northwest. So they break it down into different categories. Same as the other ones do too, but they just send more frequent emails.
The process now you’ve got to sign in and create an account on each of these. And auction.com, for instance, when you’re bidding on a property, there could be five different auctions going on at one time. So you have a $2,500 deposit. You have to leave with them to bid on these auctions, right? And I used to have … They got rid of it. They got rid of the VIP on ultra.com. But they still have VIP on Hudson & Marshall and on Xome. So I don’t have to put deposits on those.
But if you’re just starting out, you’re going to have to learn how to do that. You’re going to have to put the deposit. They just put a hold on your credit card. They’ll actually pull it, and then you start bidding on these properties. And one of the best things to do when you’re bidding, if you’re looking at a certain area, there is … Most of these have an agent on them or realtor. Contact that realtor, get some details on a property as far as what they think the as is value, or what they think the after repair value is, that they know what repairs need to be made on it.
You get all your information here. Basically, you’re taking notes, put them in your spreadsheet. And then deciding what your maximum allowable offer is going to be based off that. And then when it comes up to auction, you’re bidding them.

Chris Arnold:
Now, are you bidding through the agent that’s representing that property?

Paul Lizell:
No.

Chris Arnold:
Or is this like I’m thinking like eBay, like timer lights going down?

Paul Lizell:
That’s it.

Chris Arnold:
[inaudible 00:18:41] online.

Paul Lizell:
Just like that. So it’s online. It’s got the time. You’re bidding yourself. You create your own account and you’re bidding. You want to have an agent to represent you, you can do that. If you’re an agent like myself, I’ll use myself as the agent. But obviously, in other states you can’t always get the commission. Generally, I try to, if I’m getting information from the listing agent, I try to make them the representative for me on a buy side, because they’re giving me info. And I want them to get both sides of the commission. And I may realize them to resell the property too. And then they’ll get another commission on the backside if I go that route.

Chris Arnold:
Okay. And how often are you in this bidding type of war with all these different sites? Is an auction to happen once a week on each side? I’m trying to understand.

Paul Lizell:
Multiple times. Generally, auctions are Monday through Thursday. Some will have some on Fridays and some will start on a Sunday. It depends on which site. They all have different things. There are generally two to three-day auctions, as far as [crosstalk 00:19:39].

Chris Arnold:
How many properties then are you keeping up with, because there’s an auction on each separate property, right?

Paul Lizell:
It used to be many thousands.

Chris Arnold:
Who’s going to manage this thing?

Paul Lizell:
It used to be many thousands. And I’ve since whittled it down. So what I do again, this goes to my VA. The auctions they’re broken down into categories, send them to her on Excel spreadsheet. She comes through, does pulls comps on them. And not on every single property, right? Because it could get really tedious. We’re targeting certain markets. And there are certain states we don’t want to even bother with. So she’ll scrape them do that, send an email back to me if it sells on Google docs or on Dropbox. And I just pulled up there and look at it like, “All right, I’ll bid on this one, this one, this one.”
There may be out of 200 properties on the auction, I only bid on 25. Right? It might be a small amount that I’m bidding on. Another auction I may have 15, another one I may have 50. But generally, usually, I’m bidding when the market’s normal it’s not normal right now. It’s already nowhere near where it was. I’d be bidding on 500 plus properties a week. That’s not happening right now. Yeah, that’s not happening.

Chris Arnold:
But how many right now would just say generally?

Paul Lizell:
Right now, I’m bidding on 100 to 125 per week.

Chris Arnold:
Okay.

Paul Lizell:
And I’m whittling it down even more now. I’m really trying to be more specific because I’m worried about a market crash. So I really want to get the right type of properties. I’m going for the low line.

Chris Arnold:
Okay. So what is the numbers here? If the MLS is one out of a hundred offers, what is the auction side? How many properties do you need to bid on to find a deal?

Paul Lizell:
That’s way less. So you can do anywhere from … Generally, if I’m being on 25 properties, I’ll get one deal out of that.

Chris Arnold:
So 1 out of 25?

Paul Lizell:
Yeah.

Chris Arnold:
Huh? Of that 1 out of 25 that you’re picking up, about how many deals per month are you trying to do off of auction? Right? You’re doing one a month off the MLS. So you’re doing more volume off of the actual auction site.

Paul Lizell:
Way more. Yeah, usually between 5 and 15 per month on the auctions. Then as high as 20 some in months. But generally, I’m in that range. And what we’re doing is we target again a low lying fruit. And we hit a lot of rural areas where investors don’t go. So our competition is really low in those markets, little longer for us to resell them though because there is less buyers out there. But our margins are bigger. Our margins are bigger in those areas. So right now, it’s working perfectly cause everybody’s leaving the cities, leaving these areas and going to more rural areas. So selling them is much easier now than it used to be. They’re actually don’t fly in like this. It’s like hotcakes. They’re flying off. So it’s been good.

Chris Arnold:
Yeah. That’s great, man.

Paul Lizell:
The coronavirus is going to help us from that perspective.

Chris Arnold:
And that’s what I want to ask. Is this a strategy with everything that’s going on in the current market that you’re expecting this strategy come 2021 to be right in front of a bunch of REOs foreclosure auctions? Is there expected to be a spike in all this?

Paul Lizell:
Oh, yeah. Huge strike. So you look at the financial crisis 2008. I think it was between 2006 and 2014 there were 10 million bank REOs. They’re expecting four times that. Up to 40 million from this. Not all one year, obviously, but during probably at another 8 or 10-year period during that time. We could have four times the amount that we had the last time. And last time, I was swimming and finding them everywhere. I mean, it was so easy to pick up deals.
I was turning down deals that I knew I could make money on because I was going for the ones that I could make more money on. So we’re going to be getting there again. As soon as this moratorium lifts, and right now it’s scheduled for the end of the year. Wouldn’t surprise me one bit. They kick it down the road to the end of the first quarter of 2021 like California did. So we’ve got to keep an eye on that. But what it pertains to when they do that, they’re talking about FHA properties, the HUD properties, and government back mortgages. The foreclosures on non-government back can still go on. The moratorium is really only the government backed mortgage, which are a lot of obviously. It’s going to be good next year. It’s going to be get next.

Chris Arnold:
I love that you’re sharing a strategy. And if you’re listening, you should go, “Man, this is something I should consider.” Are all marketing channels working the same depending on the economy different? No. There’s years in which direct mail has been really strong. There’s years, obviously, when pay per click’s been really strong and depending on what was going on with bidding. Now you’re looking and understanding that every 10 years, we should roughly expect to drop it in the economy. I was around Paul in 2008 when everything happened, and there was no question. I shifted my business to short sells.

Paul Lizell:
Oh, totally.

Chris Arnold:
You know, and so for those of you that are listening that haven’t been in the game, listen to us, they’re telling you is every 10 years, roughly, you’re going to have an opportunity to jump on this bandwagon for a couple of years and pick up a lot of these deals. And Paul, I find that people don’t because they have to shift strategy and learn how to do this. And so they get a little bit lazy about this. And again, we’re not saying you’re going to ride this way for five years. But there’s definitely a couple year period where you can ride this wave just like we did in 2008. And I did that with short sales and REOs.

Paul Lizell:
And short sale will be … I think short sales will end up coming back again, right? If you have enough of a drop in value of properties, short sales become viable again. Basically, all you need is a 20% correction to make short sales become viable again. We did a bunch of short sales back between 2006 and 2010. We did a bunch of them. And we did really well those short sales. And then those became more difficult to banks to meet them harder to do.
And then we just were buying bank REOs. We were doing also direct mail. Little bit of pay per click at that point too. But in 2013, I completely shut off the direct mail and the PPC and just stuck with this strategy, just doing a bank own, just doing the MLS because I had enough inventory to get from for that. Now, but it needs to all shift right back. It’s not that hard to shift from one to the other.
But you should always be looking. You may raise a great point. People get comfortable with things. They don’t want to ship things. We have to in business. If you want to stay in business, you need to. And what I do is each quarter, I look at what’s working, what markets have worked well, and what markets are not as good. And I’ll avoid those markets that sucked. And the ones I’m doing really well on I’ll just focus on them. Right? And then you adjust again the next quarter and the quarter after that.
You got to constantly, that’s why quarterly meetings are important just look at that kind of thing. The most important one, though, is that mid-year meeting because the one in June where we’re looking at, basically, we’re looking at what’s going to be like the rest of the year? What does the economy look like? What does the MLS look like? What the auctions look like, and where are people buying and selling the most? [inaudible 00:00:26:15].

Chris Arnold:
There’s an old acronym, crisis stance requiring immediate shift and strategy. And it’s true. So this is the time to consider shifting and getting out in front and riding this wave if you’re looking for another marketing channel. So wrapping up real quickly the online auction, any other point or any other rock that we need to turn over for the audience to understand this process?

Paul Lizell:
Good thing for them to know. Obviously, for direct mail, you’re picking these things up with very little deposit down. So if you get into the other bank loans or $2,500 deposits, $3,000 deposits, you could have … If you’re going for three or four $100,000 property, it’s going to be generally 5% that they want down. So the deposits are heavier. So that’s why you got to make sure you’re in a good deal.
Make sure you know it’s a good deal while you’re bidding it. You don’t want to get in or bid it and back out because it’s not a great deal, unless you find out something that you didn’t know beforehand. So it’s more capital intensive for that perspective. Also, the bank-owned properties, you must close them. You got to take them down. You can’t assign these contracts. So you need to have either a private lender, or cash, a line of credit or any of these kinds of things be able to do.
It is more capital intensive, but it is less costly from a marketing perspective because you’re paying next to nothing for these properties as far as picking them up. It’s your time that you’re using, right? You’re not paying marketing fees of … Like we used to pay about 10 grand a month and that offer was nice. That saved me 120 grand a year. That was a big bonus.

Chris Arnold:
Cool. So Paul, if somebody is listening. They’re like, “Man, this is really interesting.” Everybody wants to know if you provide any health education videos, where would people go to find Paul to learn a little bit more about these strategies, even particularly online auction, because that one seems to be a little bit more sophisticated? How do we find you?

Paul Lizell:
Right behind me, you see reoauctionacademy.com. That’s where we train students. And it’s funny, most of our students come from California, believe it or not. And I think the reason they come from California is because the market’s so saturated. It’s so expensive by properties that they’re forced to buy virtually and that’s what we do. So we teach people how to buy on online auctions, on the MLS, how to train your VAs to scrub and do it, make it easier for you. How to sell on the backend, right? How to market your properties and different methods that work good in different areas.
So we teach them how to do that, REO Auction Academy. And also, I have a podcast called Flipping Out. It’s www.thevirtualinvestor.co. And that’s the part of the podcast is. And we talk about a lot of these different things, investing virtually and interviewing guys like Chris. I’ll probably have you come on my podcast still. It’s all kinds of different information on that. I even get into cryptocurrencies a little bit on that one because it’s virtual investing.

Chris Arnold:
Cool. I love it. I love it. Well, Paul, man, thanks for coming on today. Thanks for sharing with us and the audience. That’s what I wanted to get you guys listening today. Just a couple more tools for you to potentially consider as a marketing channel, as you’re thinking about 2021. What I want to do? Do I want to continue to call call, or direct mail or do I want to change it up?
And so, with the wholesaling community, we always want to be out there researching and finding you guys good value. And I got to tell you, after I talked to Paul in Florida, you opened up my eyes [inaudible 00:29:39]. And I’m actually going to be talking to my team this week and just saying, “Hey, have we thought about this particularly what’s happening with the shift in the market next year with the auction?” Because it makes a lot of sense. It’s pretty common sense as well.
And as always, again, if you’re looking for contrarian things to do radio call is something that we’ve been teaching on our side, been super hot this year. We’ve sold out a ton of markets. And again, moving into 2021. We know that there is going to be fundamentally. I read a statistic watching Axios on HBO Max. It’s a show. They were doing an interview and they said they should expect anywhere between 30 to 40 million evictions, potentially with Americans come January when the CDC removes the safety net.
That is a lot of deals potentially coming through landlords. I want you guys to think about that. So looking at your direct mail campaigns. But I can tell you as well on the radio side, one great way that we’re going to be utilizing radio, to be able to find deals is letting that word get out there to hundreds of thousands, millions of people utilizing radio.
So something I’ll really be thinking about Paul’s looking at it from an auction standpoint. I’m looking at it from the radio standpoint. So as always, check out what we’re doing. Go to wholesalinginc.com/reiradio. Again, wholesalinginc.com/reiradio. Book a call. See if your market’s open and take a look at radio. And obviously, talking with Paul today, take a look at his REO Auction Academy. Might be a couple of great things for you to consider executing on this year. So, Paul, thanks for coming on, buddy. Thanks for giving us some contrarian guidance today. I always love the stuff.

Paul Lizell:
Oh, thanks for having me, man. I appreciate it because the opportunity is coming up in the next couple of years for real estate investors, for sure.

Chris Arnold:
I love it. And to the rest of you guys, thanks so much for joining us. Until next time, we will add more value and talk to you soon.

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