Posted on: December 11, 2020

This episode’s amazing guest is Stratton Brown. Stratton is a successful real estate investor based in Riverton, Utah. However, he also invests in Fresno, California. Prior to becoming a wholesaler and real estate investor, he pursued his dreams of becoming a football star.

Eventually, he chose a more practical path and opted to try his luck in real estate. Fortunately, real estate was an awesome fit for Stratton as he was able to run a massively successful wholesaling business.

In this episode, Stratton shared some of the techniques that has helped him build a thriving business—from his current business structure down to how he screens his deals, Stratton covered it all.

If you’re considering getting into the wholesaling space, consider listening to this episode a must!

Key Takeaways

  • His background and how he started his real estate journey
  • What his current business operation looks like
  • What’s working for them in terms of finding sellers
  • Their highest revenue-generating activity
  • Why doing follow-ups is crucial
  • What his qualification process is
  • How he screens his deals
  • What he does with deals that are more than 90 days
  • What homeowners truly care about
  • How he manages his transition to becoming a wholesaler
  • The importance of getting your first check
  • Breakdown of a deal he did
  • What the power of networking is
  • How he goes about the negotiation process
  • Top 3 things aspiring wholesalers should focus on

RESOURCES:

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Episode Transcription

Rafael Cortez:
What’s up tribe. Welcome to the Wholesaling Inc podcast, hands down the number one real estate wholesaling podcast in America. I’m your host and wholesaling Inc coach, Rafael Cortez. And I’m super excited because today we are breaking it down with somebody who’s been through the ringer, knows the ins and outs of what it takes to make it as a wholesaler and has really found massive success through one of the best vehicles for wealth out there, Mr. Stratton Brown. Glad to have you brother. Welcome to the show.

Stratton Brown:
Thanks for having me on boss.

Rafael Cortez:
How are you doing?

Stratton Brown:
I’m doing good. I just got done playing with my son at the park and ready to have a good time talking to you.

Rafael Cortez:
Beautiful. I’ve known you for a while and we’ve talked about a ton of deals before and gone over your business and all that stuff. But you recently had a big, massive deal that I want to dive into. But before we get into the meat and potatoes of the conversation, what’s your background? How’d you get started in real estate?

Stratton Brown:
Yeah, man, my name’s Stratton Brown. My background, I was a college football player. I thought I was going to make a ton of money. My senior year, I was all conference 17th in the country in tackles. I’m like, “Oh man, you’re going to be so rich. You live in a wild lifestyle, you better learn how to invest your money, so you don’t end up on TV being that rich to broke.” I start listening to Wholesaling Inc BiggerPockets, and Dave Ramsey, Grant Cardone and just filling my mind with investing stuff because I’m already thinking, “You’re about to get a car of money, you better invest it. You know yourself.”

Rafael Cortez:
I need to put all this money in somewhere, right? Yeah.

Stratton Brown:
Right. I need to put all these millions that I don’t have, somewhere. And I make it to Seattle, I get to try out, cup of coffee, nothing happens. Then I’m at home just like, “Man, do I want to try again for a chance to make it or do I want to start a career?” So I decided to start a career. I come home, I started home inspection business. It’s awful. I’m going to meetups. I do one home inspection, I go through a crawlspace and like, “Bro, this is not for me.” I don’t like the bottom, crawling through, getting spiders on my face, I’m afraid a snake’s going to bite me. And so I was just like, “This is not it.” And at one of the meetups, I met a guy who I ended up working for, who was like, “Three years ago, I was driving a tractor, making 30 grand a year. Now I’m making several six figures a month.’ I was like, “What? Okay, cool man.” And he was like, “I want to buy a jet too.” I was like, “Okay, cool.”

Rafael Cortez:
Was that guy wholesaling?

Stratton Brown:
He was wholesaling.

Rafael Cortez:
Isn’t that crazy?

Stratton Brown:
He owned close to a hundred rentals at that point in time too, so his growth over that three years was just crazy. So I call him after that first mock inspection, I’m like, “What do you do again, man?” And he was like, “Go download PropertyRadar and go knock on every single pre-foreclosure.” And so I download it and I go knock pre-foreclosures, dusk till dawn. So much that my pregnant girlfriend thinks I’m cheating on her because I’m waking up in the morning going and knocking till the sun goes down and then I’m just doing it over and over and over again. I finally get a deal. I ended up working for the guy for about a year and a half and then eventually I broke off, started my own company.

Rafael Cortez:
Man. So you actually tapped into a business that was existing, and then you got to play in that before you went and ventured out into yourself. You mentioned pre-foreclosures, for those who do not know what pre-foreclosures are, there are the properties that are going to be foreclosed on. So these are people that have gotten notices and they’re behind on payments and it’s just one type of seller that’s out there. And okay, so you got a job with this guy and then what happened?

Stratton Brown:
So I get a job with this guy, I eventually ended up running a lot of his day to day. It feels like I’m a partner with him, we’re putting together all the marketing campaigns. We built out an in-house call center by eight people, choose all the marketing, run the office, I’m charged with another acquisitions agent and transaction coordinator. And then eventually it was just time for me to part ways. And it was the best thing I’d ever done. Anyone who’s skeptical about paying for coaching or going to and working for someone for free, don’t be. I got an MBA in real estate in about a year and a half, I learned so much.

Rafael Cortez:
How long ago was this?

Stratton Brown:
When was this? I finished college 2016, 2017, about halfway through 2017, and then I started on my own at the beginning of 2018.

Rafael Cortez:
Cool, cool. So two and a half years, you didn’t know anything about wholesaling.

Stratton Brown:
Nothing.

Rafael Cortez:
Then you went into it by yourself?

Stratton Brown:
Yeah, pretty much. I worked for him during that summer-ish, after I got back from Seattle, all the way till the end of the year and then through a little bit of the next year, and then I broke off on my own.

Rafael Cortez:
Wow. All right, so this a crazy thing, and it’s something that I talk about on a regular basis, it’s amazing how fast things move when you have this type of opportunity out there. It’s something that has … I mean, the margins are big, the overhead is not, it’s really minimal when you compare it to other types of businesses out there. If you do apples to apples with a brick and mortar business, the difference is astronomical. But the opportunity out there is, I mean, even in this type of market, it’s insane, I think. I mean, we did see a big change at the beginning of 2020, it was felt across the nation. But even then, I mean, the opportunity, it’s resilient, it’s still out there. How are you guys doing? I mean, now what does your operation look like right now?

Stratton Brown:
So now it’s me, we’re bringing on a new leads manager and then my call center handles all my cold calls. My entire business is cold calling. We do some texting, but nothing too heavy with some of the new opt out stuff. And it’s a really, really targeted list with our texting, but it’s all cold calling and then PPC as well.

Rafael Cortez:
Okay. Cold calling and PPC. So as far as finding sellers, what’s working for you guys right now?

Stratton Brown:
Cold calling is without a doubt number one, PPC is a lot more higher barrier to entry and we just have it there, and it’s nicer because people coming to us. Cold calling, if you’re just getting started out, is the number one way hands down, to get going. I’d tell you to door knock, but we’re in the middle of COVID and so it’s a little bit difficult.

Rafael Cortez:
Yeah. It gets a little tricky. And that’s one thing that I keep saying, man, I keep pressing on that. I mean, you got to have one backbone form of marketing, once you [inaudible 00:06:41] something, it’s a pillar type of marketing for your company and maybe different depending on the area, but I mean, you pick it, you test it and you figure out what works and then you have that and you always keep that going, you never stop. I mean, one mistake that I’m seeing right now is that we’re coming into the holidays and people are dialing it back, they’re slowing down their marketing. Like, no, it’s not the time, people still have issues, people still have problems that need to be solved. And we can still be out there and then create solutions for those sellers.

Stratton Brown:
Oh, you can’t slow it down. I made a mistake when COVID’s slowing down.

Rafael Cortez:
If you slow it down right now, you’re not going to see anything the first quarter, you’re not going to see profits in January, you’re not going to see profits in February. It’s consistency, at the end of the day, you have to stay on it. And it’s okay, for example, to test out different methods of marketing, but you got to have that one. I mean, in your case it’s cold calling, in my case, it’s cold calling. I actually have two that I don’t slow down from, which is cold calling an SMS. In this case, when you have something like this, I mean, you just have to go consistent on it. It sounds like you have a pretty lean team. What are your highest revenue generating activities in your business?

Stratton Brown:
Talking to sellers.

Rafael Cortez:
Talking to sellers. Wow. Yeah, mind blown and I mean that in a good way, man. It’s so easy to get around that because it’s one of those things that creates the fear of the rejection. If you can’t talk to sellers, I mean, it’s not going to work. Nothing’s going to work. The market is not going to work, the system’s not going to work, the logo, the website, all that stuff is not going to matter. And it’s actually the simplest, if you look at it, I mean, you don’t need anything other than a phone and a list. How’s your guys’s follow-up? Is that something that plays a big part into it or do you guys usually lock on the first-

Stratton Brown:
Everything comes from follow-up. Everything comes from follow up. The biggest mistake people make is not marketing consistently, and then not following up. I’d say most of our deals come from at least three to six months, a lot of our deals come from a year, where you’re just following up with them. Maybe they didn’t like the offer, the market goes up and they’re just like, “This is a number I wanted.” And so you give them the number they wanted and it works out, you never know.

Rafael Cortez:
And what happens also with long-term followup, I think a lot of leads are prematurely dropped and people just stop calling because they didn’t sell on the first or second try. But a lot of these long leads, what happens is that properties start appreciating, and then sellers are often stuck with that single number that didn’t make sense last year. But from last year to this year, hell in Maricopa County, I think we’ve seen 8% appreciation on stuff and that’s insane. But when you see that kind of stuff, I mean the numbers are almost going to work themselves out. Now you have market inventory also that plays into it, you have the desired areas, what areas are being developed. I mean, there’s so many different factors that change within a quarter. Three months ago, the landscape here is very different than from what [crosstalk 00:09:30]. And that’s going to impact the sellers price point, the sellers, whatever their price point, if that’s an issue.
Now, you’re talking to sellers, highest revenue generating activity. How do you go about digging deeper into the conversations? Because we all know, I mean, as you start doing deals, we start finding out that it’s not always about the money, right?

Stratton Brown:
It’s never about the money. If someone’s going to shop, you’re never going to win. I’ll tell you that right now. That’s how I personally feel. Unless you’re someone who has just an insane buyers list, you can lock them up and then you can make some marginal money. But generally, the small deals where you’re putting in a ton of effort, are the biggest headache, and it’s not really worth your time. And so you just got to follow up and then that long follow up builds rapport. And then if you can get that rapport, talk to them longer and it’s just you and them generally, again, people fall off, people drop it, people drop it and then it’s just you and them trying to put something together.

Rafael Cortez:
What’s your qualification process? And I agree with you, you said something very important. I think the smaller margin deals, I mean, we’re not trying to convince anybody to sell, I think it’s the worst thing that you can do, try to convince somebody to sell, because if they don’t have a problem and you’re making them think they have a problem, so you can get a property, I mean, that’s one, unethical, it’s not right. And then two, you’re going to end up with a big problem in your hands as you go through a transaction. So yes, and often the smaller deals give you the biggest headaches. How do you process that? How do you screen what’s a deal, what’s not a deal?

Stratton Brown:
Like from the TTP master, from Wholesaling Inc, we go price, timeline, property condition, and motivation. For me, motivation is number one and then price is a big deal, but some people just throw out a price. That’s not as big of a deal, but if they have a legitimate reason for selling, then that counts as a lead for us. And then property condition, if anyone says anything besides excellent, that counts for us because sellers always lying to you and saying that it’s excellent, it’s excellent, excellent, always brand new, remodeled. Anyone who says it’s [crosstalk 00:11:25].

Rafael Cortez:
1982, yeah.

Stratton Brown:
In 1982. If someone says it’s fair, you know it’s at least in the condition you want a wholesale deal to be. And then price, timeline, and then timeline. I want something to sell within 90 days. If it’s outside of 90 days, then we push it off.

Rafael Cortez:
Wait, do you push it off, or do you recycle it and then just put it on for follow up down the road? What do you do?

Stratton Brown:
They’ll just keep getting called. For our callers, they’ll just keep getting called. If it comes in through anything else, we’ll just follow up month to month, to month, to month. But as we’re qualifying in there, like, “Hey, it doesn’t even sound like you’re ready to sell right now.” Like, “Oh yeah, I’m really not, honestly.” And if you’re just real with them and go, “Are you even interested in selling right now? It doesn’t sound like it’s something you’re considering.” They’ll just be like, “Honestly, I’d like to wait a few months.” “No problem. Do you care if I give you a quick 30 second phone call in about 30 days, see how you’re doing?” They’re always going to say yes or they’re going to tell you, “Give me a call in six to eight weeks.” We still give them a call in 30 and then you just keep on pushing.

Rafael Cortez:
I know we have leads in our pipeline, I mean, they’ve been on there since 2017, but yeah, that’s money, people sell. They’re always going to sell, the timing, I think, is going to be one of the things that plays into it. Sometimes they feel like they got this as a landlord and sometimes they’re just fed up with their tenants and you just got to be there top of mind, whenever that happens.

Stratton Brown:
Exactly. Oh, I forgot, so what I mean that it’s not about the money, is that we’re really just solving problems. A lead we’re working on right now, an old man was there, he died, they inherited it and they have a squatter there, it’s the middle of COVID, they hate the squatter. I was like, “I’ll buy it with the squatter in place. I’ll give the squatter cash for keys and I’ll close in two weeks.” And then they’re like, “Well, what about this and that? What about all the junk that’s in the house. We want to go through all of it just to make sure we don’t leave anything.” “No problem. As soon as we close, get them out, we’ll leave you time to go through the whole house and pull everything out.” That’s what people care about. Solving those little problems or little things that if you can pull out that pain and pull out their concerns and objections, at least then price doesn’t matter because you solved the problem no one else even thought about solving. And most of the time the seller will go dark on other people.

Rafael Cortez:
Yep, absolutely. I’ve had people literally just walk out of the house, grab a bag and then walk out of the property like that, and that was their problem. Now they don’t have to deal with all that stuff, all that stress, all that headache. I mean, to us, it looks like a bunch of stuff, to them it’s mental junk. We’ve had that scenario, that particular scenario happen multiple times. You’re a football player and then you started working in this company where you started to learn the ropes. How did you manage the transition into becoming a full-time wholesaler and getting over that fear? I mean really believing that you could do this and trusting yourself to run an operation, how was that?

Stratton Brown:
I had no other life skills. I spent 23 years developing myself as a football player. I was like, “Bro, your degree is in communication. I don’t want to get a real job. And so I got to make this work.” Flat out, that’s how I did it. It wasn’t …

Rafael Cortez:
Up against the wall, pretty much.

Stratton Brown:
Yeah, it was like up against the wall and believing yourself. That’s a whole another thing, you don’t even know, when I broke up on my own, it was still getting over that barrier of doing your first deal all over again. On your own, with your own money, your own cash. And that was really just … Butt against the wall, dead broke, I got to make something happen, you have none of the life skills.

Rafael Cortez:
You know what happens though, and I see it time and time again, once you hit that first deal, and I mean, of course, the money matters, but the fact that you get a settlement statement that says that you closed the deal, makes everything real. It now becomes a reality. Now it’s like, “Oh wow. This is something that I can do. This is something that I can actually blow up.” And I remember getting my first closing, the first one I did on my own and getting into it, it was just a total game changer really because it painted that picture of, “Okay, cool. I can do this again, and then I can do it again, and then I can do it again.” After so many tries, you have a business. Was that similar for you, or how did it change your life setting?

Stratton Brown:
Both times it was just the proof of concept. Getting the check and saying like, “Oh wow, this is possible. I can do this.” And then it’s one thing to see everyone on YouTube talk about it, but to actually get the check in your hand and go cash it. I’d tell everyone, even though some people are like, ‘Oh, do wires.” Go get your first check, see it, hold it, feel it.

Rafael Cortez:
Smell it.

Stratton Brown:
Smell it and embrace it. Like, “I really did this. This is really possible.” And then that proof of concept was big for me.

Rafael Cortez:
Yeah. Yeah. I mean, it really just paints a whole different setting once you hit that benchmark. So I want to talk about this deal. We’ll get into the numbers and all that stuff a little later. But first off, give me the rundown, what was the scenario, the situation with the seller and how’d you find the seller?

Stratton Brown:
This one was the most bizarre one I think I’ve ever experienced. The seller was like, “It needs so much work. It’s really bad. I really just want to get it off my hands.” They lived in the coast, they’re older, retired and they had their grandson living there who was a police officer in the area. And so we texted them, it came in and the wife responded to me. I followed up with the wife for three months trying to get ahold of her. And they went dark. But for whatever reason, I was like, “Oh, this is a deal.” And it was a lead that came in through text and like, “Yes, we do want to sell.” Anyone who says, “Yes, I want to sell.” It’s more than likely to do because a lot of people try and come off guard, at least that’s how it’s been for me.
And so I’m following up, following up, one day she was like, “Yeah, let me get you on the phone with my husband.” I get on the phone with the husband and we negotiate for all of 30 minutes. He’s like, “It’s in really bad shape, what can you do for me? I want to close in 60 days because of X, X, and X.” I was like, “Easy. I’ll make that happen for you. No problem.” And so I just sent over the contract, all virtual, never saw him, never saw the house. And then-

Rafael Cortez:
What was the real problem? What was the problem behind the call and the reason for them selling?

Stratton Brown:
They were older, and they’re just like, “It’s time to move on. I’m tired of driving out to Hanford to go fix it up.” Pretty much. They lived two and a half hours away and they’re like, “I’m tired of going to this area to go fix it up or go check on it or go check in on my grandkids. I’m just over it.” It wasn’t a massive motivation, that’s why it was so bizarre for me.

Rafael Cortez:
Yeah. Not massive motivation, yet motivation. How did you find the lead? How’d you find this deal?

Stratton Brown:
It was an absentee owner, we texted him.

Rafael Cortez:
Absentee owner, text. So absentee owner list, and was it at your County or was it …

Stratton Brown:
This is, I’d say, an hour away from our main area, in a different County.

Rafael Cortez:
That’s pretty local then. So you’re doing virtual deals in your local market practically, that’s what happens, right?

Stratton Brown:
Yeah. Yeah. All my biggest deals have come from virtually, let’s say generally the owner’s out of the area anyways and so you do it all over the phone.

Rafael Cortez:
Are you always hitting the absentee owner list or what do you do with it?

Stratton Brown:
Always, always. That is going to be, I don’t know about you, but that’s our staple. High equity absentee is without a doubt, our staple, and once you get to a certain point of data, that’s really what you have to pull to keep your business running. You can’t survive off of niche.

Rafael Cortez:
Yeah. I agree, man. Niche is good, but you got to have that volume play and absentee owner high equities, I think it’s always going to give you that big fat list in any County. I mean, the first thing that we look at whenever we’re tapping into a new market is, does it have over 200,000 people in it? And if it does, more than likely, we can drop a good, healthy amount of campaigns on it, and then, go to [inaudible 00:19:09] that. So you found the seller via SMS, and it took you three months to actually get ahold of these people and have that conversation with them. So how long did it take you from the point that you first made contact, to the point that you actually closed the deal? What was that timeline?

Stratton Brown:
That was a day. And that was one of the only times it’s been a day of, I talked to him, he gave me a price and I was like, “Okay, let me run my numbers.” Called them back, I was like, “Okay, I want to move forward today. Is that okay with you?” He said, “No problem.” I said, “I need to be here.” He goes, Okay, let me talk to my wife.” I was like, “No problem. I’ll stay on the phone.”

Rafael Cortez:
I’m not letting go. I’m not letting go.

Stratton Brown:
“No problem. I’ll stay on the phone.” Let him talk to me as soon as he has any questions. And that was in the same day. But that whole process took a while, and to me, it’s still follow up, and then when people are ready, they’re ready. So you got to stay in front of every single person because you never know.

Rafael Cortez:
Absolutely man, absolutely. How many follow ups did you have to do during that three month period?

Stratton Brown:
I couldn’t even tell you, man. Countless.

Rafael Cortez:
Are you serious?

Stratton Brown:
Countless. Because a lot of times we will, when a lead initially comes in, we call them every day, sometimes a couple of times a day until they pick up the phone. Especially with cold call leads because cold calling is a lot of timing, you never know when you’re going to get ahold of them. Texting is the same way, they may engage with you, but you’ve got to get ahold of them, you’re paying money for these leads.

Rafael Cortez:
Yeah, I remember back when we first started working on your systems and all that stuff, I mean, you mentioned the seven, what’d you call it, the seven days of …

Stratton Brown:
So the seven days of hell. We call anyone who in, three times a day. I didn’t want to throw it out there, but we bombard them and then they get texts if they don’t answer, because it’s like, “We called you, you said you’re interested, let’s hop on the phone and talk about it.” Because if you don’t do that, there are other people who are calling them anyways, who are bombarding them. So you want to at least be there.

Rafael Cortez:
Yeah. After that first call, I think you almost become the needy boyfriend or needy girlfriend. Yeah, I remember you mentioning that when we were setting up your system and I was like, “Wow, that’s heavy.” But you’re going to lose deals by not following up. I mean, I’d rather lose a deal because of too much up, then because I didn’t follow up enough.

Stratton Brown:
Especially in your market where it’s really competitive, and I know some people do that, in my market I have a dude who, without a doubt, does it. I’ve called his letters just to see what happens and then I get bombarded. And so I don’t want someone to come in and catch them, so we’ll send off texts, we want to at least get some engagement. As soon as we get engagement, we’ll call it off, but at the beginning, we’ve got to get a hold of them.

Rafael Cortez:
Yeah, man. That’s crazy. I like it though. I mean, again, you have to be just on it, you have to be tenacious about things. So once you had that conversation with the seller, the seller wanted you, I mean, he had this big headache, he just didn’t want to take care of that property anymore. He was traveling two and a half hours to handle his stuff and he was done with that. How did you structure the deal? What did it look like?

Stratton Brown:
So one of his biggest concerns again, was, I want to make sure my grandson has time to move out and find a new place. He was like, “I want to do a 60 day escrow.” I was like, “No problem. We’ll do a 60 day escrow. We’re still paying cash, no inspections, no contingencies.” And that was his biggest thing and that’s the only way we structured it. It was just cash and close of escrow, 60 day escrow.

Rafael Cortez:
60 days, six zero or what?

Stratton Brown:
Six zero.

Rafael Cortez:
Okay, cool. And how did you manage the dispo on it? How did you sell the contract on this? Did you close on it?

Stratton Brown:
No, I signed it. I have a meetup here in California, [crosstalk 00:22:47] Wholesalers. And then we have 700 members, where it’s buyers and everything else. And so generally if I know it’s going to be a deal, we’ll send it out to there and got bites right away.

Rafael Cortez:
Man, the power of the network. That’s so incredible what it does. I was on a mastermind this morning and I mean just the stuff that you keep learning, even from the same guys on a regular basis. I mean, you just can’t ignore it. Everybody elevates at the same time. I mean, that’s really what happens. So you send it out to your internal network and then so at this point you had the contract in place. Yeah, you’ll sign that contract and then they just took it down and closed it from there.

Stratton Brown:
Yeah. They just closed it from there. We asked for proof of funds. We get a $2,500 to $5,000 EMD, depending on our relationship with the person.

Rafael Cortez:
Tell me a little bit about the negotiation process when you were talking to the seller. I mean, it sounds like everything was relatively fast and the magic of this whole thing was really in the follow-up. Was there any hiccups during the negotiation or anything that you would have done better or different throughout the deal?

Stratton Brown:
You can always price anchor lower. Honestly, [inaudible 00:23:51]. I think you can always price anchor lower, at least find a way to throw out some random number.

Rafael Cortez:
Bro, if you’re not clenching when you’re dropping that anchor, I mean …

Stratton Brown:
Right. And you feel so rude and you’re like, “Man, they’re going to laugh me off the phone or they’re going to cuss me out.” And you don’t want to lose the deal because you don’t want the price anchor to come true. They’re like, “Quit wasting my time, blah, blah, blah, blah, blah.” You always want to price anchor pretty low.

Rafael Cortez:
What it is, I think the fear behind the low anchor is that you’re thinking, as the person presenting the offer, you’re thinking, “Okay, that’s really what I need for the deal.” But it’s a conversation piece, it’s an anchor, it’s literally what it is. So if you see it as that, it’s just like dropping the ball on the playground and see if somebody wants to play with it. [crosstalk 00:24:43].

Stratton Brown:
It’s an art to drop it the right way and laugh it off or something else, or you just say something and then don’t say another word and wait for them to say something.

Rafael Cortez:
Yeah. I mean, it’s pretty interesting though, the way that works, when you do it right, when you’re able to just navigate the conversation and then you’re able to drop that low anchor, which is very, very important. If you don’t drop that, I mean, obviously you want to drop the anchor if they don’t give you a number first. The key thing is to try and get a number out of the seller, figure out where their mindset is at in terms of pricing and you know where they’re at with [inaudible 00:00:25:14]. But if that doesn’t happen, then you just anchor low. And all it is, it’s a starting point for that conversation.
I mean, I don’t think it’s ever killed my negotiation really because you drop the anchor and if it doesn’t work, I mean, you come back real quick and then, “Okay, well let’s figure something out of the works for the both of us, we can’t pay that much because it’s too high and it’s not [inaudible 00:25:36] and that’s not what we do. Obviously you can’t take that low, so where are we at? What is it going to take to get this deal done?” Finding that middle ground.

Stratton Brown:
Exactly.

Rafael Cortez:
And again, the better the conversation is, the more you’re going to dig into it and you’re going to find out what the real problem is. Like you said, man, a lot of times it’s not about the price, it’s about some alternative solution that you can provide for them. I mean, we’ve had it where they just don’t want to have the difficult conversations with their tenants, they don’t want to do repairs on the property. They just want to walk out and we would come in and solve that problem.

Stratton Brown:
Exactly. He wanted to sell as is.

Rafael Cortez:
Yeah. So at the end of this whole deal, which took you three months to figure out and then another 60 days to close, so it was a five month deal pretty much, right?

Stratton Brown:
Yep.

Rafael Cortez:
All right. And that is not uncommon. I mean, when we talk about wholesaling, it’s one of those things that yeah, you can be in and out of a deal in two weeks, lead comes in, you get it, you lock it, you negotiate it, you can get it under contract and you sell the contract or you close on it, in and out. That’s perfect scenario. Most of the time though, leads going to come in, you’re going to have to do follow up work, with their lead, they’re not ready, “I’ll be ready next month. Give me a call back.” And then you call them back in two weeks because we always split it in half, but it takes some time. So this five month endeavor, if you don’t mind sharing a little bit of the numbers, what was the ARV on the property?

Stratton Brown:
What was the ARV? It didn’t need that much work when we ended up getting pictures, ARV was, I want to say 270 and we got it at 130.

Rafael Cortez:
130. So 270, you bought it for 130, didn’t need much work. And California is a competitive market, I don’t know about that town where it was at, but I know California overall is just competitive. What was the sale price on it?

Stratton Brown:
We signed it for $49,000.

Rafael Cortez:
$49,000. All right. So just around close to about “$2,000 a month there. $49,000 profit man for follow-up, three months.

Stratton Brown:
For follow up.

Rafael Cortez:
Yeah. The followup was a key on that thing, huh? That’s amazing.

Stratton Brown:
Always, man.

Rafael Cortez:
I love it, man. I love it. I know you’re big into systems. Somebody who’s aspiring to be a wholesaler or new into wholesaling, what are the top three things that they should be focusing on?

Stratton Brown:
Number one, when you’re going to talk to sellers, I’m not giving legal advice, your LLC doesn’t matter, your website doesn’t matter, your logo doesn’t matter, if no one knows we want to buy their house at a discount, then you’re not doing anything right. People have got to know you at least want to buy their house at a discount.

Rafael Cortez:
You got to have those conversations, got to have those conversations.

Stratton Brown:
Number two is a CRM. Just use Podio because eventually you’re going to end up in Podio. It’s free, you can get a free real estate investor pack on Podio. That way you can house the people you’re trying to buy houses from. And you can have it in an organized way to know when to follow up with people. With me, I’m not super organized, my CRM saves my life.

Rafael Cortez:
Happy to hear that.

Stratton Brown:
And I use [inaudible 00:28:40] too. It’s amazing. And number three, I would say, get a dialer and start cold calling. If you say, “I can’t afford it,” I had to donate blood when I first began and go sell everything I had just to afford a dialer.

Rafael Cortez:
Wow. You take blood out of your body to get your business, that’s hardcore bro, I did not know that about you. That’s new found respect.

Stratton Brown:
I won’t go into it, but when I left the investor, man, I was dead broke, eating bananas and rice. I had to sell everything I had to pay rent because again, I know what amount of money goes into marketing, and driving for dollars will only get you so far. Go donate plasma.

Rafael Cortez:
Yeah. Wow. So do whatever you got to do to get things rolling and focus on those three things. I love it, man.

Stratton Brown:
Exactly.

Rafael Cortez:
I love it. Well, thank you very much, man. I appreciate you sitting down with us and then sharing your journey so far. So guys, thanks for listening. There has been no better time than now to kickstart your wholesaling career, so if you’re ready to take advantage of the best opportunity out there to create wealth and you want to cut the learning curve and you want to do it fast, scroll down and head over to wholesalinginc.com again, that’s wholesalinginc.com and schedule a call with our team, have a conversation. If it works for you, you might get an invitation to become a tribe member and I look forward to working with you personally. So thanks for being on board, man. I appreciate ya.

Stratton Brown:
Of course, man. Thank you so much.

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