Posted on: April 13, 2021

Wholesalers often throw away tons of leads because so few of them need the 70% rule, which can’t simply work on certain things. Or so they thought.

We have Brian Iregbu today in the show. He is a creative financing expert who has made great deals in real estate through his practical way of doing things.

In this episode, Brian will share next-level strategies to profit from almost every deal in an easier way than you think.

How to do things like Brian? Get all the information in this episode.

Key Takeaways

  • On motivation and the right offer for sellers
  • Brian’s thoughts in processing leads
  • Backing up his offers with data by asking the framework questions
  • On letting experts take care of logistics
  • How Brian got into real estate
  • What his lead generation looks like
  • Balancing cash or creative for the acquisition managers and incentives
  • On finding a competent escrow to go creative
  • How to be with Brian

RESOURCES:

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Episode Transcription

Darren Bentley:
Hey guys, Darren Bentley here, and welcome to another episode of the Wholesaling Inc podcast. And today, Brent Daniels is going to be speaking with creative financing expert Brian Iregbu, and Brian is going to share some next level strategies on how to profit on almost every deal. As wholesalers, we are often throwing away tons of leads because so few of them actually meet the 70% rule, and you just can’t make it work on these things, or so you thought. Imagine for a moment being able to profit, regardless of how much equity is in the house. What would that do for your business? Well, Brian Iregbu is going to show you how to profit on these deals today, and why it is so much easier than you actually might think. Enjoy

Brian Iregbu:
The majority of sellers don’t want to sell their property for pennies on the dollar, man.

Brent Daniels:
Right.

Brian Iregbu:
I mean, we’re normally dealing with, I don’t know, let’s say 4% to 8% of the population would you say?

Brent Daniels:
Yeah.

Brian Iregbu:
Somewhere along. And what I find is that when you give sellers a cash offer, it’s great, right, if they’ll accept that for speed and convenience. And a lot of times investors that think if they’re not willing to sell their property for pennies on a dollar, they’re not motivated.

Brent Daniels:
Right.

Brian Iregbu:
That’s not necessarily true. Sometimes they’re motivated, but your offer just doesn’t work. And so what I find is give them a couple of options, right? Both of the options making sense for you, and then you’ll find it actually increases your conversion quite a bit. So that’s the reason I do it. And man, I use that strategy when I had a job working 50 to 70 hours a week, and it still allowed me to keep up with investors at the time there was working full time, and I barely had just like glimpse of time to invest in the real estate business, but it still allowed me to pick up deals by adding it to the tool belt. And that’s basically the reason I do it.

Brent Daniels:
I love it. And we talked about the foundation of real estate investing is finding discounted properties, right? And then you’ve got a lot of different things, right? You got fix and flip, you got your rental portfolio, you’ve got development, you’ve got be in the bank, you’ve got all these different things, but it starts with finding those motivated sellers. Now, they might not be motivated to take a cash offer, but they’re motivated to do something. So when a lead comes into you, Brian, what does that look like? Are you putting it through some sort of mental filter that you’re like, “Okay, let’s see. There’s situations this, this, and this. I think that I’m going to go with this approach and give them a cash offer, and if not, I’ll back up, and I’ll do something that’s more creative,”? How do you process that in your brain?

Brian Iregbu:
Man, great question. So look, I love your framework. We do the exact same thing you do. I don’t like to make things complicated. People think creative finance, they think you’re doing mental gymnastics.

Brent Daniels:
Right.

Brian Iregbu:
No, no, no. You can just add a couple of just more things, right? Just real simple. You doing a layup? Okay, add a little jump shot, a few more things. So this is what it looks like. Lead comes in, we qualify the same way you qualify, for motivation. The reason for selling, what happens if you don’t sell? The condition, the timeline, the asking price, the reason for selling, and then we only give an option offer range. If we find with tug of war that this isn’t going to be a fit, then we present another offer. And a lot of times, depending on the situation, we’ll make both offers at the same time. And we’ll just assume the close. ” Mr. Seller, based on everything you shared with us, which one seems like a better fit for you?” And just shut up. And I’m telling you, man, it works like magic.

Brent Daniels:
And so you go in with a cash offer that’s obviously the price is going to be lower, and then you go in with… What other option is this?

Brian Iregbu:
[crosstalk 00:04:48] discount.

Brent Daniels:
I guess it depends on the situation, right? If they own it free and clear-

Brian Iregbu:
Okay, so let’s back it up.

Brent Daniels:
Yeah.

Brian Iregbu:
Back it up, you asked about the framework.

Brent Daniels:
Yeah.

Brian Iregbu:
So probably as a mortgage, obviously, this is going to be subject to. Right?

Brent Daniels:
Mm-hmm (affirmative).

Brian Iregbu:
There’s going to be [inaudible 00:04:59] the existing loan. Now, what we’re looking at typically on this is will it cashflow? Can the property pay for itself? Right? That’s what we’re looking.

Brent Daniels:
Mm-hmm (affirmative).

Brian Iregbu:
And if it doesn’t cash flow, if it doesn’t pay for itself, does that mean it’s a bad deal? No, we may do something like assign it, right? We might assign it to someone else, or we might structure it on a seller finance, AKA a wraparound mortgage, right? And assign that to a retail buyer, because retail buyers, they’re not looking for equity and cash flow. They pay top dollar. And so if that sub 2 won’t cashflow, but it’s still at a rate that someone is willing to pay that much because they’re going to lay their head there every night, we’ll still be able to profit off that deal. If it’s free and clear, that second offer, seller financing, of course.

Brent Daniels:
And that’s what’s exciting, right? So a couple of different things that I want to kind of pull apart there is one is if they do have a mortgage, and maybe there’s not a lot of equity. Brian, we’ve been having, this has been bananas, in our own business here in Phoenix, we’re locking up sub 2 deals, and it is like a feeding frenzy when we put it out to assign that deal. Listen, I could keep them, I could do that. I choose to keep that side, and assign, and see what’s going on there. But it is a feeding frenzy. So even if they don’t have a tremendous amount of equity, if you’re able to put together a really solid sub 2 deal, people will pay you for those.

Brian Iregbu:
Right.

Brent Daniels:
People will pay $10,000, $15,000, $20,000 a pop to be able to add that to their portfolio, not have to go get a conventional loan, every day of the week. And the second part is, [crosstalk 00:06:41] you really want to make a ton? You really want to assign it? Sell it to somebody that’s going to live there. You know what I mean?

Brian Iregbu:
Absolutely.

Brent Daniels:
Just like you said, sell it to somebody that’s going to live there.

Brian Iregbu:
Right.

Brent Daniels:
Now, the other side is the creative financing. So let’s just for everybody that’s not really sure what that means. Essentially, for the most part, these properties are owned free and clear, right? Or they’ve got a very significant amount of equity, but let’s just say that they’re free and clear for this example. Then you go in, and you approach them as being the bank. [crosstalk 00:07:11] Now, in your experience, Brian, is it because they don’t want to pay a lot in taxes? Is it because they don’t know what to do with the money? Is it because they want more for the property than you’re willing to give them for a cash offer?

Brian Iregbu:
Ding ding.

Brent Daniels:
That’s it.

Brian Iregbu:
Yeah.

Brent Daniels:
Okay. So when you’re going-

Brian Iregbu:
So it’s usually that, it’s usually that they’re not strapped or stressed for cash, they don’t really have an emergency or pressing need, and if there’s a way that you can give them more money, and it doesn’t scare them, they’re willing to do it.

Brent Daniels:
I love it. So how do you structure that? Do you put together a note? Do you put together a lease agreement with a purchase? Do you have somebody handle the paperwork for you like a closing attorney or title company? [crosstalk 00:07:54] How does that work?

Brian Iregbu:
So we write up the agreement, whatever. So Brent, if I’m looking to purchase your property, seller finance from you right now, your property is worth a $100,000, I shot you a cash offer $50,000 to $70,000, depending on the repairs. You say, “Kick rocks, get out of my house,” or hang up, right?

Brent Daniels:
Yeah.

Brian Iregbu:
And I offer you an offer of let’s say $80,000. For that exact same property I would of offered you $40,000 to $50,000, Brent. We would actually write that agreement up, right? $80,000, I normally don’t just throw out interest. I don’t negotiate against myself.

Brent Daniels:
I love this.

Brian Iregbu:
If they insist, we’re probably going to start talking there, but I’m going to start at rock bottom. But we would put that $80,000, we would put the term, we put the interest rate, at that point, Brent, I’m going to let the experts do what the experts do. I’m a real estate investor. Pass that contract over to a real estate attorney or title company, they’re going to drop a promissory note, they’re going to drop a deed of trust here in State, we’re in Texas. So that’s the actual instrument that allows the seller to foreclose and take the property back in the event that I default.

Brent Daniels:
Right.

Brian Iregbu:
So they have their [inaudible 00:09:05] as well.

Brent Daniels:
Yep.

Brian Iregbu:
So that’s what happened.

Brent Daniels:
Did you hear what he said, everybody? He said he lets the experts take care of it. He’s a real estate investor. His job is to go find the discounted properties, and the deals, and the opportunities, and running the team and the business, and cherry pick the deals that he wants to keep. He’s not going out there getting scientific with every line of the promissory note or the contract or anything, right?

Brian Iregbu:
You know what, Brent? And it’s funny because a lot of people are so scared of creative finance because they’re like, “I don’t know what to say. I’m not the expert.”

Brent Daniels:
Yep.

Brian Iregbu:
Check it out. Sellers respect honesty. They respect if you just kind of straight upfront with them. So if you don’t know the answer to a question, guess one of the best responses, “Mr. Seller, that’s a great question. Let me get with my real estate attorney. I’ll have an answer for you by 5:00. Is that fair? Let me speak with blank experts.” And they feel that they’re comforted because you’re surrounded with a team of experts. So [crosstalk 00:10:00].

Brent Daniels:
It’s the truth, we don’t need to know everything, and don’t lie, just tell them, “I don’t know. I know we can put this together. I’m going to let them worry about all of the technical paperwork, but let’s you and I work on the price and terms, and we’ll get this settled, and figured out, and as smooth as possible.” And if they believe that, and they… Remember, when you’re negotiating with a property owner, it comes down to three things, the price, the terms, and whether or not they want to work with you, that’s it. So if they want to work with you, just work out those other two, let the paperwork get done by the experts, and you’re off, and running, and looking for other opportunities, because you know as well as I do, Brian, sometimes you fall into the black hole of, “I need to protect this deal. I need this deal to close. Oh my gosh, it’s so precious. It’s so beautiful.”
But I mean, you had a 50, 70 hour a week job. You couldn’t afford to do that, worry about all this, and not sleep, and go through all the brain damage. So you went, and you set it up with people that you trust, and you rock and rolled. So let me ask you about that. Let me go back in case people don’t really know, because I wanted to give them the heat early, because I think that that’s so great. But you, how did you get into real estate?

Brian Iregbu:
Yeah.

Brent Daniels:
It sounded like you had a nice career going on. What happened?

Brian Iregbu:
Yeah. Man, I wanted freedom like you, Brent. What’s today? Today is I don’t even know. Oh, it’s Wednesday.

Brent Daniels:
Yeah.

Brian Iregbu:
We do our [inaudible 00:11:21]. It’s a Wednesday, and you’re inside of a set recording videos and doing what you want to do.

Brent Daniels:
Yep.

Brian Iregbu:
I wanted that, right?

Brent Daniels:
Yep.

Brian Iregbu:
I wanted that, and that’s what happened. I did have a great job, Fortune 3 company, but man, I just want a little bit of freedom. So like everybody else, I was searching on YouTube ways to make money. I know it sounds shallow, and I seen a bunch of scammy looking stuff, but I kept seeing people like you. And I was like, “Man, these people are real. People are really doing this.” And so I took my shot at real estate. And you hear people say, “Buy houses with no money, no credit.” That sounds like a… I’m going to tell you that sounds like a scam.

Brent Daniels:
Of course.

Brian Iregbu:
I’m going to [inaudible 00:11:59]. But it’s not, man. And it’s real, and it” change your life. Yeah, for sure.

Brent Daniels:
So with your team, how are you guys going out and sourcing your leads? What’s your lead generation look like?

Brian Iregbu:
Right. So we shifted more so now. Cold calling is our number one. Man, last year and the year before, honestly, man, RVMs was our top.

Brent Daniels:
Sure.

Brian Iregbu:
We were killing it, right? But regulations and everything, man, it’s just a lot harder. We’ve maneuvered so many different ways to get those messages through, and it’s just the [inaudible 00:12:30] is just kind of coming down. So we’ve been beefing up cold callers. I think we have eight cold callers at the time. So cold call is our number one, man. Number two, still do a little bit of RVM, and third is Facebook. So that’s our top three marketing channels right now.

Brent Daniels:
Fantastic.

Brian Iregbu:
Cold calling, RVM, and then Facebook.

Brent Daniels:
So when these leads come in, who’s working them? Is it going directly to you? Is it going into an acquisition manager, a sales person, maybe a lead manager? Where do they go? Because you’ve got eight callers.

Brian Iregbu:
Yeah.

Brent Daniels:
I mean, it’s got to be like raining leads, right? You know what I mean? You got to filter those.

Brian Iregbu:
Yeah. So once the leads are filtered, right? And it’s a qualified lead, these people are interested in selling, they understand that we’re not retail buyers, they get assigned to one of our acquisition managers. Okay. And the acquisition managers, of course they make that follow-up call, and then they try to close the deal or contract the deal. So that’s where it goes next. They contract the deal, they got the contract, everything’s in Podio, They press a button, it goes to dispositions, dispositions go does their thing and try to find a buyer for the property. That’s the process, very simple.

Brent Daniels:
Let me ask you about a struggle that I’m having. Okay. This is a struggle that I’m having in my business. The struggle is we have them come in… We get big deals, Brian.

Brian Iregbu:
I know.

Brent Daniels:
We do really well at that, but there’s a lot that we don’t get.

Brian Iregbu:
I’m so jealous.

Brent Daniels:
There’s a lot that we don’t get. And in my mind, I don’t want my acquisition managers going cash and creative, because I feel like they’re going to lean towards the creative more than the cash, and then that’s going to throw off cash flow.

Brian Iregbu:
[crosstalk 00:14:07], right?

Brent Daniels:
Right, it’s going to throw off the cashflow, and then what do I pay them if we get those deals? It’s a confusing thing. So how do you balance that out? Do they know if a property comes in that it’s most likely going to be a seller finance versus a traditional wholesale? Or do they kind of have to work that out on their own?

Brian Iregbu:
Yeah. So they work it out on their own, and that’s a great thing that you said to have an issue with, right? Because I’m going to tell you an issue that was more prominent that we had, because we had licensed acquisition managers.

Brent Daniels:
Yeah.

Brian Iregbu:
And it was kind of like, “Okay, if we can’t wholesale it, we can list it.” And if they tried to convert things into a listing, they will kill the company’s profit. It’s like, “Whoa.” So that was more of a problem than what you’re talking about.

Brent Daniels:
Yep.

Brian Iregbu:
For that, no. Because it makes more sense for the acquisition managers to contract it as a wholesale deal, they’ll make more money.

Brent Daniels:
Right.

Brian Iregbu:
The only reason we would even do creative finance for them is if the seller… It’s no way we’re getting the cash offer accepted.

Brent Daniels:
Yep. And then do you just pay them a flat fee if they get it through? Because I assume that now you own this property, right? And they’re like, “Aw, I did all this work.”

Brian Iregbu:
Right.

Brent Daniels:
So you just give them like a flat fee or sum?

Brian Iregbu:
So check it out, it depends on what type of deal it was, right?

Brent Daniels:
Okay.

Brian Iregbu:
So you remember earlier I said, “Let’s say the deal doesn’t really have any equity and doesn’t really cashflow either,” because investors buy for equity and cash flow. So on a deal like that, we would assign it and step away. So the assignment fee is the same. It might be a $10,000 [inaudible 00:15:37] assignment fee or a $15,000 assignment fee, and so you’re back to the basics.

Brent Daniels:
Love it.

Brian Iregbu:
You pay them a percentage based on that assignment fee. However, if it’s something that I keep, or one of my partner keeps, or somebody within the company keeps, this is how we do it in our company, because we promote everybody in our company having ownership or building wealth. We don’t want to just be like, “Oh, employees and…” So what we do is that that person, if they’re taking it off the table, that they have to pay the company a $5,000 assignment fee.

Brent Daniels:
Love it. Smart.

Brian Iregbu:
Right?

Brent Daniels:
And by the way, that’s a smoking deal for them.

Brian Iregbu:
Yeah, smoking deal.

Brent Daniels:
I mean, $5,000 to get a seller finance seal. Oh, man.

Brian Iregbu:
And everybody wins. Nobody wants to be like, “Oh, the company owners are getting rich, and one day I’ll be an investor.” Right? So that’s how we kind of put that into our company, to where employees also can buy deals from us.

Brent Daniels:
It’s really interesting, and for everybody building a team, listen to me, keep your salespeople happy. Keep your sales people happy because they will make or break your business and your conversions. And I think, Brian, that is just absolutely beautiful what you just said there, because I think a lot of times as owners, we go, “Hey, wait a second. I paid for the marketing. I paid for this opportunity. I want to build my own net worth. Why would I pay somebody in assignment?”.

Brian Iregbu:
Me, me, me.

Brent Daniels:
Aw, man. And that’s what really destroys the culture in a business.

Brian Iregbu:
And it’s just me, Brent, I don’t know if anybody else agrees. Matter of fact, I was with Steve Trang, and I was talking to Max and Ryan, one of the top acquisition guys that kind of moved over. I was talking to him, and we always agree in it. I really don’t even like the word “employees.”

Brent Daniels:
Right.

Brian Iregbu:
To be tossing that around the company saying, “My employees.” I just say, “Team members.” They’re part of the team, whether you’re acquisitions, lead managers, [inaudible 00:17:24].

Brent Daniels:
Yeah.

Brian Iregbu:
So you feel apart of something. Not like…

Brent Daniels:
Yeah. My team comes over, and my family’s there, and they’re like, “Oh, you worked for Brent.” And I’m like, “They work with me. All right.”

Brian Iregbu:
Yeah, they work with you.

Brent Daniels:
Like, “Let’s calm this down.” You know what I mean?

Brian Iregbu:
Yeah. Nobody is inferior.

Brent Daniels:
Yeah. I’m not overloading and, “Ah,” controlling it all. And I think that’s really important, because once you start bringing on people, you truly work for them, they don’t work for you. I mean, obviously, they have to have that motor. They have to have that engine to go out and succeed. They have to want to financially be really healthy. They don’t need you lording over them and hitting them. You know what I mean? No.

Brian Iregbu:
Nobody wants that.

Brent Daniels:
They need to have the freedom to do what they do. So that’s awesome. So when you get that property, and you turn it in, did you have to find a specific, is it escrow or is it a closing attorney in Texas that you turn in?

Brian Iregbu:
Escrow.

Brent Daniels:
Escrow.

Brian Iregbu:
With the title [crosstalk 00:18:18].

Brent Daniels:
Okay. When you turn your contract for something that’s creative into your… Did you have to find a specific escrow officer that understood how to do those deals?

Brian Iregbu:
Oh, come on Brett. I know this for the audience, and you already know the answer to that question. This is for education, but of course, right? It’s the same thing with real estate agents. Somebody, “I’ve been an agent for 30 years.” Right? But there are some that still don’t know half of what real estate is today, right? Sometimes we got to teach attorneys. Sometimes you got to teach title companies, or if don’t have the bandwidth or the patience to do that, you go find someone that is competent, and they understand what is going on today, and the things that you actually can pull off. So yes, you’ve got to find some people that understand that.
I’ll give you an example. I have real estate attorneys that will not touch the subject 2.

Brent Daniels:
Right. Oh, yeah.

Brian Iregbu:
They’ll touch up on a finance deal if there’s no underlying lane, but a subject two, they won’t touch it. But then I have some that they’ll do it all day. So yeah.

Brent Daniels:
That’s it.

Brian Iregbu:
For sure.

Brent Daniels:
And that was the point. I obviously was setting that up, because it’s really important [crosstalk 00:19:22].

Brian Iregbu:
Thank you for the layup [crosstalk 00:19:24].

Brent Daniels:
No, but I mean it’s really important to when you’re on the team, go with the experts that already know what they’re doing.

Brian Iregbu:
For sure.

Brent Daniels:
You don’t have to learn it all. Just understand that you’re working, and you’re trying to bring value to that property owner that’s in distress, that 6% to 10%, I think you said 4% to 6%. It just depends on the market. Typically, the average is about 6% to 10% are in distress at all times. There’s plenty of opportunities, but if you open up your toolbox a little bit more with some creative, and let the people handle the logistics, then you’re going to get more deals, and your team, and you, and your portfolio are going to be a lot happier. So that is awesome. So, Brian, how do people get ahold of you? How do they find you? How do they be in your world?

Brian Iregbu:
YouTube. I have a little YouTube channel as well. I don’t put out as much awesome content as Brent. I need to get consistent.

Brent Daniels:
I think it’s fantastic. It’s really good.

Brian Iregbu:
[crosstalk 00:20:15] I think I’m most active on Instagram, and I’ve been addicted to Clubhouse.

Brent Daniels:
Awesome. So, guys, definitely follow them on Clubhouse. It’ll alert when he’s on there, and you can go in here, and pick his brain, and get some really, really, really great questions answered, and then, obviously, follow him on Instagram, and check out his YouTube channel. So, Brian, thank you so much, man. That was absolutely incredible.

Brian Iregbu:
I appreciate it, Brent.

Brent Daniels:
I think you brought a lot of real, real, real instruction to this. So thank you so much. I know the audience loved it.

Brian Iregbu:
Thank you for all your content, man. I love your channel, man.

Brent Daniels:
Thank you. All right. See you, Brian. Thank you.

Speaker 3:
And if you are interested in joining the most proactive group in real estate investing, it is the TTP family, go to wholesalinginc.com/ttp. That’s wholesalinginc.com/ttp, scroll down, check out the testimonials. You’re going to have to scroll for a long time because nobody has more. We have the absolute best people in the program, but I’d love to work with you one-on-one, that’s what it’s all about. It’s about the mentorship. Check that out, if it feels good in your gut, sign up for a call, and that’s it.

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