Posted on: April 29, 2021

We’ve got an amazing guest on the show today—John Osai. He went from janitor to master mechanic to an attorney to real estate investor; and in today’s episode, he’ll talk about an even more amazing deal that he was able to close by following Brent’s TTP script.

Today is all about holding your ground against cash buyers but stick around to learn about working with opportunities that you might find in your own backyard.

Key Takeaways

  • His background in mechanics and law helped him transition to real estate investing
  • He finds fix and flips fun but time-consuming so he switched to wholesaling to build up his cash reserves first
  • There are three ways to source deals: market for them, wait for referrals from your network, or go out and earn them
  • Do a lease with an option to purchase to get into vacant properties
  • Hold your ground when you know you’ve got a great deal

 

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Episode Transcription

Brent Daniels:
Welcome to the Wholesaling Inc Podcast, America’s number one podcast for new real estate investors where we know that finding discounted property is the most proven path to financial freedom.
I am your host, Brent Daniels, Mr.TTP, Mister Talk to People and I am telling you this, with a hundred percent conviction. If I can do this business then so can you. So let’s get started. This is going to be an incredible podcast conversation here between myself and an incredible wholesaler out of Shelley, Idaho. Now listen to this everybody. This is really interesting. He went from a janitor to a master mechanic, to an attorney, to a real estate investor. All of that we’re going to learn about and that whole evolution into getting into this beautiful business of real estate investing. But not only that, he closed in an incredible transaction, made a great amount on this deal that we’re going to break down at the back-end of this podcast.
But, this podcast is all about holding your ground against cash buyers. All right? That is the moral of the story. I want to sprinkle that in at the beginning of this podcast so that you’re looking for the nuggets that you’re going to get from this incredible guy. It is my pleasure to introduce John Osai to the Wholesaling Inc Podcast. Say hello to everybody, John.

John Osai:
Hello. Glad to be here.

Brent Daniels:
So you are in Shelley, Idaho which is like an offshoot of an offshoot. You are out there, right?

John Osai:
Yep. And Shelley, Idaho, just outside of Idaho Falls.

Brent Daniels:
Absolutely. Incredible. And is that the market that you focus on John?

John Osai:
I kind of focus on the markets that are just around me. There’s Shelley, Blackfoot.There are pretty small towns all around, and mostly in Idaho Falls, Idaho.

Brent Daniels:
And I wanted to bring that up. The reason I asked you that John is because it’s really interesting. One of the biggest questions that I get time and time again is, “Should I start in my own market? Should I go virtual?” If I’m in the smaller markets, this is going to give people a great look at the potential of working in your own backyard and finding really good opportunities in your backyard. Now, obviously at some point, John, as you’re growing and as you’re doing this, some expansion is probably necessary as you’re starting to go through these lists and have really good conversations with all of the distressed property owners in your area. But just to give an idea to everybody, how big, what’s the population of your kind of service market, your area?

John Osai:
So, we’re in Bonneville County and the last time I took a look at the population of Bonneville County it was 140,000.

Brent Daniels:
140,000.

John Osai:
Yeah, in Bonneville.

Brent Daniels:
Fantastic. I love it. Perfect. That is perfect. Yeah. Okay, good. So tell me about you, John. You were a janitor.

John Osai:
Yep.

Brent Daniels:
Turned master mechanic, turned attorney, turned real estate investor. Walk me through this. How does this happen?

John Osai:
My dad came from the islands and came out here to Idaho and met my mom. But he was trying to figure out a way how to get his family out from the islands, from the Tongan islands. And so he moved to San Francisco to work for the airport and he became a custodian out there. And he owned a custodial business and that’s who I worked for, and doing yard work and custodial work. And then he convinced me to go to college. And so I came out here to Rexburg, Idaho and went to college there and got my automotive degree. And then went to Weber State in Utah to get my advanced automotive degree and then went to work for Ford Motor Company. Yeah. Then became a field service engineer for Ford and became an arbitrator eventually for them. And then the attorneys there convinced me to go back to law school.
So I went to law school and graduated from Brigham Young University and their law school and then I came out to Idaho and nobody would hire me, so I opened up my own practice and decided that I was going to make a practice for 10 years. And that’s what I committed to do. And then during that time, I got into some investments with some people that I knew and they all fell apart. They threw all the real estate that was failing and in 2009, they threw it all on me and I was stuck with all the debt and everything and to crawl my way out of it. And just kept plugging away, kept late at night, one o’clock in the morning, fixing pipes, fixing everything. I was a mechanic, mechanically inclined so I learned how to do construction during this time period and then got a lot of people to help me when I didn’t know what I was doing.
Then from there, I finally got the one apartment building sold and then started to buy houses, to fix and flip them and try to utilize my attorney skills to write the contracts and to try to find properties. But I was still missing something, that was the one thing. I knew that there was a better way out there to try to find properties. Because I was out there knocking on doors, looking at people, it was just difficult to find properties. And so I just decided to look on YouTube university and on there I looked through several different people that were on YouTube teaching this stuff and then I found you.

Brent Daniels:
Awesome.

John Osai:
Yeah. And then I just kept watching what you were doing for a while and watching your podcasts until finally I was like, “Okay. This guy is talking to me. He’s saying what I’m looking for and telling me what I need to do. I got to find a way how to join into that.” So that’s how I got to TTP, was working my way through and then finally seeing that the missing link was in what you were talking about.

Brent Daniels:
And it’s incredible because now you’re on the channel.

John Osai:
[inaudible 00:06:50] yeah.

Brent Daniels:
So everybody out there that’s watching it, that’s the path to progress there. You’re a real inspiration from just sitting back there to taking action now, being on here, celebrating and sharing your success, which is going to be fantastic when we break down this deal because it’s a really unique deal that has a lot of lessons that are baked inside of it. But, you’re an attorney, you’re working attorney hours, you’re doing well. So then you were just like, “Hey, I need to put my money somewhere. I’ll start investing in real estate.” And that’s kind of how you found it or was real estate always kind of in the back of your mind?

John Osai:
Real estate was in the back of my mind. While I was working for Ford another gentleman came up to me and said, “This isn’t the path to retirement.” He said what he did was he came out and found an apartment complex that had 30 people in Phoenix, Arizona and he purchased that 30-plex, 30 unit building. And he says, “I move people in and I move them out in a box.” And I didn’t know what he meant. He just said he would move them in, people on a fixed income, and he would keep them in there and he would never raise their rent. And he just said, he goes, “That’s my contribution. As I bring them in, I never raise their rent and then they can live there as long as they choose.” And he said, “This is how I’m retiring,” and he was just about to retire when I left to go back to law school. And so he kept talking to me about it.
And then I did get involved in the No Money Down, get the binder, get the CDs, and listen to it. So I would listen to it as I was driving down the road. And so I had it on the back of my mind for a lot of years and especially through law school, through the 10 years of practicing. And I didn’t say, right before I became an attorney, I caught Mono so I was sick and I ended up becoming a realtor for a little while and just trying to practice while I was trying to prepare for the bar, it was kind of crazy. But, that’s how I got it.

Brent Daniels:
Well. Just incredible all the different experiences that you’ve had and hats that you’ve worn. And you’ve got a great perspective on understanding one, obviously what is a deal when it comes to real estate and what’s not a deal, but also you can come into it with a mind of somebody that has done fix and flips, that has looked for fix and flips and somebody that has come and bought rentals and looked at rentals and looked at kind of cashflow on all of those assets. So you can really, probably pretty quick when you get an opportunity or a lead coming in, you can kind of put it through the filters because of your experience and really understand what is the highest and best strategy for this property, which is fantastic, which happened with this deal that we’re going to talk about. Incredible. So are you still doing flips, is flipping properties kind of your passion, you love doing that, or is it just part of your real estate kind of life, lifestyle?

John Osai:
I like doing them, but it’s time consuming to be able to get a fix and flip. So that’s why I was looking at the wholesaling side of things because right now in Idaho falls, the market’s pretty hot. And so, if you can help somebody, that’s the way I look at it. You mentioned reading The Go-Giver, so I read The Go-Giver and so that’s the way I choose to look at it. Looking for people to help, they’re in foreclosure and they’re here in my local market. You talked about local markets, I read the book Acres of Diamonds which you mentioned also and I realized that there’s going to be something here, and there’s got to be something here in Idaho Falls.
And so I started doing that and it’s interesting that as I’ve been picking up these properties, I’ve been doing fix and flips so people know me here, we all meet at Lowe’s it seems like on a daily basis. And so they come over and they’re like, “What are you working on now, John?” and I tell them, and they’re like, “I tried to get that. I tried to get that.” And I’m like, “Well, I already have it. You going to buy it from me?” So that’s how it’s been for the past little while. I wanted to do the wholesaling, eventually I’ll want to get back into rentals again. But for right now, I just felt like finding the properties, getting them under contract, and then moving them onto somebody else to do the fix and flips is kind of the area that I wanted to get into. And then eventually getting back in. I just wanted to build up my cash reserves.

Brent Daniels:
Sure. And let me ask you, when you are flipping a property, what do you think, and it doesn’t have to be perfect here, but what do you think the average is from the time that you buy that property to the time that you get your money back and actually get paid on it? Do you have kind of an average amount of days or months that takes?

John Osai:
Yeah. I was doing a lot of it myself, so it was about six months.

Brent Daniels:
Right.

John Osai:
It wasn’t what I was hoping. I was hoping for a 60 to 90 day turnaround and then it ended up being a six month turnaround. One of them actually went two years. [inaudible 00:11:32] that was the worst one.

Brent Daniels:
That gives us great perspective into the, “Why did he decide to get into wholesaling?” Right?

John Osai:
Yeah.

Brent Daniels:
Because it’s faster. It’s just a lot faster. The people that either have much larger budgets, or much larger companies, or a lot of subcontractors, or just a lot of capacity, you can move these deals over to them, get paid, and then they still have enough meat on the bone to be able to do what they need to do which is fantastic, you’re already on to the next one. Because a lot of people I think take for granted that once you have a flip going, it consumes your mind so much.

John Osai:
Yeah.

Brent Daniels:
Oh my gosh, we’re remodeling bathrooms in our cabin and we got to pick out the door handles, and the knobs, and the colors, and the countertops, and the cabinets. All these things, it’s like, “Just do whatever.” I don’t have enough brain power right now to worry about this. And it takes up a lot. And instead of worrying about all these little things about flips, you can just focus on being proactive and sourcing the deal. You can go and find the discounted property. And I’ve always found that being far more profitable and more in tune with my personality. It’s different for everybody but I totally get you. So, let’s break down this deal, John, let’s talk about this. Let’s talk about this one that you just… Well, first of all, how are you getting your deals? How are you generating leads? For everybody that’s just listening for the first time or you just came across this, there’s three ways to get leads in wholesaling real estate or three ways to source these deals.
One is that you market for them, you spend money to have people call you. All right? This is going direct to seller. Two, you wait for referrals from your network, from your sphere of influence, from people that know you, or three, you go out and you be proactive and you earn it by either door knocking or picking up the phone and calling. So, which way did you find this deal?

John Osai:
So, I found the deal by first, after I signed up with yeah, I just signed up for Propstream, I was going through your course, and it told me how to find vacant properties and pre-foreclosures.

Brent Daniels:
Yep.

John Osai:
[inaudible 00:13:42] Propstream. And then I took that and I went right to batch skip tracing.

Brent Daniels:
Yep.

John Osai:
And then I got the phone numbers, but I didn’t get as far as mojo yet. Right after I got that, and I got the phone numbers, I just started calling. I took your script.

Brent Daniels:
Just hand dialing.

John Osai:
Yeah. I just started hand dialing, it was horrible. When I was talking to them, I had just barely looked at your script and I just started to go for it. And so I just started hand dialing. This deal was my fourth call.

Brent Daniels:
Get out of here.

John Osai:
Yeah. It was first day, fourth call. I actually got ahold of the person. Well, I got ahold of his mother and then the father had the power of attorney. And so she said, “Hold on,” and all I did was use your script, I was stumbling through it. “This is John. Is so-and-so there?” And then I asked him if he’s interested in an offer and he’s like, “Maybe.” So I’m looking on your script for maybe and big, long pauses in between, and then I started talking to him about the maybe, just reading through the maybe, and then all of a sudden he turns and says, “Yeah, I’m interested.” So I stop and I switch over to the yes, and followed what you said on yes. And then he asked me if we could meet the next day. Yeah. So-

Brent Daniels:
The crazy thing is John, it’s almost impossible to screw up a truly motivated property owner.

John Osai:
Yeah.

Brent Daniels:
Truly. You just entering their life and just asking them if you could help and all of a sudden, boom, they just open up the flood gates, some of them. Not all of them, I don’t want to give people the wrong impression but sometimes they’re just ready. You caught them at the right time.

John Osai:
Yeah. They had had many many flyers come and they said they had many people that it was mostly just flyers. They said I was the first person that actually called and got through to them. And it was off batch skip trace. And there was about nine numbers it looked like on batch, skip trace, I just dialed each one. And then it was about the fourth, with the fourth number that I got the guy’s mother. And then the father talked to me, we met in the Subway in Walmart and he sat down and he kind of interviewed me, seeing if I was real or not. I had my contract sitting there, I was shaking, seeing if he’s going to do it. And he said, “Do you have a pen?” and he started signing.

Brent Daniels:
That’s one of the best questions that a property owner can ask you, “Do you have a pen?”

John Osai:
Yeah. That was what he said. And so we started signing, I took pictures of his power of attorney, and then we went through and signed the contracts and he said he didn’t want to wait. So he asked me which title company we wanted to use, and he said, “I’ll follow you over there.” So we took the contract over to the title company, they got copies of everything and we started opening up title at that point and we went through that process and I started cleaning it up the property, and try to get it to sell to cash buyers but I hadn’t developed my cash buyer list yet. And all the guys that I was getting, they were offering me less than what I paid for it. And I got it for just paying it off so during that time, it was… I got it for 140 and then I.

Brent Daniels:
Hold on. Don’t reveal yet.

John Osai:
Okay.

Brent Daniels:
So, real quick, we’ll go quick, I want to leave them hanging just a little bit. So did you see the property before you met at Walmart to sign it?

John Osai:
I did.

Brent Daniels:
Okay.

John Osai:
I drove past it but it was-

Brent Daniels:
But not the inside?

John Osai:
Not the inside, no.
No, I did not see the inside. I just drove past it and I peeked in all the windows and looked through it and then somebody had kicked in the door on the basement to the crawl space. So I went down and walked through the basement. And then at that point, I saw the carpets were in decent shape. I went down and looked at the furnace and pulled the filter and looked at it, made sure that it wasn’t all super bad. I looked at the plumbing. Being a flipper, I could see where they had winterized it. And then I saw that there was one crack in the pipe. And that was just where it came up from the main pipe so it was something that I knew that could be fixed really quick.

Brent Daniels:
Sure.

John Osai:
Just a piece of packs. So I got a chance to look underneath it and see all the bones from underneath the house but not actually inside.

Brent Daniels:
Got it.

John Osai:
Yeah.

Brent Daniels:
[inaudible 00:18:03]. So you said that they owed, just real quick, did they owe 140? Because you said 140, they owed about that?

John Osai:
Yeah.

Brent Daniels:
So, how long was the property vacant?

John Osai:
The property was vacant for two years.

Brent Daniels:
So they’ve got $140,000 mortgage payment on that and nobody’s lived there for two years?

John Osai:
That’s correct.

Brent Daniels:
So this is just draining them.

John Osai:
What happened was, I don’t know if the mortgage company didn’t foreclose on it really quick, and then COVID hit. And they actually did try to list it through another realtor they said and they just couldn’t get it sold then. And I don’t know what the reason was and then I found out later that that realtor took the listing agreement but never put it on the MLS.

Brent Daniels:
Oh my gosh.

John Osai:
So it never really got out there. And it sat like that for a year, and then COVID hit and it’s coming on the second year. Yeah. That was kind of how it all kind of-

Brent Daniels:
I always say. People ask, “How do you get these discounted properties? Nobody wants to sell for a discount. Nobody wants to sell for a discount.” How about the people that have vacant properties for two years? Yeah. Let’s say that they’ve been in forbearance during COVID and nobody’s foreclosing on them and they’re not making their payments. Well, guess what? They still have to pay that at some point. It’s still going to be part of the payoff if they sell that property or they’re going to have to catch it up or they’re going to have to restructure the loan or whatever. So this is distressed. They’ve got a vacant property for two years that nobody’s paying them rent and it’s costing them money every single month. So you found them, they’re ready to go, you drive by the property, the guy meets you at Subway at Walmart and you lock up the deal and now you’re giving it out to your buyer. So, how did you get access to it to show your buyer this property? Did he just give you a key for it?

John Osai:
Yeah. Well, no. They said they didn’t have keys so they told me to go ahead and break the lock. So I broke it and then they let me in and they let me do some work on it. I actually had it, I did two ways, I did a purchase and sale and I did a lease option to buy. So I leased it so I could turn on the heat and everything. Heat and gas and everything so I could warm it up to make sure that I didn’t have any leaking pipes or anything.

Brent Daniels:
Sure.

John Osai:
So then I was able to get in there.

Brent Daniels:
Really smart John, that’s incredible. Nobody ever talks about that. Do a little lease with an option to purchase so that you can get into these vacant properties and get the utilities on to show your cash buyers, what is the functionality of this property? What is going to be the rehab and repair costs of this? That is beautiful. I’ve never heard of that, John. That is, wow, I love that. Yeah.

John Osai:
Yeah. And so the nice part is, just people would walk by and they could see that I had my dump trailer out there, that I throwing things away so people would just stop by and ask as well. So, yeah.

Brent Daniels:
So then you get it out to your cash buyers. How many people did you get it out to?

John Osai:
I got it out to about eight people, trying to get it sold, about eight cash buyers. But they all came in with, I’m trying to get it for 140 and they’re offering me 120.

Brent Daniels:
Yeah.

John Osai:
So that was how it started. The foreclosure date was actually on March 11th and so I called and tried to cure the mortgage, that was my next avenue. Was trying to get a hold of the mortgage company and trying to cure it but the attorney there came back and said, “In order to cure it, we’re going to do $5,000 with the paperwork.” That’s what they were going to charge me to cure it.

Brent Daniels:
Wow!

John Osai:
Instead, I’d been flipping for a little while so I had some money. So I went in and I just purchased it and saved myself $5,000. So I bought it and well, the awesome part about buying it was that when I went into closing, one of my old friends was a closer there. She just came up to me and said, “What are you going to do with your extra lot, John?” And I was like, “What are you talking about an extra lot?” This house ended up having an extra, it was built on three building lots, and the house was built centered on two of the lots and there was an extra lot on the west side of it. And it was wide enough for somebody to build a skinny home. So I felt very blessed that my property value instantly went up, put it out to the cash buyers again. And this time, instead of offering me 120, they’re fighting over 215.

Brent Daniels:
Yes. All because of the lot.

John Osai:
And I did some cleanup on it, and I did paint it, and that was the extent of what I did. And I did pay somebody to come through and clean the vents.

Brent Daniels:
Sure. So then you got it for 140, you put it out at 215?

John Osai:
Yeah, 215.

Brent Daniels:
And then what did you end up closing it for and then what did you end up netting on this deal?

John Osai:
So, I did end up closing it for, it was 215, I had other guys that came in and tried to…They told me they were going to give me the 215 offer and the offers came in at 200. But I watched your video, and your video said, “Do not let them beat you up. You need to hold your ground.” And because I was already giving them a good deal.’ When I looked at everything, I cut the lot price in half and I dropped the house price by 10,000 to try to get it moved quickly. And they kept coming in and saying they wanted to pay less and I just held that 215. And finally, I just said, “Take it or leave it.” And so they took it, and then we closed the deal, and all in all, what I had into it, I ended up netting 42,500 and some change.

Brent Daniels:
Yes!

John Osai:
So, yeah. [crosstalk 00:23:47].

Brent Daniels:
That is awesome. 42,000 and some change from your fourth phone call.

John Osai:
Fourth phone call.

Brent Daniels:
Hand dialing. Oh my gosh. What an incredible story. Listen, you’re one call away, right? I’ve been saying that for four years now. You’re one conversation, one quality conversation, one call away from a potential life-changing amount. And listen, you’ve made a lot in your life and everything. But just to encourage everybody that maybe you make that in a salary, or maybe that seems like a ton of money because you’re younger or whatever else, I’m telling you, this is how it happens. This is how it happens. You got to be proactive and you got to have those conversations. If you do that, then all of a sudden you get these opportunities. And I think the important thing to mention here, that John said is, listen, he knew he had a deal. Okay? He knew he had a deal. They’re going to try to bargain with him when he knows that he has a deal?
Listen, he held strong and he knew that he had his deal. It’s like, not that I buy drugs or whatever, but I would assume that you’re not haggling with a drug dealer to lower their price on drugs. You know what I mean? They’re going to sell those drugs anyway, they’re drugs, right? If you’ve got a great deal, you’ve got a great deal, there’s no haggling. This is the price. Take it or leave it. And that’s what you did. And that ended up netting you an extra $15,000 that turned a potentially $27,000 and some change deal into $42,000. And that’s a big difference. And I congratulate you. That’s incredible. So everybody out there, hold your ground when you know you have a deal.

John Osai:
Yeah. The other thing I’d probably tell you that you might want to know is I’ve only spent a few hours in calling but I just committed this week to start doing it. During this week, right after I’m done with this call, I’m going to sign my next deal. Here’s the thing about that one. I’m picking it up for $100,200, a realtor came to me with $170,000 offer already. We’re signing both agreements today.

Brent Daniels:
Wait, wait, wait. So, you’ve called for four hours total?

John Osai:
Yeah, four hours total.

Brent Daniels:
And you’re looking at a potential 110,000. You’re making $25,000 an hour, way more than an attorney.

John Osai:
Yeah. That’s what’s incredible. It’s more money than I’ve ever made even doing anything. And I came in, talked to my wife on Monday and she said, “You just made double what you do on all your flips in half the time doing wholesaling.”

Brent Daniels:
Yep.

John Osai:
And as I said, today, on Monday I made a call, I went out and looked at the property, and then today we’re meeting to lock up the deal. This is another foreclosure guy, he owes 86,000, he owes 22 in medical bills. He asked me if I would just pay this and pay off his medical bills, he needed help. He just went through a nasty divorce, he’s paying child support, and he’s paying spousal support and he’s just, “I just need this garnishment of this medical lien off of me.” And so he’s selling it to me for that. And the realtor came over with a buyer and wants, and just made the offer, “I’ll buy it from you for 170.” So I’m going in, I get the keys tonight and I’m starting to clean it out tomorrow.”

Brent Daniels:
Pumps me up man. It’s exciting. It’s just exciting. This is real life, I love it. So John, how to thank you. Thank you for that breakdown, thank you for giving us what’s going to happen after this podcast. I’m excited about that. So text me once that’s done after we get off. How do people get a hold of you? How do they say congratulations? How do they reach out to you? Maybe they’re an Idaho and they want to meet up and network with you. What’s the best way for people to get a hold of you?

John Osai:
If we give phone numbers out, I can give you my phone number.

Brent Daniels:
Okay. You want to do it.

John Osai:
You can Facebook me, I do have my Facebook account is Osai Law.

Brent Daniels:
That is O-S-A-I if you’re just listening to this. O-S-A-I.

John Osai:
L-A-W.

Brent Daniels:
Love it. Love it. John, thank you so much. What an incredible start. You have just got out of the gates super fast, closed the 42, have the 70 in pocket. There’s some resources that he mentioned, Propstream, You can get that a ttpdata.com, ttpdata.com, check that out. You get to trial that, and it’s a phenomenal tool. Everybody that is serious about real estate investing truly has Propstream. The second one, you pulled vacant and pre-foreclosure lists, that’s so strong and make sure that like John was saying, batchskiptracing.com. Listen guys, there’s a lot of skip tracing companies, they’re all white-labeling the same info, batches, they get it from the best resources, it’s not even close. Definitely use that so you don’t go through so much brain damage of calling a lot of people and not getting connected with anybody.
So, John, thank you so much. You’re absolutely incredible. Everybody out there listening and watching, if you are interested in joining the most proactive group in real estate investing, it is the TTP family, it is the TTP program. Go to wholesalinginc.com/ttp. That’s wholesalinginc.com/ttp, scroll down, check out the testimonials, check out what the program’s about. If it feels good in your gut, sign up for a call. And that’s it. That’s our show, John, you absolutely crushed it. Thank you so much. Text me. Text me and let me know how that deal goes, that you got that locked up and sold and we can celebrate that. And for everybody out there, as always, I encourage you to talk to people. Till next time, love you guys. See you.

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