Posted on: December 28, 2021
WI 850 | Wholesaling Process

 

Real estate wholesaling doesn’t necessarily mean that you sell a dozen properties at lower prices. It’s a whole different kettle of fish.

The goal in real estate wholesaling is to go out there, generate leads, pick up the phone and sell homes to an interested party before the contract with the original homeowner closes. But the real question lies in how you can make a profitable income out of it?

Real estate wholesaling may sound complicated, but this episode will simplify it for you to understand. Let’s find out as we mark our way from A to Z and give you firsthand info on how you can build up your business, understand baits, and get that dazzling paycheck that you deserve!

Wholesaling A to Z – The 17 Steps of the Real Estate Wholesaling Process – Part 1

Episode Transcription

I want you to put yourself in a position of a fishing analogy. If you’ve ever fished, you’ve got your pole, a bait, and you go out there trying to find that perfect spot where you can find the most fish. You’re trying to find where you can cast the line out there and get as many results as possible and hopefully big results. Let’s say you wanted to start a fishing company, and I’m going to put this in parallel to our wholesaling business and real estate investing in general because it plays here. First, you’re out there and have to trade time for money.

If you don’t have the funds to be able to get this ball rolling, understand all the processes, where the biggest fish are biting, and where you can be the most successful, so you’re trying a lot of different things yourself, and you’re trading time for money. This feels like your 9:00 to 5:00 job in the beginning. It feels like, “I want to be an entrepreneur. I don’t want to trade time for money.” That is awesome. That is what’s different about your brain than anybody else that doesn’t want to be an entrepreneur. That is the seed that you don’t want to say keep trading time for money. That is an absolute fact.

What do you do? You go out there and start fishing because you don’t have a huge budget. You go out there and start making calls. You start door-knocking, sending out postcards, and putting out bandit signs. You start doing whatever you can to see where the fish are biting and where you can find opportunities to feed your family. All of a sudden, you start finding those spots and building momentum based on your efforts, having those quality conversations, going out there on the appointments, and solving the problems of the people in your community.

You’re the one out there, fishing and finding and reeling in these fish and doing all the hard work. All of a sudden, you build up enough success. You know where the fish are and can consistently get it. This is when your business starts growing. The big mistake a lot of people make early on is trying to grow a business before they’ve got enough income before they know the sweet spots, where they should be fishing and bringing in what is the bait that’s going to bring in these opportunities. You don’t know that yet. You jump in and start hiring people to start doing the fishing for you, and they have less quality bait and don’t know where the fish are.

Go out there, start making calls, knock on doors, and send postcards.

That’s the point of putting in the work early in your wholesaling business. That’s the first 1,000 conversations that you have with distressed property owners yourself. You need to take pride in that. I am telling you this from personal experience and experience from the top wholesalers and real estate investors around the country that I’ve spoken to, squat up, and best friends with. We all look back on that time, grind, hustle, and fishing, where we’re standing out there in the cold by ourselves with our fishing line, looking for those fish with nostalgia.

We look at that with respect, as earning it, and the pressure that created the diamond. Don’t skip that step over the next twelve months if you’re getting started in this or getting that momentum back into your business. You need to put in the work and have a minimum of 1,000 conversations. You’re going to trade time for money in the beginning, but then you’re going to build this thing out. I’m going to go over the first 8 steps in the wholesale deal, and next is going to be the last 9 steps in the wholesale deal. It’s going to be complete, and you’re going to see the full process.

This full process is where you plug in different roles as you grow your business. In the beginning, it’s you, and it should be you. You should find those spots where the fish are, understand what bait works the best, and understand what you need to do to get bigger fish, deals, and opportunities because it is the foundation of growing an incredible business.

Number one, don’t trade time for money. In the beginning, you have to. You have to earn the right not to trade time for money. You need to build out a consistent, predictable, and duplicatable system. I don’t know if that’s a word. Number two is to make money work for you. Once you start getting it in, that’s when you start investing. That’s when money starts multiplying and working. That’s that passive income, not earned income, or the amount of value you provide to the marketplace equals your earned income. That’s a different thing.

WI 850 | Wholesaling Process

Wholesaling Process: You need to put in the work and have a minimum of a thousand conversations.

 

This is when you get out of that hamster wheel of having to always constantly put value into your marketplace, community, and business. This thing is running it as a machine, and you make your money work for you through buying assets and building up your business. The third one is to increase your value to the world. You’ve always got to continuously do that because the world is changing and evolving.

New people, situations, and economies are coming into the world every single day, so we always have to increase our value to the world. This is step-by-step. I want to go through this because this will break down every step in a wholesale transaction. This is important to go through so that you know all the trading time for the money part. Once you start building that business, this is where you start plugging in different roles. Your acquisition manager, disposition manager, lead manager, all of these people and roles fit into this.

Find A List

Number one is you’ve got to find a list to target. That’s it. If we don’t have a huge marketing budget for this business, we have to be proactive when we’re starting out. We have to go after properties that are most likely that we can go and solve the problem of that seller. What does that mean? That means that they’re distressed. These properties are run down. They need a lot of love. These are all the lists that we pull.

We look for those distressed property lists, the tired landlord list, the pre-foreclosures, the probates, the inherited list, and all of these different things. Driving for dollars is huge here. First, we got to find the list to target. You can ask anybody this. There are certain parts of the ocean where you can’t fish. There’s no fish there. It’s only in certain parts of the world that there are fish. You have to target the 6% to 10% of the market in distress. That’s what we’re going after. That is finding the list of the target.

Always increase your value to the world.

Make Contact With Your Leads

Number two, you have to make contact with them. At some point in your business, when you start doing marketing, have a marketing budget, and start to get internet leads, bandit side leads, direct mail leads, referrals, or whatever else, you have to make contact and have a quality conversation with that property owner. What we do is start building the list and then start skipping down, doing all this due diligence, and start figuring out all these things.

Stop. Don’t do any due diligence on any properties until you have a conversation with the property owner. It’s going to save you so much time and effort. Make contact with that property owner and have a quality conversation. The quality conversation comes down to pre-qualifying that property owner. If you’ve never seen me before, there are four pillars of pre-qualifying every single property owner every single time. Those are the condition of the property, their timeline to sell that property, their motivation to sell that property or what’s their problem, and their price.

Those are the four things that we need to do. What we do is we get so excited, “We had a conversation with a property owner, and they were nice to us. This is so great. I’m going to make so much. This is going to be so incredible. This is going well. My real estate business is off and running. I had a good conversation,” but you don’t pre-qualify, and he realized that they want above retail price for their property that’s run down, or they don’t want to sell it for a long time, or they’re bored and want somebody to come over and chat with them about real estate. They’re not interested in selling their property. We have to pre-qualify every single time.

Do Your Due Diligence

This is when you do your due diligence. This is when you find out that big hurdle, when we’re getting started of, “Is this a deal or not a deal?” This is due diligence and learning the ARV, the After Repair Value of the property. This is figuring out the MAO, the Max Allowable Offer, that you can give them and still make the profit you’re looking to make on these deals. Make sure that the person you’re speaking to is the actual owner of the title. That is so important. It sounds crazy. Sometimes we have conversations with people that go well, and they don’t even own the property. They’re the caretakers of the property or caretakers of the people that own the property.

WI 850 | Wholesaling Process

Wholesaling Process: You will not lose deals because of excess follow-up, but you will lose deals for not following up enough in the right way.

 

Make sure that you’re speaking to the decision-makers on title when you’re doing your due diligence. Your efforts, that time you’re trading for money in the beginning as you’re growing your business is critical. I don’t want you to do due diligence on properties that are across the street, and you’re hoping that you can talk to them at some point. Don’t do that. You’re getting creative avoidance. You feel like you’re working and polishing or building your skills, but in essence, you’re not doing the actual thing that’s going to build it by making contact with that property owner.

Lead Follow-Up

Next is lead follow-up. You got to follow up with these leads. You’re not going to talk to somebody one time, and they’re going to be like, “Here’s the price that I want,” and you’re like, “Great,” and you signed it up. This takes time. You need to constantly be following up and staying in front of them. Where acquisition managers start taking over is lead follow-up. Make sure that you’re in there and doing it. The secret to lead follow-up is to do it. You’re not going to lose deals because of the excess follow-up. You’re going to lose deals because you’re not following up enough. This is a weird little hurdle and a challenge for a lot of people that constantly do their lead follow-up. They love hunting and fishing, and they don’t like the follow-up.

Offer Your Presentation

Make sure this is a critical part. Most of your deals are going to come because of your efforts in the lead follow-up. Next is your offer presentation. This is where you’re going on the appointment and presenting your offer. You’re going out there, seeing the property, and meeting with them. Maybe it’s virtually or over the phone, but this is where you’re putting together your offer presentation. When you have them pre-qualified, know their timeline, and when they’re ready to make that decision now, you do your offer presentation. If you do it too early, you get leveraged. If you do it too late, you get beat out. The timing of your offer presentation is critical.

Contract Acceptance

The last one is the contract acceptance. This is when everybody gets excited. This is when somebody finds somebody committed to doing business with you. It’s so incredibly exciting, “I’ve got the opportunity to do something special here.” Those are the first seven steps of the wholesale process that you need to look at and understand this whole process here. Do you have your list? Are you finding ways to make contact with them? Are you qualifying them? Are you doing the due diligence? Are you doing your lead follow-up offer presentation and contract acceptance? There you go. Build up your business. In the beginning, you were going to trade time for money.

 

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About Brent Daniels

Brent Daniels is a multi-million dollar wholesaler in Phoenix, Arizona… and the creator of “Talk To People” — a simple, low cost, and incredibly effective telephone marketing program…

Also known as “TTP”… it helps wholesalers do more, bigger, and more profitable deals by replacing traditional paid advertising (postcards, yellow letters, bandit signs, and PPC) with being proactive and taking action every single day!

Brent has personally coached over 1,000 wholesalers enrolled in his “Cold Calling Mastery” training, and helped 10,000’s of others who listen to him host the Wholesaling Inc. podcast, watch his YouTube channel, and attend his live events…

A natural leader, Brent combines his passion for helping others with his high energy, “don’t-wait-around-for-business” attitude to help you CRUSH your wholesaling goals as quickly and easily as possible!

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