Posted on: January 14, 2022
WI 863 | First Deal Lesson

 

If you want to start making money in real estate quickly, it’s time to generate and master the formula to get there! Closing a wholesale deal for the first time is a significant accomplishment for any aspiring investor since the wholesale process is unlike more traditional types of real estate affairs. The only thing that you need to accomplish is how you get there.

Not sure how to get started? This episode will inspire you to wholesale in real estate and update you on everything you need to know to ensure that your first wholesale deal runs smoothly.

First Deal Case Study – The Most Important Lesson Learned by this Aspiring Wholesaler

Episode Transcription

First, take action. Every single day, move the needle a little closer to your goal. We call them small wins in the Rhino Tribe. Every day we get small wins. Ultimately, we want to work on our list of landowners and mail that list. We want to answer the phone or have PATLive answer the phone, check the email, communicate with the seller, and send our buyer out there to look at it after we get it under contract. It’s all these small little wins adding up.

What’s up, Rhino Nation? Do you have pride in your work as a professional and American but feel you lack control or feel limited in your time? If you invest in land, you own land, land that is American land, you can experience freedom, freedom of time, freedom of finances, and freedom of geography. Join me on my show where each episode, we learn how to invest in land and make money with American land as a real estate investor so you can earn the freedom you want and deserve.

In this episode, I’ve got an amazing guest. This guy jumped in with both feet. There was no dipping your toe in the water. We gave him instructions, he took the action, is getting the result and I’m sure a ton of education from it. Before I let the cat out of the bag, what I love about this guest is he’s crushing it. He’s the most humble dude I’ve ever met. He’s always posting cool, amazing, inspirational quotes on Facebook that fire me up and he’s also a valuable part of our Land Sharks community in the Rhino Tribe. Without further ado, how are you, Kenny?

I’m doing good, Brent. I appreciate you for having me on the podcast.

My pleasure. I’ve been looking forward to this for a long time. I was waiting for one of your massive deals to have closed. It may have closed, it might be in escrow still, but I couldn’t wait any longer, so I sent you a text message, “Let’s do a podcast.” Tell us a little bit about yourself, a little bit of what you did before. How are you pulling off this amazing thing that you’re doing? I want to know all about you.

I’ve been trying to get into real estate since 2018. In late December 2017, I was introduced to real estate and wholesaling and stuff like that. In that whole process, I jumped in and was trying to make a killing in real estate. That didn’t work out the way I wanted to, so I figured I might as well go ahead and sharpen some of the skills that I got. That’s when I started getting jobs. I was working at a restaurant as a server. When I figured that game out, that’s when I wanted to go ahead and be a salesman.

Those jobs helped me polish my skills because, in real estate, there’s a lot of selling and a lot of sales skills. Getting a good understanding of that will be beneficial to me in the long run. I’m over here in the Maryland area. Real estate is pretty hot over here, but it’s not as hot as other areas that people always know, like New York, Texas, and Florida. Those are hot markets.

One thing I heard you say that stood out to me, and you said it a couple of times, was serving. You are a server. Are you still serving? Are you still working in the restaurant industry?

No, I’m not.

What I love about that is that word serving. Would you say that you’re still serving sellers and buyers?

Sometimes, things won’t work out the way you want to, especially in the real estate industry.

Yeah, all the time. At the end of the day, we make money, but I have deals where the sellers told me they had the property for so long and didn’t know what to do with it. They were glad that I was able to help them sell the property. It’s those little gestures that make me happy about doing what I do.

I’m understanding more why you’ve been so successful at this because I feel everyone should work commission-only jobs for a while. Everyone should serve in the restaurant industry for a little while to understand what it’s like to work for tips and what it’s to deal with humans, emotions, aggravations, and hangry. A word my wife coined for me was hangry. I don’t let my wife get hungry because I don’t want to get in trouble or get yelled at. You’re dealing with people sometimes at the worst times in their lives when they’re hangry. Would you say that you were able to take that service industry, your restaurant industry to the real estate market, or the actual real estate business that you’ve created?

When we think of real estate, we see a lot of people cashing checks and stuff like that online and stuff. Honestly, it takes a lot to be able to get a deal done and there’s a lot of managing that has to happen. Especially if you’re a wholesaler, you have to manage the bars and the sellers. If things are taking a little bit longer than usual, you have to calmly explain to them like, “This and that.”

“Why are my drinks taking so long?”

It’s the same thing where you have to calm everybody down and those are the traits that I learned while I was a server and while I was being a salesman. People’s drinks are taking too long, the food comes out wrong, the chef cooks it undone, it’s little stuff like that where they can blame you easily and they can get mad. You can get mad with them. At the end of the day, you’re going with the thought that it’s an honest mistake and you’re going to be able to make everything right.

What did that first deal look like? I want to hear about that, the deal progression, and what you’re doing.

Honestly, I always try to wholesale houses. That was always the thing. I thought that was the only thing. I was cold calling for that whole year. I called a seller and I was like, “Is your house available for sale? Would you be interested in selling it?” He said, “No, but I have this other property right here that I’ll be interested in getting rid of.” When he said get rid of it, I was like, “Get rid of it? That means he must not want it.” I asked for the address and stuff like that. I asked a couple of questions. I was thinking it was the house, but it was not a house. It was a flat piece of land. I was like, “I don’t know too much about land.” He was like, “If you want it, I’m looking to sell it. I need to sell it.”

He was talking about how he had a couple of issues going on around his life that he needed the money. I was like, “I don’t know about land.” I had to get a good discount and I was asking him, “What are you looking for? What do you want to get for it? I don’t want to make an offer that’s going to insult you or anything like that.” He said, “Make me an offer.” I said, “Alright.” I went and did some research. I don’t even know what research I was doing because I didn’t know what to look for. All I know is that I looked at the assessor’s page in the county and it said the value was assessed at this price. I was like, “There’s no way this land is worth this much.” I went off that.

WI 863 | First Deal Lesson

First Deal Lesson: It takes a lot to be able to get a deal done. There’s a lot of managing that has to happen.

 

I made my offer low. It was worth $80,000 and I came to him at $30,000 or $33,000 or something like that. I made that offer and I was like, “I don’t even know if this is a good offer, but I’m wanting to see if I can make work at this price.” He was like, “I have to think about it.” I was like, “Let me know. At the end of the day, I want to work with you. We want to do business.” He calls me back the next day and he’s like, “Let’s do it. Let’s move at that price.” I was scared. I was like, “What would I do now?”

“What do I do now? I can’t believe he accepted that offer at $0.41 on the dollar.” It’s worth $80,000 and you offered $33,000. You got a piece of American land. Everyone wants to own land less than half off. Imagine, you walk into Walmart and they’re selling a 72-inch TV for $40,000 or $0.60 off, 60% off the retail price. Who’s not going to pull that trigger? You might not even want another TV. You buy it. This land is even better.

I had no idea what to do, so I had a couple of real estate contracts, so I figured, “I don’t know if this is the price but let me see if I could protect myself in a way where I can be able to take control of the deal and at least see if it makes work.” My real estate contract had an escape clause where I had 30 days of due diligence, close in 60 days and stuff like that. He signed it and I didn’t even know how to advertise it.

I put it on random pages like OfferUp. I placed it on Craigslist and Facebook Marketplace. I placed them on all those three channels because they were the buy-and-sell channels I knew of. I placed it on those channels and I was getting some inquiries, mainly through Facebook Marketplace. I was getting inquiries and people were interested in buying, but people were offering me lower than what I got it for. This was my first deal, so I didn’t know. I thought it should only take 30 to 45 days to close. It got to the 30-day limit and I was like, “I don’t have a buyer yet,” but I had a couple of offers already.

You told the seller, “I don’t have the buyers yet.” You were transparent with them. You didn’t hide anything from them.

I didn’t hide anything. I went back to him and said, “I thought we could be able to move at $33,000.” I was going off the feedback that buyers were telling me, “There are a couple of issues with the land. You need about this much to build so nobody can do anything too much with this property. They want to buy to hold it.” I said, “My partner and I want it to be at $25,000.” My partner told me that he wanted $25,000. I told him, “If we can make it work between you and me around $20,000 or $23,000, then I’d be happy with doing a deal at that.” He said, “That’s a lot lower than I wanted to. The offer you gave me, I mentally spent it.” I was like, “I understand if you can’t do it. I’m not going to pressure you to not do it.”

You showed empathy. You understood. You’re like, “I can understand.”

I told him, “Think about it.” He was like, “I’m going to think about it because I could give it to my son.” I was like, “You told me your son doesn’t want it. Think about it.” I left it at that and I was at the mall when I said that. When I got home from the mall, I looked at the email, and he was like, “Let’s do it at $25,000.” I changed the contract. I put out $25,000. I go to my buyer and I’m like, “The buyer can’t do $25,000. Let’s do $30,000.” He said, “I can’t do $30,000.” He was willing to do $27,500. I was like, “If you can do $27,500, you have to take care of the closing costs, and we’ll be good.” He was like, “That’s fine.”

He was a retail buyer, so he was nervous about the whole thing. I had to go out there and meet him in person at the property and present myself in a way where he would trust me to at least do business with me. I leveraged the title company. I told him, “If you don’t trust me, you have to trust the title company because they do this for a living. If you don’t want to give me your earnest money deposit or anything like that, go put out the title company and go give it to them. They’ll hold it and we wait to close.” That’s what he did and that’s how I ended up closing. I made $2,500 on that deal.

You won’t know how to research to get started in the wholesaling business. But you just have to get started.

You did it. You kept walking. I want to point out some stuff that you recognized from your seller. You heard motivation. I kept hearing motivation, “I’ve got to get rid of it. It’s a flat piece of land.” I heard you say that, so it was intriguing to you because I know where you’re at. It’s not always flat over there. “I need to sell it,” your seller said that. He had money issues. He needs money. “What do you want to get rid of it for?” That’s what you asked. I love that you asked that question.

You were dancing the dance with him and 99 out of 100 people are not going to sell their land for a crazy massive discount. This guy or guys like this who are motivated, have a challenge, have a monkey on their back or they need to get rid of this problem and he had an issue. You solved this problem and he was motivated. That’s awesome. The way you said, “It was only $2,500,” but that means the world for some people. An extra $2,500 around Christmas time is phenomenal.

Honestly, I said it that way and it’s because I did a lot more deals at a higher price, but that deal was the best deal. I cried walking out of the title company because it took so long. I was like, “This is the best money I’ve ever made.”

You helped that guy. You helped the buyer. It’s a win-win-win. You helped your seller. You helped yourself because you made $2,500 and you helped your buyer. Ultimately the best deal out of integrity. You didn’t talk the guy into giving his land away. He talked himself into it, so alright. Now, let’s talk more about what you’ve got.

You got a system going on. You’ve got a structure for this. Let’s talk about that. I want to get into your favorite deal. I shouldn’t say your favorite deal because that was your favorite deal. Your systems. What does Kenny’s real estate look like? I love that’s what you got your name as Kenny’s Real Estate on your Zoom. What does Kenny’s real estate business look like now?

I was doing a lot of cold calling before, but I switched over to direct mail. It was a little bit more hands-off. At least what I was getting in direct mail were a lot more quality leads, so I stuck with the direct mail channel. Before, I was sending mail and answering the calls myself, asking them the questions and all that. I was able to find an answering service that works 24/7. PATLive is what I’m using. I’ll send them mail and I’ll put a number. When customers call that number, it goes to the answering service and they answer the phone call.

I give them a list of questions that I want them to ask real quick and they ask those questions. They delivered pretty much an email format to my email. From that point, I take the information. I have a CRM. You’re the one that put me on the CRM, Pipedrive. I put all the information in that CRM. When I’m doing research, I’m sending an offer to the house or sending it via email or I’m calling them to make the offer. That’s pretty much how I got my system placed.

For readers, CRM is where your leads are going. That way, you can follow up, you can track them, and you can know the next time you need to call them to check in and see if they’re willing to take that offer, that anchor price you gave them. Let’s talk about the big juicy deals now that you’re doing. I want to hear about one of those.

I’m doing a couple of big deals. One of them, I’m at least aiming to see if I can get it. The second deal has also taken the longest time to this deal. It’s probably 100 days or so. If that deal closes, I should be able to make $25,000 on that deal. Let’s talk about a deal that I’ve already closed. There’s this one deal that I’ve closed. It was in North Carolina.

WI 863 | First Deal Lesson

First Deal Lesson: Direct mail is more hands-off where you get a lot more quality leads.

 

It’s not even in your market.

I called the seller because I had called about the land that she had in Maryland. She said, “We are looking to sell that piece of land, but we have this other land in North Carolina and we’re willing to get rid of it.” I said, “Get rid of it? Why? What’s wrong with the property?” She says, “It has a house that’s been torn down. It hasn’t been taken care of for the last couple of years or something like that.”

I was like, “You guys don’t want to live there no more?” She’s like, “No, so we’re willing to sell that.” I was like, “It sounds pretty decent because it had a house already on there.” I looked at it like it was just land because that house pretty much needed to get torn down. She was like, “We’re willing to sell that one.” I said, “I’m willing to take a look at it. It’s not in my market, but I can do some research.”

I did some research on it. I made her an offer because the property was worth maybe $35,000 and I made the offer. I said, “In its condition, it’s worth maybe $10,000.” I made the offer of $10,000. I said, “This is what it’s worth. I’m still going to have my guy go out there, take a look at it, inspect the property, and all of that.” One of my buyers went out there and checked out the property. He said it was in horrible shape.

I went back to the seller and I said, “I thought we could make work at $10,000. Honestly, we probably have to get it at a lower price in the shape that it is. If that’s something that you guys aren’t willing to do, then I completely understand.” I told them my offer. I said, “We can be at $3,500 or something like that.” I made that offer and I said, “This is where we need to be at.” They thought about it, her and her husband. She was like, “Let’s do it. We don’t even want to deal with that property anymore.” I was shocked. She accepted it and I was like, “Cool.”

I went back to my buyer. I had advertised before I had it on the market for $20,000. He was like, “I can do probably $10,000 on it.” He did it for $10,000, so we put on the contract for $10,000 and sold it. It was a total of $10,500 and he took care of the closing costs. I made about $7,500 on that deal, but it was good because it was not even in my market. I didn’t know anybody in that market. I didn’t have any buyers in that market. I didn’t have any title companies in that market.

We’re going to get into it but first, the victory bell. What I heard the entire time was extreme resourcefulness. Did you have all the answers when you called that lady asking her if her land was for sale in Baltimore and she had some land that was for sale in North Carolina? No. You figured it out as you went. We have the answers enough to get us through right now and tomorrow’s answers will come tomorrow.

What I love about that is you also sent your buyers. Who else better go than your buyer, the ones going to pay the money or the local attorney who can do business there? I kept saying resourcefulness. From the time that you spoke with that woman the first time to that $7,500 went into your bank account, how long did that entire process take you?

That deal was the quickest deal I’ve probably done. That deal took about 30 days overall. I was surprised because even the attorney told me that it usually doesn’t take that long. I was like, “Why is this one any different?” He said, “I don’t know. We worked faster than usual at that period of time.” They probably also weren’t busy too. I was probably one of the clients that they had that they were like, “Let’s do this.”

At the end of the day, we make money, but there are certain deals that you’re just too happy to help sellers and make a difference in their world.

How long have you been doing land? How many months or years?

I started in October 2020. It’s been over a year now and had some changes.

How many deals would you say have you done already?

I have it written up. I haven’t updated with my past two, so I will say maybe 12 or 13 deals so far.

It’s like about a deal a month. You jumped in. For anybody reading this, Kenny has the resourcefulness and he takes action. If you can give any advice to our readers, to the Rhino Nation, what would that be? I’m going to ask you a second question. If you can give any advice to Kenny in mid-2017, what would that be as well? It’s a two-part question. What would it be to the readers and what would it be to Kenny in mid-2017 when you’re getting that acorn, the seed that this has grown into?

There’s a certain thing that comes with taking action. There’s an action where when you’re trying to accomplish a goal, you want the goal to happen as quickly as possible, but that doesn’t always happen. The goal doesn’t always happen. I tell my brother this too. I tell him, “As long as you continue to take action, it doesn’t matter if it’s one thing that day or the other thing that day, you have to keep moving the needle closer to your goal. Don’t worry about how long it’s taken. Keep taking action on it.”

Tweak and improve what you can. If you do that, over time, things are going to happen. You’re never going to take action and not get any results. You’re going to get a result and it may not be the result you’re looking for, but it’s the result that needs to happen for you to be able to move to the next level of you being able to better accomplish that particular goal that you’re trying to accomplish.

To my 2017 self, I would have told him not to look at any other types of fields because I got so distracted. In 2017 and 2018, I was doing real estate. Real estate wasn’t working as fast as I wanted it to, so I looked at other industries. I will see other people doing well in eCommerce and I’ll see people doing well in these other fields. I’m like, “Maybe I should do that instead. Maybe that will give me results faster.”

At the end of the day, that held me back a little bit because I stopped doing the real estate thing and instead of putting money in the real estate thing, I’ll put money in these other top business ventures that I’ll try to start. That slowed me down. If I kept on putting money towards real estate investing in myself, I would have gotten my deal faster.

WI 863 | First Deal Lesson

First Deal Lesson: CRM is a great tool because you will know where your leads are going. So you can follow up, track them, and know the next time you need to call them to see if they like your offer.

 

Stay focused on one specific avenue, laser vision focus. I always use this example. We put those blinders on the horses when they’re pulling those buggies because we don’t want them to see anything else except for the road in front of them where you want them to go. We’ve got people on that buggy. This giant horse, this massive horsepower, if it sees something on the side of the road or whatever that scares him, he can get off course because of the shiny object or whatever and kills these people. There are reasons why we have lasers and these lasers cut through massive chunks of steel. It’s because it’s extremely focused. Those are profound words.

First, take action. Every single day, move the needle a little closer to your goal. We call them small wins in the Rhino Tribe. Every day we get small wins. Ultimately, we want to work on our list of landowners and we want to mail that list. We want to answer the phone or have PATLive answer the phone, check the email, communicate with the seller, and send our buyer out there to look at it after we get it under contract. It’s all these small little wins adding up. I love it, Kenny. Is there anything else? Any last parting words you want to share?

It gets tough. It’s a simple concept to understand, but implementing it is hard. It’s tough to implement things and take action. Especially when you’re down, you don’t feel it or maybe you’re having a bad day. It’s hard to stay motivated and it’s hard to keep moving forward. Surround yourself with people who are in that same field. Surround yourself with people who are trying to accomplish the same thing. That will keep you on track. That’s all I surround myself with. Before, my family didn’t understand what I was trying to do, but that’s why I kept going to network meetings because I wanted to stay surrounded by those in the space that I was in.

I’m hearing that you are surrounding yourself with people doing deals, doing land, and winning. The Bible even talks about it. IF you sleep with dogs, you wake up and you’re going to have fleas. Don’t sleep with dogs. Don’t hang around people with the dog mentality, the negativity and we can’t choose our family, but we could choose the people we hang around with. You might say, “Brent, I don’t know anybody rich. I don’t know anybody that’s positive.” There are libraries filled with books that you can check out for free.

There are these podcasts. In this show, all we’re doing is talking about wins that our students like Kenny are having. I had no clue how to surround myself with rich people for a while there because I wanted to be rich one day. I wanted to own all this land and real estate, but I didn’t know these people, so I started listening to podcasts like this and I started taking courses like what we offer at Wholesaling Inc.

I started surrounding myself with the coaches and that’s how you surround yourself with higher quality people, but it starts with the meetups. It starts with the books, the biographies, the libraries, the audibles, and the right podcasts. Stop filling your mind with garbage. That’s another thing. If you’re watching Netflix, if it’s not a documentary, or if it’s Hulu or whatever, turn that stuff off.

Kenny, thank you so much for being a go-giver and sharing all your wisdom and what you’ve accomplished in such a short amount of time. I’m super excited to see what you do in the next months with this. Rhino Nation, here you have it. If you’re looking to get started in land or real estate investing, head on over to WholesalingInc.com/land. Schedule a call. We’d love to see what your goals are in real estate. If we feel we’re a great fit, I’d be honored to coach you, Kenny.

 

Important Links:

 

About Brent Bowers

863Brent Bowers, is an investor and coach with a focus on buying and selling vacant land. As an Army Officer with over 8 years of service, Brent was spending a great deal of time away from his family, and he knew he needed to make some changes in order to be more present with his wife and children. In a short period of time, Brent was able to expand his business, hire a team, and (most importantly) spend quality time with his family while still working hard and helping others.

While Brent invests in many different types of real estate, his favorite investment strategy deals with buying and selling vacant land, and he enjoys sharing his expertise in this area with his coaching clients. Brent chooses to live his life based on Bob Burg’s quote, “Your influence is determined by how abundantly you place other people’s interests first.” He is passionate about helping other people find success in real estate investing, particularly in land investments.

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