Posted on: March 02, 2022
WI 898 | Dispositions Manager

 

If you’ve just entered the world of real estate, then you might be confused about how dispositions work. Unsure about what it means or how they apply to you? Then today’s episode is the right fit!

This masterclass will help you better understand the disposition process. Letting you see through the lens of a disposition manager and what it means to have this role in line. Learn how to market properties, build rapport with your buyers, negotiate prices, and go beyond your network with insights from our special guest!

Dispositions Masterclass – Understanding the Critical Role of a Dispositions Manager

If you’ve just entered the world of real estate, then you might be confused about how dispositions work. Unsure about what it means or how they apply to you? Then today’s episode is the right fit!

Episode transcription

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In this episode, I’ve got something interesting I wanted to dive into. On the show, I pulled on our disposition manager, Christa, who’s been working remotely for years in her actual role. We want to explore what does the dispositions role looks like? What’s involved in the process? How is that affected by radio leads or leads in general?

As they’re coming in through the pipeline, what has she seen in her experience? Where did she need to pivot and pivot to or the things that she’s learned in general? I think it’s jam-packed with a lot of info. I’m excited to deep dive into this. We’ll go ahead and roll over and have Christa do a soft intro of who Christa is then explain the very basics again of what is dispositions and what’s involved on that side. Christa, if you want to introduce yourself.

I’m Christa and I am the director of dispositions for our company. For our company dispositions, once we take in a contract, we have a signed contract. It’s been turned over to title and we’re ready to market. That entails deciding on the price, doing the marketing, choosing the pictures, sending it out to our buyer’s list, arranging a showing, as well as vetting buyers and eventually accepting an offer and ending the sale with an assignment contract. It covers a full range for our company. I step in if there’s a dispute between the seller and us to facilitate that or make sure we’re moving from point A to point B to get it closed out and move on to the next project.

How is that tracked in terms of every single step?

Luckily, we have an amazing team. We meet and we talk about every property we have in motion, where our problems are, where I need to step in and what we’re going to do to problem solve to get these properties sold and closed. It’s a team effort. I’m always trying to push us to the finish line to get paid because we all know we want to get paid. If you keep track of it, everybody knows their role.

We have a system of the acquisition managers turn in the contract and who they copy on that. Everybody knows a new contract is in place. The people who work on title work with our title companies and reach out to the seller to make sure we have all the information correct as well as start gathering things for the title. We’re all there every step of the way. We have teamwork. We know where there’s a problem what we need to do to solve that problem and keep moving forward.

Is there a common problem that usually comes up? You mentioned it a couple of times. The team effort helps and sometimes people may or may not have team members with them. They are maybe trying to sort this by themselves or at least starting this process for the first time. They’re new to wholesaling in general. Are there any common problems that usually come up? If so, what does that look like? How would that affect the timing of them getting paid on an actual property?

We’re not just in business, but we want to do good business.

From start to finish, sellers sometimes have problems. We want to have a great experience with our sellers. They’ll speak kindly about us. Refer their friends and family because there’s nothing like getting a referral. Someone said, “These people helped me out with my house and you should talk to them too. They can help you out. We want a great experience for them.” Unfortunately, sellers sometimes are what bogs us down. Maybe it’s an inheritance issue. Maybe they didn’t probate a will. We’ll steer them in the right direction. We never give out tax or legal advice but we say, “You should speak to a lawyer. It’s something that a lawyer is going to have to sort out for you.”

Sometimes, especially in this economy, people want to sell and they start looking around and realize they may not have a place to go or they may have tenants in place that we need to negotiate with and contact. Every property is unique and has its own set of problems because, honestly, people wouldn’t be selling for cash if they could put their property on the MLS. They want quick, want help and usually some of them are under distress. We want to help them with that.

What I’m curious about exploring is what your role looks like or what disposition looks like? Especially doing it remotely because you’ve been in this role as a disposition manager for a few years working remotely. How does that affect this entire process? As people again are like looking into this process or potentially having to be responsible for this as well, is there any difference? What does that look like?

We have great teamwork. Everyone works virtually. Whenever you’re not in an office, communication is key. I can’t expect anyone to read my mind. It’s updates. We use Slack, WhatsApp. “I have an interested buyer for property A. We’re not getting much interest on property B.” Make sure everybody knows where we are in the process so we can work together but someone doing it by themselves. It’s still communication. Communicate with your seller. Communicate with your buyers.

You can’t sell what you can’t show. You need to keep that flow of communication up. Communicate with the title. How can we move this property forward to get it closed? Without great communication, it doesn’t work remotely. If someone is not able to convey their needs and their status either to the team or to other people like title companies, sellers, buyers then it’s not going to work. This isn’t someplace where we’re sitting face to face.

We always have to remember that they can’t see our body language. If you’re having a bad day, it doesn’t matter. You still need to communicate to your buyer, your seller and the title company. You need to be polite. You need to be business-like because you’re the face of the company that’s talking to them.

Branding comes into play when people are thinking about marketing on the front end to their sellers is like, “Here’s how I want to best position myself.” I want to present my stuff as professional and so they trust me with potentially selling their home to me but I do believe that some people may forget that even on the back end as they are dispositioning properties. It’s the same concept. You still want to be very careful about the way you’re presenting yourself. People should be able to know that they can trust you and that you are going to be professional. That is major especially if you’re doing it virtually or remotely. Whatever word you want to throw in there is that communication piece. I agree. I’d imagine that a lot can be lost due to poor communication or anything around that.

You also need to build a rapport with your buyers and sellers, especially when you’re remote. Many of our sellers are older. They’re downsizing or for whatever reason, they’re selling their home and they’re old school. Without being able to meet face to face since we do everything virtually, every step of the way, we need to reassure them. We are dependable. We are a reputable business. We are here to help you because that’s our view. We’re not only in business but we want to do good business. We want to help these people move on to the next phase of their life in a better position.

WI 898 | Dispositions Manager

Dispositions Manager: Communicate with your seller; communicate with your buyers. You can’t sell what you can’t show.

 

It’s the same with buyers. A lot of our buyers are old-school. They do email but they want to meet people. They want to shake their hand. We need to build that relationship with them so they feel confident about putting in deposits down. Our properties are going to close. We don’t want to waste their time.

I love what you’ve said there. It’s that reminder that even as a company, we are very held tightly to the doing good business piece. That comes up a lot, even in the REI Radio coaching program. I’m like, “Students, I want you to keep that in mind.” It’s like the relationship piece that you mentioned here, it’s not only the relationship that you’re building or you’re developing with your buyers and sellers. If you were to get into something like radio, the relationship and the rapport that you can or cannot build would affect your radio journey as a whole.

That is not something that’s only related to buyers and sellers. That will affect the sales reps that you’re working with or any other vendors or affiliates that you may come into contact with that. Radio has the potential to pull in all sorts of things. Once people hear you on the radio, they’re again going to assume that you’ve got everything figured out. You’re more likely to get calls from contractors, roofers, bird-doggers, the whole nine yards of people going, “Maybe I can develop some relationship with this person that I’m hearing on the radio.”

That rapport and relationship building can go a long way. I’m glad you brought that up, Christa. Out of curiosity and this is not something that I’m an expert on because radio generates the leads then I let Christa take it over on the disposition side. Once it’s on her end, I’m waiting for the payment to come through. “That station did produce XYZ this particular month.”

I am curious to understand your experience of all the other marketing channels that we utilize because you’re responsible for dispositioning all of it no matter what the actual marketing channel is. Is there a difference between radio leads or what you have experienced? What does that look like? How does our radio lead to a disposition? If you could walk us through that process, I’d love to hear that a little bit more.

The process for the disposition of any property is the same. We still have the same process but we notice a difference with radio leads. They are more determined. We believe it’s because there’s action required. They hear the radio program. They have to write the number down. They have to call us actively. It is not a postcard that comes to their mail that they may or may not glance at. They have to be actively defining to follow up on that. They tend to be higher-end properties and be more motivated. They are ready to sell and ready to get down to business. It’s not only a tire kicker. We all know that with direct mail, we’ll talk to people. We may need to call them in 90 days. We’ve had leads that we started with 2 or 3 years ago. They eventually produced but radio tends to be more immediate and that’s always nice. It’s get a contract, get it sold, move on.

That is something interesting to keep in mind. All marketing channels can produce but there are some that may be a little bit more immediate or, as you were mentioning, on the direct mail side you could send a postcard but they may hold on to it and still call you in about a year or two. That is great because it still produces. There should always be something in your funnel.

Maybe there’s something that’s hot now. Where did it go? Maybe something that’s somewhere in the middle or maybe it’s in the next 6 to 9 months. You could potentially end up in a situation. Maybe you want a marketing channel. They take more time to bake. It’s about a year or two, which is fine because it creates a steady flow for you of something hot something in the middle and something that’s a little bit further out.

A great real estate investor can always see the possibilities. They don’t see a bad roof. They see that it’s in a great neighborhood.

You always like to have something in your pipeline but radio tends to be more ready to sell, move on. It’s that hot lead. We tend to jump on those a little quicker. We like to make sure that every lead is contacted in a timely manner but we find that radio leads are ready.

I’m glad you were mentioning here that in terms of our process, your disposition process doesn’t necessarily change but depending on the marketing channel, there may be a couple of differences here and there with radio specifically. Now, as part of your process, I know that you mentioned that you have to get ready to market it and put the pictures together. I’d love to hear about that specifically.

You could use a radio lead as an example. You have a radio lead that comes in. The prospect during the acquisition manager is able to vet it and get a contract on it. It goes through the title and the closing process then it gets over to you. What does that process for the radio lead once it’s ready to market? What does that look like in terms of the pictures on the flyer? What’s on there? Do you mind explaining that a little bit further?

We have an inspection person that goes out and takes good pictures. Radio leads tend to be a little bit higher class. A lot of the time, they may be empty so there’s no stuff. The pictures are good. You can see what’s good, what’s bad and we have those pictures. That’s what we use. We always, of course, want to highlight bathrooms kitchens. They tend to be more updated with radio leads because the property tends to be in better repair. It presents well.

We have the ability to load twenty pictures onto our website. We put in the flyer. In the flyer, we’re limited on how many pictures. We tend to do the front picture, things to the front of the house, bathrooms, kitchen. If there’s a newer compressor, we may put that. We want to do highlight what is great about the property to catch people’s interest.

Do you have any other examples of what that could entail? Let’s say I’m doing this for the first time. Maybe someone has been doing dispositioning but maybe didn’t realize maybe it might be better to put together a flyer and they’re trying to piece that together. Is there anything that’s more common in terms of what highlights the property? Should they have more internal pictures? I would like to follow up on that for anyone that’s learning for the first time.

If a property is in decent repair, kitchens, bathrooms are expensive parts. We are honest. I have some buyers that call and say, “I’m interested in that property on the main street. Do you know anything about the roof?” Being familiar with the property for dispositions, helps. If the property is in disrepair, we may only post five pictures because we don’t want people to have a preconception before they see it. They have to be able to see the possibilities.

A great real estate investor could always see the possibilities. They don’t see a bad roof. They see that it’s in a great neighborhood. It may be the smallest house because it’s an older house but it’s in a great neighborhood. They tend to focus on the positive. We’ve had houses that have been empty for twenty years, usually a probate situation. We don’t want to put too many pictures because we don’t want people to get a negative outlook and not go look because they truly cannot evaluate the property until they walk.

With the flyer itself, I hear that pictures are important. You want to make sure you have something on the outside of the home and things that are internal, especially things that you know your buyers usually are looking for like information on the roof. They want to understand roughly the layout of the property. Those things should be listed on the flyer. You usually list the price, the ARV. What else should be on that flyer?

WI 898 | Dispositions Manager

Dispositions Manager: We notice a difference with radio leads. They are more determined, and we believe it’s because there’s action required.

 

We have a great template through an active campaign and it has an ARV price. Sometimes we’ll put estimated repairs. It depends on the property. We never want to scare the buyer off with a huge number. Sometimes it’s hard to judge. Are they going to do a minor remodel or they’re going to do a major remodel? Price. We include the showing time. We include the phone number, how to get in contact with us because we get the list of every investor that goes to every property.

The pictures and we also try and highlight the neighborhood. Is it two blocks away from a great reviewed high school? Is there a park across the street? We emphasize that as well because you’re not just buying a house. You’re buying into a neighborhood. Whether you’re going to rent that or you’re going to flip it, the neighborhood can make or break you. There have to be some things that draw people to the neighborhood. Maybe it’s a good walking neighborhood. Maybe there are lots of restaurants or a grocery store nearby. People need to be able to get a good idea of what the possibilities of the property are before they go see it.

I hand it off to you. That’s a whole different universe of understanding how those things are pieced together in terms of your actual process. That’s good to hear. As a side note for those that are reading, Christa mentioned the pictures being important. Also, having the ability to have an inspector who’s local in the area to go take those pictures is super helpful but maybe you’re in a situation where you don’t have that opportunity. Christa, I’m sure you’ve had sellers send you or take the pictures for you as well or even video.

Yes. People, bless their hearts, there are some who are not photographers. It’s always better to have your own pictures done by someone that you know, if at all possible because they are going to look. Are there water spots? Your seller’s probably not going to send you a picture of the ceiling of where the roof is leaking or where the door jam is beginning to come apart.

In Dallas, we have foundation problems. It’s always about the foundation. They want the best price for their property. We want to make that happen but we have to have real pictures. It’s always good to have somebody that’s working for you because some of the sellers are not very tech-savvy. If it’s dark and you can’t see anything, it’s hard to come up with a true evaluation of the property.

It’s hard to give them a fair price and give them a great customer experience. If we have to come back, let’s say, we get pictures. They’re not very good. We make a deal. We’ve overpriced the house. We get no offers because it happens. We have to go back and renegotiate the contract and we need to be able to tell them, “Unfortunately, the repairs are higher and this is what we’ve been told about the property. There are foundation and roof problems.” It doesn’t create a great customer experience for the seller or the buyer. If they go and they’ve wasted their time, we may not be able to get them back through the door because they’ve already seen it.

In that particular case, for the person for whatever reason they can’t seem to get any help with pictures and they have to rely on the seller to avoid maybe some manipulation with the photos, is it possible for them to get the seller on maybe a Facebook call then they can try and record it? I’m only imagining this out loud. You walk them through like, “Can you start from the front door and walk through the home?”

We have had people do that and that are comfortable doing that. Some of our sellers are older. They’re not always tech-savvy but we have had that happen. FaceTime, walkthrough and record and we’re able to take that video and create pictures from it. We drop those into the flyers and onto our website as well.

You’re not just buying a house. You’re buying into a neighborhood.

I’m thinking as well with everything that seems to go on and off with COVID on a market basis. You may run into someone that’s maybe are not super keen on wanting somebody back in their house, to begin with.

With COVID, we did have to have to pivot quite a bit. We started using more videos and embedding those into our flyer and onto our website. Our inspector was able to walk the property and show. We sold several properties without someone going out because they felt like they had a good grasp of the floor plan, the flow of the house and what repairs were needed.

I was thinking that racking my brain if I’m new to wholesaling or maybe I’m running into this for the first time where I’ve never had a problem getting photos on a property. All of a sudden, I’m reaching someone that is giving me pushback on trying to get photos. My option is I can have them take the pictures but with a grain of salt because they’re not going to be great photographers.

They’re not super tech-savvy and they will maybe try to manipulate it. Maybe I have the option to do maybe a Facebook live call and record it or a FaceTime. This might be a silly question but is there ever the potential to disposition a property or have you ever even had a radio lead come in where, for some reason, you could not get photos at all?

I sold the house that we didn’t even have access to. We had this property. It was in a decent neighborhood. We knew from the tax that it was a 2-bedroom, 1-bath but it had a tenant that would not let us in. We have buyers and I have separate lists. I know what buyers I have that’ll buy with a tenant in place and that sort of thing. We had one outside picture. I ended up calling several of the buyers and I said, “This is a situation. You’re going to have to evict the tenant. He’s not paying rent but this is the house.”

The seller had drawn us a floor plan. They had been in the house fifteen years. It was from memory. It wasn’t a huge house but it was in a decent neighborhood. It was on a large lot. We made a great profit off of it. We made something like $22,000 sight unseen. A lot of it is the neighborhood carried it, the large lot. People were willing to see the possibilities. That was a radio call that came into us. They heard us on the radio and called and they’re like, “I have this problem,” and they laid it all out. “I haven’t seen the inside of the house. They won’t let me in. They don’t pay rent. I can’t deal with it.” We’re like, “Okay.”

That’s a hot motivated seller. It’s like, “I have a tenant.” It’s very common. You get various stories when sellers come in. You’re going to get all types of different people that call in. Off the top of my head, as soon as you said that I’m like, “I can think of a couple of radio leads that will call in and say, ‘My tenant won’t pay me the rent. I’m not getting paid on this. I need to evict them. I need to go.’” That is one of the highest motivations that I’ve heard. “I need to get rid of this. It’s literally a problem.”

We’ve had several radio leads that have inherited property. Maybe mom and dad had several rentals so they inherited them and they find out how hard it is to be a landlord. They’re like, “I can’t do this. Please take them all off my hands.”

WI 898 | Dispositions Manager

Dispositions Manager: We want to highlight what is great about the property to catch people’s interest.

 

It’s the people’s piece of it. Building a rent portfolio is great and having that as an investment but the people can get you to a point where you’re pulling out the last of your hair.

With COVID, there’s been a lot of those calls. “I have to sell this house. They’re not paying rent. I can’t evict them but I still have to pay taxes. I still have to do upkeep. I can’t afford this. I need the money out of this property.” They may have been struggling with their own personal finances and having to carry the investment property. We have gotten a lot of those calls. Luckily, we have a huge buyers list with people who are willing to deal with that and we’re able to move properties.

I’m still in all over the property that you got sold, basically sight unseen. Especially with the image thing, I’m sure some people can probably get their hands on whatever, like the Google Map images, if that’s even available. I’m stunned. Location was a big factor there and a highly motivated actual seller that happened to come off of radio but people have sticky situations all over. I’m one that believes in, at a minimum, people have to make at least 2 to 3 marketing channels. In a perfect world, you balance something being inbound and something being outbound to cover all your bases.

Christa mentioned the difference she noticed with dispositioning radio leads is that they’re a little bit more ready to rock and roll because they had to contact us. As an inbound marketing channel, they came to us to say, “Here’s what I’m dealing with. I want to talk to someone about selling for cash.” We have as many acquisition managers and prospecting assistance still closing out anything through the outbound source but that balance helps.

It feeds into the pipeline that we were discussing that you may end up with something that produces hot leads now that are ready to go and immediate. Something that’s a little bit warmer and in the middle then maybe something that’s a little bit further out, maybe a year or two. Either way, I truly believe in balancing at least 2 to 3 marketing channels in pulling with inbound and outbound so that you’re constantly feeding that pipeline.

This was a great conversation, Christa. Thank you so much for hopping on. Once I hand it over to you, that’s a world that I am learning something new about every day. As soon as I’ve generated leads, I’m right back into it by looking at the system on how to generate more and hold it steady. This is super interesting to be able to understand what disposition looks like a bit more.

Thank you so much for joining us. If you would like to look into if REI, the REI radio program is something that’s up to your alley or if you have maybe some questions you’re tossing around about, if it’s a great fit for you and where you’re adding your business, you can always visit the Wholesaling Inc. website. That’s WholesalingInc.com/REIRadio and feel free to book a call. We’re happy to answer any questions that we can.

If it’s something you’re sure you want to pick up or if it’s something you’re still playing with to go, “I don’t know if this is the best fit for me and my business.” We’re happy to help with anything. I’m super excited again with this. Hopefully, there are a ton of gems that you can take away until we are able to check back in and see you on the next episode. Thank you so much, Christa. This was enjoyable.

Thank you for having me.

No problem. We’ll see you that are reading on another episode.

 

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