Posted on: July 18, 2022
WI 996 | Wholesaling Real Estate

 

Today David Dodge is bringing you the A-Z of real estate wholesaling. David has over 700 wholesale deals under his belt and has learned a thing or two over the years. Today he’ll be talking about some of his most important rules for wholesaling and things every new wholesaler should know.

 

If you like what you heard and want to go even deeper with David, apply to our Brrrr Method Mastery program where you’ll get access to David and his years of knowledge directly.

 

Show notes:

  • (0:56) – Beginning of today’s episode.
  • (3:35) – The A-Z of wholesaling.
  • (8:15) – Why you should always lead with integrity.
  • (9:07) – The Z-A of wholesaling.

Resources:

  • Want to learn more? Check out our Brrrr Method Mastery
  • To speak with David or one of our other expert coaches call (281) 835-4201 or schedule here.

The A to Z of Wholesaling Real Estate

Episode Transcription

I’m going to talk about the fact that you make your money when you buy. You get paid when you sell, but there’s a very important piece that we are sometimes missing here. We don’t even have the ability to make the money when we sell if we don’t ever have anything under contract. When we’re wholesaling, this is a business of inventory management, if you think about the big picture. We can’t sell what we don’t have.

Imagine that you have a product that you want to get on the shelves of Walmart. Walmart’s not going to buy that product from you. In fact, they are going to require you to front them. Give them on credit, a bunch of products to put on their shelves. They’re going to go sell that product and they’re going to pay you 2 to 4 months later, in some cases, 6 months later. If they don’t have any products on their shelf, they can’t sell anything. They are the world’s best wholesaling company, for the most part, at least one of the top. They are inventory management. That’s what we have to do.

Our inventory isn’t fishing rods and spatulas. Our inventory is the ability to buy a property. It’s a contract to purchase. It’s equitable interest in an agreement with another human being. Hopefully, when we’ve made a friend and we’re helping them out of a bad, unhappy problem. We can hopefully make their life good and happy again. At the end of the day, we’re helping people and solving problems for these individuals and that’s how we get paid.

I’m going to repeat this a few times here, but it’s for a good cause. You make your money when you buy. You get paid when you sell. You can’t get paid if you don’t have anything to sell. You can’t do that. You have to have inventory to sell and marketing business or company, or maybe it’s you sitting around cold calling. That’s cool too. It’s all the same to me, but you had to have some time invested and/or some money invested into marketing. You can have the opportunity to go run appointments and make friends with sellers and send offers. Offers lead to contracts.

Let’s talk about the business A to Z, and then for fun, let’s back it up and go from Z to A because it’s a fun exercise. I love doing this exercise with my students. I do it all the time. A, you start. It’s a marketing business. We know we’re going to start marketing. Let’s say we decided to drive for dollars to create a list and send direct mail to simple things that everybody can understand. I do this in my business and half of my students are doing this too. They’re driving for dollars and sending mail to sellers.

The driving for dollars is the list building and the sending mail to sellers is the marketing. That’s them getting their message in front of people that can then call them. The message is simple. “I like to buy houses. I pay in cash. I close fast and I’ll buy it as is,” but at the end of the day, the message should be received differently than that. The message should be received, “This person has a lot of conveniences to offer me. I may have a problem that I need to sell a property. Let’s call this person.” That’s the marketing.

You make money when you buy. You get paid when you sell.

The marketing doesn’t do anything but lead to a phone call. That’s it. All roads lead to a phone call. The only caveat is if you’re door-knocking. They’re going to answer the door and you’re going to get a face-to-face, which is great. Do that too, but for the most part, all marketing leads to phone calls. You send mail, they call you. You cold call them. You’re calling them. You text them, they text you back, and you call them. You pay for a billboard. They’re going to call you. You do some Google SEO to your website. They’re going to fill out a form. You’re going to call them, or maybe they called the number on the website. They’re going to call you.

You get a radio advertisement. We love radio. I’m on the radio. Grace is the best coach at radio I know. She loves it. It helps tons of people. Radio works. What does radio do? It generates phone calls for people or your business. At the end of the day, all marketing is going to lead to a phone call and the phone call is nothing more than an opportunity to make a friend.

Find out if that person that’s calling is the owner and what issues or problems the owner may be facing in the current situation or in their life. Sometimes it’s the property that’s the problem. Sometimes it’s the person, and it’s unfortunate. Let’s talk about this. I won’t harp on it, but when somebody comes to us and they’re facing death, divorce, disease, they can’t keep up their payments, they’re going to next week, or they have faced something terrible, we’re not trying to monetize this, but we have the most amazing tools in our belt to help this person and to solve some of their problems, and we can make a friend with them. We can go out and build rapport. We can run an appointment if we’re local.

We can offer to help solve some of these problems. In exchange for this convenience, we’re going to get a discount from them. That’s what makes it a win-win. They give you a deal. You bend over backwards and help them. You hold their hand. I’ve paid for people to move out of properties that I’m buying to wholesale. I’ve helped them pack the truck. There are lots of things that we can do, but in the end, marketing leads to a phone call. The phone call is an opportunity to help people.

Don’t overcomplicate this. Now that we have this opportunity to help people, we’re going to make offers every opportunity we have. We’re going to make a ton of offers. Before I even continue down this path, we’re probably halfway through the alphabet here. Before I continue, I want to make something very clear to you all. You can’t jump from A to D. You got to go from A to B, to C. There’s a process here.

That process starts with marketing, and then it leads to phone calls, which then leads to opportunities to make friends and solve problems, which is what makes it fun and what makes you build the lay down at the end of the night and have a super high level of integrity and say, “I helped some people. I changed some lives. I made money in the process. How cool is that?” It’s a win-win, but you can’t skip.

WI 996 | Wholesaling Real Estate

Wholesaling Real Estate: The marketing leads to a phone call. The phone call is an opportunity to help people.

 

Marketing leads to opportunities, which is phone calls to make those friends, and then that leads to either an appointment or you jumping on the phone with them, making a friend and an offer, and getting that property under contract. Back to Walmart here. Now, we have inventory. We can take that inventory and market it to our list of cash buyers. Our friends that we meet at our real estate investment clubs. The other investors we meet in Facebook groups, Craigslist, and our title company in passing and all over. There are infinite ways, but we can then turn around and sell those deals.

We can help people and create wins. The seller wins because they sold it and they got problems solved. Buyers win because they got the next deal teed up. You win because you made some money in the process here but never lead in with the goal of making a bunch of money because people are going to sense that. They’re not going to want to work with you. They’re not going to invite you out to walk the property with them. If you lead with integrity and you lead with the fact that you want to help solve some problems for people, you will make money and do deals.

How do I know? I’ve done 1,000 of them, the transactions I’m talking about here. I’ve done 700 plus wholesale deals. All my goal ever is to, “How can I help? How can I solve some problems?” If I can’t make money, I’m going to make sure that they know my offer is what it is. There’s a line that we have to draw on, which we’re going to bend over backwards for people, but if they are willing to come to that line or even less than that line, we’re going to go out of our way to help them every single time. That’s the A to

Let’s back up and let’s go Z to A. The reason that I want to do this is because sometimes it takes getting slapped in the face with some truth for you to realize that you got to get up and do something. In order to make money in wholesaling real estate, in order to do your first deal, or to do more deals, you have to sell something to somebody. As I started with this, you have to sell something to somebody. In this case, it’s a piece of real estate that you don’t even own. You hopefully have it under contract with $10 in earnest money. You sell it to them and you get paid.

If we’re going backwards, how do we do that? How do we sell something to somebody? For one, we have to have a contract on a property. It’s very important. We can’t skip. We can’t go A to Z guys. We got to go B, C, D, E. We’ve got to follow this process. You’re not going to ever make any money wholesale real estate. If you’re afraid to put a property under contract. I wish that there was a softer, easier way to say that, but this is the cold hard truth. It doesn’t have to be hard, but it’s the truth.

You got to get properties under contract to have inventory. Imagine that you have a bookcase in your office and a contract on a property as a book. Fill that bookcase up with inventory and get out there, and make a ton of offers on the property, so you now have something to sell. Backing it up again. The end goal is to get paid. Do a deal, buy a property, sell it, and wholesale it. You got to have contracts to do that. How do you get contracts? There are a lot of guys out here selling courses on sales.

If you lead with integrity and you lead with the fact that you want to help solve some problems for people, you will make money and do deals.

There’s a lot of good value in a lot of these, but I have never walked away from a situation where I made a friend and thought that I needed a special trick up my sleeve to get a deal. I’m not trying to discount these sales programs. I’m not trying to say that they’re unnecessary. That’s not what I’m saying. What I’m saying is people want to work with people they like, know, and trust. I’m sure you’ve heard that. It’s called building rapport.

If you make a friend with somebody and you are coming in genuinely with integrity, trying to help, they’re going to want to work with you. You may have to follow up with them like crazy for six months, sometimes six years, but it doesn’t matter if you make a friend with them. They’re going to keep talking to you. How do you get contracts on properties? The best way to do it is to get on the phone with a lot of people and make a lot of friends. That may come as something that may be difficult for some people who maybe don’t like talking to people or they’re not good on the phones. These are skills we can learn and we can get better at. Don’t worry, but you’re going to have to talk to people.

If you can’t, you’re going to have to hire someone who can because the marketing leads to phone calls, which leads to opportunities. We’re going backwards. In order to do the deal, we have to have a contract. In order to have a contract, we have to get on the phone with a lot of people and have a lot of opportunities to make friends. Go run appointments or send our team, or have them send us photos or whatever to where we can get to the point where we’re talking numbers, solve problems, and get the contract signed, which gives us the ability to have the inventory and sell that contract.

Hopefully, you know where I’m going with this if reading this. In order to have the opportunity, you got to have your phone ringing. You’ve got to ring people’s phones or you need to pay to get your phone ringing. There’s not much more to it. At the end of the day, all roads lead to phone calls. All marketing leads to phone calls always, every time.

You could answer the door, if you’re knocking or they could text you. I get it, guys, but you’re not going to build rapport with people if you’re not talking to them on the phone. You got to follow up, get on the phone, and offer to help them. You need to understand that they’re going to be going through some problems sometimes and you need to be a good listener. You need to ask simple questions. “When would you like to sell? Why are you selling? Is there a reason that you need the money next Thursday?”

Figure out the problem or the root cause and then focus your time and energy on solving that problem and you’re going to get paid tremendous amounts of money in some cases to solve some problems for people. Even small deals are deals. It’s going to build confidence. It’s going to help you understand that it took X number of marketing mailers. In this scenario here, let’s stick to where we went. We talked about driving for dollars to build a list to then send some mail. After you do 1 or 2 deals, you’re going to learn that, “This took me 2,700 postcards. Is that mean if I go send 10,000 of them, I should probably get four deals?” Here’s the answer. Yes. That is how this works.

WI 996 | Wholesaling Real Estate

Wholesaling Real Estate: You’re not going to make any money wholesaling real estate if you’re afraid to put a property under contract.

 

There’s no secret up my sleeves. I don’t have sleeves. Here’s why I’m good at wholesale and why I love helping people get good at wholesaling because this business is regrettably simple, but just because it’s simple, it doesn’t mean it’s going to be easy. You got to work hard, be consistent, and be persistent. If you are willing to be consistent, persistent, and work hard, there is no reason you can’t get that first deal, or maybe you’re doing deals, and you want to scale the 3 to 5 or maybe 10 a month. All that comes down to is knowing your KPIs, reverse engineering your business, and doing more of the efforts that are generating results.

That’s where coaching comes in. We’re going to analyze those things. We’re going to talk about what you’re doing that’s not working and what is working. We’re going to share amongst the community who’s crushing it and what they’re doing, and then we’re all going to try to do more of what they do. That’s where we find success. We optimize, but we don’t stop. We are persistent and we keep going.

We know this is a marketing business, so we do marketing. If our phone isn’t ringing, then we’re going to pick it up and we’re going to ring other people’s phones. It’s that simple. If you decide you want to do mail, radio, bandit signs, or door-knocking, that’s great. All of these things work. I did a show a couple of days ago. There are about 50 plus ways, maybe even 60 plus ways, to find motivated sellers. There are hundreds of ways to find sellers, but all we got to do is pick one and get good at it, build out a system, make a lot of calls or receive a lot of calls, and have the opportunity to build rapport and make a friend, and then start sending offers.

This is one of the things one of my first coaches told me, and it hit me hard. The amount of offers that we make in our business directly correlates to the bottom line of our business, which means, layman’s terms, it correlates to the amount of money we take home. If we make one offer a month, we’re going to do a deal every 37 months. If we make one offer a day, we’ll easily get a deal in a couple of months. If we make an offer an hour, and I know that’s aggressive, my team tries to make 5 to 10 offers a day, but if we make an offer an hour, we’re going to be doing deals in a matter of weeks.

The more offers we make, the more inventory we have, and the more availability, possibility, and options we have to sell this inventory to our end buyers to get paid. It’s so simple. We’re going to bring this back. You make your money when you buy. Part two is you get paid when you sell. If you don’t have anything to sell, part two is irrelevant. When you make your money when you buy, what by that is if we buy a great deal, it’s going to be easy to sell that deal, and it’s still going to be a good deal.

We’re going to make the spread between great and good. We’re going to make a profit on this deal, but if we were to buy that deal at an even better deal, we’re going to make an even better profit. This is very simple. It’s a correlation. The more of this, the more of that. If that is the profit you’re looking for, we’ll do this. That’s making offers. It’s very difficult to make offers when you’re staring at the wall and not talking to anybody. Pick up the phone or spend some money on marketing, so your phone starts ringing. It’s so incredibly simple.

Wholesaling is incredibly simple, but just because it’s simple doesn’t mean it will be easy.

You make your money when you buy. You get paid when you sell. That’s it, so simple. Go in every time with a super high level of integrity and offer to help. Figure out the underlying root because of a seller that needs to sell. Notice, I didn’t say want. I said needs. We’re looking for people that need it because that’s where the convenience that we have is so big by the way we offer them. They need to sell. We can help. We can offer to buy it in cash. We can close fast as it is and make their life easy.

I buy houses all the time where I say, “Take what you want the rest,” and they say “Really?” I say, “You can even bring some extra stuff over here if you want. Use it as your storage dump. I know you’re giving me a good deal. I’m going to do everything in my power to make you feel like you’re getting a good deal with the level of convenience that I offered to you on the flip side of this exchange, transaction, or wholesale deal. Don’t overthink it. This business is simple.

We’ve walked through it from A to Z and back from Z to A. I’ve given you guys some good action items here. Hopefully, you’re going to take something away from this episode and going to take some action. Quit thinking that you need to learn the next thing. People that do that spend years listening to podcasts and don’t ever do anything.

At a minimum, book a call with our team, so we can at least guide, help, and connect you with somebody that may resonate well with you. If you’re looking to get that first deal, I want to work with you. Let’s get you that deal. We can do it quickly. If you’re willing to put in the work, that is it. You make your money when you buy. You get paid when you sell. Don’t over-complicate this business. Keep it simple. It all starts with the marketing that gets the phone ringing. It creates an opportunity to go make friends. You don’t need a sales trick up your sleeve.

Go make a friend and build some rapport. People are going to want to work with you and then get the property under contract. Make $20,000, $10,000, $20,000, and could be $80,000 on a wholesale. We just did one a couple of weeks ago and made $112,000. You can make a killing in this business and boatloads of money, but you got to work hard.

The cool part is once you get that deal done, you’re creating win-win scenarios. You’re helping people. I’d say this to my team, my friends, and my family. “I am helping so many people out of such terrible situations that if I had it my way, I could snap my fingers and make all these problems go away, but I’m not that guy. I’m not holy. I can’t do these things, but I can hustle and work hard and help these people here and now.” You guys can too. You got it in you. I know you can.

If you want to get that first wholesale deal, I am here to help. Check out Rhino Roadmap over on the Wholesaling, Inc website, WholesalingInc.com. Book a call. Let’s get you that first deal. I’m excited to start working with you personally and directly. I invite you to come to my office here in St. Louis to sit down with me and dissect my business. I’ll give you my cell phone number. Talk with you weekly with a group, or maybe even daily, if that’s what you want or need. I’m here to help.

 

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About David Dodge

David Dodge is a real estate coach, author, and investor with over 17 years of experience. David specializes in using the BRRRR Method to acquire Rental Properties with NONE of his own money and has taught others how to generate passive income using his systems. He’s also the co-author of the book “The Brrrr Method” and currently has over 90 properties in his rental portfolio with a goal to grow to over 200 properties in the next 24-36 months.

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