50K per month wholesaling............and taking it to the next level!!

[The Investor]

Hey everyone,

            Thanks for the responses. It has been great and your feedback is much appreciated.

Roger -
              I indeed have a great accountant in place and will be working with him to limit paying taxes as much as possible. As far as spending 4K a month, this is what is required in the markets that I am in in order to turn the profits that I am in. I am entertaining other sources to obtain more value. I am always looking to save all my money yet make as much as I can. You couldn't have said it better. It is a JOB. My partner and I are systemizing everyting currently to be able to do wholesaling on a much larger level. So you are dead on by stating this. I am the one fielding the calls when the leads come in. My concern about giving my position to someone is that they will not be as diligent as I am. I am very aggresive in going after the leads once they come in. You and me both know not everyone will go after your business like you. Some things can be taught to other's but either you are born with drive or your not! I hope I am wrong because I am not planning on staying on the phone for much longer. Hopefully, I can find a way to systemize this part of it. Thanks for you reply.

Ericmedem -
             Loved your post. Like I said to Roger, I am systemizing everything now. I am humbled that you have never sent out direct mail to obtain leads. I am a network king and believe highly in this. Since I am doing all these deals away from my residence it is much harder to establish a network where people bring you leads. I am assuming you work with birdogs to bring you the deal. I am working with birdogs, realtors, and other investors to obtain other deals. If you make a living primarly from others bringing you deals, that fantastic. One of my mentors, Steve Cook, does it this way. However, he has been in the biz for 10 yrs. I know that this will take some time. Like you said: Networking and direct mail leads = will bring great results. It is going to be interesting. I think I may have to get into rehabbing at some point.
             Like a doctor or anyone for that matter, if you specialize, you will be in great demand!! My main focus is on becoming excellent at wholesaling. Then I will take the money from wholesaling and "recycle" it into commercial property to have that passive income stream!! It's #1 on the list.

NJSS,
             I like your mix of income. PASSIVE INCOME IS WHERE THE WEALTH IS!! I am all for working less and making more!!

Mcintoshcopywriter,
             I like that you commented on marketing. Marketing is key. Thanks for the advice on keeping the pieces simple. My partner and I study marketing aside from RE. We are much plugged into Dan Kennedy as well as others. I think that are marketing is more successful than the competition b/c we seen the competitors flyers and understand the difference. When I receive a call from a seller, I ask them why did they call ours out of the many that they seen and the results are great. This is a wonderful source for feedback and has taught us much!! I agree less is more! Thanks.

REI Noobster,
             Don't really understand your question, can you be more specific. Are you asking geographically, market, etc?

[eman82]

hi the invester         i was wondering how many letter do you mail out a month,maybe you can give be some good tips ....

[spacechimp]

Takin it to the NEXT LEVEL 

we've put out 7 bids now on REO's and none accepted or even given back a reasonable counter offer...
I mean if a house needs about 15K in rehab..Comps are at 95K-100
bottom line is 75K per the bank....
add in closing costs on both ends..commission on selling end possibly

You're left with KRAP for profit.

I just can't Believe how difficult it's been finding just a decent deal on a rehab..it's like these out of state banks have no idea how bad the market is around here and will only accept offers from people who are going to live there i guess.

what a friggen mess

In michigan by the way

[REI NOOBSTER]

Hey everyone,

            Thanks for the responses. It has been great and your feedback is much appreciated.

Roger -
              I indeed have a great accountant in place and will be working with him to limit paying taxes as much as possible. As far as spending 4K a month, this is what is required in the markets that I am in in order to turn the profits that I am in. I am entertaining other sources to obtain more value. I am always looking to save all my money yet make as much as I can. You couldn't have said it better. It is a JOB. My partner and I are systemizing everyting currently to be able to do wholesaling on a much larger level. So you are dead on by stating this. I am the one fielding the calls when the leads come in. My concern about giving my position to someone is that they will not be as diligent as I am. I am very aggresive in going after the leads once they come in. You and me both know not everyone will go after your business like you. Some things can be taught to other's but either you are born with drive or your not! I hope I am wrong because I am not planning on staying on the phone for much longer. Hopefully, I can find a way to systemize this part of it. Thanks for you reply.

Ericmedem -
             Loved your post. Like I said to Roger, I am systemizing everything now. I am humbled that you have never sent out direct mail to obtain leads. I am a network king and believe highly in this. Since I am doing all these deals away from my residence it is much harder to establish a network where people bring you leads. I am assuming you work with birdogs to bring you the deal. I am working with birdogs, realtors, and other investors to obtain other deals. If you make a living primarly from others bringing you deals, that fantastic. One of my mentors, Steve Cook, does it this way. However, he has been in the biz for 10 yrs. I know that this will take some time. Like you said: Networking and direct mail leads = will bring great results. It is going to be interesting. I think I may have to get into rehabbing at some point.
             Like a doctor or anyone for that matter, if you specialize, you will be in great demand!! My main focus is on becoming excellent at wholesaling. Then I will take the money from wholesaling and "recycle" it into commercial property to have that passive income stream!! It's #1 on the list.

NJSS,
             I like your mix of income. PASSIVE INCOME IS WHERE THE WEALTH IS!! I am all for working less and making more!!

Mcintoshcopywriter,
             I like that you commented on marketing. Marketing is key. Thanks for the advice on keeping the pieces simple. My partner and I study marketing aside from RE. We are much plugged into Dan Kennedy as well as others. I think that are marketing is more successful than the competition b/c we seen the competitors flyers and understand the difference. When I receive a call from a seller, I ask them why did they call ours out of the many that they seen and the results are great. This is a wonderful source for feedback and has taught us much!! I agree less is more! Thanks.

REI Noobster,
             Don't really understand your question, can you be more specific. Are you asking geographically, market, etc?

I thought you said it cost you 4k a month for direct mailing. At 50 cents a lette that ends up 8,000 letter right? I am asking of you mail 8,000 letters a month.

[Roger J]

I do still believe that you need to seriously look at where, and how, you are spending your advertising dollar to both gain more business and increased profits.

Take Noob's 8000 letters for example.  If your sending out 8000 letters, you should be getting at least 80 calls (1%).  Out of those eighty calls, you should be netting a least a 10% close rate, or 8 deals.  That's not happening.  Now, there are a number of possible problems, but generally, it boils down to two.  1, you're not targeting the right people to mail, thus wasting ad dollars, or 2, you're simply not pulling the trigger enough, or correctly enough to close the deals that are needed.  Really, only you can determine what's happening.

Also, the focus on almost exclusive direct mail marketing is flawed, IMO.  I believe that you could accomplish more, with less.  For example, take your phone duties.  You're right, no one not invested in the company will try as hard as you do to close the deal or make something work.  That's just the nature of a true business.  However, instead of just someone answering phones, you might want to consider having the call people with properties for sale and try to work a deal that way.  A wholesaler I know started out this way.  He paid a very basic income to the person plus a finder's fee/commission for any deals brought (basically telemarketing, yes).  One person would cost between $1000-$1500/month depending on hours (at $7-8/hr) plus their fees for deals (which would be including in the cost of the deal).

Raj

[The Investor]

Hello Everyone,
         Hope you all are doing well.

Eman82,
         I am currently sending 4000 pieces per month. As far as advice, I wish I could tell you. For me I am costantly changing my letters/cards to see what works and what doesn't work. Evertything is test, test, and test again. Learn by doing pretty much.

spacechimp,
         I feel your pain! It is very tough. That's why I believe you have to make as many offers as you can. It's a hit an miss thing. I myself think the banks are living in another world. They are just trying to get as much as they can. Give them a bit more time. They are hurting and I believe they will hurt even more so. Just keep making offers!!

REI NOOBSTER,
         I am currently sending 4000 pieces a month. My expenses are about 4K per month but that is not all on mail. It's my total costs to run the biz.

Roger J,
          My mailings are getting about a 2-5% response rate. I know this seems high, but out of 4000 pieces I am getting about 90-130 calls and getting about 2-3 deals out of that. I would agree about hiring someone at 7-8 dollars and let them call on FSBO's, expired listings, etc. I am very much planning on implemting a few approaches such as this. My markets are very targeted. I have doing phone sales for 5 yrs and realize that it's a numbers game. Until I start to implement other ways, I will have to continue to do mailing campaigns. Nevertheless, I am going to put a plan in place to ween myself of the phone. Thanks for your input.

[morningnewsman]

Do you do mostly assignments of contract?

[The Investor]

Yes, I only do assignments.

[morningnewsman]

That's great.  I'm in a higher priced market and deals have been tougher to come by, but the profit potential can be higher.  Sounds like you are doing well..great to hear that!
Do you live in the areas where you are wholesaling?

[The Investor]

Where are you located at?

I do all my wholesaling long distance. I target 2 markets, one is 500 miles away and the other is 1500 miles away. I don't really know much about the homes in the areas other than what I have studied demographically and geographically. I never see the homes in person or even meet the seller's and buyers. I am just learning everything that I can and letting experience be my greatest teacher.

[morningnewsman]

I am in NY.  I wouldn't feel comfortable doing repair estimates long distance.  How do you do that?  Just estimate them and come in way under what they might be?

[The Investor]

I hate placing a dollar amount on rehab work (ie 5K, 10K). Whoever decided to do that, I think hurts everyone in many ways. After wholesaling for 9 months. One of the most important things to remember and what I have learned from my buyers is so:

1) what costs one buyer a kitchen, bathroom, paint and carpet 15K might cost another buyer 8k. The reason being is that some of my rehabbers do all the work themselves so they don't have to hire labor. I have one buyer that the Father, Mother, and Son do everything. So you have a 3 man crew and no one to pay. All the money stays in the family. I have another rehabber that she has to hire everyone. So her costs are a lot more. She bid 55K on a house I was selling for 67500. I didn't even get the house at that price but my family rehabber that I mentioned paid me 67500. She later inquired about the home and I told her that I sold it at that price. She told me that she couldn't pay that then later told me she regrets not buying it. So this was a classic example.

2) what some rehabbers want to do with the home other's don't. Some don't want to change the kitchen but only rebuff and paint it.


So the bottom line.............................................

Never place a dollar amount, always get pictures of the entire house, and let the pictures tell your customers what needs to be done. As far as my pricing to wholesale it, I ask myself what is the worst that the most agressive rehabber would pay? 20K? Then I go off that price. So in the end, I am offering some of the sweetest and best deals with plenty of meat left on the bone!

[mawrain]

Excellent point. I may be new to wholesaling but your explanation of repair values was very logical. I guess I wouldn't have thought about it like that.

Makes sense though.

[The Investor]

Thanks mawrain! Welcome to the biz and kick @#$!!

Make excuses or make money!!!!

[Kevin Ramirez]

That's awesome, you are killing it already!
I'd start doing some google advertizing if I were you