How to get a 10k check on your first deal you flip! – Payneless Flipping Podcast

In this video, we’re going to have a special guest, Jarrod Morris. One of my mentorship students, Jarrod, recently closed his first wholesale contract, a deuce. He gladly closed this wholesale deal with a $10,000 charge through networking with buyers and wholesalers. He will breakdown what happened on this deal, how he handled each challenge that arose, and the lessons he took away from it. Check this video to know more.

Hey what is up Facebook Live if you saw that I was I don’t know what was going on with my stream yard but we are happy we got Jared the freakin legend Morris What’s up, Jared? Good to see you, man.

What’s going on Nathan? Good to see you bro

I’m so happy for you guys if you’re tuning in what we’re going to be diving in today is how Jared just got his first deal and we’re not going to we’re not going to church it up. We’re not not going to, you know make it sound prettier than it is he got his first deal, but it was a doozy Was it not?

It was a doozy and a half Nathan.

Well, hey, dude, my first deal like I was telling you earlier freaking night, it was crazy, bro. I was like scared to show people that house I was doing I was just doing everything wrong. And somehow we got it done. But it taught me that this is real, that there’s like you can make money. This isn’t fake. This isn’t a scam. And that’s kind of is that’s what you’re looking for to you just want to get the first one across the finish line, right?

Yeah, absolutely. It was, you know, I put a lot of work into it. So just wanted to check that off proof of concept and have some more rolling in after that. So well, let’s break it down.

Man. I think for everybody that’s gonna watch this. They’re gonna they can learn from your experience. This was your first one. And we want to know how you got it done. So real quick, before we dive into that deal, how much was did you make on it?

10k on this one,

you know, that’s, that’s a lot. That’s a lot of money. For some some people is a game changer. But you’re saying hey, man, I just watched. That’s great. That’s great to make money. But you I wanted that proof of concept. Right? For sure. For sure. Well, let’s talk about it. Man. How did it happen? In the beginning, you joined? Yeah, when was, you know, you join my, my club. And you know, you started learning but you dived in because you were asking me questions. And I appreciate that. Not a lot of people dive in and really take hold and learn. But let’s start from there. You start learning?

Yeah, yeah, absolutely. So like one of the first things I started doing was a just like building out a strong buyers list and connecting with a lot of buyers. And then B was also just connecting and networking with other wholesalers. So through your program, you connected me with one of the buyers that was in the Buy Box criteria, guys, super legit has been doing it 20 plus years nationwide. And as opposed to kind of just like sending him a message, I connected with him on the phone and stayed in touch with him throughout the weeks throughout the months, just to make sure I had that solid relationship with him. So he ended up being the buyer on this deal. Let me ask you. Yeah.

Do you feel like if you just would have connected with him over a text, it would have you would have the same outcome with this deal?

No, definitely not. I mean, I think I built a decent amount of rapport over the phone with him, and just continuing to follow up and touch base and stay in touch. So I was top of mind and you know, he’d be receptive to anything that I had for him man

And I just want everyone to know, like, I don’t care if you got a million buyers on your buyers list, or 10,000. It’s not so much about how many you have. It’s about the relationships you have, because I’m sure we’re gonna get into kind of this deal being tricky and how the relationship you had with him kept it going. I’m assuming. Yeah, for sure. Absolutely. Okay, so yeah. So let’s continue. So you’ve connected you found the buyer, then develop the relationship. What else happened?

Yep. Yeah. So I connected with the wholesaler that brought me this deal on a different deal prior, I had a different buyer go to look at this property that he under contract, that one didn’t work out. But he continued to send me deals. And he sent me the deal that ended up closing. And I thought this actually looks really good from what I know, this buyers looking for. So I sent it over to him. And he got back to me pretty instantly, it was like we liked this. I like it a lot. I can move on it very quickly. So this was on a Friday where you still feel when he resigned. So it’s funny. So it’s funny. So I sent it to him, it was on a Friday. And that Friday, I had a 60 minute massage. So I was off my phone during those 60 minutes. And of course during that he I got a bunch of texts, looking at my phone, and he’s like, I liked this, I want to move on it can submit end as long as I can go view it. And that was the beginning of it. So like I was I was pretty excited about that. That’s when it kind of started to get tricky. So when I connected back with the other wholesalers, hey, my buyer really likes it just needs a 24 hour inspection to check it out. And we pretty much be good to go. They were like there’s no sorry. But there’s like there’s no inspection period, we can’t allow for an inspection period, they need to submit EMD without an inspection, this guy’s a new so also they’re just in I’m going to I’m going to try to keep this as simple as possible to walk you through it. So then what happened was they were going to be able to view the property and I convinced them to go view the property with their inspector. So they were basically going to walk in fact it at the same time. But then the problem became that it was going to be a group showing there was going to be a bunch of people showing up and it was going to turn into a bidding war and my buyer wasn’t about that. So I was able to talk

At around the same time that you your buyer wanted it, is that right?

Correct, they were going to have a bunch of people show up at this property and basically take the highest bid. So that wasn’t going to work for my buyer. I convinced the other wholesalers to allow my buyer to be the only one that shows up. I told them, you know, I’m looking for a long term relationship, we can do a lot of deals together, yada, yada, yada. So they agreed and allowed my buyer to be the only one that went and walked the property. My buyer showed up with his inspector, they liked it, he called me back said, hey, it’s going to take about 5k More than we were expecting or 10k more than we were expecting, can you take five off off the price? So what I did, instead of just dropping five off mine, I went back to them, ask them if they could drop it as well. Everyone agreed we agreed on price. And that that looked good. So that’s that’s like first part, okay, then they needed to submit five kn end, which was no problem. But where it got tricky was in the contract, there was this line at the end of the contract that said closing must occur 72 hours after vacancy. So there was a tenant occupied, and they were going to be there through the end of the following month. Okay. The problem was if my buyer submits five KMD, and then for whatever reason, the tenant decides to move out tomorrow, now he needs to close in three days. And that’s not enough time to get funds for the deal. Right? Right. So went back and forth on trying to get that line. Now the agent that they were dealing with was not responsive. They literally just one market. It wasn’t on market, but it was through an agent. Okay, gotcha. So they literally just like crossed it out with a red line. It wasn’t even signed. And like, that’s not legit, right? This is a contract. Like it’s not legitimate, but and they’re demanding that the end is deposited by noon the next day, and I was like, this isn’t gonna work. So what I had to do is I had to put in the assignment contract if the agent and sellers don’t sign on this updated agreement, my buyers end is refundable, just to give my buyer a little peace of mind. So they agreed EMD gets deposited, we’re good. Now we’re waiting for tenant to move out at the end of the month. Okay. He also put in the contract that he has 14 days to close after vacancy, which is going to be huge as we get to the end of this. So EMD is deposited, everything’s good. We’re waiting for the tenant to move out. And then close. So and if you have any questions on this, as I’m going through it or want to add anything, let me let me know.

No, it just seems like there’s a lot of moving pieces, right? The tenant needs to move out the end. They don’t use pliers, like I’m not losing 5k If this doesn’t go according to plan, right? Is that kind of what’s going on.

He didn’t even say that. But I just because I want to I’m looking for long term relationships. I wanted to protect his and so that’s why I threw that in there. Like, if they don’t sign your end is refundable. So now everything’s good. We’re in the waiting period for the tenant to move out, which was going to be June 30. And then we have 14 days to close from that. So tenant moves out on June 30. As expected,

thank goodness, thank goodness,

I was a little concerned. But that was no issue. Yeah. So then the buyer goes to walk the property once the tenant is moved out. And when they walked it the first time. So this property is in St. Pete Florida has a pool didn’t need that much renovation, when they went and viewed it pool was blue look good. No issues, tenant moves out, they go to walk the property and the sellers turn the power off in the house. Now this is in Tampa, Florida. I don’t know if you’ve seen the the heat in the US right now. But it’s like 100 plus degrees to buyer those powers off. So now his main concern is the pools not going to be serviced is not maintained, the amount of damage that can occur between tenant moved out and when we closed could be 1000s of dollars, mold in the house, whatever. And in the contracts, it says that sellers will maintain property through closing including pool. So he’s like sellers, sellers need to turn the utilities back on. This is what it says in the contract. And I’m just like this middleman between my buyer, the other wholesalers, the agent and the sellers. So I’m basically like broker in this whole deal the whole time. My buyers saying utilities need to get turned on pull is going to go to crap house is gonna get moldy. The sellers are like no, like we’re not doing it. We’re not turning it back on houses being sold as his condition. So we’re going back and forth on this for a few days buyers not happy about it. Long story short, I get my buyer to put the utilities in his name early and turn the utilities on so that the pool can be maintained and the house is good. Okay, so got through that. I have all these notes of like everything that that happened. So you were crushing it got through that set the utilities up, and that was on like Wednesday, Thursday, and we were set to close on the following Monday. We’re supposed to close on July 10. Okay, title aging that we’re dealing with as a serious family emergency over the weekend death in the family. She’s working the file this whole time. She’s come Monday she’s not in the office pass to her colleagues. They’re not in the loop on what’s going on with the file. I’ll then my buyer is bringing funding to the deal which shouldn’t be an issue. But title is making it seem like it’s an issue.

So there’s all these other issues. Now the lender is saying to title that the name on the deed and the title don’t match and they won’t find until it matches and title is saying that we can provide you an affidavit will guarantee 100% and the lenders like no, that’s not going to work looking at a hard copy of an updated deed and the lenders the hard money lender, correct.

Yeah. Okay. So lenders like no, that’s not going to work. We need a hard copy of the updated deed with everything matching. So title company doesn’t know what’s going on. The person who was passed through didn’t even know you’re supposed to close on Monday. Now the lender is demanding a hard copy and forth. This is why I’m saying the 14 days that to close after vacancy is coming into play here because vacated on June 30 was supposed to close on July 10. And now July 10 was on a Monday now this whole week is going by a back and forth between lender buyer title deed or title company doesn’t know what’s going on. So now we’re now we’re on Thursday. 14 days is Friday. Yeah, no, this is all over the place. I hope I hope you’re following Well,

I’m following Yeah, yeah, this you know, you got a lot of people to go through just to communicate, right? There’s a lot of moving pieces, the agents involved the sellers, you got the wholesalers and then you’re brokering with the buyer, right.

So seller signed on there. My buyer signs on Thursday, everything is signed, which is good. But now we’re waiting for the funding to be deposited. So that was on Thursday that everything is signed. Okay, once it’s signed, it should be a few hours after title and lending gets approved but the title company was such a mess that the title agent that was working the file didn’t send what she needed to send to the lender until Friday at three o’clock Eastern. So wait all weekend? Well Friday’s 14 days, right? So if funding doesn’t get deposit in 14 days, the contractor cancels. So title really screwed up. They didn’t send what they needed to do until Friday at three Eastern so now I’m it’s the weekend and I’m not really sure what’s going on I call title on Monday morning. They tell me that Oh, I’m sorry. Let me let me backtrack real quick. So the lender didn’t want to approve the affidavit right. They want it to hardcopy my buyer has a really really strong relationship with the length this lending company. Of course, he got on them and pushed it through. So he made them push it through they deposited their funds. I get a call on Monday morning saying I got the lenders funds but I don’t have the buyers funds for the downpayment. Meanwhile, my buyer has receipts of depositing his funds on Friday, they were just such a mess at the title company. They didn’t even see it even though it’s deposit the whole time. They find the buyers funds, they got the lenders funds, it closes out and the deal is finally done. But it was like like you said it was a doozy.

It sounds like the biggest issue and the biggest struggles we had in this deal was well, there was a lot right but the title company kind of screwed it up. Right?

The title company was a little messy on this one.

Yeah. So who chose the title company? Was it your buyer? Or was it the seller and the agent or like

No, no it was it was the seller and the agent that chose the title company if it was up to my buyer, they use one title company for every other deal. So yeah, the the other wholesalers and the agent chose the title company.

So why did you use that title? Like I know they chose it but did you suggest using another one and they were like nah, we’ll only go with this one. Or how did that did that conversation? Do you ever have that conversation?

I didn’t on this one. But after this close because like I want to do more business with like, these guys, these other wholesalers they’re doing a lot of deals my buyers doing a lot of deals there’s I’m fine my relationship is fine with my buyers and these other wholesalers I want to do more deals with them so I reached out to them I was like hey like after this makes up my buyer is not going to want to use his title company again.

Are you guys open to using their title company so then they were like yeah Heck yeah. So that just kind of giving you a suggestion on the way This moves the smooth this is the buyer is able to choose the title company so they can have direct communication they trust whoever that would solve a lot of these issues and then you know it is it always gets a little tricky when there’s an agent involved with the seller right and then yet they communicate with you it was like seller agent who was not a responsive agent.

So it’s the sellers agents or their wholesalers myself buyer so like myself and the other wholesalers are basically brokering this whole deal. Like the agent did nothing I said to the other wholesalers, we we deserve this guy’s commission we work this deal for two months.

And the thing is, like, look how many people got paid on this right? Like, yeah, you the wholesaler and the agent, but the agent, right? Like didn’t do much, right? Dang, that’s wild. So very good lessons learned. On this one?

Sure many Yeah.

Let me ask you a question on the buyer on the wholesalers that had the deal. Why do you think they went with you? I know you said you convinced them. But you said the hairs. Yeah, they’re doing deals. Why do you think they went with you? versus, you know, just showing it to everybody and doing that route?

Yeah. I mean, I basically, I connected with them and was like, look like, I’m looking for a long term relationship here. I’m looking to do a lot of deals together, my buyer, he’s like, Jay, he’s been doing this for a very long time. He’s nationwide. And like, if we can, if we can have this workout, like, I think we can do a lot more deals together. So that was basically the value that I was bringing in. And yeah, that’s how I was able to kind of set that up.

And they probably liked the fact that he you know, you could just send them through, he was gonna bring a specter at the same time and give you give you a solid answer, right? Yeah, yeah. So let me ask you this. So did you have to make an offer to this wholesaler on his deal? Or do you just say, Hey, dude, let me ask my buyer. And then you got back to me like, Dude, my guy wants this.

How did that soy so on this one, all I did was all I did was mark up their price. So they assigned the contract to me, I assigned it to my buyer. So there was two assignment contracts in it. And then at closing, I got wire my assignment they got their assignment. And that was it.

So so this wasn’t even a JV because the JV is like when your agreement you split it or you figure out this was correct. They assigned you their contract, and then you assign when your buyer solid. Yeah. Oh, yeah. And did this cost you any money in marketing to get this deal? Did you have to spend any money? No, not $1. So let me tell you some I know that this was a doozy. But how much worse? Would this have been? If you spent five to $6,000? In mailers, ads, or whatever? And then after spending $6,000, you went through all this made? 10 You only got to keep four?

That’s yeah, for sure. I mean, like, obviously, the net is a lot less but like for the amount of time and work I put into this if I had to spend money to I mean, time is money. So the money I missed one was my time on this one for sure.

Just know from all the experiences that I had, I’ve had on doing deals like this, even if you spend money to get deals you there’s still tons of issues. I’ve been working on a deal in Del Rio, Texas for two years for two years. And it still hasn’t closed yet. It’s a title. So imagine that it’s like bro, like, I just spent I spent all this money, and I still now it’ll probably be a $30,000 deal. This could have been a third. I mean, who knows? But I’m just saying like issues arise if it’s not from like trying to negotiate with everyone or figure out what’s going on with everyone. It’s uh, you know, other things like title death probate, there’s some of them go super smooth. Some of them doozies. Yeah, but Congrats, man, thanks for telling us all that shit. anybody that’s watching this can definitely be like, Okay, I’m gonna hit up, Jared, if I have any problems. And Jared, let me tell you, like, you can help people. And you can be like, Yo, I’ll help you take this to the finish line. But let’s let me get involved and make some money. So yeah, you can definitely work with people

absolutely learned learned a lot through this, like dealing with title, just the contracts the paperwork, like so learned a lot. absolutely happy to help anyone else.

Well, the power of having a good buyer is so important. Because imagine if you didn’t have that relationship, where you could just be like, Hey, dude, pay for the utilities, you know, 100%.

And like that, you know, that was no easy asked either. But I’m glad that he was able to set it up and do it. But on top of which, like, as I mentioned, and I know we’re out of time, but I’ll go a few minutes over. It’s all about the relationship building, right. And this guy has been doing this for a long time. He’s doing a lot of deals, he’s making a lot of money in real estate. And from this deal, and just being ethical and a good communicator with him. I’m looking to now partner with him on future deals and invest myself so it’s so when when when did you find a property that meets his criteria?

Next time, this is what I do a lot with my buyers. Now as I say, Dude, pay me a little bit less than the wholesale fee. But cut me back on the flip. Keep me in on the deal. Let me own a percentage. So then you can start owning real estate without even having to worry about managing it. Maybe that’s something he might be willing to do because he likes you. Right? So yeah, that’s what I did with an Airbnb I have. It’s like, hey, I want to start on more real estate instead of taking 10 or 15. Just give me five and give me ownership. And then that way I can make you know, money without having to worry. But anyway, congrats Brian over over time. Yeah, no, I appreciate you, man. Thanks for helping us out in our community. And you’re definitely an inspiration for those that are trying to get there. So thanks for thanks for sharing your experience.

Yeah, absolutely. Thank Nathan

And by the way, you have a job, bro. Like a lot of people. Do. I got a full time job, baby.

Yeah, you gotta get going. That’s your full time job. But everybody listen, whether you’re full time or not, this is something you can do. So Jared knew I can do it. You can do that already.

Alright, see you guys.


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