All right, what’s up everybody? We are live right now with the Payneless Wholesaling podcast. I got my guest on here, Michael McDonald, what’s going on, man?
What’s up, dude, I’m so excited to be here pumped for this.
I’m glad to have you now everybody if this is your first time tuning in to the Payneless Wholesaling podcast, what we do at the Payneless Wholesaling podcast is we invite experts in the industry, real estate investors that come on, we ask them questions about how they got started, we will find out and learn from them so we can learn from their experiences. So we don’t have the pain of going through the real estate journey and making the mistakes that we can hopefully learn from others to avoid. So Michael, we’re having you on here. We want to learn from your experiences. So we don’t we don’t feel that that hurt. You know, I’m saying,
I feel Yeah, man. I feel Yeah, sometimes. You know, you don’t have to go through that pain if you just learn from the right person. Right.
That’s right. And we, before we got on here, we’re talking about masterminds and how important those are to avoid the hurt. I mean, it’s, it’s helped me a ton to, you know, level up and avoid big mistakes by learning from other people. And we were talking about we just joined the family. So that’s, that’s a mastermind, everybody, if you didn’t know what that is, but yeah, masterminds are great for avoiding that. Right.
Oh, 100%. Yeah, I have I’ve invested heavily in education and Masterminds to get me to the knowledge I have now today.
So what do you think in your opinion is better? Is it masterminds? Or like coaching programs specifically about like learning a specific skill set? What do you like more?
I mean, these days, I like masterminds, because I’ve got the fundamentals, and I know the business. But in the beginning, I would say having the the content to actually go through and understand the fundamentals and the ins and outs is probably more important than a mastermind. masterminds are going to give you some cheat codes, and you know, maybe some secrets, but it’s not necessarily going to show you how to wholesale a house or how to do it without any money or whatever the case, you can have those conversations, but they’re not going to be like, here’s a course.
Yeah, I think I think that’s the natural progression, right? Where you you learn from a mentor or coaching program. And then once you understand it, you start getting around people who are taking action as well. And you learn cheat codes, like you said, right? Yeah, yeah. 100%. Sweet. So yeah, everybody. I mean, we kind of dive right into this. But Michael, tell us give us like a 32nd spiel on who you are, you know, and then we’ll dive into your experience. So yeah, tell us who you are.
Yeah, for sure, man. So I’m a father, I’m a husband. And I started my home buying company about five years ago, because I was busted and disgusted, working a nine to five job. And I didn’t think that there was a path to financial freedom by continuing to do that. So what I ended up finding is a education program. And I learned that you can make money in this business without having a lot of money. But what little did I know, I ended up investing about 45,000 on credit cards from a free event that turned into a three day that didn’t turn into a one on one. And that was my entry into real estate.
What was that? Wait,
I’m curious. It was called. I think it was called Doug Hopkins real estate success formula. But it was actually the he was he was the face because he’s the TV star. But it was actually a company called Zurich’s out of Utah. That’s no longer in business.
I know about those guys. Yeah.
Yep. They successfully helped a lot of people raise a lot of money to pay for education. And I was one of them. And so yeah, $45,000 on credit cards. And my wife after I came home from that event, told me that she was expecting and so we had no debt. We had a baby on the way, we had the whole nine yards, and I was barely making ends meet on my nine to five job. So at that point, I was like, alright, it’s go time. I gotta figure this out.
That is wild, bro. That is that is a wild story. Just from there. Right? So how did they get you? Like, how did they get you to drop the 45k? Did they just promise you great things? Or how did that go?
Yeah, I mean, they sell you on the dream? There’s no question about that. And you’re there, there’s a little bit of high pressure sales tactics, there’s the FOMO situation where you’re in the back to the room, call your credit card company. So you can get an increase on here to be able to put this on credit, you can do 0% interest, 12 months, and you’ll go make hundreds of 1000s dollars, and you know, you’ll pay that off no problem. Like, it’s not a big deal. Obviously, there’s a little bit more to it than that, but that’s what they do is they just tell you, hey, you need this coaching. And if you don’t, like we don’t know if you’re gonna be successful, and and that was enough for me to say, You know what, I’m gonna make a call and I’m gonna make this commitment. And this is my education in my real estate journey, because I knew nothing about real estate prior to this.
Does that fire you up a little bit that they got you like that or is that? Are you cool with it?
I mean, I definitely made an emotional decision. So looking back, it was not the smartest thing I’ve ever done, but I’m not angry. I’m thankful because I got some pretty good lines of credit by doing that, that I still have today. My credit, my credit tanked after that, because I had 45 on the 60 line. But yeah, no hard feelings at all. I just knew I needed to figure it out and it needed to make that happen. I looked in the mirror and realize it’s go time I get through.
So you know what’s interesting about that? Because I think because I coach, right, so I sometimes I think like, there’s the guys that charge like the 20, the Fortune Builders, the same product, I feel like that I could provide right for a lot less, but it’s almost like that freaking giant charge gets people to take action, because if they don’t, they’re in trouble, which I don’t know if I think that’s like the best business model be like, Okay, I’m gonna force them in a terrible, sticky situation by charging them a lot. But it does. It does get people to take action. Right?
Yeah, I mean, I think there’s something to be said about it, you know, 45. I mean, that’s a lot for what I for what I received. But right, there’s definitely something about you pay if you pay attention when you pay. And so not saying to go spend 20,000 or 45,000 on credit that money, I don’t even know how you’re gonna pay back because this business takes some time. It does. It took me time to figure this out.
It really does. I totally get that. So okay, so that’s how you got your journey. So I want to ask you for the people that are watching this, or will watch this, how do you get deals? Or what’s an experience that you’ve got to deal with no marketing spend? Because we all know you can spend money to get marketing, but I want for the new beginners? How can they go out and make money? You know, without any money?
This is amazing question. I mean, you got to be resourceful. In the beginning, I didn’t have 45 to actually spend on marketing. So I had 45, to tell them to tell me what to do. And I listened. And so my first deal came from a for sale by owner, it was on a four Plex happened to be listed by a tired landlord that had actually lived in the four unit, one of the four units for several years, called it up, said Hey, see your property for sale, tell me about it and set an appointment and went there. And I actually only negotiated off $5,000 off of his ask price. So he was under asking because the property needed work. And so I got my first deal contracted it. I posted it on the real estate investor group, my inbox blew up. And I ended up taking an offer contractor for one ad took an offer for 211 on that four Plex. Nice. And I paid an agent and it was nothing but a disaster until closing because there were so many moving parts. I had no idea. Do it. Isn’t it crazy?
How those first deals like our I always feel like the first deals get crazy. You know, my first deal was crazy, too.
How those first deals like our I always feel like the first deals get crazy. You know, my first deal was crazy, too.
I think this question is going to come up. But I have to share this because this is people are gonna laugh when they hear this. I’m standing with the landlord who thinks I’m buying it for cash and just bring it in my partner, right? Literally does he know 15 people show up to the inspection. Yes, after we accepted the offer, the person said they were cashed. They actually had an a line of credit that they had to get an appraisal for the appraiser shows up to the property. I’m there with the owner. The appraiser is right here. I’m here the owners here he says, Man, I’m having a hard time with this. Can you help me understand? Why is the purchase price 180. And this price over here is 211. And my heart just draw gosh, yeah, in the seller, the seller looks at me and like he’s like, basically like, why is that? And I’m just like, well, we’re selling it to my investor friend over here. And he’s paying through 11 Like, that’s it. I gotta lie. Like it’s just the truth and and he’s like, Man, I really have some money on the table on this.
Man that’s crazy in the thing is like, that’s, that’s all we’re doing. We just know someone that will pay a little bit more, right? There’s nothing you said it’s straight. You’re like, hey, that’s what I did. Is there anything wrong? That No, no, no, not at all. That’s what you know. And that’s it’s interesting, because like the guy was paying for, and when we buy properties from people, right? Or wholesale. They’re, they’re paying for the convenience be nice, right? So we were able to get it done quick. So, you know, he accepted your offer. That’s that’s just how it goes. Right?
Yeah. And the moment that I cashed that check man is the moment that I realized that there was some real money to be made in this business. And I got pretty excited because I was a nutritionist when I was doing that. And I think I was making 35,000 a year. And that check was up more than half of my entire year salary,
dude, and then you just got stoked about that. You were like, Oh, why?
The belief was just like, alright, this is real. Like, I can do this more like again and again. And again. No problem.
Did anyone walk you through that deal? Or did you just get re able to get it done? Figure it out all yourself?
Yeah, that’s a good question. So paid the Zurich’s company, whatever, I paid them on credit. And then I found a guy who actually was local and he was mentoring people. And his deal was we split the deal. 5050 And so he showed me a handful of deals that I ended up splitting 5050 with him and worth every bit of it because there were situations that came up where I’m like, I don’t know what to do. I’ve never done this before. So he’s like, here’s what I would do. And you know, we figured it out.
Dang, there’s something to be said for those local guys that help help out those new new guys. They’re like, Yeah, I’ll take 50 But, you know, it works.
I do it again. Yeah, it’s invaluable. For sure.
Exactly. And that’s kind of how I help people in my program, too, is like, look, like, I just did a deal with one of the people in my club, right? It’s like a, like a month to month inexpensive program that help people out with we give them 6040. They take 60 I take 40. So we had a deal. He brought it to me. The house is listed for sale by owner for 320. He got it at 275. And I went out to see what buyers would pay and there they were 200. Right. So $75,000 above where buyers want to be sure I said did. I didn’t think much of it. I was like, Dude, you got to negotiate this. I got a buyer 200 Get it below 200 offer 160. And we might end up at like 180 He’s like, okay, so he comes back. He’s like, Alright, I got him. 180 Unbelievable. And I’m like, really? Okay, so signed it. Everything was good. It was actually 181 Right? So 19,000. And I was like, Man, why did they take that? And it was probably just because they were on market for a long time. No one was biting. They over listed it. So they just took it and ended up happening that the deal it was they inherited the home from their dad. So we were going through the title, everything was ready. And then we find out that dad that they inherited the property from had a $3 million judgment on him. And we’re like, dude, this deals dead. But we were able because I was able to work with him and go through some attorney stuff. We were able to get it taken care of where we found out that in 2016 it was wiped out in the bankruptcy. But before like if you’re new, you probably would have just left it left it alone, right? You were like you were able to get rid of it. Check this out. So the the buyer, everything’s ready to go everybody signs my buyer and South Carolina wires, the money. And somebody from the title company that they were working like they were wiring the money to someone had hacked the title company’s email system and put the wrong wiring instruction information. So they wire $200,000 to an account that no one who knows, right? So I was like, hey, so I call him like, Hey, how come this deal hasn’t closed yet? They’re like, Dude, we wired our money to some fraudulent person that hacked the account. So I’m like, I’m like, You guys just lost 200k and the buyers like, yeah, he was actually pretty cool about he’s like it. Yeah, yes. He never got it back. For as far as I know, as at this point, he hasn’t gotten his money back. So at that point, so we had the 3 million Arlene, the buyer wired the money to the wrong person, right, the fraudulent. And I was like, this deals dead, bro. It’s it’s not the guy just lost 200,000 He’s not going to want to buy it. So I said, Look, buyer is cool. If you don’t want to buy it, right? You just lost 200k I’m not upset. He’s like, Nah, we want it, Wolf. So then they’re like, give us another week. So then we got it done. But like that kind of crap happens. And if you’re new, you’re like, you’re probably done right? You’re just like, I’m out. Like, I don’t even know what’s going on right now. So it’s like helping people and having that experience can really help get stuff across the finish line.
Yeah, there’s no question about that. I mean, it makes a big difference having that person in your underside.
So next question I want to get into is tell me, I want to know, tell me a crazy story that you have from doing business. I kind of told you one, right? But yeah, without even meaning to tell me something crazy that you’ve had, because you’ve done a quite a few deals, I know there’s something a salary went wild or something happened? Yeah,
I have to share this one. Because it made me say that I’m never going to do another deal like this ever again. And I’m potentially in the middle of doing another deal like this. So it may just the reminder of this story could make me change my mind and tell the seller, I’m not going to move forward on this purchase. So it’s a mobile home, okay. And this situation is bizarre. We started marketing in a new market, and we got a lead from a mobile home. And the lady had lived like, already moved and everything. It was a for sale by owner, we ended up because I don’t know if what you guys know about mobile homes, but it’s not like a house. It’s a bill of sale. So it’s basically just like a piece of paper. And like I didn’t know if you could assign those or what, but long story short, we contracted for 20. And we just listed it like we listed it on Zillow. And we’re just vetting people seeing if we’d find a buyer. Well, we found a buyer and this lady lived in like two states over and she was only willing to pay like 2000 above what we had it for. So like we’re like, nobody else is interested. I contacted one of my buddies in that market. He owned a business. We facilitated a closing. He facilitated a closing at his business. And we trusted him to change like the title and to not take the extra $2,000 of the difference and all that good stuff. Yeah, and you can only imagine I didn’t do the amount of logistics that go into that
My mind can’t comprehend what’s going on. It sounds like a lot.
It was a disaster. And so long story short, it was just a train wreck of a situation, we should have never done it. And, like, learned a lot from that. But we’re like, we’ve never wholesaled a mobile home before, but we’re going to try it. And so, long story short, the seller got a check for 20, we got a check for two. And that was it. And like it, we close that deal. But it was just a complete nightmare. And I have a mobile home. That was referred to me today. And this lady’s like, I just want to be done with it. You know, whatever. And so when they get teed up, and I’ve actually been given a mobile home before, but yeah, I don’t I don’t typically deal with mobile homes for that reason, man. It’s just not as clean.
Do you feel like, in my experience, I feel like the ones where the smallest fees are the most amount of work? Do you is that true for you? Every time Yeah. You gotta like legal you almost have to like wiggle and like, I don’t know, you gotta
you gotta renegotiate the seller, you got to work out the buyer. The buyer is extra picky, because he doesn’t want to pay that you know what I mean? So it’s like, yeah, they’re always way more work.
Dang. So So tell me a little I’ve never done a mobile home deal. So it sounds like it’s like a car, isn’t it? Like, you have to like go to the DMV or something weird like that.
I don’t know how to do a bill of sale. And then there’s a title transfer component to it. And you can wholesale them, but it’s just a little bit more complex, because part a portion of the money goes to the seller, and then they basically have to cut a check for the difference. So I don’t recommend any and I mean, I was unprepared to buy him for really cheap, and then just be the bank for somebody else.
What sells? Yeah. That seems to be like the play that allowed people doing Oh, homes. Did you? Was it in a park where there was like a lot rent like a lot fi where you had to like, because it was it was in there.
Yeah, it was. And that was another component is we had to actually apply as the right person to live there. And then we had to get their approval with a sublease. And I just got off the phone with this other lead that was telling you about that. They don’t even allow subleasing anymore. So you just got to kind of know what you’re getting yourself into.
Yeah, it was. And that was another component is we had to actually apply as the right person to live there. And then we had to get their approval with a sublease. And I just got off the phone with this other lead that was telling you about that. They don’t even allow subleasing anymore. So you just got to kind of know what you’re getting yourself into.
Yeah, that’s another thing that I haven’t dealt with, personally, because I haven’t done a deal. But I know that it’s like, okay, the park is a component to you got to like, verify if they’re cool with everything. So
I’d be a lot more interested in buying the park. Yeah. In the land. Yeah.
Sounds like a good gig. I know a lot of people get into that. And they do well, so Wow, cool, man. Well, I like that story. So kind of let us know, let us the listeners that are listening in that will listen, let us know what you’re up to right now and what we can learn from what you’re doing right now.
Sure, absolutely. So we’ve had a lot of talks on kind of the back end of everything of how our business looks today. And so I’ll kind of just fill in a little bit about how I got here. I think that’s important to provide some value for the listeners, if they want to grow a team, one thing that I realized early on is that if you’re going to spend money on marketing, you absolutely must track and know where every dollar is. But you also need to be able to respectfully handle that flow of lead leads, otherwise, you’re going to be just be burning dollars. And so early on, I realized that and my goal was to build up a company that could operate if even, I’m not the one who’s making the calls. And so that’s what I ended up creating, I brought on an Acquisition Manager, I brought on a lead manager, and slowly but surely just started bringing in the people transaction coordinator, and so on, so forth. And what I learned along that is, if you don’t have a good process, you’re just gonna set them up for failure. And so simultaneously, we started really documenting the process for each department, right, you have your acquisitions department, you have your dispositions department, you have your transaction, team, finance, and all that stuff. We just processed it out and give them the tools and the resources that they need to be able to take a transaction from start to finish successfully without me having to be involved with every aspect of it. Right. So I wanted to preface it with that, because today, we have 10, full time employees. We have some contractors and stuff like that too, in the States. And then we have a handful of virtual assistants as well. And ultimately, it’s not for everybody. We’re talking our overhead has gotten up there. But it’s exciting to be able to watch an acquisition squad, you know, compete and go for deals and get after it. And so today yeah, we’re we did 93 deals last year we’re on. We’re we’re pacing to double that next year. That’s our goal, but I’m more interested in the bottom line. So if we don’t even get close to 200, that’s fine. If we can do bigger deals and less of them, that’s a lot more less brain damage. Yeah, right for our team, because inevitably, even if you have the best transaction coordinator in the world, you have the best acquisition disposition. There are just some things that you know, as an owner, you have to kind of step in and get involved with to help solve those problems. And so that’s just The nature of the beast.
Yeah, we do for sure. And what markets are you currently doing deals in.
So I’m in Vegas. Vegas is a market that we’re building up right now. So I need to do more and more deals here. And then Nebraska, just for the listeners, I actually don’t live in my main market where I do business i Hence the virtual baller, right? I I knew from Nebraska three, three and a half years ago and kept building the business up and my business partners back there still, but yeah, teams all over the country. I have an Acquisition Manager here in Vegas. I have an Acquisition Manager in Omaha, one in Arizona, and then follow up specialists is well, but we just spend the money on the marketing, the leads come in, and they know what to do. And as long as they’re performing, you know, we can consistently close those deals.
I’m question I have a question about KPIs. Do you have like a certain amount of calls that they have to hit? Or what is that main KPI that they have to hit like daily? For? Yeah, so
yeah, I mean, the the calls, we have a 50 minimum is one thing that we track. But I’m not as worried about that. Because there’s there are days where as long as they’re talk times up, and as long as they’re having quality conversations and making offers, like if they meet a certain threshold of amount of processes and amount of offers, naturally, their call times gonna go down. So for example, I think my Acquisition Manager has contracted to houses yesterday. And I think it’s either one or two today already. So it’s been a it’s been a good week. But his talktime and call numbers are going to be a little bit down, because he’s been talking to hotter leads and spending more time with those people, because it just takes more time.
Gotcha. So it has to it fluctuates between offers, talk time and calls, tickets don’t have offers they need calls, if they don’t have calls and they need good talk time.
Yeah, and it’s probably not as clear as it should be. But what I’m most concerned about, and anybody who probably manages a sales team can tell you this is the what’s what’s on the board, what’s the projected profit. So we’re always looking at that, like the projected profit, you have a minimum expectation that you need to hit. And then you have a goal, obviously, that you’re you’re striving for. So that’s what’s more important to me.
No, I totally get that. Did you ever try to do the virtual like PPC in every state, nationwide model? Or did you always stick with your markets?
I’ve always stuck with some core markets? Because I don’t know. I just felt like, you know how the disposition is, if you don’t have a networker, it’s a it’s the opposite of painless, man. It’s it’s painful.
That’s right. That’s exactly right. The the PPC model nationwide, oh, gosh, that’s a dispo nightmare.
dispo nightmares the truth. And so we’ve picked a select core markets that we have contacts with and boots on the ground in case we ever needed to have somebody run out there. But we’ve also learned how to set the stage. And I can kind of talk a little bit about that. Because I think setting the stage and expectation with the seller on a virtual deal is critical. It’s everything. So when you’re talking to a seller, they need to know what to expect. And so for example, when we have a process call, and an offer call, they already know that even if they accept the offer, we’re going to have an inspection period. And there’s a possibility that if everything doesn’t check out, as we talked about, and we get bids that are lower than what the contract price is, because maybe we paid a little bit more than we wanted to, we’re gonna have to have a conversation about that. And they’re not obligated to entertain anything less than what we agreed upon. But once we get that feedback, that is a possibility. And by the way, we’re gonna have people coming in and out of the house during this time period to be able to make this happen. So you lay it all out there.
Easy, easy. And that’s exactly how it transparency is the key, right? You got to tell. So that set the stage, there’s nothing worse than like that that feeling that you had at the when you did your first deal, right? You didn’t you weren’t open about it. So he called He asked you, right, but now you don’t have that problem. Because you said hey, this is exactly what we’re doing. We’re working with some partners in the area, we’re gonna have some people walk through the price. If everything works out, we’re gonna go through exactly what we said, if I see something that we didn’t talk about, then we’re gonna have to talk have a discussion, right?
It’s easy, and there’s no surprises, you know, you can just tell them, hey, you know what, this is really tight. Like, I don’t really love this number. If I come back to you in a week or two weeks, you know, and say that this is probably not going to work for us. Are you going to be able to live with that, like, don’t go move in your life until we can get this inspection period taken care of? Right?
That’s like, that’s my mission, right? Working with new new investors, because they have, I’d say 90% don’t know how to have that conversation. They they’re nervous about it. They don’t know how to say how to be straight up. So they’ll tell a seller Yeah, I’ll buy your house at a price. I have no idea if it works. And then I’m buyers and they will avoid the call to renegotiate until their cancellation date or the closed date for some reason and the person’s already moved out. Those are the ones that are giving us a bad name, because they just don’t know what to do. Right?
So yeah, man, definitely never want to put a seller in that kind of situation. And people think that it’s it’s such a hard, scary conversation to have. But people appreciate the transparency like, Man, this guy’s being, like, almost too transparent. Like I really trust him. I really respect him. Yeah.
100% Well, I love the way you’re doing business. I think that’s awesome. One thing that I struggle with a lot when I was having my wholesaling business, kind of like yours was bigger was doing the nation, the multiple markets, that was a tough thing. But we were following the model that at the time, it seemed like the sexy model, right, like because the Pay Per Click leads, they were cheap if you diversify your area, but the problem is, again, it’s dispo. So we got investor live thinking that would solve, there’s nothing that’s going to solve you getting a house in a crappy area, that’s just there’s nothing that solves that you can’t sell a property unless it’s in an area that has investors, you know.
So well, let me let me say something about areas without investors, because that was actually my belief as well, for the most part. And if you tried putting it out on an investor lift property to a town in the middle of nowhere, nobody is using investor lift in a town in the middle of nowhere. And if they are, it’s kind of just a fluke deal. We had a deal that we could not wholesale, but we like had it at such a good discount. It was an acreage, like a 90k. Purchase 250 ARB like it was a home run deal. And we’re like, why is nobody biting on this at like, 130? Like we were prepared to just like, you know, sell it for like way haircut of a price and just move it. And it was crickets, like nobody could get into couldn’t get hold of anybody. And like, Huh, what if we could put this property on the MLS? What if we could get this thing out to more buyers? And so we just had to have a conversation with the owner and just say, Hey, listen, like we want to move forward at the price that we’ve agreed on. In fact, we might be able to get you even a little bit more. But we’re going to need two things, we’re going to need access and the ability to put it on the open market. And if we can do those two things, Mr. Seller, we’re going to list the property we’re going to sell, we’re gonna get squared away. But that’s what we needed to have happen. And sure enough, they’re like, cool, we’re gonna go ahead and just novate this deal for anybody who’s listening who doesn’t know what that means. Basically canceling our contract once we find a new buyer, and then replacing it and getting paid the spread in between. Dude, we listed that thing within a week, we had an offer for 169,000. Beautiful, beautiful, it was nuts.
No, no, I agree. I agree. I think Novations are, are like the key right now. Right? Especially like in this market? Do you do a lot of them right now? Or do you not do so many? So many?
Yeah, that’s a good question. Since the laws are changing in some states, Nebraska being one of them, it’s kind of becoming our go to strategy. We’re just letting the seller know, hey, this is not a house that qualifies for our cash program. Or maybe the price is just too far off. We do have a program for this. And in return, this is what we’re going to need access again, we have them sign an attorney. In fact, we list the property. And it’s been a game changer because this positions don’t need dispositions manager, the agent takes care of all did. And we get a buyer who’s willing to pay us more money when you say the laws are changing. And are you talking about wholesaling, you got to have a license to wholesale in Nebraska. Right?
Would you would you say doing innovation is some form of wholesaling or not not? Not at all. It’s totally different. Right?
I mean, if you ask the real estate commission, they would probably make a pretty, pretty good argument about how it’s basically the same thing, you’re marketing a contract, but if it’s not you marketing the contract, it’s and you have the sellers permission, they’ve signed all the disclosures, all the documentation, then I would argue that it’s it’s pretty much like a wholesale without buying it.
So do you feel like those are that’s like the up and coming thing now, like, it will probably take over wholesaling. Novations Yeah,
I mean, I do I think in a year and a half, two years from now, there’s going to be some serious legislation, depending on how how many people find out about it and don’t do it correctly. Because you could you could also put somebody in a bad situation or mislead somebody if you’re not very transparent on the whole Novation thing, too.
Yeah. I think so the my process when I talk to sellers right now is lowball offer, like low wholesale offer, they don’t accept, then it’s like, I get why you wouldn’t accept that. And then there’s two other options. It’s creative or, or we can partner right? We have a program for partnering with you. Is that kind of how you roll or you just go straight to the innovation route?
No, we’re always proposing the cash offer program first, okay, unless it’s just so far off that you’re like, This isn’t somebody, I would rather just not offend them because it’s too low. We just say, hey, you know, your house might qualify for this other program we have. And here’s why we would do that. And here’s what it would entail. And we would just present that program, essentially. And it has to there has to be some sort of a FOMO. Like, let’s be real here. If everybody gets this program, it’s not as cool as if only this house because of the age and the fact that it’s not completely distressed. She gets the program, it changes the psychology behind. It’s like, oh, man, nobody’s been approved for this program and like a week is the first one of the last 20 that we’ve done here that’s been approved for this. And like, huh, this is pretty special.
Yeah, I feel I feel good about this one. Yeah, yeah, yeah, I kind of I feel like that’s like the best way to do it, to present options to the seller, see what works best for them. And I really believe that the amount of people that are can accept a wholesale offer or will is very, very low. So you got to be able to work Creative Innovations in there, or you’re going to not do as many deals especially in this market.
Man, we’ve been forced to pivot because there was just too much of a gap between the pricing expectation and the reality of what the cash buyers were paying. Were cash buyers, we closed on properties all the time, only in our core markets. But you know, if you don’t have to, you can definitely alleviate a lot of risk by having that other program. So we do creative as well. And we actually send a letter of intent, like offer options packet to the sellers with those options
Does it have those three, cash, creative and the partnership one?
Yeah. And it has a nother program, which is basically just a realtor referral. And it sounds weird. It’s like, well, people ask all the time, why wouldn’t they just list themselves? And it’s because we’re taking care of everything for them? Yeah. If the buyer is asking for repairs, we’re taking care of that. And it’s hands off.
Yeah, in most of the time, you just add it to the buyer disclosure, right? Like you, you don’t even have to fix it up, you can just say, we’ll give you that credit on innovation.
Is that right? It’s just basically a net net price to them. And we’ll take care of the rest. Do you
Can you send me that? That letter of intent? That sounds pretty interesting. I have one too. I just kind of I would like to see the one the way you’re set? You’re just set up? Sure. Absolutely. Well, I love it. Man. I love what you’re doing. And I’m kind of doing what I’m doing what you’re doing. But on a very smaller scale with specific, you know, I kind of told you my model, right? I want to help specific people that that are newer to the game. But that’s awesome. everybody that’s listening. This is exactly. If you want to go that route and build a bigger team. That’s exactly how you do you got to get people in place. So you can step out. And yeah, you’re doing it right. I like I like what you do, Michael, I appreciate you giving us a lot of your experience of how you’re doing things.
Yeah, man. Absolutely. Happy to help for sure.
Is there anything you’d like to leave the audience with? Before we wrap up?
I mean, if you want to connect with me, you can do so on Instagram? Of course. Yeah. drop drop anywhere where people can hit you up? Yeah, absolutely. So I’ll drop a link to my Instagram. It’s Michael McDonald, our Ei, on Instagram. And then yeah, I mean, have some free free tools and resources on my website. What’s your website? It’s the virtual millionaires.com
Virtual millionaires. That’s a good name to man. It’s glad. I’m glad you got that domain.
Yeah, thank you. I almost had to fight somebody for it. No, I’m just kidding.
Like, okay, so you got virtual millionaires? You said.com. And then you have Michael Rei on Instagram.
Yep, exactly. And I do have a, I can give your audience if they want a little bit of a. It’s an acquisitions accelerator. Yeah. is what it’s called. I can drop a link for anybody who’s interested in that. If you’re cool with that.
100%. Yes, please. Anything, anything we can do? I bet you’re providing tons of value to me by being on here. Let me ask my questions. And then you’re providing a ton of value the audience, so Yeah, appreciate. And you do have your own show to write your own podcast?
I do. Yeah. So behind me is the virtual millionaire show. And it’s essentially Yeah, that’s what we talked about is we talk all about, you know, growing a team, and I’m really big into marketing as well. I know. It’s not for everybody to spend a lot on marketing, but I definitely have. I’ve spent a lot of money on marketing over the years. I don’t know, I don’t want to know how much it’s probably been well, south of a half a million easily.
Yeah, but yeah, that’s great. That’s awesome. And I believe that marketing isn’t necessary. If you want to scale you’re not scaling without marketing, in my opinion, you need marketing. But if you’re new, you know, dabble a little bit in the free realm. Try to network try to get deals from going to RIAs. There’s a lot of different ways, but as you get the proof of concept, you see that this works, which it does from you can see from us that you can start diving into picking whatever marketing channel you want, and Michael is a good one good person reached out about that. Amazing. Alright brother, baller, man, thank you.
I appreciate it and can’t wait to connect in Florida, man.
Oh, we’ll connect man. It’ll be good. All right. It was good talking with you. We’ll catch you later.
All right. Sounds good brother. Take care.
