The Science of Flipping - Episode 32: How To Get The Grand Slam Deal | Real Estate Investing Podcast

Episode Date: April 18, 2014

document.addEventListener("DOMContentLoaded", function () { podlovePlayer("#player-5eb5ab321b8e3", "https://thescienceofflipping.com/wp-json/podlove-web-player/shortcode/post/500", "https://thescienceofflipping.com/wp-json/podlove-web-player/shortcode/config/default/theme/default"); }); <p> document.addEventListener("DOMContentLoaded", function () { podlovePlayer("#player-5eb5ab321b939", {"title":"Real Estate Investing Podcast u2013 Episode 32: How To Get The Grand Slam Deal","subtitle":null,"summary":null,"duration":"","poster":null,"chapters":"","transcripts":"","audio":[{"url":"http://thescienceofflipping.com/wp-content/uploads/2014/04/Podcast-Episode-32-How-To-Get-The-Grand-Slam-Deal.mp3","mimeType":"audio/mpeg","title":"AUDIO/MPEG","size":0}]}, "https://thescienceofflipping.com/wp-json/podlove-web-player/shortcode/config/default/theme/default"); }); <img alt="itunes-justin-colby" src="https://thescienceofflipping.com/wp-content/uploads/2013/09/itunes-justin-colby-150x150.png" width="150" height="150" /></p> Justin reviews how he finds and gets the grand slam deals. If you have ever been driving around looking for good neighborhoods to flip in and found that one deal you knew could make you big wads of CASH, then you need to LISTEN to this Podcast. One of these deals every 3 months can make you north of $500,000 this year alone.  Listen to how Justin gets these deals.

Welcome to the Science of Flipping Podcast. I'm your host, Justin Colby. Welcome, welcome, welcome everybody to the Science of Flipping Podcast, episode 32. I got a great one for you this week, guys. I am your host, Justin Colby, inventor and founder of this podcast, as well as the scienceofflippingacademy.com, where you can go to find all the information that we use in our business. I know a lot of you out there who've been listening to me for a long time, week in and week out with these podcasts have asked me a lot of questions about my coaching. If you're interested in learning more from me and my team and possibly having coaching from us, go over to the science

of flipping.com and you will see a tab there saying coaching. Go ahead and click that tab and shoot us some information so we can be in contact with you. I'm very excited about this week's podcast, guys. If you've never listened before, and this is your first time listening to our podcast or my podcast here, understand that this podcast is all about creating the systems in your business for us fix-in flippers and flippers in general to have the systems in

organization so that you could live the life that you want to live. So you don't feel like you're swinging the hammer and in each department of your business full time. I get plenty of students time and time again mentioning, you know, they wish they had the systems I had and, you know, they need to learn these things because they feel like they do everything in their business, which could be quite true. They might do everything in their business and that's what we're trying to alleviate so that you can flip homes while on vacation, flip homes from the comfort of your own couch, whatever it might be, so you're not in your business.

If this is your first time listening, I am your host, Justin Colby, and I am a real estate investor here in beautiful Phoenix, Arizona. We have been flipping homes here since 2007. And back then, it wasn't as sweet as it is today. That was back when the economy was interesting, let's say, and short sales were very prevalent. The banks didn't know what to do with short sales. So let's just say the success we have today, it was not the same back then. It took us almost a year to get our first two deals done. Two deals in one year, I think we made $14,000, $15,000 total. Now me and my business partner, we split that 50-50 and then you take some taxes out and guess what? I'm still eating hot dogs and top

ramen for dinner. I know a lot of you guys can probably relate to me out there because either you're going through it or you already have gone through that or you're probably shaking your head, yeah, I remember those days, or man, I'm doing that right now. In fact, one of my listeners reached out to me personally and said, I'd really like to have a couple minutes of your time. Can I get you some coffee? He came into our office and he is in the exact same position as we were back in 2007. He's struggling. He has barely enough money to live and he's hoping the next deal that he's closing is

going to get him through the next 30 days because the commission or the profits are not that big. So, you know, I, he's, uh, I want to say he was 25 and, uh, I'm sure he's going to listen to this podcast. So hello, I know you know who you are. And I just really resonated with me because we've been there. We went through that and we've had to create the systems and we've been there. We went through that. And we've had to create the systems and we've had to have the fortitude and dedication to keep pushing through those times. And guys, that's what I'm really passionate about is giving you guys systems and organizations and methods that we use in our everyday business to get to that point. So you don't need to fight the good fight that we did. And so that's why we're here on this podcast. Today, guys, what I want

to talk to you guys about is simply that one deal that we all come across as investors. When we're driving neighborhoods, when we're scouting out where we want to flip homes, when we're scouting out where we want to do some marketing, when we're scouting out where maybe we're going to do some door knocking, and that one home really catches your eye. The home that you say, gosh, if I could get this, this is my big payday. This is where I could really make some good money on this one

specific home. And we all know that home. Maybe it's a burned down house. Maybe it's a huge home that is, you know, looks like four different builders built the home, totally different styles. And you're like, oh my gosh, the reason why this home is not selling is because it just looks like four different people tried to build four different homes and made it into one home. We all know that home that you look at and say, oh, this is the money pot if I can get it at the price I want. What I want to talk to you guys about today is simply, you know, instead of maybe canvassing the whole area, which you should be doing anyways, but really, how do you attack that one specific home? we write a handwritten note specifically to them discussing why we want to buy their home for personal reasons not for business reasons but for personal reasons so the letters can look like

this and i actually have one of the letters that uh i i wrote here and i'm just going to give you a quick cliff note version of it because it's quite long as I try to be in depth with the seller. But the basic gist is, and it's three paragraphs long, but the basic gist is me and my girlfriend were looking for a home that we can put some love into ourselves. We were looking to get to the next stage of our relationship and really the home that your home, speaking to the seller, is a home that we really feel like we could make ours and create a life with our up and coming family. And this is the home we would like to take the next phase of our relationship into. Now, again, this is the cliff note of my letter that I have here,

and it goes much more in depth about the home and how we see a vision with our children and the school systems and so on and so on. But what I want to point out to you here is this starts to resonate with individuals who are selling a home. Now, it's not going to work every single time. I have written these letters time and time again, and it works. Not every time, but it works. So what happens is, depending upon the seller,

I have a couple right now. They're just an older couple, and they've been in this home for 50 some odd years. So, when they read my letter, it resonated with them. They raised their children at that home. They helped raise the grandchildren at that home, so on and so forth. So, I struck a chord with these sellers that they probably would rather sell to me and we're in negotiations currently than maybe your traditional marketing letter, which we send out 20,000 of a month

saying we're an investment company looking to buy homes in your area. If you're interested in learning more about the values of your homes and or interested in talking to me about selling your home without having to put any money into your home, paying commissions or closing costs, please give us a call at 480-blah-blah-blah-blah. That is your traditional marketing letter. And what I'm here today, guys, telling you guys is on the one golden nugget, that jackpot deal that you feel like is your home run grand slam deal, you might want to give a personal touch to it because it might resonate with an individual or a couple or even a living trust. I've had this same letter. I sent it out to that address and it turns out it was a probate or in probate and was now in the family trust.

And the trust had to make a decision to sell it. So the thing about it being in the trust is the individuals that were reviewing whether they were going to sell it and for how much and so on and so forth, they see the letter. And it still has a human aspect that even though it's technically in the trust, the executors of the trust read that letter and tend to lean towards a personal letter like that. And they will say, if we are going to sell, I think these two people are the people we would like to sell to. Now, again, I'm making it personal. So when they contact me and they say, Justin, we got your letter. Thank you so much. We are looking to sell. We don't have any money

to put into rehab or fixing up. We'd rather a cash closing. Are you guys able to buy this home cash? And I will say yes. And at that point, obviously I want to do the same type of due diligence as always, but this is where I'm able to a little bit back out of that personal touch and say, you know, personally, I want this home for me and my girlfriend or me and my wife or me and my family. But for us to close quickly and for us to close cash, I'm going to have to title it into my company's name. And the reason being is my company has all the money. And if you're okay with it, then we'll write up the contract into my company name. Now, that being said, you can do it that way. Or another way I've done it is I keep it in my personal name

and I say to my business partner, this deal is going to stay in our personal name or my personal name because it's the only way for us to get this deal. It's not going to be able to go into the LLC. Now, why most people would say don't put it in your personal name is because there's a lot of hangups with it. You have liability and tax reasons and so on and so forth, but you're also able to quick claim it over into your or re-deed it over into your LLC once you buy it. Now, again, these are very easy things to do. If buying it in your personal name gets you that deal, buy it in your personal name. That's why I'm asking you to write or informing you to write a personal letter so that the seller resonates with you. You pull on some of those heartstrings and they start to say, you know,

if we are going to sell this, this is the type of person I want to be selling this home to. Not an investment company who doesn't care about the home. They care about the dollars. And this has been a great way to get some of those golden nuggets, grand slam, home run deals that other investors aren't able to get. Because I handwrite it, which a lot of investors do, but I put a personal touch on it. I'm not just an investor.

I'm a person with a girlfriend, a wife, a family, a husband, whatever the case may be, and I want it for personal reasons, not necessarily just the dollar amount, and it absolutely works. Again, this is for the deals that those diamonds in the rough, the one deal that you know if you could get that deal, it would be a great payday for you. And that is a strategy to use for that one specific deal. Again, guys, I'm not telling you to do this on all of your marketing pieces.

Just go out for this one deal, write a handwritten letter explaining who you are and why you want that house. You're married, you're with children, you see your family making this their own, you're going to put your time, money, sweat, tears into the home to bring it up to market value and live in it and have that experience. And oftentimes, even if they aren't able to sell it to you, they're at least going to get you that call back. And that's all you really want is for that phone to ring. Again, this has been the Science of Flipping podcast, guys. Each and every week, we put these podcasts out in an effort to inform you about systems and strategies and organization in our business that we use each and every day here in Phoenix

that you can learn for free. If you want to know more about, again, my educational system, my coaching, you want to learn from me and my team, go to thescienceofflipping.com. You will see a coaching tab. Also, you can email us at info at thescienceofflipping.com. I look forward to giving you another great podcast next week, guys. I'm your host, Justin Colby, and I'm out.