Dwan is America’s most sought after real estate investor. She has been buying and selling properties such as foreclosures, commercial properties, and rehab rentals for 30 years. Today’s episode gives us a peak in how real estate investing was done in the 1990s and some insights into how people can get started in the industry.
Dwan was a single mom without a path. She didn’t want to leave her child in daycare, so she got into real estate as it offered her the convenience of working from home.
A couple of years in, she starts sharing what she learned with people. Later on, people told her to write books. Since then, she has made 2,000 deals and has had 500,000 students.
Real estate back then didn’t have the convenience offered by the internet. Dawn had to drive to the courthouse in West Palm Beach, Florida to write down the foreclosures listed. Then she spent hours mapping out properties. She made $22,000 on her first deal in 1990.
If she wanted to meet other investors, then she had to check out the newspaper classifieds to look for real estate meetings. She and one other girl were the only two women in the group, but after people realized that she was making more deals than most people, they started taking her seriously.
Dwan looked for leads by door knocking. She didn’t know then what others were doing because there were no classes, seminars, or books. Also, she had a bad script, so she experienced getting the door slammed in her face many, many times.
But people appreciated someone coming to talk to them. Most investors mailed postcards. She went door to door with her baby, and people felt more comfortable talking with her.
By the time she attended real estate meetings, she was wholesaling 75 deals a year. She found out that other people were doing between 10-30 deals a year. This made her stand out and led to other real estate groups asking her to talk in their meetings.
She realized then that she was a good trainer and loved teaching others how to close deals. She felt great seeing the people she had taught still doing great and making money 20 years later because they had crossed paths with her.
Dwan thinks that you’ll know who is a go-getter and looking for a path to financial freedom. She compares them to those people on the other end which she calls tire kickers. They are the people who only kick tires but never actually buy the car.
Those people only think about doing investing. But the one who will do whatever it takes to be successful is the go-getters. It takes a lot of work to make millions of dollars.
Dwan learned how to ask really good questions and find out which ones are willing to give up to make their dreams happen. The reality is this, to make $300,000 a year, you need to put in the time and make tons of sacrifices.
Most people fail to set a schedule and stick to that schedule. Dawn recommends setting a specific time for when you return calls, when you look for new leads, when you visit with homeowners, etc.
The number one reason most businesses fail is because of the lack of follow up. People talk themselves out of doing the follow up thinking that they don’t want to bother the person. What happens is that they end up spending their day looking for new leads instead of following up on the ones they already have.
Had they persisted on following up, eventually, things would have snowballed into closings after closings after closings. Fear stops everybody because they’re afraid of the unknown or they don’t want to come off as too pushy.
Dwan believes that you should be following up all the way until the foreclosure sale. Most owners start being in denial first, so they might be hesitant to entertain you. Then later, they’ll become fearful as the foreclosure sinks in. After a few more weeks, they might be in acceptance of what’s happening and be willing to make a deal with you.
It’s important to recognize the mindset of the homeowner and know where they are in the process to be able to help them
Nowadays, Dwan outsources all the tasks she needs to be done such as putting out signs, fielding phone calls, booking her for speaking engagements, doing the paperwork for her taxes, and designing and doing the rehab.
She trains her people to do it the way she does. But she believed that it’s important to have general knowledge, so you won’t be fooled or taken advantage of. At the start, Dwan took how-to classes on Home Depot and did the rehabs herself.
The first house she did a rehab on took her 6 months to complete. Rehabbing was the best therapy for her since she was coming from a nasty divorce. By her 2nd and 3rd houses, her family helped a bit. After that, she learned to find people to help do the things she didn’t know how to do.
But for the first 5 years, she learned to do all the things herself, except for tiling a roof, which was the only thing she has never done.
She found her construction crews to do the rehabs, but she was militant and worked with a checklist. By her fifth year, she was rehabbing 3-4 houses at a time.
Eventually, she switched to wholesaling after she found out how much she liked it.
For her first deal, Dwan didn’t have the money or the credit to buy it. But she made a deal with the owner for her to move in, make the payments, use her credit cards to buy stuff, and sell the house.
All she had with the owner was a handshake agreement to split the profits from the sale. She had no paperwork at all. Dwan used her credit cards including a $10,000 Home Depot card and borrowed money from family members. After she sold the house, the owner got ⅓ and Dwan got ⅔.
The money she made from that deal allowed her to buy her second house which she made $50,000 from. That house allowed her to buy two more houses.
Dwan was lucky because a million things could have gone wrong. The people she hired were ones she had met at Home Depot. She didn’t have a legal contract with the owner who could have skipped out on her.
By her third deal, she found a hard money lender through the newspaper. At that time, you could get a 15% interest-only loan for 6 months with another 6-month extension for another 3 points.
At that time, she still used the same title company from her first deal. She wasn’t aware that she could work with banks, real estate owned (REO) agents, and multiple listing service (MLS) until years later.
Everyone buys into the idea of doing easy work at home. But Dwan believes that you have to know something about doing rehabbing, and you should be going out to meet people.
The downside to technology is that people become marketers instead of investors.
Dwan recommends people to listen to her podcast, The Most Dwanderful Real Estate Podcast Ever, where she teaches people about every single aspect of real estate investing.
Also, find an actual, solid mentor to guide you. Join the local meetup group and learn from other people then move forward on your own.
Dwan says that everyone who follows the system makes money. If you don’t take action, nothing happens. Be wary of anything that sounds easy.
Build yourself a business by learning what a real estate agent does, what contractors do, some basic skills, and the legal side of foreclosures.
You should also understand the mindset of the homeowner so that you can put together the pieces of the puzzle and move forward with it.
The best way to learn something is to do it. People get stuck over educating themselves because they don’t know what they should be doing. But they end up with so much information and don’t know how to process them step-by-step.
If you listen to Dwan, she teaches people what they should do on a weekly basis.
Real estate investing is very rewarding because you get to help people in distress and create a win-win situation for both you and them.
So take action and don’t be held back by fear. Dwan made all the mistakes there is and still lived to tell her story another day. One of the painful lessons she learned was to never buy a house without an inspection. She had learned that after not knowing she bought a house infested with termites, which cost her a lot of money to get rid of.
Lastly, you’ll never regret a day working for yourself.
Clint Coons is one of the founders of Anderson Business Advisors, a firm that specializes in creating asset protection entities…
Justin is a real estate investor who has done almost 2000 deals across the nation and in this episode, he’ll…
David is a real estate investor and a real estate coach. He has been investing in properties for almost 20…
Andrew, a real estate investment developer, is the owner of IronGall Investments, an Austin, Texas-based real estate development company. They…
Chris is the President and CEO of Smart Growth Inc., a California-based real estate and development firm. They are focused…
Rafael is a real estate coach and an organizational psychologist based in Miracle Valley, Arizona. He owns several real estate…