Seller Financing Explained! – Max Kibler

[00:00:00] This is everything real estate investing show with Sean Pan. We interview local Real Estate Investors and professionals to go over tips tricks and investing strategies to help you learn about the business and to enable you to achieve your financial goals, and now welcome to the show. Hey everyone, and welcome to another episode of the everything real estate investing show with Sean Pan. Today, we have Max Kibler again. Max recently found a lead in Sunnyvale. That questions I want to do next. In this episode, we have a brainstorming session of how to approach the seller and the different creative financing strategies we could use to close this deal. If you enjoyed this episode subscribe to the show and leave a review. We release episodes every Wednesday and Sunday and release the show notes with the full transcription on our site. Everything re i.com. Enjoy.

Sean: [00:00:49] How’s it going everybody? We’re back here with Max, a new real estate investor, and he has some new leads. It doesn’t know what to do with it. So we’re going to go over all the questions that he has and explain all the little details that you know one might not know as a new real estate investor. So max. Go ahead. Let’s talk.

Max: [00:01:06] All right, so so I downloaded property radar and I just started trying to prospect around in Sunnyvale and San Jose basically I cold called like some people for pre-foreclosure and the people like pretty much everyone. I was calling they weren’t answering the phone. So I figured it was because their houses are just. On my summary lists. I feel like the pre foreclosure list is I mean that you can go on like Zillow right and just see that it’s under pre foreclosure or something. I mean, I don’t know if people were like someone I was talking to said once it’s on one of those lists, like everyone’s already calling them a few people. I called kind of responded but one of them it was like the house was already on Market but a time I talked to them and other people just didn’t answer or like they hung up on me. At least I felt like they probably were getting a lot of calls. So then I did like the vacancy list and. Also people were telling me like if it’s an absentee owner, there’s probably didn’t have much motivation to sell but I still just tried and this is like the second day that I tried doing it and the other person I talked to was kind of like pissed like they’re just like don’t call me back or whatever hit their like, there’s no need to call back and but so I was kind of like worried are called someone else to and they said the house was already sold, but someone to talk to yesterday just like was really receptive about it.

He was like when I said, oh, you know, you’re thinking of crazy unlike a few properties. And when I said, are you considering selling any of these properties and he is just like. Yeah, actually I am you know, and I’m you know, and I’m having some some health problems and he’s like really open to talk to me. And so I was like I was kind of surprised because the other people I talked to were kind of I don’t know like shut off or something. So it’s sort of just that moment where I was like, oh, wow, like maybe this could actually work, you know, like you can actually get these these connections and stuff. So basically just from that and then I sent you the property they addresses and stuff and trying to figure out what to do next.

Sean: [00:03:21] Yeah, yeah. So first of all anyone listen to this will probably hate you so much because I know some people who call every single day and you get nothing but you on your second day you got a portfolio.

Max: [00:03:31] Is that enough? Is that a portfolio or like me? What do you mean? They can’t do anything like it.

Sean: [00:03:36] Some guy one guy having like for properties at the portfolio Okay, and he’s going to sell maybe all of them. Who knows. So yeah, you definitely got very lucky. So congratulations on that and that’s what we have is conversation so that you’re able to close on this deal and you know be able to just do this full-time. Tiana’s doesn’t happen very often. So like when you have a deal like this you we have to make sure that you do it correctly so that you don’t like scare off your prospect.

Max: [00:04:01] Okay.

Sean: [00:04:02] So that’s why we’re talking so I sent you my ideas.

Max: [00:04:05] Yeah.

Sean: [00:04:05] Basically what I did was I went on the MLS. I looked up a radius of .25 Miles because in the Bay Area every little like block can be different. So you want to make sure your comps are all within the same neighborhood and all within the same school district. So I did I went on school and housing.com. I pulled up that database. So yeah, they’re all in the same elementary school middle school and high school and they’re all in the same neighborhood. So they all have this similar comps and then from that comp I was able to determine. All right. Here’s my purchase price. Here is how much I think I’m gonna have to put in I just ballpark, you know fifty to a hundred thousand dollars. This is like the average for a single-family home if it’s small and you do know like very little repairs 50,000. Okay, if you do a lot hundred thousand budget and then just work backwards. How much is my holding cost? How much is my closing costs when I saw the house? And how much do I want for profit? And that’s how I got those numbers?

Max: [00:04:57] Okay.

Sean: [00:04:58] Yeah.

Max: [00:04:58] So did you use like the formula the arv times whatever – your rehab or fee or anything like that? Like how did you so I know you look at the comparable like the prices and that’s how you figure out that what they are of you could be. Right?

Sean: [00:05:14] Right, right.

Max: [00:05:15] Okay, because the other number is like really specific so.

Sean: [00:05:20] The comps here are like 1.16 but those are for like rehab property. So if we just put on the market and do nothing, we can probably get one point one six for it in this market though because of 31 people don’t like one-bathroom house has your that’s why it’s hard to say. We’re going to get more than 1.2 1.2 V. So the arv I think will be one point two.

Max: [00:05:43] Okay.

Sean: [00:05:43] It could be one point three, but you know you want to be on the more conservative side because right now especially in Sunnyvale prices have gone down. So with that in mind just back out. All right, it’s going to cost me as a hundred grand to repair this home. Because I haven’t seen it yet. And here am I holding cost for it? And I want my profit as well which is like 10% of the arv. And then that’s how you got those numbers.

Max: [00:06:05] Yeah.

Sean: [00:06:05] And then voila.

Max: [00:06:06] All right.

Sean: [00:06:07] So that’s the all-cash offer this the all-cash offers always a lowest offer because you don’t want to you never want to buy the house directly. It’s like super inefficient and expensive. You always wanted to create a financing.

Max: [00:06:20] Okay.

Sean: [00:06:20] Or partnership with the seller, you know, I mean, so to entice them with that you simmer really low cash offer and if they accept the cash offer than good. Now you have a property really good price. You can wholesale it we can fix up yourself and make it even bigger profit.

Max: [00:06:33] Okay.  So, yeah for your creative financing, that’s where I’m kind of not very educated in this if you want to try to help me figure it out with seller financing or. Some other kind of plans because I’ve just been looking at it just straight up how to can do startup cash. So those types of.

Sean: [00:06:52] Okay. So first of all, you notice that the numbers I sent you were very specific all the way to the dollar amount. Yeah. So like the dollar amounts does the end in 000 it ends up like 523 or 519 and it’s deliberate it’s delivered because when someone sees an offer like that, it’s a negotiating tactic. They think oh. This guy serious. He has calculated down to the exact dollar amount. It’s not just some random number you pulled out of his ass to to send me.

Max: [00:07:20] I see.

Sean: [00:07:20] In reality. It is a number of bullet in my ass. But just to see that okay, but the perception is all this guy actually calculate these things.

Max: [00:07:29] That’s what I thought.

Sean: [00:07:31] Exactly right?

Max: [00:07:32] Yeah.

Sean: [00:07:32] So this is a strategy that you should use.

Max: [00:07:34] All right.

Sean: [00:07:35] Another thing is when you talk to him and you build rapport, I mean if you’re going to build rapport, it’s all good. But if you’re not building Rapport, you’re going through an agent write a letter. Would you like face on it? Hey, I’m an investor like hey, I want to buy your home and live in it or something like that.

Max: [00:07:47] Okay.

Sean: [00:07:47] It helps. Okay. The other thing I did is because she has so many properties in the same neighborhood. I said, here’s a cash offer for door. If you want me to buy all three together. I want to know the discount. So I drop the price by another 10 grand per door and the reason is because the seller is like if I put it on the market his closing costs x 3. And he has to have all three on the market the same time which means his properties will compete against each other. Yes, so he’s only a little boy price there. Yeah Pete his properties are competing to get yeah exactly right next to so is exactly so he’s my eyes will just dump them all at once. It’s just one person so much easier, like imagine you had a garage full of crap.  Do you really want to go on like eBay and sell every little thing or just say? Hey dude, just buy everything my garage. Here’s give me a hundred bucks. Take care of everything.

Max: [00:08:39] Yeah.

Sean: [00:08:39] That’s that’s the mentality. Yeah to get it done and get it done and we’re offering a lot of money, right?

Max: [00:08:45] Yeah.

Sean: [00:08:47] So that’s the cash side. That’s like my seller financing. Yeah. So for seller financing basically instead of me having to go to a hard money lender and asking them for a loan and having to get an appraisal done having to pay origination fees and a loan amount. I can just pay the seller. The same amount right? Like if I’m gonna take 30 grand to be a hard money lender over a four-month period I might as well pay the seller.

Max: [00:09:16] So why would you have to pay for a loan? Like what in what context would you be doing that like if you were the one who was going to just outright buy the property and you were the one who’s going to like fix it up and do everything but not if like this first this first thing you’re looking at like the cash offer that’s not is that for a wholesale deal or like. Or not it’s not right.

Sean: [00:09:38] It does it doesn’t matter because they’ll eventually.

Max: [00:09:40] Doesn’t matter because if it’s a wholesale deal you often get like more deeply discounted even than you would if you were in a like do it like I’m fixing flip yourself, right or know, he’s I guess it’s different.

Sean: [00:09:52] Well, yes because you want to have a good deal so that your end buyer has a good deal too.

Max: [00:09:57] Right. Yeah.

Sean: [00:09:59] This cash offer is as if you were going to flip it, but. At that number to be honest, if you could probably sell this for some good money too.

Max: [00:10:07] Okay, so it is still just enough to probably try to pull. So yeah.

Sean: [00:10:12] If you got these offers I guarantee you won’t have problems finding money to fund this deal.

Max: [00:10:20] Oh, okay. So even if you did have to take out a loan you would still probably be able to get it just with the numbers that are here.

Sean: [00:10:29] Oh, yeah, of course. Okay, like this is not a cash offer. This is a cash offer knowing that you’re using hard money.

Max: [00:10:34] Okay.

Sean: [00:10:35] Well because I don’t have cash.

Max: [00:10:36] Well, I know that we don’t but I know that like if you’re in a wholesale at you just get it under contract, right and then the person who’s going to buy it they have they have cash.

Sean: [00:10:45] But that’s not true to in this in this realm that we work in very few people use cash to buy properties very very few. Because this is like almost a million dollars or enemy.

Max: [00:10:55] They are the ones who have to get the loan themselves. Like right?

Sean: [00:10:58] That’s right.

Max: [00:10:59] Yeah, that’s what I mean. Yeah, and I mean they have flowers cash some people. I mean some of these I heard some do yeah, so the Chinese investors or something right have it but.

Sean: [00:11:08] They raise money to you can raise you can raise cash of course. Yeah, but ultimately someone has to pay for this loan. Right. So if you can present this deal to even a cash buyer, right your whole son someone else you could say look I got seller financing on this guy. You’d have to pay points. You just pay him on the back end. That is a more attractive. Wholesale deal then. Oh, yeah, you have to go get a loan. Good luck.

Max: [00:11:32] All right, let’s go back because it’s like slowly forming in my mind, but it defines cool. That’s what happened to Claire yet is so crazy. So instead of paying for a loan you’re paying the cellar. What do you.

Sean: [00:11:45] Yeah, and that’s better for the seller because now he’s getting like an extra 30 grand per door. He’s like, oh just for holding on to the loan. I’m getting extra $30,000 sure. It’s like more enticing for him.

Max: [00:11:56] So what loan are they holding onto? I don’t understand. What do you mean?

Sean: [00:12:00] Okay, so you when you get a loan you put down a down payment right 10 to 20% down payment and the other 90 to 80 percent you get from somewhere. There that be a bank or that be from your Rich uncle or could even be the seller himself.

Max: [00:12:15] Wow, that’s the part. I don’t get like how could it be this? Okay. Yeah.

Sean: [00:12:18] So if I imagine this we’re buying work, which is acting I own a home for a million dollars. You want to buy my home you put down two hundred thousand dollars. So I had your $200,000 and I’ll say okay, I will loan you the other eight hundred thousand dollars you get my house today. But now you owe me a hundred thousand dollars in loan payments and you owe me interest on that money when you sell the house, you’re going to pay me back the 800 you owe me.

Max: [00:12:45] Okay, so they’re able to loan you the money because they own the property. Is that like?

Sean: [00:12:51] Yep.

Max: [00:12:51] Okay, if they don’t they don’t have cash there it’s kind of like does it become like a lien on their property then or what is that?

Sean: [00:12:58] Yeah. It’s like an IOU. It’s like yeah, you bought my house for. 200 Grand today also then you’re going to pay me this look.

Max: [00:13:05] I see they’re loaning you out of the value of their house is going to sell for when it sells.

Sean: [00:13:12] Yeah, pretty much. So like you owe me a hundred eight. You owe me a hundred thousand now regardless what you do with the property and you owe me these payments is monthly payments. If you don’t pay me that I can’t then I can foreclose on you. I can get my house back and I still have your $2,000.

Max: [00:13:28] Okay. And all right. Yeah now I’m kind of understanding when you because it says plus this amount for door, right? And okay.

Sean: [00:13:38] So instead of paying that interest and those origination fees to a hard money lender. We can pay that to The Cellar so now he’s like, oh I can get more money for my house. Okay. Now I’m more willing to work with you before all this cash offers such a low ball offer. Oh, but now you can off me 30 grand more on top of that. Yeah. Okay, maybe. You know, it’s like these options so that you’re going to see where they are.

Max: [00:14:01] Okay, so I get why that would be appealing to the seller that they’re going to get more money. But like still I’m missing like how that really works. Like. How does that are? How does that benefit you as like a buyer like to be able to get them to accept something like that?

Sean: [00:14:18] Okay, so if I guess your two reasons one it benefits us because they’re more likely to sell us to us in the first place.

Max: [00:14:24] Okay.

Sean: [00:14:24] So says saying I don’t want to sell to you. I’m going to talk to some other real estate investor, or I’m going to sell it on the market now. Okay. This guy’s gave me extra 30 grand now it’s now is offered with it more enticing. That’s one the second one is if I don’t have to pay like if I can get better terms than my hard money lender through the seller then I might be worth it to. For example, if I say okay give me a five percent interest on on whatever OU versus hard money’s 9 10 percent. Then you have a spread their or no origination or origination fees. You know, the number I wrote there is the exact same amount that I would have paid the hard money lender so you could even offer lower you can say, oh 20 grand for Dorset of 30 grand for door and then that would have been better for you because you’re saving money and you’re giving him more money, you know, I mean, it’s like. Instead of paying the bank.  Now we’re keeping the money in house between us in the cellar.

Max: [00:15:20] Okay, I’m still confused about like we’re like, where’s the money coming from? Like if they’re if they’re paying sounds like they’re going to pay you and then you’re going to pay them but it’s like what I’m still missing like, where is it? Where is it coming from like outside of that?

Sean: [00:15:33] All right. We’re going to go on smaller numbers. Okay, let’s talk about like Pokemon cards.

Max: [00:15:37] You got yeah, you got to really take it to that level for me right now. Yeah

Sean: [00:15:42] Imagine you have a super rare like Pokemon card. It’s worth $100.

Max: [00:15:47] All right. Yeah.

Sean: [00:15:48] Just say that $100 very simple numbers John. You’re like damn I want that card.  But I only have 20 bucks in my pocket. Yeah, so I said, okay, I’ll give you this card. I own it right. I’ll give you this one hundred dollar card. You give you 20 bucks today you owe me 80 bucks.

Max: [00:16:05] Okay.

Sean: [00:16:06] Now I expect you to pay me ten dollars a week for the next eight weeks. Yeah, or that just say ten weeks, so it’s interest right? So now you pay me 120 total.

Max: [00:16:17] Okay, so you charge interest so that’s like installment. I’m trying to interest it’s like an installment plan kind of thing or like you’re like.

Sean: [00:16:24] 10 minutes alone. Dude. That’s how all mortgages work. It’s a loan and so I I own this card I give it to you for 20 bucks today. You’re going to pay me a hundred bucks later over those installment payments, right because I includes an interest in it. If at any time you [00:16:39] don’t pay me. I’ll get my card back plus all the money that you. Already paid me for that money is gone. You lost it. I foreclose on you. I got my Pokemon card back the head now the alternative the alternative is oh, I don’t have the money today. Then they go borrow from my friend Greg. Hey, Greg, let me let me borrow. Let me borrow like a hundred bucks or 80 bucks. And Greg says sure here’s 80 bucks today. So you can go buy your Pokemon card from me. $400 but now you have to pay Greg the same amount 10 bucks a week for 10 weeks. So instead of paying Greg who’s the bank you’re paying me directly. The seller is the same thing.

Max: [00:17:23] Okay, I see it kind of makes more sense now. So it’s like you just you don’t pay them everything but so okay. So then on that deal that you’re proposing it’s like if it was seller financing they would get that extra amount of money, but they wouldn’t get it all like at once the same way they would if it was just all the all-cash thing right? Like it would be over the span of time. Or something go you said you got it you said for musics, but is that like you just threw that out there for months or.

Sean: [00:17:56] That’s like an average of how long it takes to renovate a property and put it back on the market?

Max: [00:18:01] Okay, and then so it’s basically like you’re just you’re just. Paying like you’re just paying them over a period of time and then but the money you’re using to pay for it, or are you still taking out a loan for that like to pay them over that period of time? Well, that’s just out of your pocket.

Sean: [00:18:18] Well, you can but usually you just do out-of-pocket.

Max: [00:18:22] Okay. All right.

Sean: [00:18:23] It’s gonna be hard for someone to loan you money to pay off another person’s loan. It’s hard. Yeah, usually they want a loan to buy a property. So they have a first lien position and that’s something else we talk about that later. But usually you just paid yourself.

Max: [00:18:37] All right? Okay. So if so, that was the deal and you’re going to do that kind of financing and then what would you do like if he said okay. Yeah, I’ll do it. Then what then what happens?

Sean: [00:18:51] Then we come up with terms. How much do you want for down payment? How much do you want for interest?  Usually we say 10% down payment and then hard money interest in nine percent. So you can get comparable terms, then it’s worth it to pay the seller directly instead of having to go to a hard money lender.

Max: [00:19:08] I got it right because what did you say so sure 10% down payment.

Sean: [00:19:14] Yep, and then and then let’s say nine to ten percent 9404 the interest interest and then.

Max: [00:19:22] That’s what visitor that plus that extra 20 extra number four door. That’s for the interest and right. Yeah. Okay. Not that my God. Yeah or is it we did is a down payment part of the whole entire price.

Sean: [00:19:37] So for example, we have here 825 Grand per door, right? So I will put down 85 Grand and whatever is left over that’s my loan amount, you know in quotes that’s my loan amount. So when you pay that loan amount as interest 10% per year, so that’s like seven seventy something right? So you take 700 something thousand divide that by 12 and then you just pay 10% of that every month.

Max: [00:20:05] Every month wait, so this is going to go on for like a year. When your pics called.

Sean: [00:20:11] It’s called annualized interest. So you’re paying 10% as interest of the loan amount. So to make number of simple, let’s not let’s assume we’re getting a yeah, let’s assume we’re getting a seven hundred thousand dollar loan take 10% of that which is like 70 70 grand. That’s how much you would pay for the whole year in interest so monthly take 70 grand divide that by.

Max: [00:20:34] Okay, and then that’s that’s like the way you figure out how much you want to pay for a down payment?

Sean: [00:20:39] No, that’s how much you pay on the monthly payment.

Max: [00:20:41] Actually pay but you’re not you’re not paying him for a whole year or you or because you said four months.

Sean: [00:20:45] Nope, so you’d be out of yep four months.

Max: [00:20:48] Okay.

Sean: [00:20:49] So if yeah, so if you’re out of it earlier, then you pay less interest. That’s how it.

Max: [00:20:53] Oh, I see. So like depending on how long it takes you to pay them then you pay less interest.

Sean: [00:20:59] Right, right. Okay, that’s right.

Max: [00:21:00] All right. And so, okay. So once you negotiate all the terms and they say like I’m saying like if they say okay and then you get like you get it under like a purchase agreement, right? Is that like what happens and then? Yep, so but then what would your plan B? For the property at that point link you fix it up or you I mean, I guess that’s like kind of far in the future to even think about right now, but it’s just.

Sean: [00:21:27] Yeah, that’s that’s where you have options. You could either fix it up yourself. You could sell it you could put on the market yourself. I mean your wholesale it there’s so many options you can do once you have the property and you have good terms you do whatever you want. Okay? You can even hold onto it, you know, ultimately you could say hey, I want this as a rental or I want to live in this house. If you want to live in the house give me better terms, you know, like give me a long-term and then 3 years. I’ll pay you about and in three years you can like fix up a little bit. You can refinance out with a long-term bank loan with a much lower interest rate and then pay off your other.

Max: [00:22:03] All right. Can we talk more about like what like trying to build rapport with someone or like how to actually get info sheet with them? I mean you said oh people would be jealous that you make contact with this person or whatever. But I mean, he was just a friendly guy, you know, and I called him and he said what he said, but it’s like nothing was really set in stone. Like oh, yeah. I he didn’t like actually agreed anything specifically, you know, so. To like a pepper to kind of take it to the to that level of like getting getting getting a serious offer or like what are some kind of techniques that you would consider using or that you’ve used.

Sean: [00:22:46] All right. What you do is you follow up every day. Just like what I told you. Okay. We’re going to follow up every single day and we’re going to try to meet him in person. We’re going to meet him in his house. We’re going to meet him at the property. We’re going to do whatever it takes so that we’re serious and then you could even show him like our portfolio. Hey these guys I work with they have flipped homes in the neighborhood. They flipped one ombre agus. Okay, that’s like two streets down from where the houses.

Max: [00:23:13] Okay. Yeah.

Sean: [00:23:14] That’s a can show them. This is the house. They did. This is what house I look like before. Yeah. This is the house. They fixed and we’ll take a good job both take it will do a good job fixing the place up and we say look, we have money we close our multiple deals before we can offer you cash. We can offer you different terms. But what are you looking for? Ultimately you want to ask them? How can we help you? Okay. That’s why I offered those three things. See it’s not just a cash offer. Some people don’t care about getting cash ASAP you offer them seller financing so they have more money or sometimes they want we the last one is called partnership deal where you partner with them. You’d pay all the money you do all the work and you get paid out after the property sells and you partner with them. So after a certain threshold you split the profits 50/50.

Max: [00:24:02] Okay.

Sean: [00:24:03] That one is probably the most enticing one because they get more money. You know.

Max: [00:24:07] Yeah, do you know people who do that around here or is that like.

Sean: [00:24:11] Me I did that.

Max: [00:24:12] You did that.

Sean: [00:24:13] I did that with you owner. I got paid out. We did very well on that one. Yeah.

Max: [00:24:17] Was that the one with your friend from the Meetup or was it something different?

Sean: [00:24:22] All of my projects are with friends for me to shoot even you’re my friend from me.

Max: [00:24:26] I don’t even know like how I really don’t know your history.

Sean: [00:24:29] This one is a yeah. So this one was a really big house like 2.5 million dollar sales price after he finished with it and there’s no way I was gonna buy that by myself. So we partnered with the seller on that one. That way we’d have to pay for hard money costs. You don’t have to pay for. Property taxes or even the utility bill and we just paid for the construction and then we finish construction. We got out of there. We got our money out was great. So that’s like my favorite strategy because it’s very little money out of our pocket and everyone wins. Everyone’s a lot happier. So all these ask them. What do they want? Kind of fight figure out like what works for them?

Max: [00:25:07] So on that deal like we’re you the one like at the table with the person like, you know, some negotiating and how much like back and forth. Is it going like, you know, do they propose something and then and then they want to switch it and then they changed their mind and like they that kind of thing happen or did it happen?

Sean: [00:25:24] It doesn’t really happen to be honest. So usually like they’ll talk to you and like immediately their kind of decide. Do I want to work with this guy or not? Is she serious or is he is he fresh you don’t be fresh. I don’t like I trust my really know how to this fresh kid, but you know how to partner on this one. I’ve been looking new. He’s really good on the phone. You’ll get on the phone and I was at my of a plastic sheet 10 days alimentation and and he somehow went back and forth with her on the phone because he was like, look, I can’t buy your house for more than one point nine million dollars and she was asking for 2.1. There was no way we could budget there. And so that’s why he started thinking of the partnership deal, but then he couldn’t come to terms like he couldn’t explain how to make it work. And that’s why I went to the table and I was able to like present the documents. Yeah be like this is exactly how it’s going to work. And they’re like, oh I get it you get it and it makes sense. They liked it. And so they signed it right there on the on the same day.

Max: [00:26:19] Yeah, so they couldn’t quite like formulate they could explain exactly like the technical.

Sean: [00:26:24] It’s kind of like our situation right now. Like it’s kind of our situation right now. Like I’m telling you all these strategies, but since you’re new you probably don’t know how to explain it to The Cellar. Hello. So you would be confused he be confused and the deal wouldn’t happen. So.

Max: [00:26:36] Right. Yeah. Well when I talk to this guy on the phone, actually he did say like oh, so are you. You know kind of new at this or something and I was like, yeah, like I sorta said he’s like, oh no said, oh like so you’re a newbie. That’s what he said, you know, so is that like I’m just like I’m just dead in the water with or what do you think like.

Sean: [00:26:59] If you try to do this deal by yourself and you try to come up with this strategy say I want all your properties at once you probably like now.

Max: [00:27:06] Yeah, so that’s why I’m but yeah, but someone else will.

Sean: [00:27:09] You have resources? Yeah. Yeah, so bring us with you and then we can talk to him and say I. He’s new, but he’s working with us. And that’s why it’s okay. Yeah, you’re leveraging our experience and you’re leveraging our money. Yeah, you’re just you’re just a connector, right?

Max: [00:27:27] Yeah, that’s pretty little like in my body. This point is that until I learn more about you know, these things you’re telling me but yeah, it’s slowly slowly I’m learning.

Sean: [00:27:39] I talked to everybody when you’re new you may not have money or connections, but you have an unlimited amount of Sweat Equity. I’ll Williams said that yeah, yeah, so that’s it. You’re doing your job. You’re doing it perfectly you take an action.

Max: [00:27:50] Yeah, so. Cool. Alright. So yeah, I have to figure out then what to do next, but maybe it’ll be someone else calling them. But still, you know, we’ll see.

Sean: [00:28:05] Well, alright when you guys ended yesterday.

Max: [00:28:09] Yeah.

Sean: [00:28:10] Did it seem like it was a good conversation or was he kind of like annoyed at the end that you were new?

Max: [00:28:15] No, he was more like amused that I was new then like annoyed.

Sean: [00:28:20] And that’s how it ended.

Max: [00:28:22] I think it ended with saying like, oh we should talk again or something and he seemed he seemed kind of hoping to that.

Sean: [00:28:28] He said that are you said that?

Max: [00:28:29] Okay. I said he said that you said that I said he agreed but yeah, it wasn’t. You know, I’m not sure I’d want to try to make it sound better than it was, you know, but I think I was just so like excited because it’s like the first time I actually even like talk to someone in that situation. So that’s why I sent you the thing, you know, and so yeah, but yeah.

Sean: [00:28:56] No nothing at least you’re learning.

Max: [00:28:58] Right? Right, right. So.

Sean: [00:29:01] Okay. This is what we’re going to do today. Like in an hour 9:30, that’s usually when we were awake. Anyways, give this guy a call because I’m a text. All right, I would call him you can think up some text say hey, this is Max could see good. Talk to you again or you’re talking yesterday good talking to you yesterday.  Let’s meet up. And then choose a time to meet up just reschedule it for like yeah just be like, hey, can we check out some of the properties? He’s like I work with some investors who have done. Deals in that area. We’re really interested in working with you on this. You know, you don’t say I’m going to do it you say I work with investors who do it it builds your credibility.

Max: [00:29:42] And then the thing about Vegas nearby. I feel like that’s.

Sean: [00:29:47] Yeah. I worked on a house in Vegas two years ago. Yeah.

Max: [00:29:53] Yeah. So like if I say like, yeah, I have people like on my team or like it my friends or that investors. I don’t know if I should say friends, but.

Sean: [00:30:01] You don’t say friends. Do you say I work with people? It’s not professional. I work with I work with another investor or you know, it’s like that you got to make it sound more formal than actually is like, oh I work with some bigshot investor some like that, you know and then schedule a meeting. When you schedule the meeting, let me know. I’ll go there with you and then you can be the one building Rapport. I can be the one kind of like. Also building Rapport, but when it comes down to explaining the offer or asking the right questions, that’s where we come in.

Max: [00:30:35] Okay, so tell me your name or is that weird when I talk to them on the phone today? Should I try to say anything about like this creative financing or like such I even job just don’t even try just keep it in the realm of light.

Sean: [00:30:51] Get it meet him face-to-face before I even eat. Don’t talk about any numbers. Okay, that’s a big mistake. When you start throwing out the offers. They’re going to be like, okay and then the shop your offer around you want to you want to build a rapport? So they like you and you want to ask the questions so that you know what they want like they might not want a cash offer. They might not want a partner. They might not want something financing we ought to figure out what they want and then we can craft an offer around. What do they want?

Max: [00:31:19] Okay. All right.

Sean: [00:31:22] But that’s all that it’s all its discovering solid digging.

Max: [00:31:25] Yeah, so.

Sean: [00:31:28] Yeah, ideally if you can set one up for this weekend, that’d be great. I can go with you.

Max: [00:31:33] Okay, you said 9:30? I should call this person. Is there a reason why it 9:30 isn’t a good time.

Sean: [00:31:39] Well, he might be sleeping right now. I don’t know. All right uncle but you want to call him before he goes out to lunch. You want to call him? A reasonable time 9905 that could work too. You know, it’s called. Hey, how’s it going point is build rapport everyday, like don’t annoy him but be friendly.

Max: [00:32:02] Okay got it.

Sean: [00:32:03] It’s exciting though. Congratulations. And remember don’t be desperate for deals. If this one doesn’t work out, it’s fine.

Max: [00:32:09] Yeah, if you like it means there’s probably all kinds of opportunities at the same time.

Sean: [00:32:16] Just keep doing what you’re doing and. He’ll be fine.

Max: [00:32:20] Awesome. All right. Okay, cool. Yeah. Thanks to your help. Have a good time.

Sean: [00:32:24] No problem dude. Thank you.

Max: [00:32:25] It’s great talking to you.

Sean: [00:32:26] You too. All right. Bye.

Here are some of the key takeaways from this episode understand creative financing and leverage your connections. Especially if you’re new. If you can’t purchase everything by yourself think of the people who want to buy it from you as a wholesale cold calling Works. Mass was able to get a great lead on his second day of calling. Well, it’s definitely not typical by calling from the right list. You’re more likely to get a favorable response. The deals are out there. You just have to work for them. You can find the show notes and the full transcription on everything re i.com. Hope you all learned a lot. Thanks, and have a great day.