Number One Reason People Don’t Succeed (CFFL 0155)
Number One Reason People Don’t Succeed
Jack Butala: Number One Reason People Don’t Succeed. Every Single month we give away a property for free. It’s super simple to qualify. Two simple steps. Leave us your feedback for this podcast on iTunes and number two, get the free ebook at landacademy.com, you don’t even have to read it. Thanks for listening.
Jack Butala: Steven Jack Butala here for LandAcademy. Welcome to our cash flow from land show. We show you how to buy property for half of what it’s worth and re-sell it the next day. Great information and instruction from me, Jack.
Jill DeWit: And inspiration from me, Jill.
Jack Butala: In this episode, Jill and I talk about the number 1 reason people don’t succeed. Here’s a hint. They’re working on the wrong stuff. If that seems oversimplified, it’s because it is. I think the most simple stuff ends up being the most helpful at times.
Jill, great show today. Before we start, let’s take a question posted by 1 of our members, directly by 1 of our members, on successplant.com, our free online community.
Jill DeWit: Awesome. I purchased your program, Cash Flow from Land and sent out a mailer. From that, I bought several properties, just like you said, for a few hundred dollars each. I posted my first property 2 days ago. Nice. Today I received a call from a cash buyer. He said he needs time to catch up with the money. It’s listed for …. I saw this one. It’s listed for 3,850, $3,850.
Jack Butala: Is it the first one at the top?
Jill DeWit: Uh-huh (affirmative). He can come up with $3,000 in a week, but he needs 3 weeks for the full amount. I would really like to get the full amount since this mailer was pretty slim and I know I priced it right. Good.
How should I go about this? Is there a contract he should sign saying he’ll purchase in 30 days, or could I get some earnest money with a time frame to buy?
Also, the deed has not been recorded yet. I’m mailing it off tomorrow and just wanted to go ahead and get it listed. Is this a problem? Thanks, gang. From Chaz.
Jack Butala: Do you want to go first, or should I?
Jill DeWit: You go ahead.
Jack Butala: The number 1 thing is this. It’s Chaz, right?
Jill DeWit: Mm-hmm (affirmative).
Jack Butala: The number 1 thing is that do not remove it from the market. Don’t assume that this sale is done at all. You don’t ever assume the deal’s done until the check is cashed. I don’t mean like you received the check, ’til you cash the check is what I mean.
First, make sure that you market this property all the way through. Put it up on all the venues and don’t take it down. As far as a contract goes, I would very simply put together a less than 1 page agreement that says, “I agree to sell it. You agree to buy it. You need to send X amount of money to me by this date.” In this case, I think it’s 3,000 bucks. On the 850, you guys can work it out on the back end, let’s say in another whatever amount of days.
Yes, I would ask for some money down. I would almost always try to do this as fast as you can in response to their initial inquiry. People lose interest.
Jill DeWit: Mm-hmm (affirmative). I love it. I like your take the money down and have it really …. Talk about it. I’m all good with being understanding. If the guy’s really got, “Look, it’s coming in this day. I’ve got this coming. I’m positive and everything.” Great. I’m totally happy to work with somebody. Put it in writing like Steven said. There’s no questions.
Jack Butala: Don’t make a big deal out of it. Just …. I call let’s be all Jill about this. Just chill out about it. Have some fun with it. Just make the person feel super, super, super comfortable.
Jill DeWit: Exactly.
Jack Butala: IF somebody offers you 5 grand for it next week, then you could just figure out how to get out of it.
Jill DeWit: You’re such a stinker. That’s …. rip it up, send it back with his money. “Here you go. Changed my mind.” You are Steven.
Jack Butala: If you have a question, or you want to be on the show, call 800-725-8816.
Jill DeWit: You are funny.
Jack Butala: What’s the topic today? What’s the number 1 reason, I think, people don’t succeed? They’re not working on the right stuff.
Jill DeWit: MM-hmm (affirmative).
Jack Butala: I’ll give you a few examples. I see this in Bigger Pockets all the time. I answer questions in SuccessPlant all the time about this 1 thing.
It starts out like this. “Hey, Steve, I’m looking at a deal” and ba, ba, ba, ba, the rest of the question. You can fill it in. “Should I buy it? Shouldn’t I buy it? The roof’s falling in. Is the property located properly? Am I going …?” What they’re really asking is, “Am I going to make any money on this thing?”
My answer is always some version of this: “You should not even be looking at real estate if you haven’t spent a couple of months learning about how to use data.”
If you’re sourcing this transaction from the MLS, or you’re driving for dollars, all the stuff that we talk about in all the places all over the Internet, that you shouldn’t be doing, I know it’s tempting, but you really need to take at least 2 weeks, probably a month if you’re brand new. Look at our cash flow from land. Purchase it. Study it.
Then really all over the Internet, find out how professionals and experts like Jill and I use data and bulk mail printing to get multiple offers right in front of somebody so that a certain percentage of them sign them and send it back. You choose the best ones.
You know what, Jill? Right before we sat down to record, you told me a story about a guy in Michigan who’s a new member, brand new member in Michigan. I think you spoke with him directly on the phone.
He did not purchase any products from us at all. I think he went and got our free ebook. You tell the rest of the story, please.
Jill DeWit: It’s awesome. He and his girlfriend were looking to buy a duplex. He said, “I have to admit I did some driving for dollars. I get it now. I’m kind of over it.” I think this is fantastic. He and his girlfriend isolated 22 duplexes in the area they wanted to invest. They hand wrote letters to all the sellers. He got ….
Jack Butala: Were they sellers, or were they just owners?
Jill DeWit: Owners, excuse me.
Jack Butala: It’s not for sale property at all. I guess they probably just tested it. I wouldn’t recommend writing 22 letters by the way. You’re really setting yourself up to fail. We teach you get access to a data base and you do this in front of a computer, not driving around. The result was fantastic.
Jill DeWit: Oh my gosh. The big picture is he’s like, “I get it. This can work.” Let me tell you the result. 22 letters, 75% response yielded the beautiful duplex that they want, that they’re closing on the end of the month.
Jack Butala: That’s exactly what we’re talking about. Did he disclose the price that he paid, or how much cheaper did he buy it this way, sending handwritten letters versus going out to buy 1 for market price?
Jill DeWit: Told me that it was assessed at 124 and I think they paid 118. They’re just so excited. What we talked about too is, now think about this. Think of what you could do in sending out instead of 22, 2,200 offers and having that come back and looking at things.
Jack Butala: What I would do in that … exactly, Jill. 75% is unbelievable. I wonder if that just means a 75% response, or signed?
Jill DeWit: Response. I didn’t get into the details as far as was there an offer in there, or was it just, “Hey, I’m interested. I don’t know.” It was enough that it got their phone ringing. That’s the goal.Here’s what you and I are big on. Let’s do this. Let’s make 22 2,200.
Jack Butala: Exactly, or 22,000.
Jill DeWit: What we’re offering is even less money. He definitely won. He’s got …
Jack Butala: He proved this ….
Jill DeWit: … this income.
Jack Butala: HE proved it for himself.
Jill DeWit: He proved it. Now it’s like, “All right. Let’s think about this.” It’s 124. What if he paid 65 for it, or 70?
Jack Butala: Now you’re talking.
Jill DeWit: That’s out there. Let’s send 2,200 and go for that property. That is what can happen.
Jack Butala: That is working on the right stuff. He obviously studied this, some version of it. Now he’s purchased all of our products now, because he tested it for himself and it worked.
Imagine if, instead of driving around, he learned from us about how to utilize data, the day to day doorstep that we have and then sent out exactly what Jill said. Now if the ARV, or the market value of these duplexes is generally 125 grand, I personally would send out 2,000 or so letters and identifying which duplexes are what through data instead of driving around.
There’s lots of ways that assessors data can show you the assessed value. It’s zoned for multifamily, the whole thing. It’s really easy. It’s much easier than you really think. The first time doing anything’s a little bit tough sometimes, but once you get over that hump, it pays out in spades.
I’d find the 2,000 properties in the market that they’re interested in and I would offer maybe 60.
Jill DeWit: MM-hum (affirmative). That’s what I was thinking.
Jack Butala: 60 to 70,000 bucks, maybe even less in some cases; then see which ones come back. In that situation, because I think they’re going to live in 1 side.
Jill DeWit: I don’t know.
Jack Butala: In that situation, it’s like, “Boy. You don’t need a 75% response.” 75% returns concerns me.
Jill DeWit: It’s awesome.
Jack Butala: Concerns me in that’s great. I would be concerned. Why does everybody want to sell?
Jill DeWit: I didn’t ask that many questions. It could have been, “Are you interested in selling?” Which then would yield a big response.
Jack Butala: That would yield a 75%.
Jill DeWit: I would be like, “Heck, yeah.” It doesn’t matter what I own. For the most part, “Are you interested in selling?” “Heck, I’ll sell my own house out from under me. What do you want to offer?” It could have been something like that. The bottom line is it worked. It did yield a property. The bigger thing is it yields a property that wasn’t on the MLS, wasn’t out there for sale. He did it the right way. If you wait for that for sale sign in the driveway. You’re like, “Oh shoot.”
Jack Butala: It’s too late.
Jill DeWit: It is.
Jack Butala: Somebody else got there first. Sending a 2,000 unit mailer out, all you need is a 1% response. That’s 20 properties. When I say response, I mean a signed offer back in the mail for the price that you offered, not, “Hey, give me a call and let’s talk about it and negotiate it.”
There’s no negotiating. You offered 65,000 bucks. The letter got signed. You can bank on a 1% response even your first time out if you’re choosing the right area. That’s it. You’re buying property for half price.
It keeps coming back to the topic of the show. I see people doing the wrong stuff especially super new people in real estate investing, REI. They’re wondering why it doesn’t work, or they get real discouraged because the first deal didn’t work out. It’s just because you looked at a deal, or a piece of real estate before you learned how to do this the proper way. Maybe you made a bad acquisition decision, or not bad, an uninformed one, which is easy to fix.
Jill DeWit: You know what I think? I think just for some reason there’s a lot of people out there doing it the old way. They still have not figured out, and I feel silly saying this, but, I’m like, “We have the Internet now, folks. You don’t have to ….”
It’s like imagine going and walking on a used car lot and just trusting that the price on that car is a good fair price. Who is going to do that nowadays? I hope nobody. I hope you’re going to get out your phone and your computer and you’re going to look up KBB. Let’s look up Kelly Blue Book. What should I really be spending on a car this age, this whatever? Just basically using data to help you make a decision, that’s the bottom line. Not the old way, not trusting, not, “They have a license.” No, no, no.
“He’s been doing this business forever, I’m sure it’s all good.” Do your homework and do it the right way. My thing too is don’t waste a lot of time. That’s what I see. People sometime don’t get it. I’m like, “You could be saving so much time right now and not going over this.” You got this printout from the county. Fantastic. All right. How many hours did you spend pouring over that information trying to figure it out? By the way you’ve got to enter it in your computer to send something out. That’s crazy.
Jack Butala: There’s no downside to this. People ask us all the time, “Great. You guys have it figured out. You’ve done 15,000 deals. What’s the downside?” There’s got to be some. What’s the catch? There has to be something bad.
I’ll describe exactly what happens. You tell me if there’s something bad. You get access through us, the best data in the country. Literally it’s access to a database that’s constantly being updated by all the separate assessors all over the country.
You learn from us how to manage that data and then send out offers all over the place. It takes me, I’ve been doing it for a lot of years, less than an hour to get maybe 10,000 offers in the mail. Very super new person who’s got a regular job, it probably takes 2 weekends to get through, under our direction, or maybe 1. I don’t know.
Jill DeWit: It depends on the person.
Jack Butala: It depends on the person. Now you’re up to speed. The amount of time that you’re going to spend driving for dollars, there’s no downside. People love to sell their property without having to go thought all the stuff with an agent and the whole thing. I’m proud of these guys in Michigan that did this duplex thing.
Jill DeWit: I think it’s the coolest thing. She’s onboard. This is perfect. I was talking about it could be like you and I, Steven. He sounds like the analytical one.
Jack Butala: I would love to have him on the show.
Jill DeWit: We talked about that too.
Jack Butala: Maybe with the girlfriend too. That’d be fun.
Jill DeWit: That’s the key. We talked about I’m going to say Wilmont. You both. That would be really fun. I’d love to do that.
Jack Butala: It’s time for the if/then segment of the show. If you do X, then Y will happen. If you want to buy real estate for way less than it’s worth and immediately sell it for more, then make a task A, to task B, to task C plan. You want to buy super cheap real estate, make a plan, then make a plan.
In this case, I just jotted this down quickly, Jill. A, take a couple of weeks and learn about using data and direct mail. B, get the tools to do that, access to a database, and the use of a professional bulk mail printing entity. Hey, it turns out we provide all of those. C, get these offers in the mail and see what happens. Get the results back.
If you want to make some dough, buying cheap real estate and selling it immediately, get the right tools, get some education, the right tools and make sure you’re working a plan. You can use our plan, or you can come up with one for yourself. Make sure you’re doing it under a plan, not just spending your Sunday driving around looking at open houses, or whatever.
If you have a question, or you want to be on the show, call 800-725-8816. Jill, I bet you have some wisdom for us today.
Jill DeWit: I do. Here’s my inspiration for the day. It’s something to think about. Why do people sometimes think that using connections, or the inside track is cheating?
Jack Butala: Oh my gosh, that’s brilliant.
Jill DeWit: You know how people do that? It’s funny how you come across, “Oh no, I can’t. That’s a cheating.” Why is that cheating?
Jack Butala: Why do people sometimes, along those lines, think that suffering, or it takes 8 years to learn how to do something? That’s the right way.
Jill DeWit: That’s a good point too.
Jack Butala: It has to be hard, and I have to suffer, and I have to feel bad while I’m doing it before I’m going to get anything good out on the other side.
Jill DeWit: That makes no sense. Maybe you might just be good at it and you should go for it. There’s a thought. That was my thing just to think about. For me, I’ve never thought that way.
Jack Butala: I’m trying to think if we have a handful of members who are really trying to make this harder than it is.
Jill DeWit: There are.
Jack Butala: Obviously, without naming names, is there a good example that comes to mind right away?
Jill DeWit: No, no, but I can tell. I can’t give you exact, but I can see the people that don’t think that way. They know they’re making a good decision because they did A, B, C, D and they’re not looking back. It’s like, “You know what? I know I did my homework. I’m not going to overdo it because then I’ll never get anything done. I’m just going to go with it.”
Jack Butala: Here’s a good positive example of a question that I answered today. A lot of times you get the same question sent over and over. This guy, he’s a relatively new member, did everything that we teach. He’s in the downloading phase of getting the data and shows the data properly and the whole thing. He ran into a tiny little snag and he handled it like a tiny little snag instead of throwing his arms up and saying, “This is never going to work.”
The formatting for a couple of the APNs in the counties that came out just wasn’t working for him. I’ve run into this issue for years. It’s a real easy fix. He directly emailed me. I directly answered the question, helped him out. He’s like, “Man, that would’ve taken me 2 weeks to figure out. Thank you so much.”
It’s that kind of stuff where I think that some people can choose the littlest thing like that, get all hung up just like you said. Make it hard for themselves, take 3 weeks to figure it out instead of just saying, “You know, I’m sure between Jill and Steve and their staff they can solve this for me pretty quickly.”
Jill DeWit: You don’t get a trophy for that by the way. No, you don’t get a trophy for putting all the time in. “I did it. I figured it out on my own.” You don’t have to do that. Use your resources.
Jack Butala: You do get a trophy by putting a ton of money in the bank, buying cheap real estate.
Jill DeWit: That, you do get a trophy. That is perfect. Your balance sheet is a good trophy. That’s my personal trophy. That’s an inspiration.
Jack Butala: We should have a balance sheet of the year award.
Jill DeWit: Balance sheet trophy.
Jack Butala: A long time ago I did a bunch of consulting work at KPMG for a non-profit healthcare group. What I learned through that is non-profits are way different than for profits. For profits, it’s super clear. “We’re here for profit.” Non-profit, they’re supposed to do some good. That’s why they don’t pay taxes, because they’re making this world a better place.
In accounting, both entities are treated really differently from an accounting standpoint. How you gauge how financially successful a non-profit is is a net change in assets. I’m not so sure that’s so far off for us, either.
Jill DeWit: I think we’re doing some good.
Jack Butala: I know we’re doing some good. Instead of saying looking at net income, a non-profit looks at a net change in assets. I think that’s pretty healthy.
Jill DeWit: Mm-hmm (affirmative). I agree.
Jack Butala: Then I just go off in some way. I’m sorry. It happens all the time.
Jill DeWit: Welcome to my world, everybody.
Jack Butala: Join us in another episode where Jack and Jill discuss how to use information that’s me …
Jill DeWit: … and inspiration, that’s me …
Jack Butala: … to get just about anything you want. We use it everyday to buy property for half price and sell it for more immediately.
Good show today, Jill. I am having a tough time working in this paradise that we’re in right now.
Jill DeWit: It is hard. I wonder. I can’t wait to go back and listen and see if you can hear the ocean in the background.
Jack Butala: It probably sounds like static in a hallway.
Jill DeWit: Exactly. It really is the beach.
Jack Butala: You know what I was thinking during the show that you and I are on the process of trying to buy a pretty large boat. What did I do? I started. I made all the mistakes that I talk about. I started looking on the Internet to see what’s for sale and spent, I don’t know ….
Jill DeWit: 8 hours in yacht world.
Jack Butala: Yes, exactly.
Jill DeWit: Yeah, I [crosstalk 00:21:23]
Jack Butala: 8 hours [crosstalk 00:21:24]. This is the exact thought that I had, “What the hell is it that we tell everybody to do? Don’t buy for sale anything.” I went, this is now 5 hours later after that, and secured all the ownership records for all the boats in the state of California, in the whole country. Then drilled it down just like we do with RealQuest. Drilled it down and I’ve identified 1,100 possible boats for us to buy. I’m, next week, going to send out. I’m going film off. We’re going to do a show on this.
I’ve already started to record it on the Internet. We’re going to buy a boat. We’re going to buy a extremely expensive boat for less that 10%. That’s my goal; less than 10% of what other boats are selling for on the Internet retail.
We’re going to film it and the whole thing. We’re going to walk through the boat, the whole thing, walk through the boats that the letters that we get back and the ones that are a fit for us, we’re going to film it going through the whole deal.
It might be a disaster, might be awesome. Every single time I’ve ever tried to do this, not just with real estate, but with everything. Jill, you just did it with ….
Jill DeWit: Vacation stuff.
Jack Butala: Getting a 1 month vacation rental. We’re paying what, 20% of what the face value is?
Jill DeWit: 25%, yeah.
Jack Butala: We’ll see. It’s hard to have a good show. I don’t know …. It’s probably never as bad as we think.
Jill DeWit: It’s awesome. The beach is calling.
Jack Butala: Let’s go buy something for half price today and resell it. Jack and Jill, information and inspiration.
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