Other Creative Acquisition Pipe Lines (CFFL 457)
Other Creative Acquisition Pipe Lines (CFFL 457)
Jack Butala: Jack Butala with Jill Dewit.
Jill DeWit: Hi.
Jack Butala: Welcome to our show today. In this episode Jill and I talk about other creative acquisition pipelines. Not just direct mail. Before we get into it though, let’s take a question posted by one of our members on landinvestors.com online community, it’s free.
Jill DeWit: Okay. Jeff asked, in my last mailer I negotiated two parcels with an option to buy. While the county lists the company, how to confirm who’s authorized to sell the property?
Oh, that’s a very good question. That’s kinda like a lot of our properties. They’re not in our name anymore. They used to be. So how do you know that person is the right person?
Jack Butala: Go for it Jill.
Jill DeWit: I look it up. So here’s the funny thing, cause I just had to do this, remember you and I joked about this title company that we’re dealing with right now. And man, bless her heart, even though I explained to her that she can easily google online in the state of Arizona, my business name and pull up all the documents and see that I am the managing member and see my name. It’s all public information. I had to literally do that for her. Download them to PDF form and send them to her. Cause she just can’t get it. It’s just like, “What the heck”. Is this 1975? But anyway. So I had to do that. It’s almost like too like she needs a certificate from the Better Business Bureau saying I’m an A+. We don’t do that anymore either. It’s so funny.
But so for me, first of all, for this Jeff If it’s an LLC or something like that go look them up. You’ll probably find them online.
Jack Butala: Yeah. And now more than ever, for some reason, you really have to hold people’s hands. Even the most experienced title company.
Jill DeWit: Yep.
Jack Butala: I mean this woman’s been in the title business forever.
Jill DeWit: I know.
Jack Butala: And she isn’t up to speed on how to do stuff. So I’m past it. You just have to do it, and smile while it’s happening and that’s it.
Jill DeWit: Exactly.
Jack Butala: If you philosophically get upset about this stuff it’s gonna be a long hard life for you.
Jill DeWit: It is. It’s just too bad.
Jack Butala: You know what, honestly Jill, that’s one of the things I learned from you. I used to be a huge curmudgeon about all that stuff. And now it’s like, “Yeah, just smile and wave.”
Jill DeWit: It’s true. It’s much easier just let it go, let it go, let it go. And then you’re like, “Yeah, your right. It’s over, done.”
Jack Butala: But then once in a while you have to stick it to somebody when they’re just incompetent.
Jill DeWit: And the thing is, I want to help them. I kinda want to say, “You know, you’ve been waiting for six hours for me to get back to you with these documents. You could’ve had it five hours and fifty five minutes ago yourself.” And I even told her. I just don’t get it. I say Jeff, Google it first of all, and then if it’s not ask them. And then if you need a copy of something proving it, I’m sure they have it, and they’ll be happy to send it to you. That’s all common sense to me. A title would expect it to.
Jack Butala: I think the first person you should ask on all this stuff is the seller. And you really can find out if they’re trying to hide something. If they say, “Oh yeah sure, I’ll send it over right away. I’ve got all that stuff lined up.” Then that’s a good sign.
Jill DeWit: Exactly. And it’s like, we’ve had interesting things like this one Jeff. Like I bought from a church. And it was a church. And it was an established church. So I honestly trusted the church. They told me exactly who the people were that were the board members and how their names should read to put on the deed. Like you were just saying Jack, they provided that for me. So that was good.
Jack Butala: What’s an established church Jill?
Jill DeWit: Are you playing with one of those spinners by the way?
Jack Butala: No, it’s my watch.
Jill DeWit: Oh.
Jack Butala: It’s my new watch.
Jill DeWit: Well you have a good mic right now.
Jack Butala: What’s an established church? Like Jim Jones Koolaid? Is that an established church?
Jill DeWit: Not an online church that’s been around for five minutes. You know what I mean. That’s actually funny. You’re right, cause I looked up this church. [inaudible 00:04:08] I’m like, “Before I trust these people.” And I had talked to them enough. And the same secretary answered the phone every time, so I felt good. And they told me exactly who the board members are that have to sign, here’s how they’re names need to read, all that good stuff. I’m like, “Oh it’s cool. I don’t need further documentation proving that.”I was cool with that.
Jack Butala: Was it in Waco, Texas?
Jill DeWit: No. It was actually in California.
Jack Butala: I’m just teasing you.
Jill DeWit: Oh, oh. That’s where you were going. Are you in goof off? You sound like me. You’re in goof off mode and I’m all business. What the heck.
Jack Butala: I don’t know. What is that?
Jill DeWit: That is really weird. You’re playing with your watch. Next you’re gonna start popping bubbles with gum. I’m just kidding.
Jack Butala: You know why? Cause we’re getting so much stuff done. I’ll tell you exactly why I’m in such a good mood.
Jill DeWit: Okay tell me.
Jack Butala: I just received an email from two of our members who are going to be promoted here in a minute, about a very, very large transaction that we’re gonna do in Texas.
Jill DeWit: Oh.
Jack Butala: And they reported to me that … the members don’t know each other.
Jill DeWit: Okay.
Jack Butala: One guy sent a mailer out in west Texas and found several thousand acres owned by one person. The property actually happens to have a lot of back taxes on it. He didn’t mail back tax. We’re gonna talk about this in a second. They negotiated a deal, essentially for just the back tax amount. The guy just wants to get rid of all this property. I mean, it’s thousands and thousands of acres. I bring this other guy in, cause I know he lives down there. The property’s in two counties. Goes and meets with both counties. And he talks to the judge directly cause he’s nuts. You know who I’m talking about.
Jill DeWit: Uh-huh
Jack Butala: I just copied you on this like 30 seconds before this call.
Jill DeWit: Cool.
Jack Butala: We can sub-divide it all.
Jill DeWit: Got it.
Jack Butala: So we can take these thousands of thousands of acres and sub-divide them in one county down to five acres, and the other county down to one acre, just by selling some farms out.
Jill DeWit: And feed a family of four for years.
That’s what it sounds like.
Jack Butala: What are you talking about?
Jill DeWit: Remember your blog that you wrote a while back about ways to create enough income that you could happily feed your family for a long time. So that’s what yours sounds like.
Jack Butala: The official title of the blog was, “Five Good Rental Houses That Can Feed a Family for Generations”.
Jill DeWit: That’s it.
Jack Butala: And then it just parleyed into all ways that you can just forever make money with land.
Next week we’re gonna have a show about what you can go with land. Some crazy, crazy cool 21st century stuff you can do with land. You know what it’s all about.
Jill DeWit: I know what it’s all about. Cool.
Well what about this show?
Jack Butala: We should probably have the show.
Jill DeWit: Yeah.
Jack Butala: If you have a question or you want to be on the show reach out to either one of us on landinvestors.com.
Today’s topic: Other creative acquisition pipelines.
So if you’ve listened to the show regularly, you know Jill and I love direct mail. Sending out unsolicited offers. But what about other ways that might be just as good or you should through into the mix. I bet you have some thoughts on this.
Jill DeWit: Oh I do. Quickly, as I was thinking about this show I wrote down two ways not to do it and then one good way to do it. And I know we’re gonna explain some more. But I have to get these two “not to do it”.
Jack Butala: Yeah, that’s what I want to hear.
Jill DeWit: An acquisition pipeline is not your father-in-law.
Jack Butala: Oh my god, your right. I need to put that on my list.
Jill DeWit: People do that all the time.
Jack Butala: Just say no [inaudible 00:07:49]
Jill DeWit: I can’t tell you. I just heard that, “So and So’s mom is gonna move. It’s my best friend from high school. I know this is a great thing.” Okay, that is not your acquisition pipeline, no. Your father-in-law, your best friends mom, no those are all nos.
Jack Butala: Yeah, you never want to look at a deal like that. Even if it’s the greatest deal, because you just don’t.
Jill DeWit: Exactly. Too many things can go wrong.
Jack Butala: Yeah.
Jill DeWit: The percentage of it going wrong is too high. And the percentage of them being unhappy with you, and ruining that relationship is also too high.
Jack Butala: I have a list of people on this planet that I refuse to negotiate anything with. Not only prices of land or anything but just anything. And your number one on the list.
Jill DeWit: Oh. Is that a good thing?
Jack Butala: It’s a great thing. I don’t want to sit around and negotiate with my partner on stuff.
Jill DeWit: Thank you. Thank you very much. Good. Who else is on your list?
Jack Butala: My sister. She scares me.
Jill DeWit: Aww. She scares you?
Jack Butala: She’s like a real estate extraordinaire in Northern Michigan and she can sell me … I can’t find my way out of a paper bag. She can talk me in and out of …
Jill DeWit: Yeah, she’s good. You’re right. Okay got it. Anybody else you want to add?
Jack Butala: No, that’s good for now.
Jill DeWit: All right, good.
Jack Butala: There’s a few more on the list but I don’t want to give them the satisfaction.
Jill DeWit: Oh, okay. Got it.
All right. So another non acquisition pipeline, I want to get this out of the way, is door to door. That’s not a way to do it.
Jack Butala: Or driving for dollars.
Jill DeWit: Exactly.
Jack Butala: Or MLS
Jill DeWit: You know what’s funny? I thought driving for dollars was a very common phrase across the country. That everybody called it the same thing. But here on the west coast everybody looks at me sideways when I say that and I have to explain driving for dollars.
Jack Butala: Oh, so door to door.
Jill DeWit: Yeah. Door to door, they kinda understand that. All right.
Want to hear one of my yes ways?
Jack Butala: Yeah.
Jill DeWit: Brokers with large portfolios. Where would I find them? Hmm, I don’t know. Maybe in land watch, maybe in land pen, I don’t know. But there’s people there.
Jack Butala: This is a title that I wrote, this show, “Creative Acquisition Pipelines”, is for me to bring this point up. With direct mail, it does all the work for you. It does all the choosing. And then the sellers choose themselves. It takes 90% of the work out. Imagine if you walked up to 100 landowners or 1000 landowners in a big stadium, and said, “I’d like to buy your property for 4000 dollars.” How long would that take? It would take forever. And you would probably get punched in the face a few times.
Jill DeWit: True.
Jack Butala: Direct mail takes all that out of it. The people who are interested in selling at that time, they’re gonna seek you out. And they’re not gonna leave you alone until you send them some money. All the other ways that we’re about to talk about, and some of them are good, may require you to be proactive.
Jill DeWit: That’s true.
Jack Butala: Instead of reactive.
Jill DeWit: That’s true. Even my thing about the brokers with large portfolios, one of them is gonna get one of your letters.
Jack Butala: That’s what I mean.
Jill DeWit: So you’ll find them.
Jack Butala: The RV park that we just bought, Jill.
Jill DeWit: Yep.
Jack Butala: Was listed on the MLS, they just happened to receive a letter.
Jill DeWit: Exactly. You’re right. So the big point here is, don’t create work for yourself. Do it the right way and let the motivated people come back to you. I know we sound like a broken record here, but it is that easy and so many people don’t get it.
Jack Butala: Right. So, since we’re on the topic, after direct mail my second favorite way to buy real estate is foreclosing on tax liens. And here’s how that works. And I’m gonna try to do it in 30 seconds or less. A landowner, or homeowner, or apartment building owner stops paying his taxes. And the reason that he’s paying his taxes in the first place and the escrow company isn’t or the mortgage company is because there’s no loan. That’s good. That’s a good sign. Maybe they die. But for whatever reason they stop paying their taxes.
After a certain amount of time, the county, if it’s a tax lien county; there’s a lot of places on the internet to find out which places are tax lien and, which places are tax deed, which states, and you find out how long it’s been that they stopped paying their taxes and they issue a lien. And you can buy a lien. It’s very inexpensive, 60 to 100 dollars sometimes. You buy a lien and you have equitable title in the property. If it’s old enough, you can actually foreclose on it for the price of a lien. It is truly an amazing way to buy real estate.
Jill DeWit: Yep.
Jack Butala: And what it does too is it opens the door to that seller. Now you can send a different type of letter out or offer out that says something like this, “Hey landowner, I know there’s a tax lien on this thing. You clearly don’t want it. How about I send you 100 bucks or a 1000 bucks, or whatever the number is and we’ll just remove it out of your life. Instead of me having to go through the foreclosure process and hire an attorney and the whole thing.” And man that works. Nine times out of ten they thank you. If they’re alive.
Jill DeWit: Totally. But I gotta tell you Jack, I’ve gotten so comfortable and lazy here that I don’t even want to do that.
Jack Butala: I know. Neither do I. There’s a reason that you and I don’t do tax lien foreclosures.
Jill DeWit: I know. I just talked to a guy about this yesterday, actually. And he just joined our group yesterday.
Jack Butala: Oh good.
Jill DeWit: And it was a great conversation. Let me tell you, he did 30 deals last year. I said, “That’s fantastic.” He’s like, “Okay. And now we are at the beginning of May.” He said, “We’ve already done 30 deals this year. So we already beat last year.” I said, “All right.” I said, “So what’s going on.” He’s like, “I’m reaching to you now.” He came to us from our friend Bay, and he said, “I’m coming to you. I’ve been listening to the show.” Hi Tom. He said, “We now need to take it to the next level. Like we need to automate this. I know you guys are the pros now at really scaling this up.” I said yeah.
Jack Butala: Yeah.
Jill DeWit: I said, “Perfect.” I said, “You are in the right place. Yep, we’re the people that can help you. I mean, we’re getting these things in place to help you as fast as we can so you can do 300 if you want to this month.” You know, kinda thing. We’ve got people doing that.
Jack Butala: Right.
Jill DeWit: But you have to be freed up from some of the ew stuff. The manusha, the day to day … You don’t need to be answering your own phone every time somebody wants to call you and chew you out. You don’t need to do that. Your past that.
Jack Butala: Right.
Jill DeWit: So, anyway, we were talking about taking it to the next level and all that good stuff. And you don’t need to be out looking for deals. And I was talking to him about, you’ll know real quick, you can turn it up or turn it down based on what you’re ready to handle at that time. You sent out 2000 offers and that was too much. All right, so next one will be 1500. Cause your getting that good of a strike percentage now.
Jack Butala: Or lower your price a little too.
Jill DeWit: Or something. You’ll know what you can handle.
So that’s where I’m coming from with us. I don’t wake up in the morning and brainstorm, “Where am I gonna find a deal.” Nah. Like I’m ever bored.
Jack Butala: To the mailbox. That’s where the deal is.
Jill DeWit: Yeah. And if I’m not staring at enough mail I just do another one. All right, you know let’s look at this area, okay cool. And then before you know it, everything changes. And you’re like us now, with a lot of our people, where they never think about it again. All they’re thinking about is, “How fast can I get someone doing this job, because I’m too busy now and all those two things” so it’s good.
Jack Butala: Here’s a few other places that Jill and I have had a tremendous amount of luck buying ridiculously inexpensive property. Ebay, believe it or not, is a great place to buy property. And it’s immediate. You click on it and buy it. Bid 4 Assets, they host tax sales, county foreclosed tax sales. They have a contract in all of California. It’s an auction. Just like you’re standing there. You can buy property that way. Jill and I bought a ton of property in Big Bear one year and just made a killing on it. Right off of Bid 4 Assets, in our pajamas. I love craigslist but you still have to be pretty proactive there. There’s a lot of back and forth negotiation. What I love about Bid 4 Assets and Ebay is you just buy it. You buy it like a pair of shoes, right online. So it’s not as proactive, and they make it real easy cause the maps are all there and the whole thing.
Land Pen is a good place. It’s becoming an incredible place to buy property, especially if you’re a term seller. And you don’t like the data piece of this. You just want to buy some property that’s super cheap. This is what land pen’s for. It’s land acquisition for re-sellers. Buy cheap property for cash. And then create yourself an income stream. That site will be done by the way June 1.
Jill DeWit: You mean for the public? It’s up and going now but you mean for the public to do it?
Jack Butala: Yes.
Jill DeWit: Cool.
Jack Butala: Yeah.
Jill DeWit: That’s huge.
Jack Butala: It’s fun to talk to you cause I can fill you in on what’s happening.
Jill DeWit: Ah this is nice.
Well just to share, we’re in different states right now. That’s part of what’s going on.
Jack Butala: We’re gonna hire some salespeople for that site too.
Jill DeWit: Cool.
Jack Butala: Catch up with the rest of the world.
So, those are some other creative … What you really want to avoid is, and Jill just said talk to brokers, I mean you can do that if you want but somebody got there first. So you’re not gonna get the best deal.
Jill DeWit: Bingo.
Jack Butala: That’s all there is to it.
Jill DeWit: That’s it.
Jack Butala: And stay out of the MLS. It’s just a mess.
Jill DeWit: Again, somebody got there first on those.
Jack Butala: Yeah.
The two take aways from this show are this. Get there first, with direct mail. Do it right to the owner. And number two, make this easier on yourself. Don’t make it so you’re going out trying to find acquisitions every day. Make them come to you.
Jill DeWit: Love it.
Jack Butala: [inaudible 00:18:15] the 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.
Jill DeWit: We use it every day to buy property for half of what it’s worth and then sell it immediately.
Jack Butala: You’re not alone in your real estate ambition.
I’m so California dreaming right now in the middle of the desert.
Jill DeWit: You know what’s funny? I wonder how different we are on these shows, when we’re not sitting next to each other.
Jack Butala: You mean it went from bad to worse.
Jill DeWit: Yeah, pretty much.
Jack Butala: You know, the 16 people that listen to this show they might tell us.
Jill DeWit: Oh yeah. Is it that many already? That’s funny. Boy, that got fast. Three years later we have a whole 16. Just kidding. I know.
Jack Butala: What is this? Show number 457, geez.
Jill DeWit: I know. Okay wait.
Jack Butala: My gosh.
Jill DeWit: Are we two years in? Yeah. Is it two years or three years in? I don’t even know.
Jack Butala: I think it’s two.
Jill DeWit: Okay, two. All right, so this fall will be the two mark, I think. For this show, not the other show. It was about this time we started the first show.
Jack Butala: Exactly, exactly. It’s about two years. Well, it’s pretty close to two years on the nose. It will be two years next month or something like that.
Jill DeWit: I gotta say this is so funny. Cause this reminds me, this means two years ago I walked into your office and got a little perturbed at you fooling around on Facebook.
Jack Butala: I know.
Jill DeWit: And fooling around on Itunes. And I was like, “What are you doing?” I thought you were goofing off and avoiding …
Jack Butala: Sorry mommy.
Jill DeWit: Work. I know. And I was like, “What is he wasting his time on”? And I’m here to say, and I’ve said it many times, boy am I eating my words.
Jack Butala: It’s almost time for us to announce the new podcast show that we’re going to do called “Jack Jill Land Investors”. But we’re not gonna announce it yet.
Jill DeWit: Okay, cool.
Jack Butala: No new projects right now.
Jill DeWit: Oh, no new projects. Maybe when we’re in the same state.
Jack Butala: Right.
Jill DeWit: Cool.
Jack Butala: Information and inspiration to buy undervalued property.
If you enjoyed the podcast, please review it in iTunes . Reviews are incredibly important for rankings on iTunes. My staff and I read each and every one.
If you have any questions or comments, please feel free to email me directly at jack@LandAcademy.com.
I would like to think it’s entertaining and informative and in the end profitable.
And finally, don’t forget to subscribe to the show on iTunes.
