A Start-to-Finish Deal for Jack & Jill (CFFL 512)
A Start-to-Finish Deal for Jack & Jill (CFFL 512)
Transcript:
Jack Butala: Jack Butala and Jill DeWit.
Jill DeWit: Hi.
Jack Butala: Welcome to the show today. In this episode, Jill and I talk about a start to finish deal for Jack and Jill. Before we get into it, let’s take a question posted by one of our members on the landinvestors.com online community. It’s free, and we’ll wait for Jill to finish what she’s doing on her phone.
Jill DeWit: I’m here. I’m always here. I just happen to multitask really, really, really well.
Jack Butala: Okay, multitasker.
Jill DeWit: It’s a chick thing, by the way.
Jack Butala: Hey, you want to do a podcast today?
Jill DeWit: Hey, I’m here. [Noem 00:00:34] asked, “Hey, everyone. I’m in the middle of doing my due diligence for my first couple of accepted offers. Yay. The county I’m in is super nice on the phone, but they’re kind of lacking free accessible info on their website when it comes to most of the due diligence, like, for example, finding liens, deeds, et cetera. What is your go-to resource for due diligence? Mainly looking up chain of title and making sure there’s no open liens anywhere in the history of property.
Jack Butala: Very good question.
Jill DeWit: “I tried TitlePro247, but at least with this one, specific parcel I’m looking to buy, the info on Title Pro wasn’t complete, and even when I called their customer service, they were not sure what was up with that property. This property, I’ll just have to use a title company to close on. I’m happy to pay for the stuff, just not sure what the best tool is for that, other than a title company, of course. Any advice would be awesome. Thanks in advance.”
Jack Butala: Just like yesterday. They answered their own question. Very smart people we have in the group. Seriously.
Jill DeWit: I want to say, “… and correct.”
Jack Butala: Agent Pro of TitlePro247 is owned by a company called Black Knight out of Irvine, California. They have said this sentence to Jill and I multiple times: “We started in California, and we’re working our way east.” So the quality of their data-
Jill DeWit: Bingo.
Jack Butala: … it’s fantastic west, but they’re still working it out going east. Their goal is to get to every single property done, so I don’t know exactly which country Noem’s working on, but it could be an issue.
Jill DeWit: I got another idea, too.
Jack Butala: For chain of title, I mean, Jill, you know more about this stuff than I do. For chain of title, if you’re real concerned about it and it’s a big deal, you should get title insurance and go through title. If not, if you can actually go to the country, you can sort through the deeds. That’s what Title Plan does.
Jill DeWit: TitlePro247 is my number one go-to. Then, number two is CoreLogic. They are rapidly adding … Seriously …
Jack Butala: We’re licensed providers, by the way, both of these companies.
Jill DeWit: I can’t remember what the number is. I have the stats. I’m working on the stats. I’ve mentioned this on a number call the other day. I’m putting together some stuff for our new site coming up, OwnersData.com. Basically, it’s just cheapest access to CoreLogic. That’s all you get. I’m going to say what it is right now, anyway.
OwnersData.com, which is launching any day now, $100 a month-
Jack Butala: It’s launched.
Jill DeWit: … 10 cents a record, and it’s access to CoreLogic-
Jack Butala: For half price.
Jill DeWit: … nationwide … Less than half, actually, because it’s normally about $275 a month.
Jack Butala: Is it really?
Jill DeWit: Yeah, yeah. That’s what we used to spend, $275 a month … for nationwide access. That’s it. That’s all you get. No services, no anything like that.
Jack Butala: So we’re charging-
Jill DeWit: So if you’re using-
Jack Butala: We’re not charging them-
Jill DeWit: If you’re using it, or you just need the flat out data, there you go. It’s there for you, because we are licensed providers.
Anyway, back to that. So I was pulling the stats-
Jack Butala: Nice commercial. Nice plug.
Jill DeWit: Thank you. They are adding … I don’t know, a million documents a month, or something crazy, because it used to only carry the vesting deed, the most recent document, and now they see the need for this, too. So Noem, I would go … Number two, go back to RealQuest Pro, check that. Then, number three, the county.
Because I want to do this right now. Here’s the thing. When I’m looking at these properties, or when I was in this position, like Noem, it was usually in the evenings, and the county’s not open. I need the answers right now, so I’m trying to do it online, so 247 first, then CoreLogic, then I’m going to call the county the next day, ask them. If it’s really … You know what, too?
Jack Butala: I’m going to get philosophical for a second.
Jill DeWit: Here’s my thoughts.
Jack Butala: Why do we care?
Jill DeWit: I also … Here’s my thing, Noem. Depending how long the person has owned the property makes a difference to me. I might stop.
Jack Butala: Thank you, Jill.
Jill DeWit: If this guy has owned this property-
Jack Butala: That’s the answer.
Jill DeWit: … for ten years-
Jack Butala: That’s right.
Jill DeWit: … and has done nothing with it, I don’t technically care about the 20 years leading up to it. Oh, and by the way, he bought it from his brother-in-law, or something like that.
Jack Butala: Yeah. I agree.
Jill DeWit: I’m not going to go back and be-
Jack Butala: Title doesn’t go back-
Jill DeWit: They go 30.
Jack Butala: Thirty years.
Jill DeWit: Traditionally. And I-
Jack Butala: We buy property from people regularly who have owned it for 30 years.
Jill DeWit: Yeah, and then it’s like, “Well, case closed. Done.” There’s nothing. Or it’s 25 years or 20 years. Yeah, because they bought it when they were in their 40s or whatever, they had young kids, and they thought it’d be an investment, A, or a retirement thing, B, and now they’re 70, and they decided it’s not going to happen. That takes the guesswork out of it right there.
Jack Butala: Plus, it’s land. So if it’s unimproved property and there’s no lender, that takes 98% of the potential issues out of it, in my opinion.
Jill DeWit: Exactly. Anyway … So you need to … A), Those are your resources, and then B), The second one is how far back do I really need to go? Then, depending how much the purchase price is … If it’s a $50,000 purchase price, I would be doing title anyway. But say you’re buying it for $4,000, Noem? Now you’ve got to go, “All right, do I really need this? If something crazy happened and I had to refund somebody $4,000 down the road, could I afford to do that? Yeah, I can do that,” and that’s okay.
Jack Butala: We’re here, so you can benefit from our experience. Let me share our experience. In almost 16,000 transactions, I have never — I am knocking on wood — ever had somebody come back and say, “I own that property and you sold it.” Never.
Jill DeWit: Right. Exactly. Don’t get too hung up on this.
Jack Butala: Don’t get hung up on it is what I’m saying.
Jill DeWit: Don’t create your own roadblocks and your own problems, and don’t try to do more work than you really need to, and you’ll be great.
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. Please keep these ultra-intelligent questions coming.
Jill DeWit: You know what? I’ve got to say, imagine … Have you ever thought about this when you’re buying a car? You know what I mean? Have you ever paused and said, “Even though we-
Jack Butala: Are we going to go backwards on this show, or forwards?
Jill DeWit: No, I’m just curious. I’m just curious, though. Why do we get hung up on it in this thing? Why are we trained to get hung up on this detail? We don’t think about it anywhere else.
Jack Butala: You’re getting a little miffed, aren’t you?
Jill DeWit: No. I mean, I kind of am. I bought a watch … Okay, how about this. You buy a used watch on eBay. You’ve always wanted this watch.
Jack Butala: What kind of watch is it, Jill?
Jill DeWit: Cartier.
Jack Butala: I knew it was.
Jill DeWit: Follow me on this one, please. Am I really going to go, “I need to see the receipts from the guy you bought it from and him and it all better be legit,” and you won’t know, and …
Jack Butala: Six guys ago … Six women ago, they’re going to call you and say, “You know what? That watch was stolen and it’s mine.”
Jill DeWit: Right. Exactly.
Jack Butala: Is that going to happen?
Jill DeWit: No.
Jack Butala: No.
Jill DeWit: I don’t know why we’re trained … Yes, we do want to make sure/However, don’t make it hard.
Jack Butala: All right, since you brought this thing back up, I’m going to start saying something.
Jill DeWit: Did you buy my watch from a pawn shop? Is that where this came from? Is it stolen? Did you buy it from a guy on a corner?
Jack Butala: Not the watch, but the engagement ring is, yes.
Jill DeWit: Oh, there we go. I knew it. Anyway, you say it was your mom’s. Yeah. Now I know the true story. It was somebody’s mom. It wasn’t yours!
Jack Butala: To bring this to close, please don’t worry about it. If it’s rural vacant land, don’t worry about it. If it’s a skyscraper in Manhattan, you need to get title insurance, and I think that we’ve been sold, as a community, and as investors, a bill of goods. This title insurance malarkey is not that necessary. Jill and I started a company, it’s not released yet, and we will release it by the end of the year, called TitleNined.com, which brings reality to this whole crazy, too-profitable industry. If you’re a regular listener, you know about it. When the time is right, we will release it.
Jill DeWit: Bingo.
Jack Butala: Today’s topic.
Jill DeWit: Yes, what’s the show about today? I already forgot.
Jack Butala: Jillsrant.com.
Jill DeWit: That’s right.
Jack Butala: A start to finish deal for Jack and Jill. This is the meat of the show. So what’s a deal look like from start to finish? Here we go.
I day dream, in front of a computer, and I use RedFin.
Jill DeWit: How awkward. If you leave pause in there, I’m going to jump in. “I day dream, often. Period.”
Jack Butala: It starts with a Jack day dream.
Jill DeWit: I’m usually staring at a computer. Period.
Jack Butala: And I look at Red Fin-
Jill DeWit: That’s when you’re not on YachtWorld.
Jack Butala: Yeah. That’s actually true.
Jill DeWit: Sorry.
Jack Butala: I look for a place to send some letters, send some offers out. These days, I use RedFin. Sometimes I just look at historical tax sales.
Jill DeWit: Do you ever drive around?
Jack Butala: No, I never-
Jill DeWit: Thank you.
Jack Butala: No, it’s not real estate. It’s not about real estate. It’s about data. I don’t care about the real estate. I care about the numbers and sale prices and asking prices and things like that.
Jill DeWit: That’s the key.
Jack Butala: I don’t care about the actual real estate. It doesn’t matter. It doesn’t matter if it’s a house, it doesn’t matter if it’s land. We just pick on land for some reason.
Jill DeWit: You’re looking for an opportunity.
Jack Butala: I look for consistencies in patterns, just like a day trader would, in the stock market or the bond market. It’s basically the same process. Then I find a place that looks like it has consistent sale prices and consistent data, and I send everybody an offer for about 40% of what the asking price is for all the data that I found, all these properties.
Then, I go to the beach, because Jill takes over. Jill and her team take over, because what does she always say? “He makes my phone ring.”
Jill DeWit: Yeah.
Jack Butala: This is rated ‘G,’ Jill.
Jill DeWit: Sorry. I just had a really bad-
Jack Butala: So go ahead. Take it from there.
Jill DeWit: You ring my bell. Ring my phone, ring my bell, whatever.
Jack Butala: If you have kids in the car …
Jill DeWit: Sorry. I went there.
Jack Butala: “Hey, kids. We have little bells in our bedroom, and we just ring our bells.”
Jill DeWit: Yeah. That’s what we do! Ding, ding.
Jack Butala: Yep. Just like on a boat.
Jill DeWit: That’s all.
Jack Butala: Then we laugh together.
Jill DeWit: That’s right. That’s what that means. Whew! Is it hot in here?
Jack Butala: Yeah, it is hot.
Jill DeWit: Anyway, where was I?
Jack Butala: So go ahead. I send out a bunch of mail, a bunch of offers, and then I go to the beach, and what do you do? You pick it up from there. What do you and your team do?
Jill DeWit: Answer the phone and open the mail, and then we put it all in a spreadsheet. We talked about on yesterday’s show, we’re not sparsing it out. We want all the good stuff to come in at the same time. We’re going to put it all in our system, basically. You could use a spreadsheet, but we have a system that organizes all this. Then we can look at them intelligently, at one time, and review all the deals.
You’ll find the ones that quickly rise to the top. You’re basically going to sort for, “Did they like my offer? What are the great properties?” Where they are, what attributes do they have? You’re going to organize that. You’re going to organize by who’s alive and well and able to sign, what are the deals I can quickly close on?
Jack Butala: That’s right.
Jill DeWit: Based on all that-
Jack Butala: Low-hanging fruit.
Jill DeWit: Yeah. You’re going to go, “Oh, my gosh. Wait a minute.” Something’s going to … This is usually what happens. One or two or five, however many you’ve got-
Jack Butala: One out of ten.
Jill DeWit: … are going to …
Jack Butala: One out of ten, you’re going to say, “This can’t be right.”
Jill DeWit: “Whoa! Wait a minute. Sweetheart, look at this with me.”
Jack Butala: “This can’t be right.”
Jill DeWit: “Is it just me? Does that look like it’s on a river?”
Jack Butala: “Uh huh.”
Jill DeWit: “Oh, my God. Wow! And look at the trees! Wait a minute-”
Jack Butala: “Is there a house on this?”
Jill DeWit: “… and this guy really liked my price, and-”
Jack Butala: “He wants to sell at this-”
Jill DeWit: “… look at that road-”
Jack Butala: “… property for $2,000?”
Jill DeWit: “… and there’s a house next to it, and there’s this. Oh-”
Jack Butala: “It’s got to be worth forty grand.”
Jill DeWit: “We’ve got to grab this one.” And then you’re going to quickly divvy up your acquisition funds and run out and buy them. I mean, that’s really how it goes.
Jack Butala: That’s exactly how it goes.
Jill DeWit: Then, the ones that you don’t have enough for … Let’s just say you’ve got a lot. This is the best possible situation. You’re going to be calling these people back, going, “Okay. Here’s the deal. I can buy it right now, but I only have this much money left over this month. I can buy it for $2,000 now-”
Jack Butala: Or you’re going to go to landinvestors.com and you’re going to find yourself a financial partner.
Jill DeWit: Something like that. “How fast do you need to close?”
Jack Butala: Because you never let a good acquisition go to waste.
Jill DeWit: Right. If they’ll hang out until next month, I’ll do that. I’ll put them kind of in a schedule and close them. My first choice is, I don’t want to share the wealth. I want the money. I don’t want a financial … No, I’m serious, Jack.
Jack Butala: Just two shows ago, you were saying, “I’m not motivated by money at all.” Let me tell you something about Jill.
Jill DeWit: Oh, well that’s different.
Jack Butala: Two point five carat Jill.
Jill DeWit: Stop. Listen. Seriously. All right, I am eating my words.
Jack Butala: I just walked through the garage and the top’s down on your Lexus.
Jill DeWit: All right. Stop it. But come on-
Jack Butala: Hey, Cartier.
Jill DeWit: Well, shut up. All right, all right. So my point is, though, I could … That’s true. I could do that, but then there’s more work and I’ve got to get the other person involved and we’ve got to talk about it and how it’s going to go down and everything. It’s really easier for me and my team if we just close the deal ourselves. That’s really the reality. That’s part of the criteria, too. Who needs the cash right now because they’re really ready to sell?
You know what? Jack’s right, because it’s true, time does kill deals. If I let somebody wait two months, they might go, “Eh, you know what? I talked about it with my brother, and he bought it. He said if I was going to let it got for that price, then he wants it.” That does happen, so you brought up a good point. So thank you, Jack.
Now, do you want to-
Jack Butala: If you talk to anybody who does this for a living, any version of it, there’s always a bottleneck. It’s different for different people. The bottleneck for us used to be engineering. We call it ‘engineering,’ but really it’s due diligence. The vast majority of these rural vacant land properties, these transactions, they don’t have a physical mailing address, so they just have an assessor’s parcel number. It’s a number, and you can’t find it.
Jill DeWit: That used to be my single hardest thing.
Jack Butala: Man, it would just take forever.
Jill DeWit: Finding the property.
Jack Butala: I had a whole staff, for a lot of years, engineering staff, and we kept them in the basement, because they’re weirdos. Since then, Jill and I released ParcelFact.com, which is a-
Jill DeWit: Solves your GIS problems.
Jack Butala: It solves your whole engineering staff. You could literally type in an APN and the corner points to the property. It pulls up Google Earth.
Jill DeWit: It’s the real deal.
Jack Butala: It’s the real, professional deal.
Jill DeWit: It might have six angles. It might be a really funky … I had one the other day. The guy’s like, “Is this right?” It looked like a full rectangle, but with a sliver off to the side.
Jack Butala: Yeah, I saw that. I saw that deal.
Jill DeWit: Yeah. I’m like, “Call the county. They clearly … Maybe it’s a little access thing that’s deeded in.”
Jack Butala: It’s a deeded easement, is what it is.
Jill DeWit: There you go.
Jack Butala: It’s a deeded, plated easement.
Jill DeWit: I’m like, “Congratulations. There’s your access.”
Jack Butala: That stumped me. I haven’t seen a deal like that in quite some time.
Jill DeWit: That’s why I came here.
Jack Butala: It didn’t stump me, I just haven’t seen it.
Jill DeWit: It was cool. That just means ParcelFact is awesome.
Jack Butala: This is not a commercial for ParcelFact.com, F-A-C-T, but we’re here to solve problems.
Jill DeWit: It does.
Jack Butala: It’s incredibly cheap for the information that it actually provides.
Jill DeWit: I want to point out something, too. So we’re doing a start to finish deal, right? What’s interesting is for us, for me … You’ve heard us say this before, probably. If not, I’m going to tell you: you win when you buy it. For me, I almost feel like the deal’s done at that point, because once I have this property at the price I wanted in my inventory — the transaction, it’s in my name — as far as I’m concerned, that was the deal part. I know how it’s gonna end. I already know, but really taking it all the way out, we gotta post it. Do you want to follow up with that?
Jack Butala: So now I’m staring at a database of 15 or 20 deals where our acquisitions people say, “This is … ,” and there’s notes in there. “They don’t want to sell it for $4,000, but they want to sell it for $5,000. Yes or no, Jack?” Every other day, about, I go in there and I say, “Yep. Yep. Nope. Yep. All right, love it at $3,000, I hate it at $5,000,” or whatever. That’s something that you can’t outsource. There’s a bunch of things that you can outsource as an investor, but making that actual, pull-the-trigger decision is something that I still do by myself, alone, in the dark. Seriously.
Once that happens, we decide to either close it with title, if it’s a larger deal, or we close it ourselves. How do you close a deal, Jill?
Jill DeWit: Okay. I’m trying to think of how to shorten it since it’s basically-
Jack Butala: The seller wants to sell and they live in Connecticut.
Jill DeWit: Right. So what you’re doing … You’re just going to arrange, with a local notary … I go to Notary123, and I sort … I’m just going to give you the … Skipping on the top, here, and not all the details … Basically, I get a local notary, and I’m going to overnight to them the documents, cashier’s check, for them to go to the seller’s house and do the transaction.
Jack Butala: We generate the deeds in house, and we generate them with DeedPerfect.com.
Jill DeWit: Which is another one of our sites that we created to solve everybody’s problem.
Jack Butala: It’s not commercial. We’re solving problems.
Jill DeWit: That’s what’s so funny. All of the stuff that we’ve done is because our members said, “I need help with this.” We’re like, “Okay, we’ll create a product. There you go.” Then most of them are free to our members. Like DeedPerfect and all the data and all the good stuff, the due diligence stuff.
So they close the deal and it’s signed, the deed comes back to me, I send it in to be recorded. Piece of cake, and then we post the property and let it go. It sells.
Jack Butala: Then sell it. We just post it everywhere. All over the internet.
Jill DeWit: I don’t sit and go, “You know, that’s perfect for Craig’s List.”
Jack Butala: Specifically on LandPin.com.
Jill DeWit: No. I put it all over the place, because that’s what you need to do. Or, what happens to us now, often … After a while, you build up a buyer’s list, and I’m just going to email my people. That’s usually how it goes. I don’t even have to post it. I don’t have to do any of the mapping of things like that, because you eventually get a good list of other investors and they know how to pull a property and look at them. You can just send them a list of APNs, basically, and they could say, “I want those six.” Then we already have … We’ve been doing the stuff so long they know my bank wire information.
Jack Butala: Every property that we buy is already sold. We already know who’s going to buy it. That’s part of the acquisition decision.
Jill DeWit: Yeah.
Jack Butala: If you’re brand new, you’ve got to work through that, but if you go onto our YouTube channel, I have videos about how to get an A-list of buyers really quickly. It’s actually really simple.
Jill DeWit: Yeah.
Jack Butala: So anyway, that’s another episode where Jack and Jill discuss how to use information, that’s me …
Jill DeWit: … and inspiration, that’s me …
Jack Butala: … to do just about anything you want.
Jill DeWit: We’ll use it every day to buy property for half of what it’s worth and sell it immediately.
Jack Butala: You are not alone in your real estate ambition.
Jill DeWit: Was that too lengthy?
Jack Butala: The length of this show rivaled the first podcast that we did.
Jill DeWit: How long was that?
Jack Butala: It was like 20 minutes.
Jill DeWit: Oh. That’s not bad.
Jack Butala: It’s important, though, you know?
Jill DeWit: Yeah.
Jack Butala: It’s important to know all this steps of a deal.
Jill DeWit: Yeah.
Jack Butala: Information and inspiration to buy undervalued property.
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