Jack Jill Divide Conquer in Acquisitions Sales (JJ 693)

Jack Jill Divide Conquer in Acquisitions Sales (JJ 693)

Transcript:

Jack Butala:                         Jack and Jill here.

Jill DeWit:                            Hi.

Jack Butala:                         Welcome to the Jack Jill Show, entertaining real estate investment talk. I’m Steven Jack Butala.

Jill DeWit:                            I am Jill DeWit, broadcasting from sunny southern California.

Jack Butala:                         Today, Jill and I talk about how we together divide and conquer in acquisitions and sales. The whole premise here, I think, is if you have the opportunity to partner up with somebody who is better at or more interested in doing one side or the other side of anything really, real estate investment wise, my opinion is you’re going to do better.

Jill DeWit:                            Well, what one person can … I can’t think of anybody that can … You can’t be perfect at it all.

Jack Butala:                         Well, you’re going to run out of a time at some point.

Jill DeWit:                            Well, that too.

Jack Butala:                         No matter what.

Jill DeWit:                            Our energy and … Yeah, I agree.

Jack Butala:                         There’s ups and downs in everything, so I just think … I don’t know. It seems to work for us. I’ve always had business partners in the past for things that I’ve done, for better or worse, but I’ll tell you. It sure, I think, just from my personality, it works a lot better.

Jill DeWit:                            Remember my dodge ball reference?

Jack Butala:                         No, go ahead.

Jill DeWit:                            This is how I see how we operate. It’s like how you and I run our business and do things, it’s like picking members of a dodge ball team.

Jack Butala:                         How do I not remember this?

Jill DeWit:                            Because its like … Remember when you’re in, I don’t know, third grade playing dodge ball. Everybody lines up and you’re one of the captains and there’s the other captain and you’re picking first the best players and then you got to divide up what’s left over. So that’s how we are. It’s like if you line up everything about our business, Jack and I are pretty good. We sit there and go, “All right, you’re good at that. Acquisitions go to Jack’s team. I’m good at sales. Sales goes to my team.” Then we get down to the crap that’s left over, for lack of better words. It’s like, “Well, all right. I’ll handle the phones if you handle the tech piece,” kind of thing.

Jack Butala:                         Right. God, that’s true.

Jill DeWit:                            Isn’t it funny?

Jack Butala:                         Then there’s that one kid at the end.

Jill DeWit:                            Exactly, that nobody wants.

Jack Butala:                         It’d be better if they weren’t there at all.

Jill DeWit:                            Exactly. We’re like, “I’ll take him today, you take him tomorrow.” “Okay, fine.”

Jack Butala:                         Whats the equivalent of running a business from that?

Jill DeWit:                            Personnel.

Jack Butala:                         I was going to say something else.

Jill DeWit:                            We’ve got a lot of people go.

Jack Butala:                         Personnels.

Jill DeWit:                            You know what I mean.

Jack Butala:                         You didn’t even hesitate.

Jill DeWit:                            No, that’s all I …

Jack Butala:                         You didn’t hesitate on bit.

Jill DeWit:                            No, stuff just happens. See? Nobody wants to do it. That’s the sad thing too. I mean we got to include that kid. Come on, there’s always one that can’t throw a ball or can’t run or something.

Jack Butala:                         I’ll handle it. I’ll handle personnel.

Jill DeWit:                            Or always gets hurt. There’s always going to be one.

Jack Butala:                         Speaking of dodge ball, even recently, I’ve watched some kids play dodge ball.

Jill DeWit:                            Really? That’s good.

Jack Butala:                         In this day and age, it shocks me every time I see it, that it’s so violent.

Jill DeWit:                            It kind of is.

Jack Butala:                         This generation doesn’t let their kids even fall down on the ground and scrape their knee, let alone just get their head bashed in by the kid whose just beyond his years in size.

Jill DeWit:                            Yeah. You know, that’s funny. We should’ve had helmets back then. Because yeah, you would nail … Remember? Kids would come back and they had those little red rubber balls.

Jack Butala:                         Crying.

Jill DeWit:                            That would leave a welt on your back if somebody hit you right.

Jack Butala:                         Right. I remember back when I played when we were kids and I played dodge ball. They went on record and said, “Please, don’t excessively hit someone in the face.”

Jill DeWit:                            Oh, yeah right.

Jack Butala:                         That point blank range.

Jill DeWit:                            They say that.

Jack Butala:                         If you do … In Michigan, it was the equivalent of a penalty box. So you’re just going and sitting in the box and laugh and horse around for a minute.

Jill DeWit:                            We never had that.

Jack Butala:                         Then go back out. Because it’s worth it. It’s worth it to have a time out. You need a rest anyway.

Jill DeWit:                            Oh.

Jack Butala:                         It totally backfired. And here’s my final point on dodge ball.

Jill DeWit:                            We never got that.

Jack Butala:                         I think the coaches and gym teachers have more fun watching this than everybody.

Jill DeWit:                            Oh, it’s hilarious. Oh, you know that. “Take them out. Get them for me.” That’s right.

Jack Butala:                         Yeah. It’s making me feel better.

Jill DeWit:                            “That kid’s been a pain in my neck. Let him have it. I didn’t see it.”

Jack Butala:                         What goes on in your head, Jill?

Jill DeWit:                            Dodge ball was really for the coaches. It wasn’t for us. It’s the coaches way of allowing us to just get everybody. I don’t know. That’s funny.

Jack Butala:                         Yeah, because they can’t hit the kids.

Jill DeWit:                            No, they can’t, but we can.

Jack Butala:                         Were you ever standing in the back hoping not to get hit?

Jill DeWit:                            Oh, yeah. Well, you just got to be fast.

Jack Butala:                         I was never that person.

Jill DeWit:                            You know what I did? You just got to be fast and you got to get behind someone bigger than you. That was my strategy.

Jack Butala:                         I was the guy standing in front causing all the problems for everyone.

Jill DeWit:                            Oh. You’re like, “Bring it, bring it.” You’re that kid?

Jack Butala:                         Yeah.

Jill DeWit:                            Oh, no.

Jack Butala:                         I was the enforcer.

Jill DeWit:                            Oh, no. You’re like … Did you like stare down?

Jack Butala:                         Oh, all that. I was in the penalty box more than anything.

Jill DeWit:                            Okay. Got it. “Bring it on. Let me have it.” Because you know what I’m going to do back to you-

Jack Butala:                         Nothing’s changed.

Jill DeWit:                            Intimidating. Nice.

Jack Butala:                         Do you know what? This role was ready and what we’re talking about.

Jill DeWit:                            How do you win by intimidation?

Jack Butala:                         Yeah. We should stop this right now.

Jill DeWit:                            That’s right.

Jack Butala:                         Somebody’s calling the American Psychological Institution right now. Take these guys off the air.

Jill DeWit:                            That’s right. Okay.

Jack Butala:                         Before we get into our actual topic … Geez.

Jill DeWit:                            Oh, we have something?

Jack Butala:                         Yeah.

Jill DeWit:                            Okay.

Jack Butala:                         Let’s take a question posted by one of our members. On LandInvestors.com, online community. It’s free.

Jill DeWit:                            Okay. Delphine asks, “Hello. I would appreciate any help on this. We are pretty new to this and need some guidance. We purchased some land in the area that has a-“

Jack Butala:                         POA.

Jill DeWit:                            POA.

Jack Butala:                         HOA or LOA, Property Owner’s Association or Land Owner’s Association.

Jill DeWit:                            Right. “We have sold some and financed some. On the parcels that are financed, before the association can transfer the property, the person who financed the land, they need a deed. They said they typically get a warranty deed with a vendor’s lien. I only have a template for a warranty deed, nothing with a vendor’s lien. Can someone help?”

Jack Butala:                         Yes. This is again, another great question and it’s rooted in experience. I really, really appreciate these intelligent questions. There’s two ways to sell property on terms. The back of the napkin approach, which is what Jill and I favor, in a deed of trust. Around different places in the country, it’s called different stuff, but it’s the exact same way that you buy a house with a mortgage company. You buy the house, you sign a bunch of papers, you get a loan, and the mortgage company records the deed. Usually the title company records the deed on their behalf with a lien on it. Until you make your payments in 30 or 15 years, 30 years later, they release the lien because you’ve paid off the mortgage. Then you get a different deed, but you’ve had a deed the whole time stuffed somewhere in a drawer. That’s called deed of trust.

                                                The other way, which is what I prefer, is where there’s a buyer and a seller, and we put together a little agreement in Microsoft Word and we say, “You’re going to pay us $150 a month for eight years at 3% interest. When we’re all done, we’re going to record the deed. We’ll do it for you. We’ll record the deed of accounting and then we’re done. You own the property free and clear.” You own it anyway the day we’re signing it, it’s just got a lien on it because we’re acting as a bank. Hope that’s clear. Is it clear, Jill?

Jill DeWit:                            Owner financing. Exactly.

Jack Butala:                         When you have a POA or a Home Owner’s Association, is it really necessary to tell them that this is all going on? That’s my question to you, Jill.

Jill DeWit:                            You know, here’s my thoughts on this. I’m not a fan.

Jack Butala:                         Neither am I.

Jill DeWit:                            There’s two ways that I would do it. One is I wouldn’t do it. I wouldn’t owner finance.

Jack Butala:                         I wouldn’t either, Jill. I would avoid this.

Jill DeWit:                            Because here’s the thing. I wouldn’t owner finance because I’m responsible for the POA fees or the HOA fees until this is all done. I don’t want to be responsible. How do I know that they’re really paying them? My only other choice is, I add that on, which I could do. That would be the only way that I would do it. Like you said, Jack, I wouldn’t even go there. I would not owner finance it, I wouldn’t transfer the property. I’d have them make payments to me directly, plus the HOA fees every month, and then I know it’s all getting paid because then I’m writing a check to the HOA and making sure that happens every month. Then when it’s all done and said, like I think you alluded to, then I transfer the property and now we’re done. Then in the contract, like we all do, if anything goes sideways, it’s mine. I’m cool with it.

Jack Butala:                         And you don’t have to undo anything.

Jill DeWit:                            Exactly.

Jack Butala:                         Which happens frequently.

Jill DeWit:                            Exactly.

Jack Butala:                         Here’s the moral of the story. We just said everything politically correct.

Jill DeWit:                            Right.

Jack Butala:                         Here’s the real Steve way. Ready?

Jill DeWit:                            Okay.

Jack Butala:                         Avoid the hell out of POA property.

Jill DeWit:                            Yeah.

Jack Butala:                         If you must buy POA property, and we do it all the time, buy it for less than $100 a property because all POAs have tons of property they foreclosed on. They may tell you they don’t, but they do.

Jill DeWit:                            They do.

Jack Butala:                         They tell you, “No, no. We don’t have that.” Then you’re not talking. You got to go higher up.

Jill DeWit:                            Yeah.

Jack Butala:                         Until you get to the president and that person will say, “Oh my gosh, you should see how much property we have. Please come and get it.”

Jill DeWit:                            Right.

Jack Butala:                         If you must buy POA property, buy it cheap and sell it for cash immediately.

Jill DeWit:                            Fast.

Jack Butala:                         Do yourself a huge favor, send the people that work at the POA a lot of brownies and stuff. You want them on your side because you’re going to be transferring a lot of property. You do not want them to look at you like you’re some evil person that’s causing work for them.

Jill DeWit:                            Right. Exactly.

Jack Butala:                         Oh, by the way, one last point here. The last sentence says, “Do they typically get a warranty deed with a vendor’s lien? I only have a template for a warranty deed, nothing with a vendor’s lien.”

                                                In my experience, you don’t record the fact that there’s a lien on the property in the actual document. Where this comes from, I think, is a car title. You know how you look at a car title and there’s a spot for a lien holder?

Jill DeWit:                            That’s true. It shows a lien.

Jack Butala:                         That’s not how this goes.

Jill DeWit:                            Exactly.

Jack Butala:                         It’s a completely separate document.

Jill DeWit:                            Yeah. I was thinking one more thing. You were talking about with the county and becoming their friends. Shucks, it was good.

Jack Butala:                         Send them brownies at the POA because you don’t need them upset.

Jill DeWit:                            Exactly. I think that was it. I’ll think of it. It’s all good.

Jack Butala:                         [Face 00:10:59] topic. Jill and I divide and conquer when it comes to acquisitions and sales. I’ll tell you, it hasn’t always been like this. This is the meat of the show. Jill loves stories. I’m going to tell her a brief story.

Jill DeWit:                            Okay.

Jack Butala:                         I started what is now Land Academy Land Investors and all these revenue streams that we have, House Academy, in the late 90s at a coffee table by myself long before I met Jill. They have done, since that day, very, very, very well up to and including this minute. I met Jill about 10 years ago and she had a regular job. One day, she was bitching about her job, not like the real crazy nutcase rant like I do, she was just upset about her job and unhappy with where it was going. I said, “You know? I got a bunch of property over here. Why don’t you take a crack at it?” This is how we usually do it. Why don’t you in your spare time sell a couple properties a week, just see what happens. Just like everybody else probably listening to this show is thinking about doing. Well, she turned it into what, 20,000, 30,000 bucks real fast.

Jill DeWit:                            Yeah.

Jack Butala:                         I mean crazy fast. Then I got to think, I’m like, “What if this is how it works? What if this was exactly what the whole regular company was like where she just handled sales? Because I can buy property.” Most people listening to this show, if you follow what we do and follow our education steps, you can buy property all day long. I just was never happy about selling it. My answer was always, if it’s so cheap, it sells itself. I got away with it for a long time. I got away with that for years and years and years and years. The end of the story, you can write the end of the story yourself. It turns out we’re better together. We divide and conquer this thing. I just jam the acquisition pipeline full and I mean jam it full until they say stop.

Jill DeWit:                            That’s funny. I always remember it. That’s good. I hadn’t thought about that in a while. I remember we were going out to dinner one night and I remember you’re like going, “What are you doing?” I’m looking at my phone. I’m like, “Oh, cool. That checked out. That checked out. They checked out.” He was like, “How much money is that?” I remember you looking at my phone going, “What the … How did you get that much money?” I’m like, “I don’t know. I just do what you told me to do.”

Jack Butala:                         I never expected that it would work. That’s the truth. That’s the straight, honest truth.

Jill DeWit:                            I was selling the stuff. First what was great too, you gave me a bunch of junk, if you will. It was like the broken sunglasses.

Jack Butala:                         I gave you the worst properties. Yeah.

Jill DeWit:                            I made them work, like okay. Yeah. It was so darn funny. All I said is, “I just did what you said.” But apparently my little spin on it was all that was needed, my little tweak on that.

Jack Butala:                         That was my next point. That tweak, which is what I was not willing to do, which is what I believe … This is false, by the way. I believe that price would make up for any type of customer contact at all.

Jill DeWit:                            Right.

Jack Butala:                         That I would just run it through an auction. We had live auctions and we had online auctions through Ebay and Bid4Assets. There was no customer contact. Well, it turns out just the slightest bit of customer contact, whether it’s in email or in Jill’s case, usually it’s taking an inbound phone call or placing an outbound one just to check to make sure everything is right. That creates a returning, appreciative customer for life. It was something that was missed. I was missing the mark completely until I met Jill.

Jill DeWit:                            Thank you.

Jack Butala:                         My point is, if you have the opportunity to work with your spouse and you’re able to do that without killing each other or you have the opportunity to work with a brother or a sister or somebody whose expressing the same kind of disgust with their regular job, give it a shot. Do it part-time for a while. But I will say this. If they have the same exact personality … If you have two data people working together, it doesn’t make any sense.

Jill DeWit:                            That’s true.

Jack Butala:                         I’m data, she’s sales. Go ahead.

Jill DeWit:                            Well, the thing too like you said about … It’s really important to … It’s a difference hiring someone versus having a partnership. It’s so great. It’s so much better. We all know it when they have skin in the game. If you both put in $10,000 or $50,000, whatever it is to get this rolling so you’re both in it, that will make a difference. People just make different decisions. It’s a fact. I mean I watch our staff sometimes. We just moved into a new office. They went a little shopping crazy. I’m like, “Hold on everybody.” I had to like reel them back in.

Jack Butala:                         Really?

Jill DeWit:                            Yeah.

Jack Butala:                         What kind of shopping craze?

Jill DeWit:                            Just coffee makers. We have extra stuff now. I mean little office supplies. That was really fun. Do we really need a stapler? We don’t have that much and do we need an expensive stapler? It’s not a big deal.

Jack Butala:                         Hold on. I need your rant for a second.

Jill DeWit:                            It was just kind of funny.

Jack Butala:                         We are at all paperless in our office, but there is no paper.

Jill DeWit:                            I know.

Jack Butala:                         I make a big point about this.

Jill DeWit:                            Yes.

Jack Butala:                         Unless we have to do deeds. You need an original signature on a deed, so you can’t avoid that.

Jill DeWit:                            Yes.

Jack Butala:                         At least at this time.

Jill DeWit:                            Yes.

Jack Butala:                         What is it about office supplies for some people?

Jill DeWit:                            I don’t know. We have highlighters.

Jack Butala:                         Just hold on a second. Some people, when I sit down at their desk and they get all their stuff where it needs to be with a little pencil thing.

Jill DeWit:                            Right. Business cards, make sure it all looks perfect.

Jack Butala:                         We don’t even need drawers, I don’t think. There’s nothing there.

Jill DeWit:                            I know. The drawers, that’s where you put your purse and your lunch and your car keys.

Jack Butala:                         I would argue you don’t need any of those things.

Jill DeWit:                            And your cell phone. But anyway, that … especially your cell phone. Anyway, that’s one thing. When you’re-

Jack Butala:                         I could rant about that all day.

Jill DeWit:                            When you’re building your business and doing this, I mean that’s a huge one for me. If you could get a partner, a real partner, who would, like Jack said, who compliments the areas that you lack in, that’s awesome. Here’s something else that was funny I was going to share. Last night, I happen to be rewriting my BiggerPockets bio. I went and looked at it and I’m like, “It needs to be updated a little bit.” It was so funny because as I’m writing my bio, it really wasn’t my bio. It was our bio because it’s impossible-

Jack Butala:                         Oh, that’s not good.

Jill DeWit:                            No, no, no. But it’s good. Go read it. It’s impossible for me to describe me without including you, in my business, without including you. I can’t say, “Me, me, me, me,” because it’s not me. It’s us.

Jack Butala:                         It is now.

Jill DeWit:                            I didn’t mean to plug you in my bio, but I kind of did plug you in my bio because it’s the truth. So there you go. Hopefully that … I want you to go read it, Jack or Steven, go see what you think. Steven Jack.

Jack Butala:                         The other thing, and this is my final point, it allows the person to concentrate on what they’re really good at.

Jill DeWit:                            Yeah.

Jack Butala:                         I can for the first time in a long time, probably for the last year or so, freely concentrate on data and spend the extra research time to make it spectacular. If you listen to our House Academy show or you follow us on House Academy at all, Jill and I buy houses. We buy land first and foremost, but we also buy houses and wholesale them. In a data piece, that’s allowed me to create that because you’re handling the sales/customer service piece of all of this. The bigger it gets, the bigger that piece gets. My job doesn’t get that much bigger because I can send out 25,000 letters.

Jill DeWit:                            Right.

Jack Butala:                         Or offers just as easy as I can 2,000. With the help of some overseas people now.

Jill DeWit:                            Exactly.

Jack Butala:                         My point is, your burden is much bigger than mine and I’m thanking you on the air.

Jill DeWit:                            Thank you, Jack.

Jack Butala:                         That’s the whole deal.

Jill DeWit:                            I appreciate that [inaudible 00:18:51].

Jack Butala:                         Well, you’ve done it again. You spent another, I don’t know, 20 minutes with us, listening to the Land Investors Show. Join us tomorrow where we discuss how to record your own deed stories and why it’s so important in sales.

Jill DeWit:                            And we answer your questions that you have posted on our online community found at JackJill.com or go straight to LandInvestors.com.

Jack Butala:                         You are not alone in your real estate ambition. This really is a lot easier with you than without out.

Jill DeWit:                            Oh my goodness, yes. It’s so nice that we know. It’s like things come up, it’s automatic. That’s your side of the sheet. That’s my side of the sheet.

Jack Butala:                         Yeah.

Jill DeWit:                            There really isn’t any dividing it up. I mean we all know what you’re good at and we all know what I’m good at.

Jack Butala:                         That didn’t happen overnight as I recall. I think there were some moments where I was wondering if it was going to work at all. I’m sure you had those too.

Jill DeWit:                            You know, for me, it was more … I guess I don’t really have to prove myself to you, but I had to take some of the ideas and run with them. You know what I mean? Before you really would let me go … You had to hear me do it. You didn’t know I could automatically jump in and do it.

Jack Butala:                         Yeah.

Jill DeWit:                            When you said, “Hey, see if you can sell these.” I’m like, “Well, I can sell that.” Then you’re going, “Oh wow, I guess she can.”

Jack Butala:                         Well, that’s what happened. Then I’m like, “What can’t you sell?” Because you took the bottom of the barrel as far as land goes and turned it into … You took property … I should’ve said this on the regular show. You took property that I mentally wrote off.

Jill DeWit:                            Yeah.

Jack Butala:                         I’m like, “We just can’t sell this.” It’s not because it’s not bad property. That wasn’t it at all. It was just because we had so much of it. We had tens of thousands of these properties laying around literally.

Jill DeWit:                            Right. It just got pushed down on the list and you didn’t care about it.

Jack Butala:                         Right, because we long made our money out of it.

Jill DeWit:                            I get it.

Jack Butala:                         We still have property lingering around like that. It’s amazing.

Jill DeWit:                            Oh, I know. It always happens. Hey, share the fun by subscribing on iTunes or wherever you’re listening. While you’re at it, please rate us there. We are-

Jack Butala:                         We’re Jack and Jill, information and inspiration.

Jill DeWit:                            Information and inspiration-

Jack Butala:                         To buy undervalued property.

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