A Deal We Killed Yesterday (LA 1416)
A Deal We Killed Yesterday (LA 1416)
Transcript:
Steven Jack Butala:
Steve and Jill here.
Jill DeWit:
Hi.
Steven Jack Butala:
Welcome to the Land Academy Show, entertaining land investment talk. I’m Steven Jack Butala.
Jill DeWit:
And I’m Jill DeWit broadcasting from sunny, Southern California.
Steven Jack Butala:
Today, Jill and I talk about a deal we killed yesterday. This is part therapy for Jill.
Jill DeWit:
Uh-huh (affirmative).
Steven Jack Butala:
Because she needs to vent, and an incredible source of entertainment for me.
Jill DeWit:
This doesn’t happen very often. Usually, I’m killing a deal because we come across just a major title issue, or there’re just liens that we miss, and it just now doesn’t make sense. Access we thought we had, now we don’t. There’s usually some property-related reason why we have to kill a deal. It is very, very rarely that it’s 100% the person involved in the deal, as in the seller, as the reason why we don’t want to do it. I flat-out told this gentlemen-
Steven Jack Butala:
Before we get into it, let’s take a question.
Jill DeWit:
All right. You’re, “Hold it back, hold it back.”
Steven Jack Butala:
Posted by one of our members on the landinvestors.com online community. It’s free. I can’t wait to hear this.
Jill DeWit:
Oh yeah. Is this really who this is?
Steven Jack Butala:
Mm-hmm (affirmative).
Jill DeWit:
Okay. It’s written by-
Steven Jack Butala:
It’s Steve.
Jill DeWit:
It’s Steve?
Steven Jack Butala:
Yeah. Steve says…
Jill DeWit:
Okay. Steve says, “Happy New Year. We’re looking for a few folks who need money partners. We like purchases between $5,000 and $50,000 typical splits. We’re getting pretty good at creative financing.” Whatever that means.
Steven Jack Butala:
It means because they’re private lenders or private partners being very flexible to what the person, the deal finder needs.
Jill DeWit:
Sure. All right. “We also buy seller finance notes and we’ll even lend on performing notes, small shop with deep experience in credit and collection.”
This is hilarious.
Steven Jack Butala:
So please, everybody, whatever you’re doing, please stop and listen. I want you to never, ever worry about the money part of this ever again.
Jill DeWit:
Right.
Steven Jack Butala:
This is this, and then Steve leaves all his information and his cell number and all of that-
Jill DeWit:
Hidden in our group.
Steven Jack Butala:
Which I, yeah, there are probably a hundred people in our group that are like this and maybe 500 more that are lurking that are not part of our group, dying to finance our fund, your deal, starting with us.
Jill DeWit:
Beautiful example, today is Wednesday. The show that I did, the Facebook live and YouTube live show that I did eight days ago, we led the show with a survey about how many of you here are looking for money or how many are here to lend. And it was funny, because it was 100% the people that completed the survey were a 100%, I’m looking for money. And then halfway through the show, in comes all the lurking people. They didn’t want to answer the question that I’m here to lend money. But when they heard someone had a good deal, here comes people’s phone numbers, emails, contact information, “I’ll help you, I’ll help you, I’ll help you.” Just like Steve here.
Steven Jack Butala:
Many people are very shy.
Jill DeWit:
Yeah.
Steven Jack Butala:
They won’t stand up in the front of the room. They’ll stand up in the back of the room.
Jill DeWit:
That’s where they are.
Steven Jack Butala:
But they will not stand up in the front of the room and say, “We would love to be your partner.” They just don’t. That’s not their personality.
Jill DeWit:
They want to hear about the deal first.
Steven Jack Butala:
That’s exactly right. They don’t want to hear how great you are and how shiny your shoes are or any of that. They want to look at a deal. They want it to be presented easily and they want it to be an awesome deal. And they will throw money at you literally, throw a hundred dollar bills at you. It just needs to, you need to find them. You need to work them. You need to be cool about it. And you need to consistently send them fantastic opportunities and they will do it. Every single deal you bring them after the second or third deal. How do you do that? How do you find great deals while you’re in the right place? You send out a bunch of mail. You look at tons of properties, you get organized and you find if I need money partners, they’re right here.
Jill DeWit:
Perfect. Back in the day, if you’ve ever gone to any REI meetup in any town, there were always guys standing, leaning against the wall in the back of the room. And all they’re doing there is watching and listening for people. You’re there talking about, “Hey, I just got this under contract. I think this is this. I think I can do that. This person is asking for information on the deal.” And if you watch on their way out the door, they might’ve been followed by one of those guys saying, “Hey, do you need money for that? I can help you.” That’s exactly what’s going on. And now the back of the room is the version. Now that we don’t have a room to stand in right now, the back of the room is lurking on social media-
Steven Jack Butala:
That’s right.
Jill DeWit:
Lurking in all our online community and, and lurking on my Facebook live.
Steven Jack Butala:
I don’t want to sound like a broken record here. We’ve been saying this for five years. Well, it’s actually seven years that we’ve been doing Land Academy, I did all the math-
Jill DeWit:
Yikes.
Steven Jack Butala:
In 2015.
Jill DeWit:
[inaudible 00:05:10].
Steven Jack Butala:
It’s 21.
Jill DeWit:
Wow.
Steven Jack Butala:
We’re on our seventh year.
Jill DeWit:
Wow.
Steven Jack Butala:
So we’ve been saying some version of this for a while, but I will tell you this. And it’s truth time, I’ve never seen so many money people. It’s just taken a lot of years for this thing to catch on because land is historically been this thing that nobody wants to touch.
Jill DeWit:
Right.
Steven Jack Butala:
After years of doing this podcast and there are Thursday webinars and all of these, these finance guys are looking for new creative ways to partner money and they’re finding us.
Jill DeWit:
Mm-hmm (affirmative).
Steven Jack Butala:
And they’re finding us because a lot of our members are pretty loud about selling property,
Jill DeWit:
Mm-hmm (affirmative).
Steven Jack Butala:
Which should they should be because that’s what we’re here for. You buy a piece of property and resell it. So please, don’t let money stop you now more than ever. And including us, we’re worried that probably half the deals we do are money deals.
Jill DeWit:
Mm-hmm (affirmative).
Steven Jack Butala:
Maybe 40%. I don’t know. Some number like that.
Jill DeWit:
I don’t know. [crosstalk 00:05:59].
Don’t ask me about math right now.
Steven Jack Butala:
I’ll do the math for you.
Today’s topic. The deal we killed yesterday. This is the mid of the show.
Jill DeWit:
[inaudible 00:00:06:09]. The math that I know, I look at bank balances.
Steven Jack Butala:
Yes you do.
Jill DeWit:
I do. And I look at the math. Here’s the math that I care about. I look at bank balances and I look at per transaction, but then I, so I get an offer and I always have to go back and look and go, “What are we in for?” Like, I had an offer that day for $70,000, we’re in for $23,000. I know that math. I’m good on that. Even though the broker gets 10%, I don’t flipping care, he earned it.
Steven Jack Butala:
Oh, yeah.
Jill DeWit:
Its so funny.
Steven Jack Butala:
No, I look at all of that for us.
Jill DeWit:
Yeah. You do the other math.
Steven Jack Butala:
You just keep selling sweetheart.
Jill DeWit:
Right. So, okay. So as I was saying, it’s very rarely that a transaction gets killed over people. And so I was going to start by sharing real quick here. The exact message I sent to my dear sweet transaction coordinator this morning. And I said, she was saying, “Okay, I’m taking care of, I’m doing the things that we talked about yesterday.” I said, “Thank you. I bet you will also sleep better knowing that we have that man out of our lives.”
She put a happy face. And then I went on to say, “PS I’m sorry, if you were trying to tell me that he was kind of abusing you. Steven and I do not tolerate anyone, giving our people any crap. Please pull me aside if it ever happens again and I will take care of it.” And she said, “Will do.” So I didn’t know this was going on too.
Steven Jack Butala:
Well, he’s going to get a phone call from me.
Jill DeWit:
Oh, yeah.
Steven Jack Butala:
Today.
Jill DeWit:
So let me back up with a story. Just our normal thing, offers go out. It was a great deal for everybody. It was seven properties. There were one or two wells involved. I think two, and at least two-
Steven Jack Butala:
There was well service. No, every single property had it own well, [crosstalk 00:08:07] and two of the properties-
Jill DeWit:
Needed one.
Steven Jack Butala:
Two of the properties were sharing a well. So no, there is wells on every property.
Jill DeWit:
So, yeah. So they were [crosstalk 00:08:16]. It doesn’t matter. Details don’t matter.
Steven Jack Butala:
They matter.
[crosstalk 00:08:21]. The’re seven properties we were paying $10,000 each per [crosstalk 00:08:23]. They were worth at least $50,000. $50,000 is way wholesale. So, we would be in for 70 and-
Jill DeWit:
81. We’re in for 81 at the end.
Steven Jack Butala:
There was some well thing. Yeah. We would have sold them for $600,000 total.
Jill DeWit:
Right. So, deal’s going along. We talk, he and I agree on everything. I thought things are going along. Dear man, he’s older. And-
Steven Jack Butala:
Let me set this up. Just one more point.
Jill DeWit:
Okay.
Steven Jack Butala:
There are a lot of issues with quick clean deeds and alot-
Jill DeWit:
That’s what I was going to do.
Steven Jack Butala:
Okay. Go ahead.
Jill DeWit:
I was just going to say that.
Steven Jack Butala:
Yeah. Go ahead.
Jill DeWit:
He had done his own paperwork all along the way as seller financing and different things he had done with these properties over the years. He had several LLCs that he opened, he closed, rolled things up here, rolled things over here, all the while doing his own paperwork and all this. So, okay. So we’re under contract, everybody sign, he’s making a big deal about I’m going to walk, making sure I put my earnest money in and I did. I did everything right. I’m making him feel good all along the way. And it keeps coming up that there’s all these issues and I couldn’t figure out what was going on and then come to find out. He’s just, I don’t know if he was embarrassed or upset that he had not been…
He’d, again he’s been acting like his own attorney this whole time.
Steven Jack Butala:
Yeah.
Jill DeWit:
Is what was going on. And he’s not an attorney. And with title, we’re having to undo mess after mess, after mess. And I’m sure he was getting tired, probably tired/embarrassed of getting another phone call saying, “I need these documents because that wasn’t done correctly.” And my team and our wonderful escrow agent, this girl couldn’t be sweeter. We talked to her on the phone the other day, trying to get this done two days ago before I, I’m going to say, actually he killed the deal.
Steven Jack Butala:
Did he really? He killed it?
Jill DeWit:
Yeah. Well, I’ll explain it in a minute. Going along, that he just was not complying and making it harder and harder and harder. He didn’t understand. And so I finally got to the point where we had a call yesterday.
It was yesterday or the day before yesterday. You and I, our transaction coordinator and the escrow agent, all got on the phone for 30 minutes talking about every property and what needed to happen. Deed in lieu of, deed in lieu of this and undo that and get these documents. I’m, “What the heck?” So, and my poor transaction coordinator, bless her heart was letting me know it was difficult, but didn’t tell me. I felt [inaudible 00:10:54] told me the true story because she’s trying to do her job, which is sweet and get this deal done for us. So I got on the phone with her yesterday. I said, “All right. I’m going to call this guy. I’ll get this all done. I’ll make sure we’re all on the same page.” Because he started to change numbers on us and look, “I’ll pay for these documents to undo this stuff for him.
Because it all, because my girl is so wonderful. She’s going to get 11 documents done to undo his mess for $500. I’m, “I’ll pay the stupid 500 bucks.” Because we all know how this was going to go. But then he had some other money issues he wanted to throw in there. I’m, “No, that’s not part of the deal.” So anyway, I called the gentlemen yesterday and I started off really nice. We just talked about building relationships. “How are you? I haven’t talked to you in a couple of weeks. Here’s what we’re getting close. We want to get this done.” And he kind of launched in that we should have just done quick clean deeds and just done it that way and all these been done.
I’m, “Hold on a moment. These are great properties. I have big plans with them. I want to do them in the right way. I need to get title insurance. And in order to do this, I need this and this.” And he’s, “I’m just not going to do that.” I said, “What?” And so he was throwing back some other money things I said, “Fine. All right, here’s the deal. Seller, if you will agree…” And now the anxiety is building up in me, by the way, it just never happens. And I’m, “All right, fine. I will agree to, even though this is not the way it’s normally done in this state. This is way against how these deals go. I will agree to give you this and pay for that if you promise me, when the title agent calls, you’re going to answer the phone and do as best you can to get all the documents so we can get this done fast and easy and everybody move on.”
He’s, “No, I’m not going to do that.” “Excuse me.” He’s, “You know what? I just don’t even have to sign this.” I say, “You know what? And neither do I.” So if you’re going to be that way, I said, “We don’t.” I said, “Look.” I flat out said, “This deal is not going to make or break my business.”
Steven Jack Butala:
Oh my God.
Jill DeWit:
I said, “You don’t want to do this deal. You just say the word. ” And he’s, “Nope.” And I said, “Awesome. Have a nice day.”
And that’s how it ended.
Steven Jack Butala:
Did it get to name calling?
Jill DeWit:
No. Oh, no.
Steven Jack Butala:
Okay. Good.
Jill DeWit:
Nobody did. He did say, “Well, a little bit, I’m a crook.” And I’m-
Steven Jack Butala:
Why? Because you wanted title insurance?
Jill DeWit:
Because I want it done right. That’s what was mind boggling to me. I’m, “Seller, you did all this stuff wrong and my people are trying to undo it.” I couldn’t have the best team. And by the way I told him, I looked up and said, “We’ve been in doing this deal with you for 54 days now. This is ridiculous. It’s really on you.” I was trying to-
Steven Jack Butala:
Its too bad. It was such a great deal.
Jill DeWit:
Nicely say, “Dude.” And I actually said with authority, “You did the stuff wrong. We’re undoing your mess. No one else is going to do this. And that’s the whole point here.” When I hung up, I knew that this guy going to die with these properties and I feel really bad, but no one’s going to undo this mess. If he gets someone to quick claim this stuff, I feel bad for that person because they’re inheriting a disaster.
Steven Jack Butala:
We do a lot of rural real estate deals. And this one was semi-urban. It was urban enough where we needed a title insurance and what we were going to do with the properties, we certainly need to title insurance.
Jill DeWit:
Exactly. That’s why.
Steven Jack Butala:
But its in an urban sprawl area. And so, and this property, he’s been there for a while.
Jill DeWit:
Mm-hmm (affirmative).
Steven Jack Butala:
So I’m sure he’s just used to the cowboy way of just saying, “I quick clean deed it.” And out of sight, out of mind or in sight in mind kind of thing. It’s like, this is it. And people stop paying or whatever, however it works. So he’s living probably 50 years ago.
Jill DeWit:
Yeah. And [crosstalk 00:14:43] he’s still… Well, and I really think he’s under the assumption that if they record it, then it’s correct.
Steven Jack Butala:
Right. I’m sure you’re right.
Jill DeWit:
That’s really what I think, because it was recorded.
Steven Jack Butala:
You’re using terminology he doesn’t understand. You’re a city slicker, all of that.
Jill DeWit:
It doesn’t, I don’t know.
Steven Jack Butala:
So it’s too bad.
Jill DeWit:
Oh, I…
Steven Jack Butala:
It kills me because it’s those, we would’ve made half a million bucks. [crosstalk 00:15:03].
Jill DeWit:
I don’t care.
Steven Jack Butala:
I know. I agree with you.
Jill DeWit:
But you know what? This goes back to-
Steven Jack Butala:
I’m standing right next to you on this.
Jill DeWit:
It comes back to two points I have to make. Number one, the time we spent on that, I could have made $500,000 another way. So let’s all stop talking about that.
FYI.
Steven Jack Butala:
Lets all means [crosstalk 00:15:21].
Jill DeWit:
Lets all meaning you Steven.
In 53 days, I can make $500,000 and knock it off. Number two. No one should take that crap. And that’s why I kind of want to have this show today too.
Steven Jack Butala:
Yes. Jill, that’s right.
Jill DeWit:
I want everyone to know that you’re not at the mercy of somebody. You shouldn’t take this.
Steven Jack Butala:
That’s a great point.
Jill DeWit:
If you’re here listening to us and you’ve been here with a while, you obviously roll how we roll. I want to do things the right way. I want everybody be cool here. Let’s all help each other out and all make great money together. This guy could have made, he was going to make a nice chunk of change on the stuff, period. Anyway, and we could too, he, I don’t know what was going on with him.
Steven Jack Butala:
He was nice in the beginning. And I think that, I don’t think he’s sitting around saying, “Oh, I did the paperwork wrong.” Or anything like that. I think he’s just, he’s not knowledgeable.
Jill DeWit:
Yeah.
Steven Jack Butala:
That’s really, I think he doesn’t, he’s saw quick clean deed that’s how you do it. That’s how we’ve done our whole lives. That’s how my neighbors do it. That’s how my parents did it. That’s how my whole family did it.
Jill DeWit:
There’s no reason to act the way he acted. That’s the sad reality too, because I don’t know if you heard the beginning of the call and I called him yesterday, I’m, “Hey, how are you? Haven’t talked to you in a while.”
Steven Jack Butala:
I didn’t hear it all.
Jill DeWit:
“How’s your wife.” I thought we’re going to have a nice sweet conversation. I just want to clarify, because the whole reason I was getting involved here is because he was changing some of the terms. I’m, “That’s not what we agreed upon. So I just want to clarify we’re all in the same page here.”
Steven Jack Butala:
Was it just the affidavits and stuff that he had to sign or did he have to dig through paperwork and provide things? It was just signatures, was it?
Jill DeWit:
I think it was signatures at this point.
Steven Jack Butala:
So what’s the problem with that?
Jill DeWit:
[crosstalk 00:17:06]. I don’t know.
Steven Jack Butala:
Just sign this, sign here.
Jill DeWit:
I just think, I don’t know. Okay. He was either overwhelmed or he decided, “I’m going to go off and cowboy sell this myself-
Steven Jack Butala:
That’s what I think it is.
Jill DeWit:
And do my own deals. And I’m going to cowboy sell them to someone who’s not that smart or they don’t really want to do anything with them or something.” I don’t know. And that’s fine.
Steven Jack Butala:
This could be just-
Jill DeWit:
Or it could be a way to just get out of the deal.
Steven Jack Butala:
Yeah. That’s what it sounds like.
Jill DeWit:
[crosstalk 00:17:32]. And just say that, you want to get out of the deal.
Steven Jack Butala:
Jill, and I haven’t even talked about this and all I know is that she was half crying yesterday-
Jill DeWit:
Oh, I was not. I was pissed.
Steven Jack Butala:
And half punching the wall.
Jill DeWit:
Yeah. I was, “Oh…”
Steven Jack Butala:
I’m, “Save it for the show.”
Jill DeWit:
Exactly. Thank you for letting me vent today. Happy you could join us in Jill’s therapy session.
Steven Jack Butala:
You feel better?
Jill DeWit:
I do.
Steven Jack Butala:
Okay. Good.
Jill DeWit:
Five days a week you can find us right here and I promise it won’t always be like this on the Land Academy show.
Steven Jack Butala:
Tomorrow the episode on the Land Academy Show is called, why test mailers don’t work. You are not alone in your real estate ambition.
Jill DeWit:
Yeah, that was totally me and about 15 minutes of rant. Thank you very much.
Steven Jack Butala:
No. I think it’s, I learned a lot. I’m sure-
Jill DeWit:
Uh-huh (affirmative).
Steven Jack Butala:
That everybody listening, you either have a story or a couple of stories like this, because you’re seasoned or you’re new and you’re, “I learned that stuff can happen.”
Jill DeWit:
Here’s a positive that came out of this. Number one, that mean, mean man is out of our lives. Number two, I have even built up a better relationship with my staff because I let my staff know, “Okay, if you were trying to tell me that and I missed it, I’m sorry. I don’t want you taking any crap from anybody.” And then number three, we are sending treats to that dear sweet title agent, which we have other transactions that we’re doing with her and we’re going to continue to deals with her because she’s awesome. She’s going to be, “Yay. I get to shred these files and I just got flowers and goodies delivered.”
Steven Jack Butala:
[crosstalk 00:00:19:06]. It is the silver lining in this. We found a title agent in that state that’s going to do everything for us now. She’s amazing.
Jill DeWit:
Yeah. It’s all great. If you need access to any sort of property details, including owner phone numbers and FEMA flood overlays, check out neighborscoop.com, created by investors, that’s us, for investors like you. [crosstalk 00:19:31] We are Steve and Jill.
Steven Jack Butala:
Information.
Jill DeWit:
And inspiration.
Steven Jack Butala:
To buy undervalued property.
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