This is episode number 2,030. Our topic is we’re going to go through land deal funding by the numbers. We’ll ultimately show you how much money you can make without starting with the penny. My favorite part of this exercise is your bank balance. You start with zero. You do a deal, and you split it. You make $25,000, you split it and do another one. You make $50,000 and after a few months of doing this successfully, you’re going to be staring at a few hundred thousand dollars in the bank.

This has happened to me. Multiple times. It continues to happen to us without putting a dollar in. That’s the beautiful ending to the story. We’ll talk about some of the things that can go right and go wrong, where the challenges are and all of that. The theme is everything you need to know about funding your land or your house flip transaction. It’s something Jill and I know a little bit.

I didn’t put it in there. I should point out, though, I look at land and houses if you go to LandFunding.com. Put it in there whether it’s land or house. You’re like, “I got one now. That’s why I’m reading. I waited till Tuesday for you to tell me this.”

“My old partner sucks and I want a new one.”

That, too. There you go, or let’s try one deal and see how it goes. Put it in there. I’ll give you the feedback or we’ll do the deal.

Purchase Agreement

Each day on the show, we answer a question from our Land Academy member Discord forum and take a deep dive into land-related topics per your suggestion. Jill, let’s take a question.

Jenny wrote, “Hello, all. I have a newbie question. I have a signed purchase agreement for a property that looks promising, but my offer was too high. The purchase price is $16,000. What I like to buy it for is somewhere between $8,000 and $11,000. Is that possible to negotiate a lower price when the sellers already signed the purchase agreement? How do you approach that?”

Part two is, “The person who signed this identified themselves as executor. It appears the owner has passed.” I’m going to jump in here. The first thing I would do, Jenny, is part two.  Before you even go down the path of talking to them, looking at it, getting all excited, working on a price and having that locked in. Let’s first make sure that the person you’re communicating with does have the power to transfer the property.

Let’s assume for this exercise that they do. Probate was done or it’s in a trust. All the documents are in order and they are the right person because that’s important. Now, what do I do about that purchase price? What are the reasons? You have reasons. You didn’t put them in here, but why are the reasons that you’re saying it’s too high? Is its accesses not as great as it could be? Does the property have some issues, like it’s 10 acres, but I can only use 4 acres because of the hill on the back?

The first thing I look at is why are you rethinking your price other than I just came into high. Other than I goofed it up. There was some stuff in there with the county that made it go funky. I would use those things as the facts as to why and there’s nothing wrong with that. Here’s how the conversation would go. Let’s just assume I offered $16,000. They signed it. They’re all excited. They sent it back and I look at it.

I go, “Shoot. It’s not as close to this town. I can only use 4 acres of the 10 acres. There’s not much out there.” I still like it and I’m looking at the math. I could sell it for somewhere between $16,000 and $20,000, so I can’t pay $16,000 to buy it. I need to get it at $8,000. This is where you call the seller back and go, “We got to talk.”

Often, in some situations, if they know the property, they’re ready for it. They go, “I thought this was going to happen.” It’s funny how often that comes up and you go, “Look.” You give them those three things. Not 30. You give them 2 to 3 things. That’s it like, “I thought it was closer to the town. After I looked at it and saw the flood zone, I don’t know if you’re aware of that or not, but 6 of the acres are underwater half the year. I can’t use those. It’s only four. The third thing is,” fill in blank.

I go, “I do still like the property, but now the best I can do and I hate to do this to you. I hate to be that guy, but it doesn’t command that $16,000 purchase price. It does command $8,000. If that works for you, I am ready to go. I have Susie at ABC title all set up. I can get this done in ten days. I’m still going to honor everything that I said in my letter. I’ll pay the closing costs and all that. How about I open escrow? I’ll just send you everything over and get your new purchase agreement in your email in two minutes?” That’s how you do it.

To answer your question directly.

I thought that was directly.

Renegotiating a price happens very often. This is not an unusual situation. There’s no such thing as a perfectly priced mailer. People think that a lot. People think that if you spend a ton of time and months pricing on your mailer, They’re going to get a better response and it’s all going to be beautiful pictures and cream. The fact is, I price a mailer. I send it out probably at least half, maybe more or probably more than half. She’ll have to go in and make some type of adjusting based on their personal situation. In this case, it’s an executor scenario. Hopefully, there’s a trust. There’s a bunch of things going on here. That’s good for price reduction. It’s what Jill said, the deals are unique.

Land Deal Agreement

Our topic is land deal funding by the numbers. How much money can you make? I used the example of buy for $10,000 and sell for $60,000. I think there’s $50,000 of profit in a deal. I went through the education. Buy an academy education. I got myself signed at a Discord. Asked a bunch of questions and in months later, I got a mailer out and a deal. It’s buy for $10,000 and sell for $60,000 with $50,000 of profit and I don’t have any money. I knew that going in and I don’t feel bad about it.

I need a funder, so I told Jill or I go to LandFunding.com and put the deal in there. Jill likes the deal. I generated $50,000 or do the deal. She gets $25,000. I take $25,000 and I put it in the banks and another mailer. I do the same thing and I have $50,000 in the bank again, $75,000. Now I have $100,000 in the bank and it’s a year later. This is very realistic and accomplishable.

That’s going slow.

That’s going very slow.

This usually be one of a month.

At the end of the year, I have $200,000 in the bank. Do I need Jill anymore? No. I can continue to do deals with her. I chose to continue to deal with her. You can do that. You can continue to have a lifelong funding partner that way. In fact, in that case, we can even adjust the percentage, instead of splitting the deal 50/50. We would probably bring it down to some other percentage because you know what you’re doing now. You’ve got some experience.

You don’t need me.

Everybody knows what to expect from the other partner. There’s probably not a lot of talking by now. Let’s do another one. Shortly, we’re going to, but my point is, that’s what’s possible. People get hung up on, “I’m not giving away 50% of the profit margin of this deal.” If I went to Bank of America and got along, I’m not getting an expertise. When something goes sideways, I call the bank. They’re going to say, “What are you talking about? We don’t even have your deal once sideways.” That’s too bad.

They wouldn’t even take the call. There’s a lot more involved than that. What could you expect if you are good at executing the education of Land Academy and turning it into money for yourself? You can expect to make hundreds of thousands of dollars systemically with a funding partner until you believe you don’t need that person anymore. Land Academy is packed. It’s full of people that we heard a lot from in the beginning when they joined. They ask a lot of questions. They were very vocal on our Thursday webinars and are still in the group years and years later making tons of money.

Quietly.

How do we know that?

They’re the bank now.

How do we know that? It’s because we owned a printing company called Offers 2 Owners. We see that they’re sending out tens of thousands of offers every single month.

That’s a normal progression. People come in, and you have just painted that beautiful picture. $25,000 at a time, and they come up front and they, “Now I have $250,000. I can either keep going like I’m doing it. Don’t borrow anybody’s. Don’t use any partners and keep it all to myself or I could do a little bit of both. A lot of people do that. I’ll do mine and run out of dough. I’ll do some of these with Jill. Whatever it is.”

The other thing they often do is, “Now I can be the bank for somebody else. I can be on that end of it. I’ll fund somebody’s deal. I’ll put in the $10,000 or $15,000. Whatever it is, split the profit with some new person.” That’s common. I know there are people in Land Academy, and that’s the only reason they’re here. They don’t even want to send out mail. They just know how smart our group is and want to be the bank and be the funding partner for our people because these deals are that good.

People are in Land Academy because they know how smart our group is and want to be the bank and be the funding partner for our people because these deals are that good. Share on X

Dynamic Personality

“That’s great, Jack. It sounds easy and peaches and cream. Why doesn’t everybody do it?” Here’s why. This only works if you have a dynamic personality and can create a real estate transaction below its current value. How does that happen? By having a personality like Jill. By having some type of skillset. You might be brand new and you don’t even know you have the skill set yet. You might be a real estate agent who’s been helping people buy and sell houses for many years and you know you have a dynamic personality. You’ve been on the phone for ten hours a day for many years.

If you have that type of personality where you can bring people together when things go sideways, make them straighten out again and make things go your way. You’re going to do great at this. If you sit in a dark hole like I do and I’m crunching numbers all day and are happy with that. It’s going to be very difficult for you to accomplish this to do well for yourself financially in this business without having a partner like Jill.

Everybody says, “What’s the catch? Why does everybody do this? You guys describe it so easy. You have to have a dynamic personality and some experience on the phone or that type of personality.

Thank you.

Tons of money can be made here. Jill and I do millions of dollars a year buying and selling real estate. It tied up and she gets a deal done and we have staff.

It’s funny, the right partner when you someday tell them, “I’m good now.” Trust me, it’s hard for them because I’ve been on both ends of it. I’ve had to tell people like, “I don’t need your money now,” and let them down a little bit. On the other side, they said, “I don’t need your money anymore.” I’m like, “I was waiting for that to happen.” When I’m telling them, “Go get two more of those. Can you please or ten more of those?” I’m like, “I got this. Thank you,” but it’s good.

That’s why we always say it’s a great point. Think about it. When you retain a partner, do not, under any circumstance, form an LLC with them. You’re 50% and they’re 50%. Don’t ever do any of that stuff because you need to go on a date first to see if you’re going to get married. You want to do one deal first and split it. Another deal and split it. You could happily do that for the rest of your life, but co-mingling and all of that is where everybody gets debit cards and there’s money in a bank account. What a disaster. We’ve done that. Jill and I have done that with each other and with other people. I’ve done it with other people. I don’t think you have many years ago. We won’t make that mistake twice.

We’re going to talk about it because our topic is we’ve done so many land deals that we’ve funded that we’re going to talk to you about how they go step by step. You’re like, “You don’t mingle your money.” We’ll explain it all.

You are not alone in your real estate ambition. We are Jack and Jill. Information.

You are not alone in your real estate ambition. Share on X

Also, inspiration.

To buy undervalued property.