REI INK

Wholetailing: Flipping Real Estate With No Money With Travis Johnson

  Have you ever thought about flipping real estate deals but don’t know how to do it? You’re not alone. Travis Johnson, a successful house flipper in Minnesota and author of the Seven Figure Flipping Book, learned how to flip real estate the hard way. With no books or training when he first started, he did everything wrong and took financial losses. Today, Travis shares his experience on how to get involved in flipping real estate deals with no money, wholesaling strategies, and treating real estate investing as a real business. Tune in! — Watch the episode here   Listen to the podcast here   Wholetailing: Flipping Real Estate With No Money With Travis Johnson Welcome to the show. With me in this episode is Travis Johnson. Travis, how are you? I’m very good. Thanks for having me here. I knew you from a mastermind but why don’t you take a minute to tell the reader a little bit about yourself? I’m based out of Minneapolis and the St. Paul area of Minnesota. I started investing part-time in real estate in 2001. I went full-time in 2016. I built my business from the ground up and doing quite well at it. I do a lot of rural investing. I also do a lot of the metropolitan where all the other investors are at. I like to start these episodes with what I call the bottom line up front. When I was in the Marine Corps, they always told us we had to tell the general the most important thing as soon as the briefing started in case he had to leave the room. Take two minutes. Talk to the reader about what you think the most important things are that they need to be paying attention to or doing in this market. That’s a pretty broad question that you’re asking me to answer but I can best answer it in regards to interest rates having a huge play. Over the last couple of years, interest rates have been fantastically low. When you purchase a house, if you had another contract and there was delay after delay, it didn’t matter. The values kept going up. It was an easy extra payday. Now, you have to pay more attention to interest rates going up. If you’re buying a higher-value house, you have to pay attention to that. The main point I would say is to pay attention to interest rates but also get out there and do stuff in regards to investing because wholetailing, which we can dive more into the show, is working well and will continue to work very well in the near future. I also have my little secret strategy as to how to invest in the rural market. We’re going to talk about wholetailing and rural markets. I love the interest rate conversation. It’s one of those things that I’m always having but let’s go back. What is a wholetail? How I define wholetailing is actual wholesaling. That’s where you get a property under contract with a motivated seller and then you’re going to find an investor that’s going to want to buy that contract from you on an assignment basis. You’re wholesaling it from the motivated seller to the end cash buyer and you’re making a fee in between. On the wholetail side of it is retail. If you take the retail side, you’re selling it to the consumer. It’s someone that’s getting a bank loan typically for the property. The property has to be in lendable condition. All the safety issues are taken off the table. Not having a collapsing deck is a good example but it is move-in ready other than it probably needs updates. That’s a good way to look at it for wholetailing. If you can do the actual wholetailing and eliminate the wholesaling part knowing that you’re going to capitalize very fast on turning around your wholesaling to a cash investor but it’s to an end-user or the person that’s going to cash you out on the retail end, you would make huge margins on your deals. How does that work? Are you charging full price? Is there a discount? What do the numbers look like? In the last couple of years, it has gone through the roof that what I thought was well over retail for a nice house. That’s what wholesaling was getting. Now, the retail price is going even higher so it’s back-filling. That’s how it works in regards to that. For me, the better answer is, for example, a house all fixed up was worth $150,000. It’s move-in ready. The paint colors are neutral. The carpet is in. The hardwood, floors are done. Everything’s fine about the property. I’ll wholetail it for $150,000. I’ll probably sell it for about $130,000 or $140,000. There is a slight discount underneath but you’re hardly doing any of the work on the inside. The nice thing is you’re getting this thing on the public market. Yes, MLS.   For some people that wholesale or assign properties, part of their problem is they can’t test the public market to get the maximum price. You’re going to have to take title to the property. There’s no way around it. Is this an inner-city thing? Is this a rural thing? Where do you find this strategy has the most bang for your buck? I’ve been fortunate to be very successful even in the rural markets. I’m doing that strategy a lot but if you want the biggest return, go to the heavy metropolitan areas where it’s a dense population. You’re going to make insane numbers doing the wholetailing strategy. How long have you been doing this? I’ve been doing it full-time since 2016 but investing part-time since 2001. What’s been the best part about it for you? The financial freedom and flexibility with family schedules. We have four kids. Being flexible with school schedules and getting everyone where they need to be, that’s what

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UNIN 4 Logan | Discounted Deals

How Your Profit Margin Compares To Your Margin Of Safety With Logan Fullmer

  If you just found a good deal but got stuck with legalities, you can’t miss this episode of Uncontested Investing! Logan Fullmer joins Tim Herriage and shares his journey from managing construction in the oil field to finding real estate success through discounted deals. Not too long after starting his real estate journey, Logan saw himself earning over a million dollars on a single deal! Tune in as he talks about how he invested in educating himself about property codes and researching case law and some insights into how curative title work and resourcefulness have helped him take calculated risks between profit margin and margin of safety and closing deals at discounted prices. — Watch the episode here   Listen to the podcast here   How Your Profit Margin Compares To Your Margin Of Safety With Logan Fullmer Thanks for stopping by. Logan Fullmer is with me. Logan, how are you? I’m great. Good to see you. It’s good to see you. Logan is someone I have been watching on social media. You are putting on these big seminars that aren’t typical seminars. It’s to teach people, which I find interesting. Why don’t you take a minute and tell people a little bit about yourself? Thanks for letting me come. This is fine. I enjoy doing this stuff. It’s become part of things I’ve done over the last few years. You get busy working down in your lane and it’s neat to share if I know what else going on. Here I am. I do some educational stuff. I have been anti-guru, and anti-real estate education because there’s a bad name. I do have a very unique component to my business and it always blows people away. I’ve spent more and more time talking to people and giving advice on sharing information online. I’ve gotten literally hundreds of people asking for this content. After a couple of years, I finally decided, “If I can do this, make a little bit of money doing it but deliver what is the best amount of information I can I will do it.” It’s curative title work. This is stuff nobody cares about, except for when you can’t close a deal. The title company says, “Where’s your Schedule C, so and so? You got to fix this.” It’s either simple. The title company might help. You got to call a lawyer or even the attorneys throw their hands up. That’s when I show up. I’ve seen some of your deal numbers. We are going to get into that in a little bit. Some people are like, “Title work.” Why do I care about the title? Do you want to buy property at $0.10 on the dollar? They care about title work. Everybody cares at that point. One of the first things we do every week is what I call the bluff, the bottom-line upfront. What that is? I learned at the Marine Corps. I used to be brief generals. They always said you had to give them the bottle upfront in case there’s a mortar attack or they have to get up and leave the room because generals get busy. What I like to do is I’m going to give you about two minutes and tell the audience the most important things they should be doing, looking at, watching trends they should be following the most important things that in your mind people should be watching in real estate. Two minutes you are on the clock. One of my favorite things to tell people is your profit margin is also a convertible margin of safety. I’ve never heard anybody say it that way but that’s how I think about it. When I go into a deal, what’s most important is to say, “How am I going to lose my money? How am I going to risk principle?” That’s the first rule. If I can measure all my risks, attach dollar amounts to them, and decide that I’m not going to lose any money, then I realize there’s an investment thesis here to build on. From that point, we start talking about maybe making some profit? How’s that going to look? What are the risk components? Can we afford all these things? It’s looking at the margin of safety and the profit margin, which are the same thing. It’s profit when things are going well. It’s a margin of safety when things go bad. It operates together. I look at that with real estate businesses, other businesses through manufacturing businesses or other operating businesses we own now that it came from our real estate. Are you an attorney? No. How can you be smart enough to do curative title work without being an attorney? The way folks do that does a good job in formal education. I struggled in school big time. That’s the most common thing for our guests. I did badly in that format. I took seven years to get a Bachelor’s degree. I got bad grades in high school. I run into problems and didn’t like the answers to those problems. I have a bullheaded attitude of, “I’m going to fix this at all costs.” I had to learn as I got older that all costs aren’t always the answer but you can go deep. I spent the time paying lawyers to teach me how to read the Property Code, the State’s Code, the Tax Code, and the Probate Code and taught me how to research Case Law. Once I realized that’s where these answers would come from, that’s where I started digging. Every time I would have a problem, I would go figure out how to solve it and hire an attorney or attorney team and say, “I need you all to litigate this. Here’s how we are going to do it.” You mentioned something earlier to me about the oil fields. Were you solving problems out there too? No. I was trying to make a living. I had

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There’s Transactional Money And There’s Wealth With Eddie Speed Of NoteSchool

  As the world increasingly moves towards a data-driven economy, data is becoming increasingly important in the note industry. By understanding the data, businesses can make better decisions about growing and scaling their operations. That is what our guest, Eddie Speed, the President and Founder of NoteSchool, talks about. Having been in the note industry for thirty-plus years, Eddie has an unparalleled track record in the industry and honed marketing and negotiation skills. Tune in to this episode to know more about data, tax loophole strategies, and caution flags in real estate investing. — Watch the episode here   Listen to the podcast here   There’s Transactional Money And There’s Wealth With Eddie Speed Of NoteSchool I’m joined by a good friend and mentor of mine, Eddie Speed. Eddie, thanks for being here. How are you doing? If I was any better, I’d be you. Eddie, I met you for the first time in a meeting at the DoubleTree Hotel in Dallas when I first got out of the Marine Corps. You were selling a book called Streetwise Seller Financing. You were the first real estate author I’d ever met. I was awestruck until I realized you were a normal guy. Why don’t you take a minute and tell us a little bit about yourself? I started buying seller-financed notes with my father-in-law in 1980. Seller financing became a big thing because of inflation, high rates. That’s how I got started in the business. My wife and I married in 1982. We came to the big city of Dallas Fort Worth to buy notes. By the time I met you, I’d set up the note system for home investors, had a whole era with Frank D’Angelo, and all that. In the end, I spent about ten years showing real estate investors a formula of how to make seller financing. I did that for my own selfish reasons. They could sell their notes to me for top dollar. What has become our thing over the years is how to do it correctly so that you’re making the best product. Whether you’re going to keep your note or sell your note or whatever, that’s how it works. It’s important to do things right. Eddie, every week I start with what I call the bottom-line up front, the bluff. When I was in the Marine Corps, I used to brief generals. They would always say, “Never bury the lead. If the general has to get up and leave in the first couple of minutes, he’s got to know the most important thing.” Imagine someone tuned in on this show, they’re on their way to work, but they got to pull over, get gas, and don’t finish reading it. I’m going to give you two minutes to tell the reader the most important things they need to think about, be doing, or avoid in this market. Eddie, the bluff, take it away. The most important thing for every real estate investor, whether you’re a high-volume real estate investor, or whether you’re a guy that does 2 or 3 deals a year, you got to know the data. Take advantage of the data. When I started in the business in 1980, honestly, there wasn’t any data. Now we have all kinds of information. Let’s play a little “Did You Know?” Did you know there are 2 million residential mortgages that aren’t making a payment? Did you know the most frustrated property seller in the business? Burned-out landlords, small-time landlords, particularly ones that self-manage. Did you know how many houses they have? They own almost 12 million residential houses. That’s a big target list. Whether you’re looking at that, at how growth rates are going or projecting the market conditions, let me warn you of this. A lot of people love to read the headlines. You got to understand what’s behind the headlines. Some reporter wrote an article. They wrote a headline for a zinger. The big zinger may be details in that article that are way past the headline. Know your data. When you know your data, you can make smart decisions and find voids that every other real estate investor is missing. I’ll talk about strategies that are a big deal. According to some of the top real estate negotiation trainers in the business, friends of Tim’s and I, the number one reason the frustrated landlord doesn’t sell is they’re scared of paying taxes. Why don’t you angle a tax loophole strategy? Instead of, “I’ll pay you top dollar,” why don’t you lead with, “I’ll show you a way to defer taxes?” That’s a completely different angle that positions you differently in the market. Once again, you have to know some data. You have to understand how that works to position yourself differently. That’s about it. I was an intelligence analyst. We always talked about single-source information. Data was one of those things that you’re not supposed to ever take action on. If you heard something one place, or you only got imagery of something, you don’t start a battle plan against that. You have to go get more information. If you got imagery, intelligence, you’d go look for human intelligence, signals intelligence, or all the different types of information to form a picture. It’s almost what I heard you say. Don’t read the headline. That’s single-source. Get through those articles and look for the underlying data that you can form your own opinion on. It’s got to be supported. A couple of months ago, I was at a mastermind meeting. I won’t say whose. Someone said, “The Boise, Idaho market’s going to crap.” I was like, “I hadn’t heard that.” I started looking it up. There are some articles days on the market, up 75%. We’re from 7% to 12%. I get it. That’s what I tell everybody all the time. Percentages right now are misleading. That’s why I caution against reading the headlines. I see it all the time. I don’t

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