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benjyjim

A deep breath and a step back

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Ahoy colleagues.

I am in what I know and recognize to be a troth of disillusionment.

I am not here, however, to take the air out of the (chat) room--far from it.

I'm here to recharge, regroup, and redouble.

 

I bought someone else's course :ph34r: in January and am one month into one on one mentoring. I feel I "get" it--that I have the knowledge and skills to make my first deal. I've set up my LLC, my 800 number, run ads, found homes (two of which I locked up, one that expired and I did nothing with and one that's still in the works for 1 week) and am dangerously rife with the theoretical aspects of the business. I did get a full price offer on the home from folks who were rejected by the seller (and, pretty much by me, though I didn't want to admit it)--and assignment stood to make me $6,000 (hence, my inability to admit that these folks were not the right folks for the house).

 

I have a demanding day job, a pregnant wife, and a 2 year old. I am near the end of my rope due to the pressure I've put on myself. I recognize that I've come a long way, learned much, and am about to strike gold any day--and that I must release some pressure from myself and continue to work my hard-won system: ads, voice mail, 'script' (not written, just my learned questions and demeanor), calling on ads, networking, signage, etc.

 

Given all of this and nothing (in cash terms) to show for it, I'm anxious and doubts can creep in and spread like, well, mad. My most recent doubt: does our market support this business?

Ok, that's an inflammatory question--and I truly do believe any market is an ok market for this business--my question is: aren't we in a difficult time for having a humming lease purchase business--low rates, recession, buyer-favored market? Sure, some people are coming around to being flexible with their home sale, and that's helpful, but there's a relative paucity of quality tenant/buyers out there, aren't there?

I have found some quality folks, but I'm frankly failing at eliciting their pain and closing them well and it's my #1 focus in mentoring (not the mechanics or the strategies, but instead the sales methods, asking the right questions, making the sale with finesse and not as the result of a pure numbers game).

 

Ok, Ok, I'm diving in too deep, still holding on too tight here.

I guess I just want to hear from some experienced (more than 1 year of making deals, and more than 10 deals under the belt) folks who may have gone through the disillusionment and recall it vividly and what twist, quote, spin, technique, or attitude shift made a difference for them.

 

And, number 2, would like to hear folks talk about the marketplace today for this business vs. 1, 2, 5, 10 years ago--as I think 1, 2, 5, 10 years ahead to how things might change for me (for the worse, for the better).

 

Many thanks for your patience and any responses.

Kind Regards, :D

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Hi, benjyjim. Long time, no hear.

OK, it sounds as if you are well on your way: you have the knowledge base necessary to put together the deal. You're facing some basics: set up your LLC, 800 number, your marketing, etc.

You also have, and correct me if I'm wrong here, you also have found two homeowners who you have structured a lease purchase deal with. One deal your potential buyers didn't qualify. Is this correct? What was your Plan B with this property? For example, since they couldn't obtain financing did you try and set them up with a lease purchase? They sound like the perfect tenant/buyer. They like the house. They want the house so much they even went through the financial hoop jumping process. Turns out they need to buy time before they buy the property. Again, perfect tenant/buyer candidates. Where do they stand presently?

Your second deal is one week old. As I write this you could be speaking with a potential tenant/buyer and your first sandwich lease is a done reality. So, it's way too soon to despair, although I understand all too well that it is human nature to do just that. Fight it, benjyjim.

Your question about whether or not your market supports this business is a common one. My answer is a resounding "Yes!". Every market supports creative real estate. Sure, it's a hell of a lot easier when buyers are in control locally, and homeowners aren't receiving offers for months on end and when they do it's at a 25% discount to their asking price. But, the fact that your local market is strong does not mean that every seller in it is, too. There is always, and I mean always any number of sellers who are in trouble and need a solution to their very real and pressing problem. You are their solution, my friend. They need to know who you are and how to contact you. It comes down to doubling your marketing efforts to get your name and number out into the communities where you want to be know as the go to guy for real estate solutions.

You ask if we are in a difficult time for investors. Yes, we are. Here in my locale the market is ridiculously strong. We have averaged a one percent appreciation rate per month for 48 months........and that's conservative! Is it harder for me, and others, to find deals now? You know it! But, I can't fight the market place. I needed to change my way of thinking. I am now forced to do deals with a much thinner spread, and in many cases I simply offer asking price and hope I can assign the contract for a reasonable assignment fee. $2,000 ain't $20,000 but it's better than $0.

benjyjim, I really do understand well your disillusionment and discouragement. Getting started is surely the toughest part, but you are understating your already accomplished beginnings. Stay with this, and work harder. The payoffs will be grand and well worth the wait and effort. Stick around and keep us posted. We can help.

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You asked: Where my current tenant/buyers stand?

This is a cooperative assignment--I learned this only after talking through the sandwich lease option with the seller and taking this offer to him--he wants control on who goes in there. So that was a bruise on my plan.

These folks want this place badly, offered my full price (with some financing over time of the option $), but the owner didn't like the sound of them--too much undocumentable income (under the table--one guy is a roofer who makes a spread on each job when he can deliver for less than what the owners will pay) and a history including an eviction and a foreclosure.

My owner wants folks who can buy his house and these folks will not be able to buy this house--probably not ever. If I were in complete control, I might go ahead and keep them, but I can understand his concerns and so I told them it's not going to work but I'll keep looking for a house for them.

They're strong for the right kind deal and a properly motivated seller--and my owner may come around and see that as he makes another payment on his empty house (he transferred, has left the state, and this is a FSBO), but for now, it's a no go, so I'm going to keep looking for the right people.

 

Thanks for the feedback!

I can feel my energy level picking up...

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