Driving for dollars... AND THEN?!

[Kristen Reyes]

Hi BP!

I am really working on getting my first deal. The MLS is not working, and I am going to start driving for dollars.

I have already targeted a neighborhood with the ARV that I want, and I am ready to go out and look for distressed properties. However- if I get a call back what do I do then?!

Everything I read is telling me how to drive for dollars, but my question is how to close on the deal? What documents do I need. Is it just a purchase agreement? 

I guess I need help on the technical side. YAY we agreed on a price now how do I finalize this deal? Any help would be awesome.

Thanks BP!

[Brenden Mitchum]

Hey @Kristen Reyes

Yes, this would just be some kind of purchase and sale agreement. It can be as simple or as complex as you want it to be but the important thing is that it be approved by a real estate attorney. You have a few options here to obtain a solid agreement. 

1. Hire a real estate agent to act as a transactional agent. This means they will simply provide the correct forms and do the paperwork for you. Expect to pay them around .5-1% for each transaction. This might make sense if you know someone who has their license or are able to get the seller to pay for this. 

2. Hire an attorney to draft up a contract for you. This allows you to have a higher degree of control over the contents of the agreement. Plus, you will then have a contract that you can use repeatedly so long as laws do not change.

3. Network with seasoned investors in your area and obtain one of their sales agreements. You can then take this to an attorney to review (make sure you do not skip this step). This will cost you less than step 2 but the end result will be the same. 

Hope this helps a bit. Please, feel free to message me anytime if you have other questions or just want to chat!

[Jonathan Greene]

You are way ahead of yourself. What's even your system for driving for dollars? Once you identify a property that looks vacant, what is your next step? Are you using Deal Machine to postcard mail or are you doing a personal letter? How are you going about doing the back research on the property without a RE license to get the good data? Are you using skip-tracing or something similar to upgrade the chances you can call the owner? The problem with the "advice" you are getting or listening to is that it makes it sound easy - just drive for dollars, send one postcard, get a call back, make offer, write contract, agree, buy, flip, sell. But no, it's not at all. You may go 1 for 100 on driving for dollars. You may go 1 for 10 in even having the right information.

[Kristen Reyes]

@Brenden Mitchum Hey Brenden thanks for the response! That is really clarifying. I didn't want to do all this driving for dollars,  get interest, and not know how to close.

So- once I get the right documents, what else is there to it? Once I find an interested seller and we sign the purchase agreement and sales agreement- what do I need to do? Like it isn't as simple as the documents are signed and then we exchange money and the property is mine right lol? I know I am getting detailed- I just want to get an idea of what is ahead. Really trying to get my first deal before the year ends!

If you would rather PM let me know.  

[Kristen Reyes]

@Jonathan Greene

Hey Jonathan, Thanks for the response. 

I read the blog post "Driving for dollars bible" on BP and I was going to try to duplicate his system. Identify a neighborhood with the desirable ARV- which I have already done.

Then do the driving, get addresses and pictures of the property. In this article it mentioned everything can be done through the local county's website for research- which I was planning on doing.

Do you not recommend using assessor's website to pull property record information? I was considering doing as the article suggested and having their property printed on the envelope to get a better response. I also like the idea of texting, which I have heard has a great response rate.

I know this method may be slow- but I want to target specific properties that fit my criteria. 

Do you have an recommendations that you use for researching a property? Do you personally use deal machine? I am open to any suggestions- My goal is to get 1 property under contract by the end of this year so I am all ears! Gotta make this happen!

[Jonathan Greene]

@Kristen Reyes it depends on the county how much and how good the information is, but that's also information that everyone has and a lot of people are driving for dollars, especially now. It won't separate you from anyone else, but is good practice just identifying homes that could need work. But once you see one, you need to get the owner info, how much they owe, phone or email contact, age, how long they have owned the property and as much as you can. Texting assumes you have a cell phone number which you will almost never get from these searches and even paid searches are probably around a 25% success rate. I direct mail so I don't use Deal Machine, but I know others that use it. I would get the book If You Can't Wholesale After This, I got nothing for you by Todd Fleming. It's not a great book, but it's the best on the generalities of wholesaling that I've seen.

[Brenden Mitchum]

@Kristen Reyes

After that, the process is the same as any other deal. You do your due diligence, renegotiate if needed, and close on the property. Make sure you have your financing lined up before you even start looking for deals or at least have a good idea of who you will bring the deal to if the plan is to partner.