Network, Network, Network. And then Network some more.

[David Lopez]

I wanted to write about a recent phone call that saved me tens of thousands and will change the amount of money in my bank account for the positive. 

After looking in to a recent flip opportunity in Allendale, NJ I decided to confirm some comp pricing with my landlord. I knew he was a realtor but besides sending him checks I never spoke with him after my first visit to the home. He immediately told me to stay away from the deal because the new flood lines put the property in the flood zone which I would not be able to locate easily, especially if I did not have updated maps. He also expressed his appreciation of me making the phone call to him for this information and taking the time to hear his full response. 

This one phone call saved me an $20-40K loss. It also started a relationship that will benefit both of us. In the process of talking to him he asked me if I knew he was a flipper and had (4) projects under construction. I was surprised to hear that but even more surprised when he told me he would be willing to sit me down and show me everything he does to find, evaluate, and profit from real estate. After a two hour priceless lesson, and looking at his 200 binders of statistics on every city and township throughout two counties, I was working on closing my first deal with him. 

The one phone call did not only save me a lot of money but opened up off market deals for years to come. He happened to be at a time in his career that he was not interested in growing but maintaining his accumulated wealth and enjoyed being a realtor. He could have hustled to do every deal that came his way but he was content now doing what his crews and cash could handle and helping people like me do the ones he couldn't get to in time. Talk about stepping in poo.

The moral of this story is talk to everyone you can. If at the 11th hour of my decision making on the first deal I had not listened to my gut or simply gave myself an excuse not to bother him I would have paid dearly.

The best contacts will come from the most unsuspecting conversations so make sure you tell everyone what you are doing and talk to people everyday. Business is built on relationships and the more you make the more options you will have to invest in real estate. Take time to respond on forums, make connections with other active members, make those calls, and attend those meetings because no matter what direction you take in real estate each new relationship can easily have a lot of dollar signs attached to it for all involved.

Quick info on the deal:

My first deal is a 1200 sq/ft Cape Cod I am adding 850 sq/ft to and converting in to a 3bed 2.5 bath colonial. We expect to net, before taxes, $97K. I took on a partner because I am in the process of moving to Florida but did not want to lose the ability to work this connection from there. I prefer 50% of something then 100% of nothing. Now, with the partner in place and me bringing the deals to the table with my new connection we are already looking at a second project.

Regards and Good Luck Investing,

David Lopez