All Forum Posts by: Cole Swartz

Not much quality wholesaling competition in the area. As Chris said, put us on your list. 

Exactly, and thus every case must me analyzed on an individual basis. Definitively telling an individual he shouldn't use direct mail in Wisconsin because you have had little success using it in California, or just going off the national average, doesn't make much sense. And vice versa, it doesn't make much sense for me to tell someone in California to use it because I've had success with it here in Wisconsin.

I fail to understand how momentum is an oxymoron here nor is it a novel concept with regards to wholesaling. This concept of momentum would only be applicable when you are mailing to the same area. Most individuals do not respond to the first mailing. And thus, if OP doesn't plan on staying in Wisconsin much longer, it doesn't make much sense ramping up a direct mail campaign of sufficient size and duration to sustain a wholesaling business. 

@Jeff B.

Maybe out there in California, but here in parts of Wisconsin we often get 15% to 20% response rates with our direct mail campaigns. Our last owner occupant campaign was 15% and we are currently in the middle of a landlord campaign with a 20% response rate thus far.

That said, to the OP, wholesaling with direct mail is all about momentum. If you are just trying to cherry pick a property for personal acquisition, then you'll be fine with select mailing. But if you truly want a wholesaling business, with emphasis on business, then you need to be extremely consistent and persistent with your mailings. There are numerous BP podcasts that have harped on this exact point.

@Dakoda Spencer

To your first question, one Google Voice number will be sufficient. The main purpose for Google Voice is two-fold. First, it allows you to connect with these individuals without giving out your personal information. Secondly, it allows to to "pre-screen" the call in that individuals can leave you a message on the Google Voice voicemail. Lots of folks like this as they are often afraid to take live calls, especially when starting out which is understandable, but there is no better way to grow than getting outside your comfort zone. If you have a smart phone, you can sync Google Voice with your cell phone so that you can make and receive calls using your personal phone, but you will be using your Google Voice number. Youtube should have plenty of tutorials for you.

And yes you can absolutely use a VA, but you need to learn how to screen the calls yourself before you do so. How can you train the VA to screen potential sellers for motivation when you yourself don't know how? And no matter how many books you read or podcasts you listen to, you aren't going to truly learn except through personal experience.

You still need to have some reserves built in. Murphy's law is alive and well and it would be wise to be extremely conservative on your first deal.

I know the seller told you $750, but I would also try and talk to some local investors to see what they are getting for rents for similar properties in the area. I certainly wouldn't just take the seller's word for it.

An umbrella policy is still going to have a limit. If that is exceeded, they can go after your personal assets to make up the rest. With an LLC, if set up correctly, they can only go after assets in your LLC.

My personal suggestion would be to set up an LLC, especially if you plan to acquire quite a few properties as it seems you do. I'll just say that in our own direct mail campaigns, we specifically target landlords with a bunch of properties all under their own name. It is often a good indicator they are less sophisticated and less knowledgable about what they are doing.

You need to account for Repairs and Capital Expenditures. Cap Ex would be things like replacing roof, water heater, etc. It would be wise to account for possible vacancies as well. Also, do you plan to manage the properties yourself? If not, you need to account for a property management fee as well.

Extremely general break down until you get to know local numbers would be something like:

Repairs: 10%

Cap Ex: 10%

Vacancy Rate: 8.4% (1 month)

Just get a yellow legal pad and some red pens. You can look up the name and mailing addresses for these homeowners on your local assessor site. For each of these properties you find, write a letter something like what follows:

Dear "seller",

I am interested in purchasing your house at "address".

If you are interested in selling, please give me a call at "Your Phone Number".

Dakoda

It really can be that simple. Hand address the envelopes and the return address. If you want to take it a step further, set up a Google Voice and a PO Box. Use Google Voice to screen the calls and the PO Box will be what you use as the return address. That should get you going. Once you start getting calls, you want to screen these individuals for motivation. Finding out WHY these folks called you back and are looking to sell is the most important aspect of the whole process.

Sean Terry has some excellent podcasts on wholesaling that covers everything you could want, including direct mail and screening sellers for motivation. Even if you don't plan to wholesale, his info is excellent.

Are you familiar with yellow letters?

Just get a yellow legal pad and some red pens. You can look up the name and mailing addresses for these homeowners on your local assessor site. For each of these properties you found, write a letter something like what follows:

Dear "seller",

I am interested in purchasing your house at "address".

If you are interested in selling, please give me a call at "Your Phone Number".

Camillia

Hand address the envelopes and the return address. If you want to take it a step further, set up a Google Voice and a PO Box. Use Google Voice to screen the calls and the PO Box will be what you use as the return address. That should get you going. Once you start getting calls, you want to screen these individuals for motivation. Finding out WHY these folks called you back and are looking to sell is the most important aspect of the whole process.

Sean Terry has some excellent podcasts on wholesaling that covers everything you could want, including direct mail and screening sellers for motivation.

There is no one right answer. 

It depends on your goals, your market, and your risk tolerance. It is going to be different for everyone. You have to keep this in mind when you are listening to podcasts and other successful investors. What works or is acceptable for one individual might not for another. That is what is so amazing about REI is there is almost an infinite number of permutations for how you can go about it.