All Forum Posts by: Ed Brancheau

First of all, thank you for your service. Growing up in San Diego, you can't swing a dead cat without hitting a sailor or Marine. So, the city has mad respect for you guys.

Plus, I live right across the freeway from Marine Corps Air Station Miramar so every year on one late summer Thursday afternoon just after 2pm a Blue Angel will secretly drop down out of the Sun into my backyard and scare the crap out of me. It's always their first practice run that makes me jump out of my skin then I'm fine for the rest of the weekend.

Anyhow, that's enough about me. Let's talk about you.

I've helped a lot of military around here find deals which they can afford and that can be really tricky here in San Diego where the average home price is $500K.

But the trick is to use "house hacking" that is taught here on BiggerPockets and combine it with a VA loan through Navy Federal.

I don't know whether you're going to stay in Fort Worth after retiring or move somewhere else but, basically, use your VA loan to buy as big of a multi-unit building as you can qualify for. And if you don't have a large enough down payment, partner up with investors.

We love these deals because neither of us has to pony up a ton of money and military people generally have their **** together and get things done.

And even if you've already got a VA loan, getting a VA loan isn't a one-time deal. After using a VA mortgage to purchase a home, you can get another VA loan if (here's a great article on NerdWallet):

• You sell the house and pay off the VA loan.
  You sell the house, and a qualified veteran buyer agrees to assume the VA loan.
  You repay the VA loan in full and keep the house. For one time only, you can get another VA loan to purchase an additional home as your primary residence.

Then, you could live in one unit and rent out the others. Plus, you could even AirBnB the other units for even greater profit about 400% more than the traditional rent. And "short-term" rentals are great near a lot of bases because the bases oftentimes have contractors working on the base temporarily that need a place to stay.

A retired Marine Corps Sergeant Major friend of mine has a quad near Miramar that he house hacked, rented the three other units out as short-term rentals until he retired, sold the quad to one of his former subordinates while getting 20% of the short-term rental income, paid off the balance, moved home to San Franciso, got another VA loan for their fixer-upper house, and then built an ADU that they rent out which covers nearly their entire mortgage.

All in all, I think he's probably made about $600K plus he owns a home that is now worth $2M+ and costs him like $200 per month for the mortgage.

Not too bad for a jarhead, right?

My point is that that VA loan can be the best financial piece of your service if you use it on a mutli-unit property.

Have a Happy Independence Day!

So, I'm familiar with Than Merrill but not his book. But, if you want someone to help you here's what I would do:

1. Be specific about what you will want from them.
   1. Do you want to talk to them daily/weekly for 15 minutes? Text or email them?
   2. Do you want them to tell you what step one is and then step two after you've completed step one?
   3. Most people want to mentor others BUT they're afraid of the time commitment. Allay their fears by being specific and sticking to it. (I used to be a cinematographer before I started losing my eyesight and, to my amazement, one of the best cinematographers of all time, Roger Deakins who just won the Academy Award for 1917, agreed to mentor me. It started with 15-minute monthly phone calls which I always began and ended on time and it grew to him inviting me on the sets of two Best Picture Winners: A Beautiful Mind and No Country for Old Men. My point is that I respected his time.)
2. Choose 3-5 zip codes in your area where there is investor activity.
   1. I don't know what part of GA you're in but I'm in San Diego and when I was wholesaling, I never wanted to drive more than 20 minutes (if you're in a rural area, you might have to widen the area.) Luckily, my zip code and the two neighboring zip codes were the hottest in San Diego County at the time.
   2. You can use Max Maxwell's ListSource strategy to find the hottest zip codes in your county.
   3. Get a trial to PropStream and search those 3-5 zip codes for owners that own 5+ properties AND bought a property in the last six months. These will likely be active investors. And many investors started out wholesaling.
   4. Start calling them all and ask them if they'll mentor you in exchange for bringing them deals with a significantly discounted wholesale fee
      1. $1000 for the first deal
      2. $2000 for the next two
      3. $3000 for the next three
      4. $5000 for the next five
      5. $8000 for the next eight
      6. and $10000 from then on out
   5. This shows them that you're in it for the long-haul and it will be worth it for them.
3. Ask them what they would like out of the mentorship in addition to deals?
4. Do everything that you say you will do by the time that you said you will do it.

@Andrew Holmes is right that it's worth it to get your license. It's not that difficult (although here in California, and I'm guessing Illinois, it's time-consuming) and it actually makes things a little easier because buyers and sellers trust you more.

There are tons of people here on BP that only get their license for this one reason.

However, I've done deals up in Evanston without a license and there are ways to use your wholesaling desire and knowledge legally. I'm not a legal expert (certainly not in Illinois) so you should check with a lawyer in Illinois but you can:

• Actually buy the properties. If you find a deal, get a hard money loan to buy the property. Or use seller financing or lease options. Once you own the property, you can do whatever you want with it. You can even sell it two seconds later. The point is you're selling a property and not a contract.
• Find investors and create an LLC with them where you find the deals and they fund it (it can even be an LLC for one specific property like "1124 Sherman Ave Evanston IL LLC.") Because you've set up an LLC, you and the other investor are now employees of that company and the LLC is buying the property. Therefore, you end up doing the same thing you would have done as a wholesaler but as an employee of the company. Then, if you and the other investor don't want to continue to work together, the other investor can simply buy you out.

And again, get your license because it opens up other opportunities, gets everyone off your case, and builds trust with buyers and sellers.

Is it today? And are they recurring on a regular day of the month? Because it'd be really nice to meet other real estate investors and also great a pint or two of Stone. Haven't been there since COVID started. Just been living on the Stone I've bought at Costco. :-) 

Wholesaling is a very good way to get started but you can also apply wholesaling marketing methods to get deals for yourself because, while it sounds totally cliche, you can get started with very little money (less than $1K.)

Of course, there's wholesaling where you can find deals for other investors.

You can also create an option for you to buy a property, find a lender to rehab it, and then sell it for quick cash or rent it out (BRRR method) for long-term rewards.

You can also buy properties where the seller finances them to you.

Or you can even do short-term rental arbitrage where you find traditional landlords and work a deal so that you can rent their property on AirBnB. You pay them a higher than market rent in exchange for granting you the right to sublease the property.

There are so many different ways to get started BUT HERE'S THE MOST IMPORTANT THING...

Pick one strategy, jump in and work hard at it for at least six months. Avoid "shiny object syndrome" because it's the #1 business killer.

To anyone outside of Virginia, check out your state's bar association for referrals. Most of them offer a free service that will put you in touch with three attorneys in good standing to get free 30-minute consultations.

Unfortunately for you Tommy, Virginia charges a whopping $35! 🤣 https://vlrs.community.lawyer/

First of all, are they a Realtor or just a real estate agent?

Do they understand that wholesaling is legal in CA? Does their broker know it's legal?

Many don't even though the head lawyer for the National Association of Realtors says it's legal: https://www.nar.realtor/window...

And I'm not suggesting that they don't. I'm just warning you that that is a common response from Realtors and real estate agents.

Now, I've wholesaled in California and have not found it to be as heavily regulated as real estate agents, who get pissed at wholesalers because they don't actually understand it, claim that it is except for the real estate agents themselves.

They think that wholesalers are basically stealing business while they went through all of the training and testing to get their license. But they could benefit from wholesaling in two ways (and that license gives them advantages as well.)

First, they can team up with people like you and build their business around investors. I know two great real estate agents here in San Diego that do just that. Each of them makes over $250K per year (in addition to being investors themselves) and they spend much less time than other agents make a fraction of what they do.

Second, they basically get referrals from wholesalers to help the wholesaler's client buy the house from the sellers. The wholesaler assigns the contract to the investor who needs help dealing with all of the paperwork and, more importantly, they need someone to help them sell the property or rent it out.

I work with a lot of Realtors and I encourage them to work with investors because they can make almost twice as much in commissions by essentially acting as a wholesaler.

Basically, they help investors find deals just as a wholesaler would but, instead of assigning a contract, they just simply help negotiate the deal for their client. When their client buys the property at say 70% ARV, they get their first commission. Then when their client sells, they get a second commission. Or they might help their client rent the property and get smaller recurring commissions.

In the first example, they might help their client find and buy a property with a $500K ARV for $350K. For this deal, they would make about $7500 in commission (3% of $350K) when they get the deal for their client and another $15K (3% of $500K) when their client sells. Plus, they get repeat business.

But most real estate agents don't do this. They just complain about wholesalers and fight for business from other agents to get that one $15K commission. (Right now, there are more real estate agents than there are properties available if you can believe that.)

Now, your right that THEY cannot split commissions (technically, you can split with them but they can't split with you.) That's illegal in just about every state. But you can simply switch off who gets each deal. You get one. They get one. You get one. They get one. And you both keep 100% of every other deal.

HOWEVER! HOWEVER! HOWEVER! TWO THINGS...

If you became friends before getting into real estate, I'd highly recommend not working with them. You know the axiom about doing business with friends and family, right?

It backfires way more than it works out because I've found that friends and family always want you to give them more for less. Plus, our friends tend to be similar to us and so you get business partners that are both good and bad at the same things when a business needs partners that good at things that their partner is not.

I get the sense that this desire to partner with someone is because you fear your lack of experience. If that's the case, I can tell you

And you might be interested in my answer that I gave on this post: https://www.biggerpockets.com/...

Well, first of all, you're in the right place. And BP has great books in the bookstore.

But I think that if you asked other investors and wholesalers what their #1 mistake was, 99% of them would say, "Taking too long to just jump in."

That would be my #1 mistake.

And I think that it's important to think of wholesaling and investing more like marketing rather than buying or selling.

If you got no money and more time, just find properties on a site like Redfin that have been on the market for more than 90 days, pick up the phone, and start talking to people.

If you have money and little time, send flyers to those same people.

Both methods will likely yield the same results in the same time frame.

If you mean software, I'm using FreedomSoft and really like it.

If you mean a service that sends the SMS for you, I don't have a recommendation.

Yes. They are the same.