High Salary? No Thanks, I’d Rather Be Wholesaling w/Aaron Latal

Ashley Kehr:
This is Real Estate Rookie, Episode 143.

Aaron Latal:
That’s I think the big mindset shift is just using the word if. Like in 25 years, if I was at the number one best place I could be financially, what would look like? Could you make it up?

Ashley Kehr:
My name is Ashley Kehr and it is almost the new year 2022. And Tony Robinson is still my wonderful cohost and I could not be happier to go into the new year with you, Tony.

Tony Robinson:
We made it through another year, Ash. 2021, it was crazy, right? Because 2020 was the crazy year for everybody in so many ways. And everyone thought that 2021 was going to be the year that things got back to normal, but it was kind of just more the same. So here’s to hoping that 2022 is the year that we get back to some semblance of regular normalcy, and that everyone that’s listening gets their first real estate deal, then it’s just good news around everybody.

Ashley Kehr:
I know. I know. And reach out to me and Tony on Instagram too you guys at WealthFromRentals and at TonyJRobinson and let us know what your new year’s resolutions are, what your new year goals are to get that first deal or to get that next deal. We would love to, love to hear from you guys about that.

Tony Robinson:
Yeah. So I think we’re actually probably going to do an episode, Ash, coming up here, but where we talk about our goals for 2022. So I won’t spoil that yet, but just what’s new with you? Give me a life update. What’s going on in the world of Ashley Kehr?

Ashley Kehr:
Well, today started out super great. I just had like, we have our little mastermind call me, you, and our friends, I guess. And then I got some random calls just about different opportunities and I was like, “Wow, today’s great.” And then this deal I’m working on, they won’t even counter my second offer. They countered my first offer, but now they’re not even countering my second offer and there’s another offer coming in, so I have some homework and some more tightening of my numbers to do. One thing I will not do is I will not stretch my numbers to make the deal work as much as I want that property. So always remember that guys is don’t overinflate your income and don’t deflate your expenses just to make the deal work. There will always be other deals. And I’m going to replay this to myself repeatedly today as I really, really want to just offer the full amount and get the deal. But I won’t. What about you, Tony?

Tony Robinson:
Yeah, but just commenting on that, it’s such an easy thing to do. When you spend so much time looking at a deal, analyzing it, you’re already what you’re going to do with the property. It’s super easy to start making decisions that are based on emotions, they’re not based on data. Like there’s a small motel here in Southern California in Big Bear Lake that I put an offer in on a few months ago and we couldn’t agree on a number and it’s still listed and I keep thinking should I just go back and ask them what they’re… But it’s like, if it’s still listed, it’s still listed because they’re asking for too much. So yeah, really, really solid pass.

Ashley Kehr:
I even made the property the background on my phone. So when I look at my phone, it’s like, “Is what I’m doing right now really helping me get this property?” So I’m going to be so disappointed if the reason I don’t get it is because they get a higher offer, something where at first there’s been no offers and really not a lot of interest. So it was more of like, can I come up with enough money to make this work? And can I pull off the operations? But now it’s like, oh my gosh, I might not even be able to get it under contract. So we’ll see.

Tony Robinson:
But they say sometimes the best deals are the deals you don’t do. So if this one doesn’t work out, maybe it’s for a good reason.

Ashley Kehr:
Right. Yeah.

Tony Robinson:
But what’s new with me? Let’s see. Still trying to sell my house in Louisiana. Mentioned that in the last podcast. We had it under contract for all of 48 hours before it fell out of contract because of the flood insurance. So if anyone wants a house in Louisiana, it’s still up for grabs. But super excited, our team-

Ashley Kehr:
You could put a link in the show notes.

Tony Robinson:
… Yeah. We’ll put a link in the show notes if you guys want to check it out. Yeah. But I was super excited. Our team at Alpha Geek Capital is growing. We’re actually looking for an acquisitions person. So we just closed that application last night. We had a bunch of people apply, so we’re hoping to get someone onboarded within the next couple of weeks to help us get to our goal of buying not one, not 100, but 1,000 short-term rental units in the next two and a half years or so. So we’re going to need a pretty cool team to make that happen. But that’s what’s going on in my neck of the woods today.

Ashley Kehr:
I feel like over the last couple of weeks, or even the last month, you and I both have had a lot of clarity as to where we want to go, what we want to do. And just from conversations we’ve had, I think at least like the last six months, we’ve been a little lost, both of us. So I love it that we’re so in sync. We’re lost together and we find our way together.

Tony Robinson:
And what better time than right here at the end of the year, where we can go into 2022 with a lot of clarity. But I last thing on that point, I think what helped me gain that clarity was having conversations with other investors, right?

Ashley Kehr:
100%.

Tony Robinson:
And it wasn’t necessarily that they came to me and said, “Tony, this is what you need to do.” Honestly, what someone told me, they were like, “Tony, it doesn’t matter what you decide, just pick something.” Like, “It doesn’t matter what you decide, just decide on something.” And when I got that feedback, I was like, “Man, I guess you’re right.” And when I had that kind of realization, it was really freeing to realize that I could pick whatever I wanted to pick, I just needed to pick something.

Ashley Kehr:
Yeah. I agree. It was those little side conversations that happened at conferences or phone calls with other investors. So that’s why it’s so important to network, not even just the inspiration, motivation, but because you’re going to get those, it’s usually just one liners too that are like aha moments for you. I’m like, “Wow. Okay.” But I have to say, since I have this clarity again, that I feel so much more motivated. I can’t even tell you the last week, how much I’ve just wanted to grind and hustle and work because I know exactly what I’m going for now. And so nice to have clarity. Let’s hope I can keep it.

Tony Robinson:
Yeah, when the podcast comes around in February, we’re both in totally different directions. I’m buying farm houses in New York by you and you’re buying, I don’t know.

Ashley Kehr:
Vacation homes in Mexico. Yeah.

Tony Robinson:
Vacation homes in Mexico. Yeah.

Ashley Kehr:
Well you guys ready for today’s show, the last guest episode of 2021? Today we have Aaron on the show and Aaron is going to talk about systems and processes for wholesaling. And he just started his wholesaling business in the spring of 2021. So he’s already hired virtual assistants and people to outsource his tasks to. Even if you’re not wholesaling, this is a great episode to listen to, to learn how to do these things and start to outsource.

Tony Robinson:
And not only does he go over how he’s building his team, but we also spent a good chunk of the episode just talking about how he set goals for himself. So what a great episode to end the year out with.

Ashley Kehr:
Okay, well make sure you guys check us out on Instagram if you haven’t already at WealthFromRentals and TonyJRobinson, we’re going to be sharing even more content going into the new year. And then check out the Real Estate Rookie YouTube channel. We post the podcast on there and also have weekly videos released that are tailored just for rookies. And let’s bring Aaron onto the show.

Tony Robinson:
Aaron, welcome to the Real Estate Rookie podcast. Super excited to have you on man. Welcome to the show.

Aaron Latal:
Awesome. I’m excited to be here and honored.

Tony Robinson:
Yeah. Awesome man. So we’ll get into the story here. Aaron, why don’t you tell us a little bit about yourself. Tell us how you got started in the world of real estate investor.

Aaron Latal:
All right. So I graduated from college in 2017 and I got a job. I studied engineering, so I got a decent paying job. And then I was like, “What?” Because I had never really been paid before and then getting a W2 income, like every two weeks they were paying me more than I ever made really. I worked jobs throughout school, but never really made any money. And then I was like, “What am I going to do with all this? Geez a wheeze.” And I ended up having way more time as well, because after I got home from work, I didn’t really have anything to do and I was super involved in college.
So I was really bored when I got home from work. And I was like, “Well, I don’t know, I like working on things. So I’ll just start working on this place that I’m living in now and see if I like that, I might buy a property to fix up and flip or something.” Because I was looking to try to figure out something to do with my money. And I looked at investing in a stock market. And that wasn’t really, for me. I don’t know, tangible guy. So I bought a duplex after looking for a while and getting super involved in reading tons of books and being a Bigger Pockets junkie, listening to those podcasts to and from work for six months or something.
So I bought this duplex, rehabbed one unit, rented it out and then rehabbed the other unit and then moved out of it with… I was living in it with a friend. So like house hacking the unit and the whole duplex. And then me and that friend that I was living with, moved into his duplex, which was a block and a half away. So I grabbed my stuff and we threw it into his car and drove. There wasn’t enough room in the car for me to sit there, so I just a handful of stuff and I walked over to the duplex quicker than he drove over there. So we moved out of that place and then I guess buying that first duplex was how I got started.

Tony Robinson:
Yeah. So it sounds like you house hacked to begin with, is that the first strategy?

Aaron Latal:
Yeah, definitely.

Tony Robinson:
Awesome, man. So just give us an overview of where your portfolio is today.

Aaron Latal:
Okay. I still actually just have that one duplex that I bought a few years ago. And then since then I did one flip/hotel, because it was a bad wholesale deal, really. I couldn’t sell it to anybody else.-

Ashley Kehr:
Can you just explain what a hotel is for somebody that doesn’t know? Real quick please.

Aaron Latal:
Yeah, definitely. It’s a property that really could be listed or it’s really close to being able to be listed. So I bought the property and then listed it in two weeks. So basically I just repainted some stuff and then fixed a couple cabinet doors and closet doors that weren’t closing properly.

Ashley Kehr:
Awesome. So is that your one flip and then anything else after that?

Aaron Latal:
Yeah, after that I did one wholesale deal, and that one, I JV’d with somebody. And then as I got the call from the title company… Or the day that I got the call from the title company like, “Hey, your checks here, come pick it up.” That was the day after I had quit my W2 job. So I was like, “Ooh, that could be, I don’t know. I believe in signs and everything, but that seems like it could be one of them.” So I had quit my job. And then since then went on a little vacation and came back and started wholesaling. And now I’ve done three more wholesale deals since I started doing that. I’ve got a few under contract right now and then one of them I bought and I actually am seller financing it to somebody else.

Ashley Kehr:
Awesome. Okay. So lots of different stuff going on there. First, I want to know what was the motivation to quit your job. Is it because you hated it or was it because you were making money in real estate or you wanted to have more time to pursue real estate really?

Aaron Latal:
Good questions. It was kind of weird to quit my job because I didn’t hate it. I liked it. I liked the job and I liked the people and yeah, pretty much everything about it I liked. I was just like, I don’t love it and it’s not really what I see… I guess I knew what my ideal life looked like and then I knew, or I could see what path I was on and the path I was on was going to end over here to like… And then my ideal life is over here. So it didn’t feel perfect, and it’s a good time.

Ashley Kehr:
Let’s break that down a little bit. So it’s the end of the year, everybody’s getting ready to put together their New Year’s resolutions. What’s going to be their goals for this coming here. How do you set that vision for yourself? For me, it is really hard for me to see into the future and be like, “This is what I want my life to be like in five years.” Do you have any tips or tricks for me and any of our listeners as to how you set that vision for yourself and really pushed yourself to meet that goal?

Aaron Latal:
Absolutely. I will also start off with, I guess, it’s really hard for me to set a long term goal. I’m definitely a goal setter and I love personal self-help books. Basically love those. And so I set goals and normally my goals are like, “Well, this year I want to run a half marathon or do something like that.” That was how I was approaching my goals. But in 2020 I went to the ONE Thing Goal Setting Retreat and they gave me a really good framework for how to set longer term goals. And then they, instead of, I don’t know, I’ve always built my… Or I’ve thought that you could build a three month goal and then off of that, you can make your one year goal and then you can make your five year goal from there. And they were like, “No, do it backwards.”
So think about what you want your life to be like in 25 years. And that’s really, really hard to… I’m barely 25 years old. So in 25 years I’m going to be twice as old as I was, or as I am now, it’s just insane to think about. So they’re just like, “If it was”… That’s I think the big mindset shift is just using the word if. Like in 25 years, if I was at the number one best place I could be financially, what would that look like? And it’s kind of, at that point, you can kind of play around with it and be fun and be like, “Okay. So if I was totally satisfied with my job, what would that look like? And just make it up.

Tony Robinson:
Let me add one comment onto that, because I love the conversation about goal setting because is I feel like it’s such a… I think everyone understands the value in setting big goals for yourself, but people don’t often take the time to really clearly identify what those goals are. And funny enough, Ash and I were just on another call this morning, we were sharing our goals with another group of investors. And it’s just such a motivating feeling when you can set a super specific and clear goal for yourself, because it’s like all of the other noise just starts to go away when you’ve got this really clear vision of what your future looks like and clarity around what you should be doing on a day to day, week to week, month to month basis.
That clarity just really comes in when you’ve got a really crystal clear vision of your future. So not to put you on the spot too much, Aaron, but I guess in the way that you’ve set your goals, what is your advice for someone if they want to mimic what you did and maybe set that big 25 year picture or 10 year picture, one year goal for themselves.

Aaron Latal:
Okay. So basically you got to break it down, because you can’t just be like, “In 25 years, my whole perfect life between my family, my relationships with friends, my fitness, my finances, my job. So I’m talking about all these things. Break those down into categories. So start off and just say, “I think it’s best. If you can try to get some time alone, like make a big time on your calendar and you can go out somewhere. I think that’s what I’m going to do. I think making it more special can make it a little bit exciting.
So do that and then break it down into my perfect finances would look like this. And so I have X amount of dollars saved up and I’m going to be spending X amount of dollars per month. And so that’ll last me the whole time, or I’m going to have this many rentals that are paying me and so that’s going to last me for whatever. And then my relationships I’m going to just have a core group of five to 10 friends. And we see each other a couple times a year and we go on these types of vacations. And so you make all of that up. And like, that’s kind of, I think the fun part. But definitely be writing it down and try to get as specific as you can.
And then, so you have your life broken down into those categories. The basically five that I can think of would be finances, your job, family, friends, and health. You can break it down into more or less, but I think having that is a good place to start. So then identify your 25 year goals in those five areas. And then from there comes the part where you’re going to break it down and figure out basically your most important next steps or your action plan. So break your 25 year goal down, and do a five year goal, and then you can break that down into a one year. And then from there, you kind of know what you need to be working on this quarter or this month or this week.

Ashley Kehr:
That’s awesome. Thank you so much for sharing that, Aaron. Bigger Pockets also has the intention journal that works in the same way, where it has you break down your mins, your most important next step. And it really helps you develop those action items to reach your goal or to get there. But Aaron, enough about goal setting and the future and the vision, I want to hear about what you’re doing right now in your business. So you mentioned you’ve been primarily doing wholesaling. What does that business look like? Do you have partners? Do you have employees? What kind of systems do you have? I want to hear all about it.

Aaron Latal:
Okay. I started wholesaling in May this year and I had been wholesaling, it was basically, I was like, “Ah, I need to make a little bit of money and it would be a good way to find my next property. So maybe I’ll find my property off market. And if I find something that’s not a good fit, I’ll just try to sell it to somebody else.” And so that’s what I had been doing for about six months of the end of 2020, I guess. And so that’s when I found that whole tail deal. And then I found that other deal that I JV’d. But then since May, I was like, “This is what I want to do full time.” And so I’m actually, it turns out, pretty interested in the business side of things and the process side of things. So what I’ve been doing since may is trying to systematize and make a process around things so that I can eventually hire myself out of the business.
So, so far I’ve been able to outsource. I had outsourced some cold calling and text message prospecting to a friend of mine that wanted to learn more about real estate. And he’s since moved on and I’ve found a virtual assistant in South America that’s doing some cold calling for me right now and I’m interviewing a person to help me with dispositions right now. So they’re going to be sending out emails and creating the emails to send out to my buyers list and then doing all that communication between the interested buyers and us and the title company and just making sure that runs smoothly so that I can focus more on spending more time going out and looking at properties and analyzing properties. Because that’s a fun part for me.

Ashley Kehr:
I saw Ashley Wilson, she’s at BadAshInvestor on Instagram, she does multifamily syndication. She had done this post this morning or yesterday and it was that when she goes through her email or when she does anything, it’s either that task is going to be automated, delegated, or eliminated. And I thought that was so awesome and that’s what like keeps her from having to do tasks and to be that high level person where she can take something and categorize it into one of those dumps I guess, and dump it into there. But Aaron, are you using any kind of software to manage these contractors that are working for you or to do your project management workflow?

Aaron Latal:
Yeah, absolutely. I was using Podio when I started just because it was free, and it was working pretty well for me to manage like following up with people, but it wasn’t working as well as I thought it could be. And now I’m using Forefront, which is a CRM that Danny Johnson made. And I found him actually on another Bigger Pockets podcast, and I was using him for a website before that and he invited me to a webinar where he was rolling out the CRM and he was like, “We’re giving everybody a great deal.” And I was like, “I don’t know if I need it, but I think it’s going to be helpful.” And so kind of took a leap of faith and it’s awesome. I love it so much.

Tony Robinson:
Aaron, one thing I want to point out, because I feel like a lot of times on podcasts, you hear the guests and you hear the host talk about like team building and getting this VA and hiring this person for their team and doing these things. And when I think about myself, when I first started in my real estate business, I didn’t have the money in my business to go out and hire somebody. And I think that’s just an important distinction to make because it’s like when you’re first starting, sometimes you do have to wear all of the hats just to get the whole machine to get to start turning. Like if you maybe go out and try and hire everything right away, you might not have the resources, whether that’s money, whether that’s the knowledge and ability to train those people or even just the desire.
So I just want to make sure that we’re framing the conversation in that, yes, it’s cool to hear Aaron and Tony and Ashley and Brandon and Dave and all these other people talk about how their teams are being built. But when you’re first starting out, sometimes you do have to do everything yourself. So I guess my question to you, Aaron is when you first started wholesaling, was your team what it is today or was it just you as a one man show?

Aaron Latal:
My team was me for sure when I first started wholesaling. And so I was making calls to people and then following up with them, and then signing contracts with people at the properties, and then talking to the title company, and then making sure everything closed. And then when it didn’t just tearing my hair out and run around like a chicken with my head cut off, and then go into a different appointment where I’m trying to put my head back on so the person that wants to sell me their house thinks I have it together. And honestly, still, I feel like I’m just, I’m faking it till I make it. I feel like.

Tony Robinson:
I mean, we’ve all read the E Myth, right? Have you guys read The E Myth by Michael Gerber? So in that book, it always talks about working on your business and not always working in your business, but I listened to an interview with Michael Gerber where he made a very important distinction about they’re working on versus working in. And what he said is that, that is a gradual change. Like the book, you read the book and it’s a six hour, seven hour read. But the actual process to go from consistently working in your business to consistently working on your business, that’s a gradual change that takes time. And he said, most people when they first start this should be working in their business. So I appreciate you being transparent and open Aaron about how you’ve started off that way, but you’re trying to transition into working more so on your business.

Ashley Kehr:
Aaron, do you have any book recommendations or even YouTube videos or people that you’ve followed that have really helped you with this mindset shift and to help you implement some of your processes to get to this point where you want to be working outside of the business instead of in it?

Aaron Latal:
Yeah. So like I mentioned, I love self-help books. So I could go on a big list, but I think the most helpful for working on my business, I mean, I’ve read The E Myth and I listened to the audio book of Traction or whatever, and I think I need to read that one because it didn’t like… I was like, “Eh, that book’s okay,” but everybody’s going crazy about it. But the book that really did help me a lot for working on my business or how to think about it is this book called The Road Less Stupid by, I think it’s Keith something, but I haven’t heard of it a lot of places. And I think it’s really underrated, because it gives you these different chapters and then like here’s things that I’ve seen.
He’s I guess a VC, so a venture capitalist. He’s seen a bunch of businesses grow and everything, and he’s like, “Here’s this one specific topic. Here’s how you should think about it.” And then at the very end of the chapter, he gives you a list of 15 or 20 questions and he spends the first quarter of the book just outlining how you should think about your business. And so he coined this term for me at least called thinking time. And he is like, “You should do a thinking time probably two times a week, if possible.” And when I first started my business, it was actually easy to set aside time for the thinking times. And so I got in a good habit of Tuesday, Thursday mornings. First thing I’d do is I’d just make some coffee and get myself really situated. I got a sweet ritual around it where I light a candle and I put on a special hat and sit down at a table where there’s no distraction, it’s just me and a legal pad and write down a question and answers to it. And so that book has been really helpful.
But then, like I mentioned, I don’t feel like I really know what I’m doing when I’m hiring people, because I worked for a huge company, and I never had anybody you reporting to me. And so now I’m hiring a VA, the second VA. I feel like I have no idea what I’m doing, but I heard, basically I heard somebody on a podcast. It’s this guy named Dan Bro. It’s Dan Brault. He was on one of the Bigger Pockets podcasts and he is doing cool things with wholesaling. And so I followed him on some social media and then I saw him post like, “Yeah, I got a mastermind coaching call group thing.” And I was like, “Yeah, sure. I could learn something from you for sure.” And so I signed up for that and he’s been providing a lot of helpful information for wholesaling in particular.

Ashley Kehr:
Yeah. Thank you for sharing that. That’s super cool. And Tony, I saw you typing in to order that book. So please send me a copy too while you’re at it, while you’re shopping. But Aaron, so you’ve been doing your wholesaling business since this spring really of 2021. And you already have started building your team. What is your advice for a rookie investor as to when they start building their team? When they start reaching out to outsource some of their task and how do you find these people?

Aaron Latal:
That’s a good question. I think for me, I knew that when I started wholesaling, I was like, “I don’t want to be a one man operation.” Although, I think there are a lot of people that are just like, “I’m just a one man wholesaling operation. I make good money for myself. I don’t spend that much time doing it.” But when I was going into it, I was like, “I want this to be”… Basically I want to build it up to a certain level and then get myself out of it as fast as possible so I can focus on other stuff, whether it’s flipping houses or burying a whatever I decide to spend my time on.
So I was like, “I want to hire people as fast as possible without rushing into it.” So basically I just came up with a couple criteria in a thinking time where I was like, “I want to have three months of somebody’s salary saved up and I want to have a little bit of other runway.” I think Scott Trench mentioned it, or he had that term where you have like a financial runway. So I want to have my financial runway and then a financial runway for them. And so that’s when I decided I was ready to hire somebody.
And then how I chose the specific person to hire, I used this table of four different categories, I think. It was in EOS or Traction or that book where it was like, “What are the things that you’re good at and you like doing? What are the things that you’re bad at and don’t like doing? And then bad at, but you do like it?” And then so basically it was just start on the things that you’re bad at and you don’t like doing and then outsource those. And for me, I was lucky that those were the repetitive and the tasks that would be easy to train a virtual assistant for. And so I’ve been making videos on Loom. So I’m just recording myself and my screen whenever I’m doing stuff like getting an email ready to send out to the buyer’s list or when I’m sending texts to people how I do that, make a video with Loom.

Tony Robinson:
Yeah. Aaron, so much good advice there. And I think a lot of people, they have fears around building out a team because sometimes it does seem like it’s more work to train somebody up than it is to just do it yourself. But your process of just recording yourself while you’re doing it, because you’re going to do it anyway and then sharing that with them as a training material, I think is super insightful. I think one follow up question for me, because you, you mentioned this briefly, but you said the VA that you hired to help with cold calling is in South America. It’s a totally different country. A couple of questions around that hire. First, is that if you have this person that you’ve hired for cold calling, were they already trained in how to cold call for wholesaling or was that a process that you had to train them up in? And then second, was the language barrier at all, a concern for you in hiring from someone overseas.

Aaron Latal:
So it’s a service that I’m using, and I found them through another Facebook group of wholesalers. They were like, “Yeah,” one person on there was like, “Yeah, we just started or we’ve been cold calling and this person has really helped us out. You should check it out.” And then like a few weeks later, somebody else was like, “Yeah, I just started with that same guy.” And like, “I’m loving it. He’s super helpful.” And so I was like, “Well, this is something that I do want to hire out and I need more leads coming in. I’m ready to handle them. And so it just makes sense. I’m going to test it out.” And the language barrier is, it’s not too bad, so they are just giving me the warm leads. So I guess they don’t have to talk on the phone a ton. And then there’re some words that the script that they’re using, just they don’t say very well. So I’ve been training them a little bit that way.

Tony Robinson:
So two follow up questions for me on that, and this is about the quality control and then the workflow, I guess, I’ll talk about the quality can control portion first. Do you have an ability to listen in on their conversations, to be able to give them feedback or are you just blindly trusting that they’re knocking it out the park for you?

Aaron Latal:
I can listen into their conversations, so that’s a good question. I’m using, what’s now called ReadyMode. It used to be Xendialer. Or that’s what they’re using, I guess, and that records the conversations. And I’ve been recording all the other conversations that I’ve been having, because I’ve been using CallRail. So I’ll call somebody up, when I was cold calling, and actually when my friends and I were cold calling, we would have sessions on Fridays where we would roast each other in our cold call. So it was basically just put on a 10 minute call of you talking to somebody and then let my colleague just tell me what went well and what went poorly. And I really liked those and I’m still doing some feedback sessions with other wholesalers now.

Ashley Kehr:
Tony, maybe we should do those Friday night roasts between me and you. Like, “Geez, Tony, I can’t believe you said that on this podcast.”

Tony Robinson:
Yeah. You know what Ash and I have been talking about doing is just going on social media and just reading all the mean reviews of us on the podcast. So maybe that’s what we can do for our roast session is just read the bad review.

Ashley Kehr:
Yeah. It’s like on the late show they had their mean tweet segment where they’d have celebrities read the mean tweets out. I don’t think anybody’s ever said anything mean about Tony. So I’ll just have to create some.

Tony Robinson:
I don’t know if that would be as productive as Aaron’s roast session, but close enough. So Aaron, one more follow up question for me on the workflow with your VAs. So in terms of how the leads are moved through the pipeline, I guess just give us an overview of what that looks like. Are you giving them the leads? Are they pulling their own list or is it your list? Are they just trying to, I guess gauge for interest in selling, or are they actually setting appointments. And then how do the leads actually get to you? So just give us an overview of that entire process.

Aaron Latal:
It’s actually, the process is still in development. So in ReadyMode, my VA started setting an appointment for me. And since then I was like, right, when she first started, I had no idea. I was like, “Why haven’t I gotten any leads? This is ridiculous. It’s been half a week and I haven’t seen anything come through.” Because I thought they were going to be pushed to my CRM. And then there was just an integration error. And so there was five appointments that I just had not gone to. But since then, she’s now setting follow up call appointments for me to understand what the seller’s motivation is. And then basically get motivation timeline and a price range from them just to see if we’ll be a good fit.
And then from there, I will go out on an appointment to the actual property and take some photos and try to sign a contract if it makes sense for both of us. But the lists I’m pulling and then I send to them. And yeah, I would like to probably at some point automate list pulling and managing of… Because I’m using a couple, I was cold calling for a little. Or sorry, cold calling, texting and sending direct mail. And I was rotating through the lists. And I honestly am not managing that as well as I should be.

Ashley Kehr:
Aaron, I want to take us to our rookie deal review and break down one of these wholesale deals that you have done. I’m going to ask you a couple, just fire on questions here, just so we can get an idea of what the deal looks like. And then if you want to go ahead into the story after that. But so do you have a deal in mind? Do you want to share with us?

Aaron Latal:
I do. Yeah.

Ashley Kehr:
Okay. What kind of property is it? A single family?

Aaron Latal:
Yeah.

Ashley Kehr:
And what market is it in?

Aaron Latal:
St. Louis, Missouri.

Ashley Kehr:
And how did you find the deal?

Aaron Latal:
So I found the deal by driving for dollars, actually, when I would still had my W2 job. Driving for dollars, sent them a bunch of direct mail. They never replied. And then I recycled that list and was cold calling it when I first started and they answered a call and then I went out and meet them.

Ashley Kehr:
That’s so funny that you tried the two different ways and the one worked and the other didn’t. Okay. And then what was your contract price on this?

Aaron Latal:
Got it under contract for $140,000.

Ashley Kehr:
And what did you assign it for?

Aaron Latal:
145.

Ashley Kehr:
Nice. Okay. Do you want to go into tell us how you negotiated that and how you found your buyer?

Aaron Latal:
Yeah, absolutely. So I want to be clear, the assignment fee was $5,000, so-

Ashley Kehr:
Right. Yeah.

Aaron Latal:
… Yeah. That would be a wild deal.

Ashley Kehr:
Don’t worry. I would’ve had a lot more excitement if it was 145,000. Your excitement too.

Tony Robinson:
145, yeah.

Aaron Latal:
So yeah, I’ll let you know a little bit more about it. The reason I guess, that they did not answer or reply to any of the direct mail probably was because it was just not the right time for them. They had a tenant in the property for seven years, and then when I called them, they were finishing up the process of kicking that tenant out, because they had to stopped paying water and utilities and rent for months. And so I just got a hold of him at the right time and I was like, “Hey yeah, have you ever considered selling that property?” And she was like, “Well actually we just had a real estate agent walk through it and I’m going to go and get some quotes from somebody this Friday, would you be able to”… And I was like, “Oh, I could come by and have a look at it and just let you know what I think I could offer.”
And so when I was negotiating it, I really wanted to obviously get it for a little bit less than 140. I was hoping really I could be, I was like 135 would be a good number for me. And then I could assign it for, I was hoping 150. And then I always tried to target a $15,000 spread, although I’ve yet to hit it, that’s what I’m aiming for. So I started a little bit lower with my numbers and she was like, “Yeah, I really want… We want to get 150. I know it’s probably worth 210 after it’s fixed up.” And I was like, “Yeah, but it doesn’t need a lot of work since that tenant was in there for seven years.” And they were kind of like, they had a lot of dogs and they were DIYing some updates to the house that were questionable.
And so she actually had moved out of state after she had the property. So for their, her and her husband’s job, they moved into Indianapolis. They were five or six hour was away. And so I was like, “So what’s your plan with the property?” And she’s like, “Yeah, we’re just going to fix it up, come down on the weekends and stuff and fix it up and then probably just sell it. It’s a good market.” And I was like, “Yeah, it is. If you didn’t want to drive down here.” And she had two little kids with her and I was like, “If you don’t want to come down here with your family all the time, I could just buy it and fix it up. It’ll be easier for me.” And so that’s how that negotiation went.

Ashley Kehr:
So you were listening to things that she said, like she had kids with her and she lived far away and you used that as a tool to offer her something that was appealing so that you could get that lower purchase price. That’s awesome. So how long did this deal take place? How much time did you put into making that $5,000?

Aaron Latal:
Probably more than I would’ve liked to really. Somebody was under contract to buy it for a while. I guess, I think I set the close date to be 45 days after we signed the contract. And this guy went and saw it and he was like, “Yeah, this looks great. I’m just going to move some money out of my 401k. And then we’ll be able to buy this property and fix it and flip it up, or fix it and flip it.” And then it was his deal for a while. And then for whatever reason, he couldn’t get the finances to buy it in closing time. And that was two or three weeks before I was supposed to close. And so I was scrambling for a week or two, just like, “I need somebody to buy this property in two weeks for $140,000 at least.” And then I ended up finding a local investor that wanted to get it, but I was all over the place.

Tony Robinson:
I think that’s a really critical piece. So I want to make sure we don’t gloss over that. You had two weeks to find a buyer and you said you ended up connecting with a local investor. Walk us through how you found that person in the 11th hour. Was it through like a meetup? Was it just a friend? Where’d you guys connect?

Aaron Latal:
So I was like, I was posting it in the different Facebook groups and sending out texts to people that had bought properties, cash in the area before. And I called like the, We Buy Ugly Houses people. And this guy just out of the blue reached out to me and was like, “Hey, I’m looking for this place.” And he was one of the people that I had texted, I think. And then I was like, “Yeah, come through and have a look.” And he was like, “Yeah, it looks pretty good. We buy a lot of houses in this area.” And we signed the assignment contract, I don’t even think it was a week before the close. I think we agreed on it with a handshake a week before we needed to close. And then all the documents were signed on Monday or Tuesday, and then closing was on Thursday and I was whoo.

Ashley Kehr:
Sweating on that one.

Tony Robinson:
Yeah. But kudos to you for figuring it out. I think a lot of people that get into that situation, they kind of panic. But you kept your cool for the most part and found a way to make the deal work. One last question, before we move on from this rookie deal review, what would’ve happened Aaron, had you not been able to find a buyer? What would your next steps have been?

Aaron Latal:
That’s a good question. The contract that I have is, I would’ve just lost the earnest money that I had put down on that property. I had a few other people that were interested in buying the property. And I was talking to another wholesaler that was like, “Yeah, we’ve got somebody that’s super interested, but they only are going to pay 135 for it. That’s what their numbers are coming out at.” And so I actually reached out to the buyer, and I was like, “Would you… I know I said I was going to close on it.” And it was just the worst feeling that I had going into the conversation. And then the conversation was awful and the seller of the property was not happy with me. And she was like, “No, I can’t close for less. People have already talked to us.” And then I finally found somebody that would close for a little bit more than what I wanted to, or a little bit more than, and she got what she needed.

Tony Robinson:
And I asked that question because different whole sellers will approach that situation in different ways. Some will say, “Hey, we never not close on a deal.” I know some that say like, “Okay, if we have to buy it ourselves, we’ll buy it ourselves. And we’ll figure it out from there.” Some, like you said, they’re okay walking away and just leaving the seller with their assignment fee. So there’s a bunch of different exit strategies, I guess, on a wholesale deal. So that’s the point that I was really trying to make. So thank you for sharing that experience with this man. It sounds like you did pretty good clearing 5k on a relatively easy deal, man.

Aaron Latal:
And actually, I would’ve probably ended up closing on it if I had the funds, but for that one, I just couldn’t do it. But the first wholesale that I did where it was a hotel, that was the reason, because I had it under contract for too much and couldn’t sell it. So I was like, “It makes sense for me to flip it.”

Tony Robinson:
Let me do it myself.

Aaron Latal:
Yeah. And barely made anything on it and learned a lot.

Tony Robinson:
But you learned and that’s the beauty of real estate man, is that there’s so many different ways to make a deal work brother. So glad this one worked out for you. So Aaron, want to move on to our mindset segment next. I want to get into the psyche of Aaron and learn a little bit more about what makes you tick, man. So if we go back to Aaron, maybe when he first graduated from college or before he started consuming all those Bigger Pockets podcasts and books and whatnot. You had some maybe assumptions you had about what it means to be a real estate investor. You had some, maybe made up beliefs about what you thought it was going to be like. If you think about all those thoughts, all those ideas that you had, which of those turned out to not be true? Which of those turned out to be misconceptions about what it means to be a real estate investor?

Aaron Latal:
I think it’s kind of funny. I’m probably unique in that I really thought, I was like, “Oh, it’s really easy. You just buy a house and then rent it out to people and then they just pay your mortgage.” Be silly not to do that. So I just jumped in and I was like, “Oh, it’s a little tricky.”

Tony Robinson:
But I think that cuts both ways, right? Because you see some people that overestimate the amount of complexity that goes into real estate investing. And then the flip side, you see some people that underestimated, and I’ve shared this in the podcast a lot. You hear other investors say it as well, but real estate investing is not super complicated. It’s a fairly simple process to get started in the world of real estate investing. But it is definitely not easy to become a real state investor. It takes an extreme amount of effort to get there. So it is hard. It’s not complicated, but it is hard.
I think there’s so many proven paths that you can follow to become a real estate investor, that’s why the complexity’s not there. But it is hard, especially if you’re working in W2. Especially if you have busy family commitments. Especially if you have other things going on to dedicate the time, to underwrite the deals, to make those relationships, to do all of the leg work that’s required to get the first deal done, I think that’s where the hard part comes from. So you’re definitely not alone, man in getting that guess wrong, but we appreciate the transparency around it.

Ashley Kehr:
Yeah. Me and Tony still, even today will text each other and just be like, “Do you feel overwhelmed right now?”

Tony Robinson:
Yeah.

Ashley Kehr:
Yes? Me too. All the things you [crosstalk 00:44:19].

Tony Robinson:
Absolutely.

Ashley Kehr:
Okay. So I’m going to take us to our rookie request line. You guys can give us a call at any time, 1-888-5ROOKIE, and leave us a voicemail. We may just play your question on the show and have a guest answer it.

Ashton Maxima:
Hey there, Ashley and Tony, my name is Ashton Maxima. I’m here in San Diego. I have a question. It’s right now I’m a full-time worker detailing and I’m wanting to get into real estate and I’ve come to a place in my life where I can take off a few months of work and really just focus on it. My main goal is trying to get into wholesaling and doing that, but really just wondering if you guys think that’s a good idea or any other thoughts you guys might have. Thank you.

Aaron Latal:
I would say, start working on getting into wholesaling before you quit your job. Because at the beginning you’re not going to have just a pipeline full of leads that you can follow up with and go and visit. And it takes a long time to close a deal. And like I mentioned, this person that I, like in the deep dive deal, I found them nine months before the deal closed, before you even sign a contract. And then it was another two months after that. So do a little bit of maybe driving for dollars and then get a good… You have a good unique list that way. And then reach out to them however is best for you. If you don’t have a lot of money, but you have a lot of time and energy, cold calling could work. If you are on the opposite end of the spectrum, you could send out some direct mail or something like that. And yeah, just talk to other people also that are in your market that are wholesaling and see what their take is as well.

Ashley Kehr:
Yeah. I bet there’s an opportunity out there where you can even work for a wholesaler doing driving for dollars for them and send them leads and learn their processes and systems. And maybe you just do it one or two nights a week or Sundays or something. But I think giving out your time for that experience is definitely very valuable. And then who knows, they will probably pay you a fee or part of the assignment fee if you bring the deal or something like that. So look out for those opportunities too with other investors, Tony, who is our rookie rockstar of the week?

Tony Robinson:
Today’s rookie rockstar is Dalton from PA, and for all of our rookies that are out there listening, if you would like a shout out on the Real Estate Rookie podcast, be sure to get active in the Real Estate Rookie Facebook group. Be sure to get active on the Bigger Pockets forums. That’s where we’re pulling all these folks from. Or give Ashley and I a shout out on Instagram. She’s at WealthFromRentals, I’m at TonyJRobinson. If we find some good stories we’ll be sure to share it on the podcast as well.
But anyway, Dalton from PA, this one’s really cool. Just got the appraisal back on my first mini BRRRR and the purchase price was 62,500. Rehab was 3,000. So they’re all in for just a little over $65,000. The appraisal came in at $107,000 on this property. So they were able to cash out refi at $80,250, which means they pulled out $17,750 more than what they put into it. So, awesome, awesome. First BRRRR, Dalton, and excited to see what comes next for you guys.

Ashley Kehr:
So great. Aaron, thank you so much for joining us today. Can you let everyone know where they can reach out to you and find out some more information?

Aaron Latal:
Yeah, you can catch me on Bigger Pockets for sure, or Instagram or TikTok. Instagram is ToppDoggEnterprises, T-O double P, D-O double G Enterprises. And TikTok is T-O double P, D-O double G R-E-I, Real Estate Investing.

Tony Robinson:
Dude, you’re giving the Snoop Dogg run for his money right now, man. The TO double P, D-O double G. I love it.

Aaron Latal:
I started an LLC to get my first rental property and I was like, “I don’t know what to make it.” And I was a DJ in college and I was Topp Dogg, so it just made sense.

Tony Robinson:
There you go, man.

Ashley Kehr:
On your TikTok, are we going to see some DJ videos down there?

Aaron Latal:
It’s a mix right now of videos of me being really goofy, maybe too goofy. Really pushing the line and then also real estate stuff, walking through houses, trying to give tips on looking at houses.

Ashley Kehr:
Oh cool, we’ll have to check that out. Well, thank you so much, Aaron. Everybody, thank you for listening to this week’s Real Estate Rookie podcast, and I hope everybody has a great new year’s. This is our last guest episode of the year. And Tony, I think that going into the new year, I’m going to change out the outro, because we always say, this is Ashley at Wealth From Rentals. And this is Tony at TonyJRobinson on Instagram, but I feel like we need something new and fresh. So start thinking about it. Maybe an inspirational quote or a movie quote at the end of each episode.

Tony Robinson:
It’s all Tommy Boy. All Tommy Boy one liners is the end of each episode.

Ashley Kehr:
For a whole year. Thank you guys so much for listening. Have a great new year and we will see you in 2022.