September 21, 2025 • 24 mins
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:07):
What's up everybody.
Welcome to Virtual Wholesalingfrom A to Z.
I'm going to be breaking downthe complete process today so
you understand exactly whatvirtual wholesaling is and can
decide if that is what you wantto do inside of your business.
Our team has done over 2,000deals in all 50 states over the
past decade using this exactprocess.
(00:29):
Today's goal is to give you acomplete overview.
Now we're not going to bestopping at any destinations,
we're just going to be givingyou the roadmap of what it is.
Now, before we dive in, let meexplain our H hedgehog concept.
We are a nationwide virtualwholesaler.
That's it.
Anything that doesn't fitinside of that scope gets a no.
(00:50):
This eliminates all of theshiny objects that exist in the
real estate investing world andit's easy for us to say no to
flips, novations, buyingproperty subject to and things
like that.
All right, let's get into it.
Step one define virtualwholesaling and why there's
money to be made Virtualwholesaling.
(01:11):
What makes this virtual is thatyou never leave your office,
you never leave your house.
You do everything virtuallyfrom your desk and on the phone.
We're not going to physicallyvisit properties and we're not
going to want the propertiesourselves.
Every property that we contract.
We never go see them, we neverlay foot in those properties
whatsoever.
(01:32):
In the wholesaling side,wholesaling is when you contract
the property and then you'reselling your equitable interest
in that contract for a fee.
You're not selling the propertyitself.
So we talk to a seller, wecontract the property for
$100,000, and then we turnaround and we will assign our
(01:53):
rights to the buyer for a fee.
So I say, hey, for $110,000,you can have my equitable
interest.
They buy the property for$100,000 and I get the $10,000
difference.
The other way you could do thisis called a double close, but
we've pretty much moved awayfrom double closes.
Almost all of our deals areassignments only.
(02:17):
Step two do you need an entityto virtual wholesale?
The answer is no, you don'tneed an entity.
You could absolutely contract aproperty in your personal name
and assign your rights to an endbuyer and receive your wire or
check directly to your personalname.
However, I will say there is abenefit to creating an entity
(02:37):
and having that protection.
If, for whatever reason, youwere to get sued or there was
some sort of liability, thatcomes back on you.
You're protected and they can'tcome after your personal assets
.
There's also a certain level offinancial commitment that
you're making to yourself.
It's almost a mental commitmentthat you're saying, hey, I'm
going to take this serious, I'mgoing to be a business, I'm
(03:00):
creating entity to get thisstarted.
Now, if you don't have thecouple hundred dollars to create
the entity, you're probablygoing to be running into some
issues when it comes to virtualwholesaling, because it does
require operating capital.
This is not the free way to doreal estate investing.
It does require money to dolead generation and buy systems.
(03:21):
Step three what is a motivatedseller?
The first thing we need to dois locate a motivated seller
that's willing to sell theirproperty for a discount.
If you're brand new, you'relike well, what does that mean?
Because isn't every sellermotivated to sell their property
?
Of course, but that doesn'tnecessarily mean that they're
motivated to sell it for adiscount.
(03:42):
There are two core fundamentalreasons why a seller is
motivated to sell sell it for adiscount.
There are two core fundamentalreasons why a seller is
motivated to sell their propertyfor a discount.
Number one is financialdistress.
There's financial distressfactors saying, hey, I need to
quickly and efficiently sellthis property and so I'm willing
to sell it at a discountbecause, financially, I need to
sell this piece of real estate.
(04:02):
That's pre-foreclosure tax,delinquency liens, bankruptcy
judgment, loss of job, healthissues, inherited a property
that has a mortgage on it andthey can't afford it.
The next thing is physicaldistress.
This is where the property hasnot been remodeled in decades.
Or maybe there's a structuralissue or system issues where AC
(04:23):
doesn't work, roof doesn't work,foundation problems, maybe it
has tenants inside and it's atenant-occupied property and the
tenants devastated anddestroyed the property while
living in it.
We've even had animals catsdestroyed a property with pee
and poop, vultures overtook aproperty, beehives created
inside of a wall and destroyedthe entryway.
(04:44):
Those are the two ways thatreally lead to a seller becoming
motivated to sell for adiscount.
The reason why motivation is soimportant is because that's
where you're going to want tounderstand why the seller is
wanting to sell this piece ofreal estate for a discount.
If they're not motivated, thenwe're probably not their best
(05:04):
solution.
That's what realtors exist for.
Step four lead generation.
Lead generation is themarketing that you're going to
do as a wholesaler to turn thelights on to these motivated
sellers and let them know thatyour company exists, contrary to
what we believe the vastmajority of people don't know
(05:25):
what a wholesaler is or how tocontact a real estate investor.
When they go to sell theirhouse, they're thinking about
contacting a realtor and goingto Zillow and maybe listing it
themselves for sell-by-owner.
They don't know that we exist,so we have to be great at
marketing.
Here's how we do that.
One thing you can do is you canpull lists on places like Batch
(05:46):
Leads, propstream, listsource,and you can pull from motivating
factors like pre-foreclosure,tax, delinquency, vacancy,
bankruptcies, expired listings,and you can skip trace it and
that means you're getting theirphone number and then call them.
You can also send direct mailto that data, send them a
postcard or letter saying, hey,I buy houses.
(06:09):
Now, the thing that I love thatexists today is buying inbound
leads.
Now you can run your owncampaigns on social media
Facebook ads, instagram ads,youtube, google, pay-per-click
and they search need to sell myhouse fast, fort Worth, texas.
Your ad pops up, it takes themto a landing page and they fill
out the form and it comes to youand you call.
(06:29):
But then there are companiesout there like Speed to Lead,
leadzolo Property Leads thatwill generate these leads for
you and sell you the lead that'scalled paper lead.
Instead of running your owncampaigns, you just swipe your
card.
Property Leads charges like $30for nationwide exclusive leads.
Boom, it comes to you.
(06:50):
You call them 10 seconds afterthey fill out the form.
You have to have this.
Without leads, you can't reallydo anything else.
This is the foundation for yourvirtual wholesaling business.
Now the heartbeat is step fiveacquisitions.
Specifically using the closersformula, you generate the lead.
(07:11):
The motivated seller comes toyou and says I want to sell my
house.
Now you've got to be able toacquire the deal.
You've got to get great atbeing able to have
human-to-human interaction onthe phone to solve their problem
by buying their real estate.
Now here's the steps.
You call the seller.
Hey, mr Seller, this is RJBates.
(07:33):
Are you still looking to sell123 Main Street?
Yes, that's step one.
Verify that they want to sell.
Step two Awesome.
How much are you looking to getfor it?
Ask them their asking price.
How much do they want for it?
They're the seller, we're thebuyer.
Ask them how much they want.
Everywhere else in the world,when you go buy something,
(08:02):
there's a price tag.
It's the same thing here.
Step three open-ended questions.
Tell me a little bit about whatyou got going on.
This opens it up to let themtalk about the most important
thing to them.
You didn't ask them about thecondition, you didn't ask about
the timeline and you didn't askabout occupancy.
You just said tell me what yougot going on.
This allows them to open up andtell you their whole story.
(08:23):
From there you're going tocontinue to ask open-ended
questions while you're doingstep four, which is comping and
underwriting and analyzing thedeal.
And then step five you closethe deal and analyzing the deal.
And then step five you closethe deal.
You get them to sign thecontract and agree to a price.
That is the closer's formulaskeleton.
You have to treat that leadlike gold.
(08:44):
When that lead comes in, youget on the phone and you solve
that seller's problem.
Now step six inside the closer'sformula, we talked about
comping and underwriting thedeal.
We refer to this as the webwherein buyers buy.
When you're on the phone withthe seller, they give you the
address and the first thingyou're going to do is drop it
(09:05):
into Google Street View and lookaround the neighborhood and ask
yourself if I were to live atthis house, is there any reason
why I would not want to own thisproperty Could be across from a
gas station or a busy road neara commercial airport jail
something that would diminishthe value based on location.
And once you've identifiedthere's nothing wrong with the
(09:28):
location, you're going to dropthat address into your comping
software.
And yes, you do need compingsoftware.
We do not comp on Zillow, wedon't comp on Redfin.
You need to invest in yourbusiness.
The comping softwares that weuse are PropStream and Privy.
Now, when you're comping, thefirst layer is understanding
(09:49):
what neighborhood is this inIdentify the price point.
If the seller says they want$100,000, what I want to see is
is there a $0 to $50,000neighborhood or a $50 to
$100,000 neighborhood, a$100,000 to $200,000
neighborhood?
Where are the vast majority ofproperties selling in this
(10:10):
neighborhood?
If I'm on the phone with aseller and they say they want
$100,000, I really hope this isa $200,000 neighborhood.
Otherwise the price is probablygoing to be pretty
significantly off from us buyingthis as a wholesale deal.
Now I'm going to be diving intothe comps and trying to put a
rough after repair value number.
(10:31):
The after repair value is howmuch the house will be worth
once it's fixed up.
I'm looking for what is thesquare footage, bedroom count,
bathroom count, year built andlot size.
Those are the five things I payattention to.
I start with square footage.
My house is 1,500 square feet.
Do I have other properties thatare 1,500 square foot comps?
(10:53):
Do I have other properties thatare 1,500 square foot comps?
My house is a three bed, twobath.
Are those 1,500 foot housesthree bed, two baths as well?
What is my year built?
1979.
Do I have a 1979 build?
What's the lot square footage?
Is it 10,000 square feet?
Is it 25,000 square feet?
(11:13):
Do I have a similar size lot?
These do not have to be exact,but they need to be close in the
range.
I always like to compare applesto apples.
I want to find another houseexactly like this Same size,
same bedroom, bath, same yearbuilt and same lot size.
Once I've identified that, Ilook at the price in which
(11:36):
they've sold.
I look at the lowest first.
Why did this sell for so low?
Is it a tear down?
Is it in horrible shape or isit in pretty decent shape?
And next I go to the highestcomp and compare the difference.
Is this completely remodeled?
Is everything brand new?
Is it beautiful?
Is it flipped?
(11:56):
Is that why it sold for so much.
This is what I'm really tryingto identify and I go through the
comps and I look at thepictures.
Once I've identified my afterrepair value, comping is done.
But now we have to move on tounderwriting.
We're going to take that afterrepair value and plug it into
our profit calculator, whichautomatically calculates holding
(12:18):
costs and closing costs.
What's the only other number?
We need Repairs.
Now how do we do that?
Sitting at our desk here inFort Worth, texas, come up with
an after repair value in Phoenix, texas, or Phoenix, texas,
phoenix, arizona, and then comeup with the repairs.
Well, we do that by asking goodquestions.
I don't want you to ask whenwas the last time the roof was
(12:41):
replaced, because if they saytwo years ago, it doesn't really
give us the answer.
Not if it's in Dallas, texas,or Phoenix, arizona, where you
can have hailstorms andwindstorms and tornadoes in the
past two years.
Instead, ask questions like ifwe were to fix up the property,
what do you know needs to bedone?
(13:02):
You can fix up the property andsell it for maximum value.
What do you know needs to bedone?
The sellers will open up andstart thinking about everything
that needs to be done to theproperty and this is how you
find out more about thecondition.
What we're doing here isdetermining where would an end
buyer buy this property.
We're going to say the propertycould be worth $200,000 fixed.
(13:25):
It's going to calculate holdingand closing costs and then
we're going to say it's 1,500square feet, needs cosmetic
updates, so it needs $40,000 to$45,000 in work.
From there we probably need tobe somewhere in the $85,000 to
$90,000 range.
That's going to include ourwholesale fee, their profit,
(13:46):
their holding costs, theirclosing costs, the rehab and
what they can sell it for.
All right, let's move on to stepseven, which is the contract.
Now we have a simple two-pagecontract that we use across the
country.
The contract is super easy tofill out.
It's like seven or eightfill-in-the-blanks to fill out.
It's like seven or eight fillin the blanks Seller, buyer,
(14:07):
address, legal description,price, title, company, what
state you're doing the deal inand the date You're going to
fill that out.
Put it in e-signature softwarelike DocuSign, dropbox, sign,
pandadoc, whatever you want touse, and you send it to the
seller via email to get them tosign it.
If you're on the phone with theseller and they're available to
(14:28):
read that contract with you onthe phone.
You absolutely do that.
You want to walk them throughthe contract and make sure you
can answer any questions theyhave about the contract right
then and there.
Now, step eight is openingescrow with title.
The moment that they sign thecontract, you move on to opening
escrow with title.
Whether that's a title companyor a closing attorney, different
(14:52):
states have different rules.
Once you get that signedcontract, you're going to open
up escrow with the title companyor closing attorney by emailing
it over and asking them to pulla title commitment on the
property, and this is whereyou're going to find out if
there's any liens on theproperty mortgages, judgments,
encumbrances, anything that canhinder this deal from closing
(15:12):
and anything that needs to bepaid off from the closing
proceeds.
It's also going to verify thatthe person you're talking to is
the actual seller that can sellyou the property.
You always go through title andyou're always going to want
your end buyers to get titleinsurance.
When you open title, you makeyour earnest money deposit as
(15:33):
well.
Our earnest money depositnormally is somewhere in the
range of $10 to $100 percontract across the country.
Of course, that could be more,depending upon the price point.
This earnest money is ourconsideration, our financial
consideration to making this alegally binding contract and our
good faith payment down.
It is refundable per ourcontract through the terms.
(15:58):
Step nine recon on the property.
Now that we have a signedcontract from a motivated seller
, we have to do recon on theproperty.
We have to put together ourmarketing package for our end
buyers so we can turn the lightson for them and show them why
they would want to be the endbuyer for this property.
Now, how are we going to dothis?
I'm here in Fort Worth.
(16:18):
I never go see the property andI'm buying a property in
Phoenix, arizona.
How am I going to do that?
Well, number one, the easiestsolution is ask the seller.
How am I going to do that?
Well, number one, the easiestsolution is ask the seller.
They will send you pictures ofthe property and we have a
checklist that we use.
That we send the seller and wesay we need a picture of every
exterior wall and we need apicture of every interior room
(16:39):
and walk through the rooms.
This lets us know what's goingon with the property.
They don't have to beprofessional photos.
Nowadays our phone cameras arebetter than most cameras that
you can buy anyways.
If the seller cannot do it, thenext step is you go to your best
known buyers in the area andgive them first right of refusal
(16:59):
to go out and view the property.
If they want it, they can haveit.
If they don't want it, at leastgive me the pictures.
And the next thing you do ishire a company like Investor
Boots.
Investor Boots will go out andthey'll get contracts signed for
you.
They'll get things notarizedfor you, but they will also take
pictures.
The other solution is you couldhire a handyman.
(17:20):
Handymen love to do this andthey're a hell of a lot cheaper
than photographers.
And the reason why I lovehandymen is because you'll say
hey, can you find the thingsthat are wrong with the property
, things that would need to befixed up, if you were to go out
and be the one that fixed thisproperty up and they'll take
those pictures for you, whereasa photographer normally wants to
(17:41):
avoid the ugly stuff.
But as a wholesaler, we need toknow everything about the
property.
We need to show that to our endbuyers.
Now that we have pictures, wemove on to step 10, which is the
marketing package for our endbuyers.
We get the pictures back andnow we put together our
marketing package for thosebuyers.
We'll put all of our picturestogether, write up a description
(18:05):
as to why this is a goodproperty for them to purchase as
a flip or rental, and breakdown all of the numbers for them
.
And then we're going to moveinto dispositions, which is step
11.
Dispositions is where you'regoing to do the marketing of
your equitable interest in thiscontract to your end buyers.
To assign your rights to thatcontract to them, your end
(18:28):
buyers to assign your rights tothat contract to them.
You're basically going to besaying, hey, for $10,000,
$15,000, $20,000, whatever yourassignment fee is, you can have
my equitable interest in thisproperty.
And here's what's going on withit.
Here's the pictures, here's allthe description.
This position gets forgottenabout and, with the amount of
technology that we have nowadays, acquisitions has gotten so
easy.
Your ability to comp andunderwrite across the country
(18:50):
has gotten so easy thatdispositions is now where it's
at.
If you can disavow propertiesand you know how to talk to
buyers, you know how to buildrelationships with them, you can
do it anywhere in the country.
This is the key to virtualwholesaling in 2025.
Country this is the key tovirtual wholesaling in 2025.
There's tools out there likeInvestorLift, dealspeed,
(19:15):
investorbase your ability to domarketing to your end buyers and
have that conversation.
You need to have a formula onhow to talk to them, just like
we have a formula on how to talkto motivated sellers.
Step 12 is assignment ofcontract.
Once you've identified yourbuyer and they say, okay, you've
got it under contract for$100,000.
I'm selling it for $110,000.
So I'm trying to make a $10,000assignment fee, they say I'll
(19:39):
take it.
You have to have yourassignment of contract.
This is a separate form fromyour contract and it was saying
you're assigning it to that endbuyer for this fee, your
equitable interest in thatproperty.
Once that is signed, you sendthat off to the title company
and then they are required tomake whatever earnest money
deposit that you put on thatassignment of contract.
(20:01):
For us, unless it's a superlow-end property or super
high-end property, it's almostalways $5,000 non-refundable
earnest money.
Now step 13 is where everyone'seyes start to glaze over and
that's with transactioncoordination.
Transaction coordination reallystarts the moment that you get
(20:21):
the signed contract from theseller and that's when we send
it off to the title company,making sure that your earnest
money is deposited, making sureyou get a title commitment back
and making sure that anythingthat shows up on the title
commitment gets cleared prior toclosing.
The title company is not goingto make sure the title gets
cleared.
You're going to have to makesure that those actions get
(20:43):
taken.
There's going to be times whereyou're going to have to be the
one calling the seller, gettingthem to maybe do an affidavit of
airship or something like that.
The title company will tell youwhat is needed, but you have to
make sure that you areprioritizing your deal over
everybody else's.
One of the best ways to do thisand I recommend this for
(21:04):
everyone is don't be atransaction coordinator in your
business.
There are transactioncoordinators that do this for a
living and they are experts.
Outsort this, delegate it Forus.
We use easy REI closings.
They're going to make sure thatyour deal is handled with care,
because that is their job.
That is how you get paid andmaking sure that your deal gets
(21:27):
closed.
Step 14 is closing.
If it's an assignment, nothingreally happens for you.
You just send off your wiringinstructions and say send me a
check.
We get everything wired at thispoint and closing is super
simple.
You need to make sure that yourbuyer and your seller get
scheduled.
You need to make sure that thetitle company is good and that
(21:49):
they have your wiringinstructions and make sure that
they understand how to get youyour money.
Make sure that you communicatewith them throughout the day hey
, is the buyer showing up, isthe seller scheduled?
And once that is done, you getyour money.
It's over.
The final step step 15, isfollow up with your buyer and
your seller.
Once it's over, pick up thatphone, congratulate the buyer
(22:13):
and seller and say hey,congratulations, you got rid of
that deal or you bought thatdeal.
It was beautiful working withyou.
You want to shoot me a videoand give me a testimonial.
Take care of your buyers andsellers and they'll take care of
you, and that's wholesalingfrom a to z.
We just do that over and overagain.
Now, what can you outsource andwhat must you do?
(22:35):
I'll be honest with you.
We've gotten to the point wherethe vast majority of things
that I just told you throughoutthe process, somebody else is
doing.
Do I create an entity?
No.
Do I generate leads?
No, I buy those from otherpeople.
Speed to lead, lead, soloproperty leads, acquiring deals.
We do that internally but I'vegot a team that sits right here
(22:58):
in this office and they acquiredeals using the closers formula
all day, every day.
They comp and they underwriteand they get the contract signed
.
We send it off to the titlecompany.
We're not a title company.
Title company takes care ofthat Recon.
We make the phone calls and getthe recon done.
Someone else does the recon forus Dispo.
(23:19):
Well, we've got the systems andwe send the assignment of
contract.
Someone else does the TC andsomeone else does the closing,
the assignment of contract.
Someone else does the TC andsomeone else does the closing.
The vast majority of what we aredoing when I talk about being a
virtual wholesaler, getsnarrowed down to acquisitions
and dispositions because you canpretty much outsource
everything else to someone else.
(23:40):
The core of what you have tohave is you have to have leads
and then you've got to be greatat closing them.
You got to get great atassigning them and then you
outsource the TC, your abilityto pick up the phone and have a
conversation with another humanbeing about why you could buy
their house and then to your endbuyer on why they should be the
(24:01):
end buyer for that property.
If you can do that, you cancreate your own reality with
virtual wholesaling.
That's it, just those 15 steps.
It's as simple as that.
That is virtual wholesalingfrom A to Z.
What's up everybody.
Welcome to Virtual Wholesalingfrom A to Z.
I'm going to be breaking downthe complete process today so
you understand exactly whatvirtual wholesaling is and can
decide if that is what you wantto do inside of your business.
Our team has done over 2,000deals in all 50 states over the
past decade using this exactprocess.
(00:29):
Today's goal is to give you acomplete overview.
Now we're not going to bestopping at any destinations,
we're just going to be givingyou the roadmap of what it is.
Now, before we dive in, let meexplain our H hedgehog concept.
We are a nationwide virtualwholesaler.
That's it.
Anything that doesn't fitinside of that scope gets a no.
(00:50):
This eliminates all of theshiny objects that exist in the
real estate investing world andit's easy for us to say no to
flips, novations, buyingproperty subject to and things
like that.
All right, let's get into it.
Step one define virtualwholesaling and why there's
money to be made Virtualwholesaling.
(01:11):
What makes this virtual is thatyou never leave your office,
you never leave your house.
You do everything virtuallyfrom your desk and on the phone.
We're not going to physicallyvisit properties and we're not
going to want the propertiesourselves.
Every property that we contract.
We never go see them, we neverlay foot in those properties
whatsoever.
(01:32):
In the wholesaling side,wholesaling is when you contract
the property and then you'reselling your equitable interest
in that contract for a fee.
You're not selling the propertyitself.
So we talk to a seller, wecontract the property for
$100,000, and then we turnaround and we will assign our
(01:53):
rights to the buyer for a fee.
So I say, hey, for $110,000,you can have my equitable
interest.
They buy the property for$100,000 and I get the $10,000
difference.
The other way you could do thisis called a double close, but
we've pretty much moved awayfrom double closes.
Almost all of our deals areassignments only.
(02:17):
Step two do you need an entityto virtual wholesale?
The answer is no, you don'tneed an entity.
You could absolutely contract aproperty in your personal name
and assign your rights to an endbuyer and receive your wire or
check directly to your personalname.
However, I will say there is abenefit to creating an entity
(02:37):
and having that protection.
If, for whatever reason, youwere to get sued or there was
some sort of liability, thatcomes back on you.
You're protected and they can'tcome after your personal assets
.
There's also a certain level offinancial commitment that
you're making to yourself.
It's almost a mental commitmentthat you're saying, hey, I'm
going to take this serious, I'mgoing to be a business, I'm
(03:00):
creating entity to get thisstarted.
Now, if you don't have thecouple hundred dollars to create
the entity, you're probablygoing to be running into some
issues when it comes to virtualwholesaling, because it does
require operating capital.
This is not the free way to doreal estate investing.
It does require money to dolead generation and buy systems.
(03:21):
Step three what is a motivatedseller?
The first thing we need to dois locate a motivated seller
that's willing to sell theirproperty for a discount.
If you're brand new, you'relike well, what does that mean?
Because isn't every sellermotivated to sell their property
?
Of course, but that doesn'tnecessarily mean that they're
motivated to sell it for adiscount.
(03:42):
There are two core fundamentalreasons why a seller is
motivated to sell sell it for adiscount.
There are two core fundamentalreasons why a seller is
motivated to sell their propertyfor a discount.
Number one is financialdistress.
There's financial distressfactors saying, hey, I need to
quickly and efficiently sellthis property and so I'm willing
to sell it at a discountbecause, financially, I need to
sell this piece of real estate.
(04:02):
That's pre-foreclosure tax,delinquency liens, bankruptcy
judgment, loss of job, healthissues, inherited a property
that has a mortgage on it andthey can't afford it.
The next thing is physicaldistress.
This is where the property hasnot been remodeled in decades.
Or maybe there's a structuralissue or system issues where AC
(04:23):
doesn't work, roof doesn't work,foundation problems, maybe it
has tenants inside and it's atenant-occupied property and the
tenants devastated anddestroyed the property while
living in it.
We've even had animals catsdestroyed a property with pee
and poop, vultures overtook aproperty, beehives created
inside of a wall and destroyedthe entryway.
(04:44):
Those are the two ways thatreally lead to a seller becoming
motivated to sell for adiscount.
The reason why motivation is soimportant is because that's
where you're going to want tounderstand why the seller is
wanting to sell this piece ofreal estate for a discount.
If they're not motivated, thenwe're probably not their best
(05:04):
solution.
That's what realtors exist for.
Step four lead generation.
Lead generation is themarketing that you're going to
do as a wholesaler to turn thelights on to these motivated
sellers and let them know thatyour company exists, contrary to
what we believe the vastmajority of people don't know
(05:25):
what a wholesaler is or how tocontact a real estate investor.
When they go to sell theirhouse, they're thinking about
contacting a realtor and goingto Zillow and maybe listing it
themselves for sell-by-owner.
They don't know that we exist,so we have to be great at
marketing.
Here's how we do that.
One thing you can do is you canpull lists on places like Batch
(05:46):
Leads, propstream, listsource,and you can pull from motivating
factors like pre-foreclosure,tax, delinquency, vacancy,
bankruptcies, expired listings,and you can skip trace it and
that means you're getting theirphone number and then call them.
You can also send direct mailto that data, send them a
postcard or letter saying, hey,I buy houses.
(06:09):
Now, the thing that I love thatexists today is buying inbound
leads.
Now you can run your owncampaigns on social media
Facebook ads, instagram ads,youtube, google, pay-per-click
and they search need to sell myhouse fast, fort Worth, texas.
Your ad pops up, it takes themto a landing page and they fill
out the form and it comes to youand you call.
(06:29):
But then there are companiesout there like Speed to Lead,
leadzolo Property Leads thatwill generate these leads for
you and sell you the lead that'scalled paper lead.
Instead of running your owncampaigns, you just swipe your
card.
Property Leads charges like $30for nationwide exclusive leads.
Boom, it comes to you.
(06:50):
You call them 10 seconds afterthey fill out the form.
You have to have this.
Without leads, you can't reallydo anything else.
This is the foundation for yourvirtual wholesaling business.
Now the heartbeat is step fiveacquisitions.
Specifically using the closersformula, you generate the lead.
(07:11):
The motivated seller comes toyou and says I want to sell my
house.
Now you've got to be able toacquire the deal.
You've got to get great atbeing able to have
human-to-human interaction onthe phone to solve their problem
by buying their real estate.
Now here's the steps.
You call the seller.
Hey, mr Seller, this is RJBates.
(07:33):
Are you still looking to sell123 Main Street?
Yes, that's step one.
Verify that they want to sell.
Step two Awesome.
How much are you looking to getfor it?
Ask them their asking price.
How much do they want for it?
They're the seller, we're thebuyer.
Ask them how much they want.
Everywhere else in the world,when you go buy something,
(08:02):
there's a price tag.
It's the same thing here.
Step three open-ended questions.
Tell me a little bit about whatyou got going on.
This opens it up to let themtalk about the most important
thing to them.
You didn't ask them about thecondition, you didn't ask about
the timeline and you didn't askabout occupancy.
You just said tell me what yougot going on.
This allows them to open up andtell you their whole story.
(08:23):
From there you're going tocontinue to ask open-ended
questions while you're doingstep four, which is comping and
underwriting and analyzing thedeal.
And then step five you closethe deal and analyzing the deal.
And then step five you closethe deal.
You get them to sign thecontract and agree to a price.
That is the closer's formulaskeleton.
You have to treat that leadlike gold.
(08:44):
When that lead comes in, youget on the phone and you solve
that seller's problem.
Now step six inside the closer'sformula, we talked about
comping and underwriting thedeal.
We refer to this as the webwherein buyers buy.
When you're on the phone withthe seller, they give you the
address and the first thingyou're going to do is drop it
(09:05):
into Google Street View and lookaround the neighborhood and ask
yourself if I were to live atthis house, is there any reason
why I would not want to own thisproperty Could be across from a
gas station or a busy road neara commercial airport jail
something that would diminishthe value based on location.
And once you've identifiedthere's nothing wrong with the
(09:28):
location, you're going to dropthat address into your comping
software.
And yes, you do need compingsoftware.
We do not comp on Zillow, wedon't comp on Redfin.
You need to invest in yourbusiness.
The comping softwares that weuse are PropStream and Privy.
Now, when you're comping, thefirst layer is understanding
(09:49):
what neighborhood is this inIdentify the price point.
If the seller says they want$100,000, what I want to see is
is there a $0 to $50,000neighborhood or a $50 to
$100,000 neighborhood, a$100,000 to $200,000
neighborhood?
Where are the vast majority ofproperties selling in this
(10:10):
neighborhood?
If I'm on the phone with aseller and they say they want
$100,000, I really hope this isa $200,000 neighborhood.
Otherwise the price is probablygoing to be pretty
significantly off from us buyingthis as a wholesale deal.
Now I'm going to be diving intothe comps and trying to put a
rough after repair value number.
(10:31):
The after repair value is howmuch the house will be worth
once it's fixed up.
I'm looking for what is thesquare footage, bedroom count,
bathroom count, year built andlot size.
Those are the five things I payattention to.
I start with square footage.
My house is 1,500 square feet.
Do I have other properties thatare 1,500 square foot comps?
(10:53):
Do I have other properties thatare 1,500 square foot comps?
My house is a three bed, twobath.
Are those 1,500 foot housesthree bed, two baths as well?
What is my year built?
1979.
Do I have a 1979 build?
What's the lot square footage?
Is it 10,000 square feet?
Is it 25,000 square feet?
(11:13):
Do I have a similar size lot?
These do not have to be exact,but they need to be close in the
range.
I always like to compare applesto apples.
I want to find another houseexactly like this Same size,
same bedroom, bath, same yearbuilt and same lot size.
Once I've identified that, Ilook at the price in which
(11:36):
they've sold.
I look at the lowest first.
Why did this sell for so low?
Is it a tear down?
Is it in horrible shape or isit in pretty decent shape?
And next I go to the highestcomp and compare the difference.
Is this completely remodeled?
Is everything brand new?
Is it beautiful?
Is it flipped?
(11:56):
Is that why it sold for so much.
This is what I'm really tryingto identify and I go through the
comps and I look at thepictures.
Once I've identified my afterrepair value, comping is done.
But now we have to move on tounderwriting.
We're going to take that afterrepair value and plug it into
our profit calculator, whichautomatically calculates holding
(12:18):
costs and closing costs.
What's the only other number?
We need Repairs.
Now how do we do that?
Sitting at our desk here inFort Worth, texas, come up with
an after repair value in Phoenix, texas, or Phoenix, texas,
phoenix, arizona, and then comeup with the repairs.
Well, we do that by asking goodquestions.
I don't want you to ask whenwas the last time the roof was
(12:41):
replaced, because if they saytwo years ago, it doesn't really
give us the answer.
Not if it's in Dallas, texas,or Phoenix, arizona, where you
can have hailstorms andwindstorms and tornadoes in the
past two years.
Instead, ask questions like ifwe were to fix up the property,
what do you know needs to bedone?
(13:02):
You can fix up the property andsell it for maximum value.
What do you know needs to bedone?
The sellers will open up andstart thinking about everything
that needs to be done to theproperty and this is how you
find out more about thecondition.
What we're doing here isdetermining where would an end
buyer buy this property.
We're going to say the propertycould be worth $200,000 fixed.
(13:25):
It's going to calculate holdingand closing costs and then
we're going to say it's 1,500square feet, needs cosmetic
updates, so it needs $40,000 to$45,000 in work.
From there we probably need tobe somewhere in the $85,000 to
$90,000 range.
That's going to include ourwholesale fee, their profit,
(13:46):
their holding costs, theirclosing costs, the rehab and
what they can sell it for.
All right, let's move on to stepseven, which is the contract.
Now we have a simple two-pagecontract that we use across the
country.
The contract is super easy tofill out.
It's like seven or eightfill-in-the-blanks to fill out.
It's like seven or eight fillin the blanks Seller, buyer,
(14:07):
address, legal description,price, title, company, what
state you're doing the deal inand the date You're going to
fill that out.
Put it in e-signature softwarelike DocuSign, dropbox, sign,
pandadoc, whatever you want touse, and you send it to the
seller via email to get them tosign it.
If you're on the phone with theseller and they're available to
(14:28):
read that contract with you onthe phone.
You absolutely do that.
You want to walk them throughthe contract and make sure you
can answer any questions theyhave about the contract right
then and there.
Now, step eight is openingescrow with title.
The moment that they sign thecontract, you move on to opening
escrow with title.
Whether that's a title companyor a closing attorney, different
(14:52):
states have different rules.
Once you get that signedcontract, you're going to open
up escrow with the title companyor closing attorney by emailing
it over and asking them to pulla title commitment on the
property, and this is whereyou're going to find out if
there's any liens on theproperty mortgages, judgments,
encumbrances, anything that canhinder this deal from closing
(15:12):
and anything that needs to bepaid off from the closing
proceeds.
It's also going to verify thatthe person you're talking to is
the actual seller that can sellyou the property.
You always go through title andyou're always going to want
your end buyers to get titleinsurance.
When you open title, you makeyour earnest money deposit as
(15:33):
well.
Our earnest money depositnormally is somewhere in the
range of $10 to $100 percontract across the country.
Of course, that could be more,depending upon the price point.
This earnest money is ourconsideration, our financial
consideration to making this alegally binding contract and our
good faith payment down.
It is refundable per ourcontract through the terms.
(15:58):
Step nine recon on the property.
Now that we have a signedcontract from a motivated seller
, we have to do recon on theproperty.
We have to put together ourmarketing package for our end
buyers so we can turn the lightson for them and show them why
they would want to be the endbuyer for this property.
Now, how are we going to dothis?
I'm here in Fort Worth.
(16:18):
I never go see the property andI'm buying a property in
Phoenix, arizona.
How am I going to do that?
Well, number one, the easiestsolution is ask the seller.
How am I going to do that?
Well, number one, the easiestsolution is ask the seller.
They will send you pictures ofthe property and we have a
checklist that we use.
That we send the seller and wesay we need a picture of every
exterior wall and we need apicture of every interior room
(16:39):
and walk through the rooms.
This lets us know what's goingon with the property.
They don't have to beprofessional photos.
Nowadays our phone cameras arebetter than most cameras that
you can buy anyways.
If the seller cannot do it, thenext step is you go to your best
known buyers in the area andgive them first right of refusal
(16:59):
to go out and view the property.
If they want it, they can haveit.
If they don't want it, at leastgive me the pictures.
And the next thing you do ishire a company like Investor
Boots.
Investor Boots will go out andthey'll get contracts signed for
you.
They'll get things notarizedfor you, but they will also take
pictures.
The other solution is you couldhire a handyman.
(17:20):
Handymen love to do this andthey're a hell of a lot cheaper
than photographers.
And the reason why I lovehandymen is because you'll say
hey, can you find the thingsthat are wrong with the property
, things that would need to befixed up, if you were to go out
and be the one that fixed thisproperty up and they'll take
those pictures for you, whereasa photographer normally wants to
(17:41):
avoid the ugly stuff.
But as a wholesaler, we need toknow everything about the
property.
We need to show that to our endbuyers.
Now that we have pictures, wemove on to step 10, which is the
marketing package for our endbuyers.
We get the pictures back andnow we put together our
marketing package for thosebuyers.
We'll put all of our picturestogether, write up a description
(18:05):
as to why this is a goodproperty for them to purchase as
a flip or rental, and breakdown all of the numbers for them
.
And then we're going to moveinto dispositions, which is step
11.
Dispositions is where you'regoing to do the marketing of
your equitable interest in thiscontract to your end buyers.
To assign your rights to thatcontract to them, your end
(18:28):
buyers to assign your rights tothat contract to them.
You're basically going to besaying, hey, for $10,000,
$15,000, $20,000, whatever yourassignment fee is, you can have
my equitable interest in thisproperty.
And here's what's going on withit.
Here's the pictures, here's allthe description.
This position gets forgottenabout and, with the amount of
technology that we have nowadays, acquisitions has gotten so
easy.
Your ability to comp andunderwrite across the country
(18:50):
has gotten so easy thatdispositions is now where it's
at.
If you can disavow propertiesand you know how to talk to
buyers, you know how to buildrelationships with them, you can
do it anywhere in the country.
This is the key to virtualwholesaling in 2025.
Country this is the key tovirtual wholesaling in 2025.
There's tools out there likeInvestorLift, dealspeed,
(19:15):
investorbase your ability to domarketing to your end buyers and
have that conversation.
You need to have a formula onhow to talk to them, just like
we have a formula on how to talkto motivated sellers.
Step 12 is assignment ofcontract.
Once you've identified yourbuyer and they say, okay, you've
got it under contract for$100,000.
I'm selling it for $110,000.
So I'm trying to make a $10,000assignment fee, they say I'll
(19:39):
take it.
You have to have yourassignment of contract.
This is a separate form fromyour contract and it was saying
you're assigning it to that endbuyer for this fee, your
equitable interest in thatproperty.
Once that is signed, you sendthat off to the title company
and then they are required tomake whatever earnest money
deposit that you put on thatassignment of contract.
(20:01):
For us, unless it's a superlow-end property or super
high-end property, it's almostalways $5,000 non-refundable
earnest money.
Now step 13 is where everyone'seyes start to glaze over and
that's with transactioncoordination.
Transaction coordination reallystarts the moment that you get
(20:21):
the signed contract from theseller and that's when we send
it off to the title company,making sure that your earnest
money is deposited, making sureyou get a title commitment back
and making sure that anythingthat shows up on the title
commitment gets cleared prior toclosing.
The title company is not goingto make sure the title gets
cleared.
You're going to have to makesure that those actions get
(20:43):
taken.
There's going to be times whereyou're going to have to be the
one calling the seller, gettingthem to maybe do an affidavit of
airship or something like that.
The title company will tell youwhat is needed, but you have to
make sure that you areprioritizing your deal over
everybody else's.
One of the best ways to do thisand I recommend this for
(21:04):
everyone is don't be atransaction coordinator in your
business.
There are transactioncoordinators that do this for a
living and they are experts.
Outsort this, delegate it Forus.
We use easy REI closings.
They're going to make sure thatyour deal is handled with care,
because that is their job.
That is how you get paid andmaking sure that your deal gets
(21:27):
closed.
Step 14 is closing.
If it's an assignment, nothingreally happens for you.
You just send off your wiringinstructions and say send me a
check.
We get everything wired at thispoint and closing is super
simple.
You need to make sure that yourbuyer and your seller get
scheduled.
You need to make sure that thetitle company is good and that
(21:49):
they have your wiringinstructions and make sure that
they understand how to get youyour money.
Make sure that you communicatewith them throughout the day hey
, is the buyer showing up, isthe seller scheduled?
And once that is done, you getyour money.
It's over.
The final step step 15, isfollow up with your buyer and
your seller.
Once it's over, pick up thatphone, congratulate the buyer
(22:13):
and seller and say hey,congratulations, you got rid of
that deal or you bought thatdeal.
It was beautiful working withyou.
You want to shoot me a videoand give me a testimonial.
Take care of your buyers andsellers and they'll take care of
you, and that's wholesalingfrom a to z.
We just do that over and overagain.
Now, what can you outsource andwhat must you do?
(22:35):
I'll be honest with you.
We've gotten to the point wherethe vast majority of things
that I just told you throughoutthe process, somebody else is
doing.
Do I create an entity?
No.
Do I generate leads?
No, I buy those from otherpeople.
Speed to lead, lead, soloproperty leads, acquiring deals.
We do that internally but I'vegot a team that sits right here
(22:58):
in this office and they acquiredeals using the closers formula
all day, every day.
They comp and they underwriteand they get the contract signed
.
We send it off to the titlecompany.
We're not a title company.
Title company takes care ofthat Recon.
We make the phone calls and getthe recon done.
Someone else does the recon forus Dispo.
(23:19):
Well, we've got the systems andwe send the assignment of
contract.
Someone else does the TC andsomeone else does the closing,
the assignment of contract.
Someone else does the TC andsomeone else does the closing.
The vast majority of what we aredoing when I talk about being a
virtual wholesaler, getsnarrowed down to acquisitions
and dispositions because you canpretty much outsource
everything else to someone else.
(23:40):
The core of what you have tohave is you have to have leads
and then you've got to be greatat closing them.
You got to get great atassigning them and then you
outsource the TC, your abilityto pick up the phone and have a
conversation with another humanbeing about why you could buy
their house and then to your endbuyer on why they should be the
(24:01):
end buyer for that property.
If you can do that, you cancreate your own reality with
virtual wholesaling.
That's it, just those 15 steps.
It's as simple as that.
That is virtual wholesalingfrom A to Z.
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