JF1525: Leverage A Mentor & Scale Faster with Dakarai Towns

Listen to the Episode Below (30:21)
Join + receive...
Best Real Estate Investing Crash Course Ever!

Dakarai had done a couple of wholesale deals on his own and more with a mentor. He was able to partner with someone with more experience, learn the ropes, and build his own business while in school full time as well. We’ll hear breakdowns of some of his best deals and how he made them happen, as well as how he was able to work with a mentor. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!

 

Best Ever Tweet:

 

Dakarai Towns Real Estate Background:


Get more real estate investing tips every week by subscribing for our newsletter at BestEverNewsLetter.com


Best Ever Listeners:

Do you need debt, equity, or a loan guarantor for your deals?

Eastern Union Funding and Arbor Realty Trust are the companies to talk to, specifically Marc Belsky.

I have used him for both agency debt, help with the equity raise, and my consulting clients have successfully closed deals with Marc’s help. See how Marc can help you by calling him at 212-897-9875 or emailing him mbelsky@easterneq.com


TRANSCRIPTION

Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless, and this is the world’s longest-running daily real estate investing podcast. We only talk about the best advice ever, we don’t get into any of that fluffy stuff. With us today, Dakarai Towns. How are you doing, Dakarai?

Dakarai Towns: I’m doing great, Joe. Thank you for having me again, and hello to all the Best Ever listeners.

Joe Fairless: Well, I’m glad to hear it, and you’re more than welcome. I’m looking forward to learning from you and learning about what you’ve got going on. A little it about Dakarai – he is a 24-year-old senior and real estate investing entrepreneur. He’s been working in real estate for two years while getting his BA in interdisciplinary studies. He has done a couple deals independently, and then he has partnered up with a mentor and done many more. He’s based in Columbia, South Carolina. With that being said, Dakarai, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?

Dakarai Towns: Sure. A little bit about me – I’ve been in real estate for two years, as you’ve said before, and I started wholesaling real estate and single-family homes. I did a few single-family home wholesales, and I just started to see that my time could be probably spent a lot more into bigger deals, so that’s when I discovered apartments, and I wanted to wholesaling and apartments and combine those strategies together. Then I also discovered apartment syndicating.

Joe Fairless: Okay. So the two deals that you did, those were single-family homes. How many additional deals have you done with your mentor?

Dakarai Towns: We did about ten deals, and basically it was him showing me the ropes, showing me how to calculate deals, how to look at the rehab and give good numbers upfront, before ever sending it out to anybody, and just making sure that they made sense. That’s how that went.

Joe Fairless: Were those single-family as well?

Dakarai Towns: Correct.

Joe Fairless: Okay. It sounds like you are no longer focused on single-family, because you said you were wanting to do larger deals… Or did I misinterpret that?

Dakarai Towns: Well, yes, I am currently taking some time to study the multifamily deals, but I am doing single-family on the side still, so when they come about and if I have a deal, I don’t do it as aggressive. But if I do see some potential deal, then I would still stop by and get some contact information and try to make something out of it.

Joe Fairless: Alright, let’s talk about the two deals you did on your own. Can you tell us about each of them?

Dakarai Towns: Sure. Those were really impactful deals experience-wise, I would say, just because prior to those two deals I looked at probably close to 15-30 homes almost, and the majority of them fell through, but that was just walking and trying to get the experience all I could; I just had to get out in the field.

For the first deal – it was actually a deal out here in Rosewood; it’s a popular area here in Columbia, South Carolina, and it was something that I came across through Craigslist and looking through a few platforms that I used, or free leads. As I came across the deal, I contacted the owner, and he said “Hey, I just wanted to see how this would work”, and I was very transparent with him… I let him know how wholesaling worked, and who would be helping me into closing the deal, and he said “Okay, great. As long as we get it done, I’m fine with it”, and I said, “Okay, great.”

It took about a month and a half, because there were some discrepancies and some smaller things that we encountered during the due diligence…

Joe Fairless: Like what?

Dakarai Towns: There used to be termites in the wall, and they had a whole termite situation on this entire wall next to one of the main bedrooms… So we said, “Alright, we’ll really have to get someone out here for a termite inspection of that nature”, and basically learning how to get all the facts first, and being able to come up with a solution… He was like, “Okay, I’m all for it. Let’s do it.”

One of my buyers that I presented the deal to, he actually sent out a few inspectors, and I actually had another close inspector of mine come through and look at it… They said, “Yeah, this would be done in XYZ.” Down the line we found out that it did have some minor foundation problems, so bringing all those facts in together, I presented it back to the seller to let them know “Hey, this is not gonna be a great deal unless we are at this price point”, just because of the foundation repairs, and that whole wall needed to be taken down and rebuilt, and it was gonna hit my buyer’s pocket pretty hefty.

That deal – I made about, let’s say, $1,250 on it, and that was the first deal. It was about $1,250.

Joe Fairless: $1,250 or $12,500?

Dakarai Towns: Yeah, $1,250.

Joe Fairless: Okay.

Dakarai Towns: That really humbled me, just because of looking at all the seminars, and watching wholesaling videos…

Joe Fairless: You were supposed to make $20,000 a pop, right?

Dakarai Towns: Yeah. [laughs] I was supposed to make this crazy amount spread, and I’m just like, “Okay… Well, this is great! This is a great profession to be in!” So it was really nice to see the satisfaction from my investor, as well as the seller… Because I found out that the seller was actually moving — during the whole process I found out that they were actually moving to another home in Lexington and they closed on another home that same month, I believe… So everything worked out for them, and then even though they didn’t get what they were asking — they were asking $55,000, so I ended up getting it down to around $28,000.

Joe Fairless: Wow… Holy moly!

Dakarai Towns: Yes, it was a crazy deal… So I was satisfied with that.

Joe Fairless: Wow, so you had it under contract at 55k?

Dakarai Towns: Correct.

Joe Fairless: And then it was renegotiated based on termites and foundation to 28k… Wow. What did they want initially? Or was it 55k initially?

Dakarai Towns: That’s what they wanted initially. I said, “Okay, let’s put it on paper. That’s fine.” I’m all for giving people what they want, but at the same time, when I come and find things that will diminish either profit, or somewhere along the lines of my investor’s pockets when it comes to the rehab, I have to bring the facts in, and they can’t argue with the facts. It’s truth. So when they look at the truth and they’re saying — when you hear those first three words, you’re already like “Okay, great. We got them down.”

It took about two times, because they went down to about 45k at one point, and they ended up coming all the way back down to — oh, I’m sorry, it wasn’t 28k, it was 22k, actually… [laughter] The second deal was 28k.

Joe Fairless: Wow. But they did start at 55k?

Dakarai Towns: They did start at 55k, correct. That is very true.

Joe Fairless: Huh… And when it starts at 55k and then it goes down to 22k, was your fee initially $1,250, or was it a percentage?

Dakarai Towns: No, my fee was initially 5k. That was my fee, and during the conversation between me and the seller as well as me and the investor, they were both giving me very tight numbers. So I did my coming down, because I wanted the deal to work out and I wanted this guy to sell his home, and I wanted my investor to have a good investment property, and this area that it was in — I lucked out and ended up getting a very good property in a very prime area. It’s actually a historic area, and most of those homes around the corner from it go to maybe I would say 150k… So at the end of the day, the owner was like, “Alright, let’s settle on this”, and then my buyer came back and said “Hey, I can only do this”, and I said “Okay, great. Well, that matches up, and that works out for me. It’s $1,250 spread, and it works out, so I’m fine with it.”

Joe Fairless: You said homes sell in that area for much higher… When you got it under contract for 55k, how much did you think it was worth as is?

Dakarai Towns: As is, after I did a little bit of homework, I thought it was worth around 40k-45k. So I was like, “Okay, maybe 55k is good–” because I went back again and I checked my numbers about 3-4 times, and then had one of my agents that I was working with, and she ran comps as well, but sometimes the agents like to do the high-end… So she was giving me comps and telling me “Hey, this could actually sell for around 90k.”

Joe Fairless: Uuh… Jackpot. That’s a big difference from 45k.

Dakarai Towns: Yeah, exactly. [laughs] But that was the great thing though – I was just like, “Well, do you mean 90k at the end as retail?” and she said “Yeah.” I was like, “Okay… Well, it should work out then. If I get it at 55k, it should still work out.” So I ended up getting it at 55k, and jumped it down to about 22k, and once we jumped it down to 22k and [unintelligible [00:11:14].11] my buyers came and picked it up. Once they picked it up, they ended up selling it — and I think they actually sold literally like two weeks ago, for 93k.

Joe Fairless: So she was right!

Dakarai Towns: She was right! [laughs]

Joe Fairless: How much did they put into that puppy?

Dakarai Towns: They put in about 37k for rehab.

Joe Fairless: Okay. Well, I hope they took you out to dinner afterwards.

Dakarai Towns: Yeah… Well, the funny thing too is this investor actually — they’re two guys from Israel, so when they came across one of my ads on Craigslist, they gave me a call, and this was six months before we even closed on any deal. I had no deal under my belt. So these guys were very loyal to me when I had nothing, when I was first starting off. They said, “Hey man, you really sound like you’ve been doing this for a while…” I was like, “No, not really. I’ve been doing this for about a month now.” So they still gave me the chance.

Around six months, that’s when we actually came across the first deal, and we did the whole deal, they liked it, they ended up selling it, and then they actually came to visit Columbia last week and we went out to dinner, went and had some beers and had some dessert, and I took them downtown.

Joe Fairless: Awesome. And they paid, yes?

Dakarai Towns: Yeah, they paid. They had me down. [laughs]

Joe Fairless: Good. What about the second deal?

Dakarai Towns: The second deal is almost the second exact scenario, in a sense. The second deal was in a higher-end area in Columbia; it was a bit North. We contracted it for — it was a 3/2, it was about (I wanna say) 1,200 square feet, and this one wasn’t really a big rehab; it was for a rental, so that’s what I wholesold it as. We got it around 65k, initially…

Joe Fairless: Who’s “we”?

Dakarai Towns: When I say “we”, I’m really referring to my team, but I really was the one who [unintelligible [00:13:02].19] I established a big team and a foundation before actually going on to the second deal. We moved to the second deal about two months after the first one. We ended up contracting the first, 65k initially… And I told him, “Hey, this is too much, because none of my comps are matching up”, the numbers weren’t working out. So he came literally about three weeks later… He called me back, he said “Hey man, I know the other number was pretty high, so how about we do 55k?” I said “Okay, let’s do 55k.” At the time, 55k was around the number I was at for the sale, and I ended up getting the guys out there in literally the same scenario.

We had some due diligence done, we had it contracted, and once the guys came out, they said “Hey man, this would need some repairs for the chimney, and it has some cracks in the walls, paint etc.”, things of that nature. So they’re hitting us with some of these facts, and I just laid the facts down on the owner. He trusted me, and he said “Yeah, man… I feel like you’re a good guy and I feel like you really are being patient with me…” Because at the end of the day, there were so many different schedule modifications, because he had to work, and I’m here, and at another property etc.” So I was really trying to work with him so he can sell his home. And just like the other owner, he had another home he was wanting to close on in another part of Columbia, so he really needed this to sell.

Once we got it contracted and once had due diligence and I was showing him the facts, we ran the number back down, and he said “Okay, how much can we really sell this for?” I said, “Look, there’s not much room because of the repairs, and the rehab is really extensive.” They had a very old kitchen. So what happened was I didn’t end up selling this to an investor, I ended up selling this to a hedge fund actually. So it took them a little minute to really come back with the correct amount that I was actually willing to agree to. They came and bought it for 38k. On that one I made about $7,500.

Joe Fairless: Wow!

Dakarai Towns: Yeah.

Joe Fairless: That’s incredible. That’s great stuff.

Dakarai Towns: Thank you. I couldn’t take no for an answer on that one, because I’d just been working with them for too long for them to not come out on top with it.

Joe Fairless: How long?

Dakarai Towns: It was about a month the first time, just to see if the numbers would work out, and if they were really willing to sell, and they weren’t motivated at the time, so they came back three weeks later… So it took about almost two months to sell this one.

Joe Fairless: You said your team… Who was on your team when you were starting out, and how did you recruit them?

Dakarai Towns: Sure. On my team there was a financial broker, and they actually reached out to me. She basically went to a seminar and learned about how to go about loans, and working with these big groups who would help with financing, and things like that. So I said, “Okay, great. This would be great for some of my investors who don’t actually have all the financing for the deals. They even financed rehabs.” So I said, “Alright, this will be awesome.”

So she also unfortunately couldn’t work physically at a job because she was in a car wreck, so she had all the time in the world to stay at home, be on the computer and actually work on deals. And I said, “Alright, I think that would be a  great partnership, while I’m actually out and I’ll physically look at the properties that you send me.” Basically, she looks at properties, analyzes them and she would send them to me, and I would analyze them again and let her know whether or not it would be a good deal or not. And if it is a good deal, we’ll move on it. And for those two deals that I worked on, I had brought those deals in, but she would continuously shoot me over deals.

Another part of my team was a real estate agent. She was not as versed in the wholesaling strategy, but I ended up explaining it to her, I ended up explaining how we get things done, and she was okay with it; she was great, she was really transparent with me, and really wanted to get things done fast.

How I met her was I was just pretending to be a buyer at one of these homes that I looked at that was actually on the market, and figured out that it wasn’t a good deal, but she ended up staying in contact with me and I told her what kind of deals I was actually looking for. And she said “Oh, wow, we can get those deals all day”, and I said, “Okay, great!”

From there, we just all partnered up and we said “Okay, anything that we make, we pretty much will split it 1/1/1, or we’ll just figure something out at the end of the day”, but we all came into a contract and then made some money along the way.

Joe Fairless: For the second deal, that $7,500, was that split a third each?

Dakarai Towns: Actually, no. That one was split — I forgot her contract… The agent has to make at least a thousand, so it did eat up some of the profit, but I wasn’t complaining, and then I gave my other partner a thousand. So I personally didn’t pay myself until after everything and everybody else was paid. I kept the rest for marketing and business infrastructure, let’s say.

Joe Fairless: You have two deals under your belt. One you made money (you didn’t lose it), not factoring in marketing costs and your time… And then the second one you made almost seven times more than the first one. Then you partnered up with a mentor – let’s talk about that quickly, and then we’ll talk about something else I wanna ask you… But first, help us understand how you came across a mentor and that structure.

Dakarai Towns: Sure. My mentor [unintelligible [00:18:26].19] Craigslist. It’s a very powerful system. He actually came across one of my old ads that I put out in the Columbia area, about “We buy homes. We’ll help you sell your home pretty quickly”, things of that nature. So he actually reached out to me through one of my Craigslist ads, and he was giving me filler questions… He was acting as if he was wanting to sell his home, and he wanted to see what kind of a response I would give him

After the end of the conversation, he was like “Well, I have a confession.” I was like, “Okay…” [laughs]

Joe Fairless: “Where is this headed?”

Dakarai Towns: Right, exactly.

Joe Fairless: Maybe it’s a murder or something, if [unintelligible [00:19:05].11]

Dakarai Towns: [laughs] Right. It’s like, “Okay… What’s up?” and he’s just like “I’m very intrigued on your conversation, and I really like you a lot. You sound very genuine, you sound very transparent.” I was just like, “Wow, thanks! That’s what I’m shooting for, to kind of give off the natural kind of transparency.” So he said, “Yeah, so I really wanna mentor you.” I was like, “What?” He was like, “I wanna mentor you.” I was like, “Okay, great. I was actually looking for  a mentor.” And at the time I was just stunned, because I’m like, “Okay, this is another deal. Hopefully we get this deal done…”, but at the time I met my mentor, and then after that he started showing me a whole bunch of different software, or a whole bunch of different tactics and strategies that normal people who are in the real estate game and are wholesaling aren’t really doing.

Joe Fairless: Like what?

Dakarai Towns: Basically, almost like a thought leadership platform that you always talk about on the Best Ever Show, it’s something of that nature. He was basically telling me, “Yeah, you need to make this like a video, or a commercial”, and at the time I wasn’t really well-versed in how to market. I wasn’t well-versed in how to really get my name out there like that, and how to really get people to know that I’m here and willing to help them sell their home, or vice-versa with the investor.

He basically told me “You need to get on social media, you need to make an Instagram account, you need to make videos and specify them to yourself, and not only for what you can do, but to yourself as a person.” I said, “Wow, that’s genius.”

It’s funny though, because he’s a very elderly guy, and he’s not really well-versed in technology as I am… So what he did is he had me go on his different social media sites, or kind of took some of the data that he had from his computer and let me run it… Because I’m on the computer 24/7, I’m in college, so I’m always on my laptop. And at the times I’m not doing anything, I’m like “Okay, let me go ahead and run these numbers for these leads that i have in.”

From there, he took me on  different journeys of real estate, and journeys of how to be more open-minded about different solutions… Because I was always tunnel vision on “Let’s get a deal done. Let’s get it done”, but I wasn’t clear on the different ways that I can get it done.

Joe Fairless: What’s an example of that?

Dakarai Towns: I would say, for instance, just to make it really simple, the fee. I was not thinking about bringing down my fee for a deal, but then when I thought about it, I’m like “Well, why would I bring down the fee? I’m not getting paid as much, and then I can’t do this, that and the third”, but he was reminding me “You started from nothing. You started from literally zero dollars”, and that’s literally what happened… I started from zero dollars, and took a small seminar, took some tidbits from that, and I just kept going with it. And once we met, he started to tell me “Just let this deal flow. This is the first deal, so don’t let this define you as a person and don’t be greedy.” So that’s really what happened, and I ended up coming down on my fee.

He also showed me that you can help some of these investors have money by financing through loans… Because he’s an official underwriter and a loan officer, and I believe an official broker. So he’s really well-versed in the real estate and in the vintage real estate game. So he’s not well-versed in the technology yet, but he showed me a lot of things that he did in the past. He would go out, put poster boards up, put bandit signs up, and he would actually not say “Hey, cash for your home”, he would say stuff like “I have a rental available” or “I have a 3/2 going for this price”, and people would give me calls. It was endless. So that’s pretty much what our marketing strategy was.

Joe Fairless: Did you know him before your first deal?

Dakarai Towns: No, I didn’t know him.

Joe Fairless: Because on that first deal, you took that advice without having known him, right? You lowered your fee…

Dakarai Towns: Well, I lowered my fee and I did know him before — because he ended up becoming my mentor before my deal. So after that deal, he started to tell me more situations and different strategies I could go without having to lower my fee. Then once I lowered it, he said “Okay, this isn’t the end of the world. This is your first deal. This is what it would do for your investor and their pockets, and this is how it will make you look. At the end of the day, you’re not being greedy.” He just basically taught me the ways of not being greedy versus profiting. Because everybody would say “Oh, you took a hit…”, but you still made money, so you technically didn’t take a hit. You just made a little bit less than what you thought.

Joe Fairless: Sure. So you’ve got this momentum with wholesaling. Why shift the focus to, as you said, larger transactions with apartments, larger deals?

Dakarai Towns: I just saw that with the timing and with me being a student, it worked out, if I were to do something that did take a little bit longer. But at the same time, I’m not limiting myself to just apartments, but I see the potential. It took about two months to close both of those deals, and before that, like I said, I was going in to about 15-20 homes and they all fell through, so I would take tidbits and learn from each one that fell through and I would bring it to the table. So during those two deals I was still learning, and it took a little bit more time, but at the end of the day I was able to close those deals successfully.

Joe Fairless: For someone starting out, what’s your best real estate investing advice ever?

Dakarai Towns: Sure. My best ever advice to all the Best Ever listeners out there is to create genuine long-term relationships and bring something to the table… Even if it’s just as little as “Just go visit this property for me.” Because the small things count, and they look at that and they say “Okay, great. I can really depend on this person.” And once the bigger things come, they would at least entertain it. It’s not a guarantee that they would actually go through with it, but your relationships are definitely the definition of who you are as a person.

Joe Fairless: We’re gonna do a lightning round. Are you ready for the Best Ever Lightning Round?

Dakarai Towns: I think so, let’s do it.

Joe Fairless: Alright, let’s do it. First, a quick word from our Best Ever partners.

Break: [[00:25:09].06] to [[00:25:59].22]

Joe Fairless: Best ever book you’ve recently read?

Dakarai Towns: Currently it’s the Best Ever Syndication Book.

Joe Fairless: Oh, there we go! What’s your favorite part?

Dakarai Towns: My favorite part is the ending questions. I haven’t dug as deep as I want to, but I did skip around for what you had mentioned I believe in the Facebook group. It said something about exercises, so I wanted to check it out and I looked at the exercises, so it gave me a good SAT prep kind of feel; I’m really enjoying that.

Also, how to create the platform, and giving me the advice that I needed to understand what a real thought leadership platform is.

Joe Fairless: What’s a mistake you’ve made on a transaction?

Dakarai Towns: One of the mistakes I made on a deal was letting my seller drive all the way down from — I can’t remember where it was… It was from either Florida, or somewhere like that. But he basically drove all the way down just to hear that he couldn’t do the deal because of the numbers. And what I did was I ended up having one of my partners, which was the financial broker – I ended up having them do the numbers for me, because at the time I was busy with other properties, so I didn’t have time to run the numbers and get back with him with the offer price, so I needed someone else to do it.

By the time I got back, I get a call from the seller saying “Hey, we’re on the way”, and I’m like “Oh, crap… Alright. Well… Yeah, I’ll see you in a bit.” And then I get a message from my financial broker saying “Hey, we can’t do this deal. The numbers are too high.” I said, “What?! We’ve literally waited an entire day for this and you’re just now telling me this? Literally, the guy is on his way.” So that’s what happened, and it was just a big flop from there.

Joe Fairless: So you heard that, and then what did you do?

Dakarai Towns: What I did was I made a few changes to how we operate the business, and also I take it upon myself to do the numbers.

Joe Fairless: I’m more interested in the drama. So you heard that from him, and then did you call the people who were on the road?

Dakarai Towns: Yeah.

Joe Fairless: How did that conversation go?

Dakarai Towns: It didn’t go great. [laughs] They were driving down… He actually didn’t answer my call. I texted him because he told me that he was going to be coming in in about an hour, and he said “Really, dude? You’re gonna wait this entire time?” and I said “From the deepest heart of my heart, I apologize.” If you come now, let me see what we can do; let’s talk it over, let’s figure out if this is really what it’s gonna take…”, because at the same time, the biggest issue was he had a pool in the backyard. The pool in the backyard was gonna take a lot to have construction come in, fill it in, things like that. And like I said, I told him this as well before we ended our discussion the first time… So while he was on his way back, I said “Hey man, let me take you to dinner and let me talk to you, talk the numbers out.” He was just not going for it, he was not interested at all at that point. He was just like, “Alright, we’re done here.”

I ended up losing a potential deal, and it was definitely a lesson learned, to really make sure you don’t hold people accountable too much. So that was just a big lesson right there for me.

Joe Fairless: How can the Best Ever listeners get in touch with you and learn more about what you’ve got going on?

Dakarai Towns: Sure. They can get in touch with me on LinkedIn and Facebook at Dakarai Towns… As well as my e-mail, dhomesrealestate@gmail.com. And just a small advice for getting into wholesaling apartments – it’s really hard, so make sure you contact the syndicator. For example, if I hadn’t contacted Joe, we wouldn’t be on this interview right now, so don’t be scared to contact them and have some face-to-face talk with them sometime.

Joe Fairless: Well, Dakarai, thank you so much for being on the show, talking about how you did your first two deals, as well as the nine after that. We got into the specifics of each of the two deals; I love getting into the specifics and the twists and turns of each deal. I hope you have a best ever day, I’m really grateful we caught up, and we’ll talk to you soon.

Dakarai Towns: Sounds great. Thank you, Joe. I appreciate it.

Best Real Estate Investing Advice Ever Show Podcast

JF1056: He Made $20,000 in His First Two Weeks After Listening to THIS Podcast! With Brent Moreno

Listen to the Episode Below (26:23)
Join + receive...
Best Real Estate Investing Crash Course Ever!

He was driving for his full time job when he heard his friend on our podcast. Brent Decided to reach out to his friend and learn what he was doing. After thoroughly educating himself on how to wholesale, he went out and made $20,000 in less than two weeks!  If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!

Best Ever Tweet:

Brent Moreno Real Estate Background:
-Founder at Cash Homes Carolina Studied real estate business after a friend was on the show and started posting checks
-Studied for 2 months how a past guest made his money in real estate
-Began 1 month ago and landed his first house and had it sold in less than 24 hours
-Based in Columbia, South Carolina
-Say hi to him at www.cashhomescarolina.com
-Best Ever Book: Richest Man in Babylon

Made Possible Because of Our Best Ever Sponsors:

Are you an investor who is tired of self-managing? Save time, increase productivity, lower your stress and LET THE LANDLORD HELPER DO THE WORK FOR YOU!

Schedule Your FREE TRIAL SESSION at mylandlordhelper.com/joe with Linda at Secure Pay One THE Landlord Helper today. 

 

Brent Moreno Real Estate Investment

 

Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless, and this is the world’s longest-running daily real estate investing podcast. We only talk about the best advice ever, we don’t get into any of that fluff. With us today, Brent Moreno. How are you doing, Brent?

Brent Moreno: I’m doing fantastic, Joe. Thanks for having me on the show.

Joe Fairless: Yeah, my pleasure. Today, Best Ever listeners, we’re gonna get a different perspective from a guest, like we usually do. Today Brent is just starting out. He has done two deals, and he’s working on two leads on two more deals, so we’re gonna hear about his first couple deals, how that happened, and we’re gonna talk more about the beginning aspects of getting into real estate obviously, because he’s just getting started.

A little bit more about Brent – he is the founder at Cash Homes Carolina; his website is appropriately named – CashHomesCarolina.com. He studied the real estate business after a friend was on the show and started posting checks. He studied for two months and he has since, as I’ve mentioned, closed two deals. He’s based in Columbia, South Carolina. With that being said, Brent, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?

Brent Moreno: Yeah, so currently I’m mostly focused on wholesaling. I’m looking for the right deal to actually fix and flip, but like you said, I just got started… I actually launched the business in May; I was actually at home for about a month — or actually not even a month, I was home for like a week, and I got two deals done in that week’s time, which brought me about 20k… But I didn’t have any background, I just saw my friends doing it, and I heard my buddy on the show, [unintelligible [00:03:50].08] Once I saw those checks posted and heard his interview, I was like “I’ve gotta dive into this show some more and learn everything I can, because the thing is really promising.” So that’s where I got to, and that’s where I’m at now.

Joe Fairless: And by “show” are you talking about this podcast?

Brent Moreno: Yeah, the Best Ever Show.

Joe Fairless: Oh, wow, that’s cool.

Brent Moreno: Yeah, I really dove deep. Basically, I drive a lot for my current job, so I basically just listen to and catch up on all the podcasts that I miss, and I do them over and over and over.

Joe Fairless: So you were listening to this podcast and you heard Max Maxwell being interviewed, and you knew him already and you heard that he was making the money? Or you got introduced to him by listening?

Brent Moreno: No, so I knew Max from several years ago; we both worked in the same field of event marketing, and we had worked a couple events together and just kind of stayed in touch. I’ve always kind of kept up with him via social media and what he was doing. He had posted the link to this show, and I called him up and I was like, “Hey man, I wanna do what you’re doing. This seems really promising. Can you give me some pointers?”

So I drove up, met with him for a day and I got some pointers, and really took off from there, and just kind of buried myself in books and podcasts, and like I said, I officially launched in May.

Joe Fairless: When you met with him, what were some of the pointers?

Brent Moreno: I’m like everyone else that thinks you have to have a lot of money to get started in real estate. I’ve always thought that and I’ve always been interested in real estate, but I always assumed that if you don’t have like 100k in the bank, then you’re probably not gonna really get anywhere, you’re not gonna be able to find a good deal and put some money into it and make [unintelligible [00:05:24].07] I never knew about the wholesaling side and the fact that I could walk in and put $100 down on a contract and find an investor… That was really new to me, so it was really exciting to know I could do that.

His pointers were “Read this book, listen to these podcasts, and once you get some money, set up your website, get your LLC, and go out and drive for dollars” – he said that’s the best way to get your first deal, it’s to drive for dollars… So that’s what I did.

My first deal actually came from an Uber driver, which is — I don’t know about a lot of people doing that, but I run a Uber Facebook group in Columbia, South Carolina, so I basically asked the question “Hey, would you like to make some extra money? $500-$1,000 extra/month.” I had a bunch of people interested… No one did it, but one girl came through and just was sending lead after lead after lead [unintelligible [00:06:11].15] because I’m out on the road, I can’t be there.

So she’s sending me lead after lead and I’m like “Okay, I’ve gotta start calling these people.” Sure enough, the very first person I called — I ended up calling him probably around eight or nine times, just having a bunch of different conversation with him, and [unintelligible [00:06:27].22] he just didn’t have time to fix it up. It needed about 30k with the works, and I got it for 27k and within 24 hours I sold it for 39.9k.

Joe Fairless: Congratulations on that!

Brent Moreno: It was a pretty good deal. I literally laid up in bed all night, thinking “What am I gonna do if I can’t sell this thing? Who am I gonna call?” But I went to a foreclosure auction and that’s how I found my buyers. I sat in there, listened, and found the people that were spending the money, found out where they were buying at [unintelligible [00:06:57].17] It’s five minutes from the University of South Carolina. It’s a good spot, and literally the first person that I called and showed it to, took it. It worked out great. I didn’t expect it to work out so great.

Joe Fairless: Do you physically went up to the foreclosure auction?

Brent Moreno: Yes, I physically went to the foreclosure auction, just to meet buyers.

Joe Fairless: Alright. Do you drive a car or a truck? I’m guessing truck.

Brent Moreno: I drive a truck, yeah.

Joe Fairless: Yeah, I knew that… I could tell. [laughs] You just pulled up in your truck… You get out, you shut the door, you walk up to the foreclosure auction – what did you do?

Brent Moreno: It was inside of a courtroom, so I just walked in and sat down, and I had the list of all the pre-foreclosures or all the houses that were going up for auction, and I just sat there and listened, because after every sale, the buyer has to state the name of their business or their name… And I would just write down all their names and then try to introduce myself to as many of them as I could after the auction was over.

The ones that I didn’t introduce myself to, I went back and just googled them and found their phone number and added them to my buyers list. I called them and said, “Hey look, I’m a wholesaler. I’m working on getting some deals in place. What areas are you interested in? What’s your criteria?” and I filled my buyers’ list that way.

Joe Fairless: Bravo! That’s what I’m talking about. That’s some resourcefulness, take action in an intelligent way. Did the buyer who ended up buying it meet you in person at the courthouse, or was that someone you didn’t have a chance to meet and you googled later?

Brent Moreno: That was actually somebody I did get a chance to meet. It was pretty quick, even whenever he came to the property. He just basically was like “Boom, boom, boom! Okay, what do you gotta have for it?” I had it listed for like 41.5k, and I said “I’ll take 39.9.” He’s like “Okay, deal. We’ll have 5k earnest money and we’ll close in seven days.” I was like “Wait… Did that just happen?”

Joe Fairless: [laughs] Oh, man… What’s he gonna do with it?

Brent Moreno: He actually assigned it for $4,500 more, so I was like “Damn, I could have gotten more money…”

Joe Fairless: No, no… That’s okay. [laughter]

Brent Moreno: I was like, “That’s good, man. I’m glad you did that.” The great thing is that I have my fiancée back at home and she handles a lot of my closings for me because I’m constantly traveling. [unintelligible [00:09:07].11] and then he asked if we had another property. Well, I just got one under contract, and he actually bought that one, too.

Joe Fairless: Same guy.

Brent Moreno: Same guy.

Joe Fairless: Did he assign that one?

Brent Moreno: No, he didn’t assign that one. The end buyer for the first house that I bought was the one that was assigned on the contract, too. He’s the one that bought from me that time [unintelligible [00:09:26].02] I was like “Yeah, I could have saved you $4,500.” [laughs]

Joe Fairless: Alright, so let’s talk about that part of it. Is there any stepping on toes issue where you’re now skipping the guy who helped you make the 10k or so on the first deal?

Brent Moreno: No, not at all. I talked to him… They actually had the first [unintelligible [00:09:46].17] it was a very big property; it was like a $325,000 property, but it needed about 70k-80k worth of work, and was on a private golf course.

I sent it over to them and said “Hey, is this of any interest?” They went and looked at it and they were like “Oh, it’s just a little more than what we wanna spend on rehab, but thanks for the offer.” It just so happened that the next guy in line was good, so I basically sent it over to them first and gave them the first chance to look at it because I enjoyed having everything work smoothly and close in less than a week.

I told them “If you guys can do that with all my properties that you guys are interested in, I’ll just keep sending them to you.”

Joe Fairless: Just so I’m on the same page in terms of how you found each of them… You said you got the first deal being an Uber driver – will you just summarize that for me again? Because I was trying to follow and I’m not sure I followed.

Brent Moreno: Okay. Like I said, I used to drive Uber, just because when I’m home — my fiancée’s in law school, and I’m like “I’ll drop you off at school, and then I’ll try to make some money for the car payment just because I don’t wanna stare at the walls.” So I started a Facebook group for everybody to share information on events coming up and stuff like that.

I posted on there about finding a bird dog, basically. I posted on there to find a bird dog. I got one person, like I said, that was really interested and really motivated. She found my first house, and I gave her $1,000 for finding it. Basically, what she does is she just drives around, takes pictures of vacant houses and send me the addresses, and then I research them.

Joe Fairless: Okay. And you started a Facebook group… What’s the Facebook group’s name?

Brent Moreno: It’s Ride Sharing Community of Columbia South Carolina. It used to be just “Uber of Columbia South Carolina”, but now there’s Lyft and all that stuff, so I just changed that. I’m not really active on there anymore – like I said, I stopped driving Uber, but…

Joe Fairless: I’m just curious, who joins that? What’s that for? Is it just for other Uber drivers who want to stay in touch with each other?

Brent Moreno: It’s more just about “Hey, this is what’s going on in the area. These are the concerts going on, these are the football games going on…” or “What’s the best areas? What do you think about sitting at the airport?” It’s not a very huge market, as far as like a major city would be. It’s a small group of like 150 people who are on there, who just share information with each other to help each other out to make a little bit more money, sharing where the events are, and stuff like that.

I thought about it as “Well, they’re Uber drivers… All they do is drive around all day.” I was like, “If you see a vacant house, take a picture of it and send it to me. If I close on it, I’ll give you 1k.”

Joe Fairless: It’s a no-brainer for an Uber driver to be a bird dog. That’s great. So this is a much deeper and more impressive conversation than I thought we would have, because you’ve done tactics that people who have done maybe 10-20 deals would be doing, and you did these on your first couple deals. I’m really impressed with your approach.

You said earlier when you met with the gentleman who was on this podcast (Max) he said for you to read a book… What book did he ask you to read?

Brent Moreno: Actually, it wasn’t him that suggested I read the book… It was my friend in Mississippi that’s doing the same thing. He’s like “This was the one I started off with.” It’s called “Flipping Properties”, and it was like $4 on Amazon. It’s the second edition; it’s kind of old, but it’ll give you a good idea of where to start.

I read that book, and he’s like “Just come back to me with any questions.” So I’ve shot questions to my buddy in Mississippi and to my buddy Max [unintelligible [00:13:14].29]. They’ve both been helping me out and they’ve both been giving me really good information, because Max won’t talk about the technology side of things, and I’m a bit of a techie… Whereas my buddy in Mississippi likes to call it [unintelligible [00:13:25].26] So I’ve been trying to help him with this technology side of things, but he’s been kind of giving me some old school, grassroots [unintelligible [00:13:39].03] how to go about finding these deals and finding these buyers and stuff. Both of them have been very helpful to me and they’ve been someone I could lean on, and I highly suggest to anyone that wants to get started to find somebody that’s doing it in your area or even anywhere remotely close to you that you can drive, and will spend some time with you.

I spent maybe three hours with Max and I’ve probably spent two days with my friend Adam in Mississippi (which is where I’m originally from), just riding around and [unintelligible [00:14:05].29] and looking at records, and going through the computer systems there in the courthouse… He’s got a really good system going down there that he’s doing 4-5 houses a month and he’s not using really any technology platforms. He doesn’t even have a website, and his e-mail address is Hotmail.

Joe Fairless: Oh… At least that’s a step up from AOL. [laughter]

Brent Moreno: I think it actually might be AOL…

Joe Fairless: Okay, there we go…

Brent Moreno: Actually, I think it is AOL.

Joe Fairless: [laughs] The second deal that you closed – remind me how did you get that one?

Brent Moreno: I found it actually driving for dollars with my buddy from Mississippi. He came up [unintelligible [00:14:42].16]I picked him up in Mississippi, stopped off in South Carolina for a few days to hang out and look for some properties. We were just driving around in the neighborhood and I was like “Man, this one [unintelligible [00:14:53].29]” so we jumped out, took a look at it, and I skiptrace the owner and it was an older lady who was living in a townhome. I couldn’t get a hold of her; I tried calling all the numbers I could find, but I found her next of kin…

Her next of kin was her son that was a developer in South Carolina. I look him up, I find him on Facebook, I notice we have a mutual friend… I hit the mutual friend up after talking to the guy, and I’ve called him, probably.

He said he was interested in selling it. I said “I’m out of town right now, but I’d love to take a look at it next week, when I get back in town.” He said, “Okay, that works. Call me when you get back in town.” Well, I was only gonna be in town for a week, and I called him immediately when I got back in town – no answer. I sent him a text message – no answer. I called him the next day – no answer.

I was like, “Well, maybe this guy got the cold feet”, but I kept calling and calling and calling, so that’s when I went to Facebook and I found that we had that mutual friend, so I hit him up. I said, “Hey, how well do you know so-and-so?” and he’s like “Well, it’s my boss’ son-in-law.” I was like, “Oh, really?” I actually had worked for his boss and those guys before in the past. I was like, “Could you tell him I’m trying to get a hold of him? If he doesn’t wanna sell it, tell him to let me know and I’ll quit bugging him”, but I just stayed on his case and finally, the day before I had to leave, I went and saw the property.

He wanted 195k, I got him down to 175k. The house, like I said, is worth like 335k. I was really worried, because I didn’t really get it for the typical 70k minus repairs, minus my fee and all that jazz, but I knew it was such a great property, it was in such a great neighborhood  that if somebody wanted to come and put an extra 500 square foot on the property and really dump some money into it, that could increase the value about 100k and they’d really, really make some good profits on it.

So I took that chance and it worked out for me. I was kind of stressing, because the first one went so fast; the second one took like four days.

Joe Fairless: Well, that’s pretty quick turnaround. You said he wanted 195k and you got him down to 175k – how specifically did you get him down $20,000?

Brent Moreno: Well, my first offer to him was 136k. I was gonna say 136.5k, and then my buddy in Mississippi was like, “No, 136.581k and some change. It makes it seem like you did some calculations.”

Joe Fairless: Oh my gosh…!

Brent Moreno: I was like, “No, I don’t really wanna do that…” [laughter] But then I was like “You know what, what do I care?” I was like “If I could get it for 150k I’d be happy”, so I started at 136k, and I really thought I could get it at 150k. So we just went back and forth and I finally — he said it was too low of a number for him, that he would just do it himself, but he had already said that he was tired of fighting with his mom about doing the rehab, because it was his mother’s property… He didn’t wanna deal with it anymore, he just wanted to offload it and get rid of it.

I finally called him back after we went back-and-forth a couple times; he wasn’t really budging, and he went from 195k to 185k. I was like “Well, I’m at 145k [unintelligible [00:17:46].18].” I just called him and I said, “Look, I really don’t wanna beat each other up over prices, I don’t wanna go back and forth and waste all that time… What is the absolute most that you have to have for the house?” He said, “You know what? Since you got the ball rolling and everything, I’ll have the deal at 175k.” I was like, “Okay, I think I can make that work.” Just persistence, that’s all.

Joe Fairless: And what did you assign that for?

Brent Moreno: I assigned that for 187k, I believe.

Joe Fairless: Great stuff. Over what period of time did you get your first two deals done?

Brent Moreno: Most of those deals were done within a week and a half of each other.

Joe Fairless: And how long did it take you once you had that first conversation with Max, after you listened to him on this podcast, to actually get the deals done?

Brent Moreno: I wanna say Max was on there in February or March (I can’t remember). I really started studying in February, and I wanna say it took three months of just studying, and then literally I put everything into action beginning 1st May, as soon as I got back home. I think I was home for two days and I went and looked at some properties, and then I started making all the phone calls on the leads that were coming in, because she was sending me 10-12 leads every three or four days… And I was like “This is a lot.”

I go very deep into the research. I wanna make sure my numbers are right and I wanna make sure that I know what I’m doing. I don’t wanna make a mistake right off the bat and sink my ship immediately. I guess I launched everything at the beginning of May and I did those deals before 17th May, so it took 2-3 weeks until I really went after it, to get my first two deals.

Joe Fairless: Based on your experience, starting out right out the gate quickly with these two deals, what is your best real estate investing advice ever for someone who wants to do what you’re doing but hasn’t started?

Brent Moreno: I would say find somebody that can answer your questions, study as much as you possibly can, and be persistent. I’m like a shark; if there’s blood in the water and I feel like somebody’s interested in selling, I will not let up; I will try every means possible to get in touch with you, or to get in touch with somebody that knows you, and figure out if we can make a deal or not. I’d say persistence in the follow-up – I think that’s what most people probably don’t do, or maybe they’re scared of cold-calling somebody.

I just really kind of [unintelligible [00:20:05].01] after listening to my buddy on the phone and just kind of going after it. I was like “I’m gonna talk to him like I’ve got a million dollars in the bank, because that’s how I have to be.” So it’s about being persistent and following up. Follow up, follow up, follow up. Do not let up on somebody that’s interested in selling their home quickly and needs to get rid of it quickly.

Joe Fairless: Are you ready for the Best Ever Lightning Round?

Brent Moreno: Absolutely. I’m looking forward to it.

Joe Fairless: Alright, let’s do it. First, a quick word from our Best Ever partners.

Break: [[00:20:36].07] to [[00:21:32].29]

Joe Fairless: Best ever book you’ve read?

Brent Moreno: I would say the one that got me started years ago is one that everyone talks about, obviously – Rich Dad, Poor Dad. But most recently, one of my favorites is “The Richest Man In Babylon” that I just read, and “The Subtle Art Of Not Giving a F*ck”

Joe Fairless: I haven’t heard about that one. Another one I think you’d like is Three Feet From Gold.

Brent Moreno: Three Feet From Gold? I haven’t heard of that one.

Joe Fairless: I think it’s a Napoleon Hill Foundation book.

Brent Moreno: Okay.

Joe Fairless: Best ever way you like to give back?

Brent Moreno: I would say right now I’ve honestly been kind of talking to a lot of people who I know have the same kind of mentality and drive that I have. I’ve traveled all over the country, I’ve met a lot of friends, I have a lot of friends all over the place, but I see them in the same routines that I am, just getting really nowhere. We have great jobs and we have a lot of fun, but there’s a point in time where you realize you’re not gonna get much higher than when you’re are at; you don’t wanna always be gone, so… I’ve been giving those people advice and they all seem to be taking it very well and they’re all interested in getting started.

Where they go with it — I don’t have answers to a lot of people’s questions, but I like to give back by trying to at least be that person that Max was to me, even though I’m just starting out. I feel like I have a fresh perspective on just starting out and helping somebody get off the ground… So that’s how I like to give back.

Joe Fairless: What’s a mistake you’ve made on either of the first two transactions, that when presented the same situation on a future transaction, you’ll approach differently?

Brent Moreno: I would say a mistake that I really still think of, even though I turned a really good profit on that house — I really still think I should have got it for 150k, honestly. It just wasn’t in the parameters; I had a lot of people look at it…

Joe Fairless: The second house?

Brent Moreno: Yeah, the second house. This wasn’t in the parameters that I feel comfortable with, but I had a gut feeling that I could get it done if I had just really busted it and met somebody and got it done. Fortunately, it worked out; it was the same person I had sold the first house to… But I had a bunch of people go and look at it, and no one was really [unintelligible [00:23:26].23] some offers for like 160k and 170k, and I was like “I can’t do that, obviously. Maybe I’m gonna have to go renegotiate”, but I’d already been kind of firm with the guy that I was not gonna beat him up over price, so…

I really didn’t feel like I got that one as low as I should have, but it worked out. I just trusted my gut, but I would say that one really kind of kept me up at night a little bit, thinking “How am I gonna get this thing done?”

Joe Fairless: How can the Best Ever listeners get in touch with you?

Brent Moreno: Well, they can e-mail me at brent@cashhomescarolina.com, or give me a ring. I’d love to talk to anybody. 803-335-56-59.

Joe Fairless: Brent, this has been an impressive conversation. The word “impressive” is the one that comes to mind when I think about what you’ve done on these two deals, because they were not cookie cutter deals, in terms of how you approached getting them. The two next level strategies that you implemented is 1) going to the foreclosure auction, sitting down in the courtroom, listening to each transaction, writing down the names of the people who are buying the properties, introducing yourself to as many of them as possible, and writing down the names of the others, googling them later, and then calling them and building your buyers list. It’s such a smart, effective move. Clearly, it was for you, because it closed you the first deal.

And 2) you started a Facebook group for other ride-share drivers and you posted about having them take pictures of properties and be a bird dog for you. One person was really active and she ended up finding that property for you and you paid her $1,000, which is a whole bunch of Uber rides that she didn’t have to do to make that $1,000. She was happy, right? She loved it.

Brent Moreno: Oh, absolutely. Now she’s trying to get other Uber drivers to work for her… [laughter] I was like, “I love it!” I love her drive, I love the way she goes about it.

Joe Fairless: These are stories that put a smile on my face, and it’s a beautiful thing to hear. And then lastly, the persistence in follow-up. You said that about seven times in a row, and I’m glad that you did. No elaboration needed there.
Thanks for being on the show, Brent. I hope you have a best ever day. I’m glad that you got value from a previous guest and you took action on it; we didn’t even mention that… And now here you are. I hope you have a best ever day, and we’ll talk  to you soon.

Brent Moreno: Absolutely. Thanks, Joe.

 

 

Subscribe in iTunes and Stitcher so you don’t miss an episode!   https://www.youtube.com/channel/UCwTzctSEMu4L0tKN2b_esfg

Best Ever Show Real Estate Advice

JF61: But I Don’t Wanna Do My Homework!

Today’s Best Ever guest brings a different perspective to the show than what’s typical because her background isn’t exclusively focused on real estate. She’s a certified financial planner and talks to you about her Best Ever advice.

Tweetable quote:

Ashleigh Brooker’s real estate background:

–        Certified Financial Planner for A.J. Brooker Financial Associates in Columbia, SC

–        Guest Columnist for The State newspaper

–        Provides wealth management for professionals, business owners and families

–        Real estate investor and owner of a rental property

Subscribe in iTunes and Stitcher so you don’t miss an episode!

 

Sponsored by: Door Devil – visit  http://www.doordevil.com  and enter “bestever” to get an exclusive 20% discount on your purchase.

Listen to the Episode Below (13:53)
Join + receive...
Best Real Estate Investing Crash Course Ever!