Acquisitions vs. Dispositions: Why Your Deals Keep Falling Apart

Mike DeHaan: [0:00] Real quick before we jump into the show, we created the collecting keys podcast to be a real estate investing podcast that is created by real estate operators for real estate operators. And we want operators everywhere to know what it really takes these days to be successful in this business rather than all the fluff that all the other content creators and podcasters out there make. And so one of the challenges with this is that it's challenging to grow because most operators are too busy out there working. Right? And they aren't always learning or actively seeking new learning material. And so if you could please share this show with any fellow operators you know. You know, you can text it to them. You can post it on your socials. You can leave us a good review that you then share somewhere. That would be amazing. But really, whatever, it really helps us continue to get excited to create content, and it will also help you because everyone that you expose us to will get better as a real estate operator and close more deals. So if you could do that for us, it would really need a ton. And, otherwise, we appreciate you guys, and let's get into this episode.

Mike DeHaan: [1:04] There's been just, like, less and less ways to generate leads. What is going on, guys? Welcome to today's episode of the collecting keys real estate investing podcast. I am here today from Colorado. If that sound a little bit different, recording out of my normal studio. And I'm also here with Dan today because Dylan is out once again, but he actually has a valid excuse this time. He had a little vet emergency that he had to deal with, whereas last week, he just completely forgot. But if this is your first time to the show, this is the real estate show for operators by operators, and we talk about how to continue growing your real estate business in this ever changing market. I am Mike DeHaan here with my cohost, Dan Austin. Ew. And we are gonna dive into a handful of different things that are going on with business in the market today. So, Dan, I know you've been the hustlepreneur in our business right now with all the the dispo you've been doing. Mhmm. And it's funny. It's actually led to a pretty interesting conversation that we kinda had before the show, which I think is something to I think I think it's a relevant conversation for people that are in this industry is setting up that relationship between acquisition and dispo Yeah.

Mike DeHaan: [2:16] And how important that is and how it's something that when you start to have multiple team members, you don't really I mean, you start to realize how much of a mass that turns into really quickly. Totally. Because ultimately, we always have this situation right now where the acquisitions people are completely removed from the DISFO. And so what happens is they go and get these contracts signed around, and then it turns into a mess for you because you don't quite always get all the information, The relationship between the seller and the acquisitions person is maybe a little bit too friendly. Right? And then you start to uncover some of the BS once you kinda get into the brass tacks conversations. Totally. But, I mean, you've had a handful of those right now, which have been kinda tricky to deal with.

Dan Austin: [2:59] Yeah. I would say, to elaborate more on what you're saying is the thing that you and I have seen, and it's hap it's not like anybody is, you know, completely removed from this ever happening to them. It just happens because it happened to us when we had employees, it happened to us when we had partners. It's like acquisitions, when you don't have anything to do with dispositions, it's almost like, I gotta get this contract, and anything that happens after this is not my job, so I don't really care how it happens. And I don't say that an acquisition person does that maliciously. They just have no incentive to make the disposition easier. Although, you would think if you're gonna get paid a commission or you're gonna get paid a portion of that wholesale fee, you do. But it doesn't work that way. It's like a mental thing. It's like, get this thing under contract at all costs. Let the dispo do the hard work. Yeah, it might be a little bit high, the house might be a little shittier, but we could sell it. We could sell it to somebody, right? It's like, well, that we has to be somebody, and we've seen it again when we had employees, and and it creates frustrations between the two departments, so to speak. And another big piece of that is just the giant gap in communications if you're not on top of it, because, you know, if the acquisition person is running a 110 miles per hour, and on the dispo you're running the same speed because they're trying to get as many contracts as possible, you're trying to wholesale as many as possible.

Dan Austin: [4:14] You don't have necessarily as much time to communicate, so you have to be super deliberate in that. And then, you know, like you're alluding to as well as like uncovering stuff that should have been uncovered during the acquisitions, but it's like, I'm not gonna uncover that rock because that's gonna blow this up on the front end. I'll let that, you know, hopefully slide, and it won't happen or become an issue for me because it'll be the dispose problem. And you see things like tenants that don't actually pay rent or trying to think of other ones that we've done where it's just like

Mike DeHaan: [4:42] We had a a weird title situation recently where if the ACT person had looked at the the change of title that had occurred, we would have seen that the person we're talking to probably didn't actually own the property.

Dan Austin: [4:55] Yeah. Just ask a few deeper questions. Right? Like, not just take what is said as the gospel, you know, because when we're dealing with these sellers, like Mike and I, you we were just talking about this before we got on the show. Most of the sellers now kinda know what they're getting into when they're dealing with a cash buyer. They've had friends or family that have gone to get the cash buyer. They've seen the commercials, they've heard the radio ads, they've gotten the mailers. They are in the demographic that is getting marketed to and or know people that have sold this way. So they kind of know what they're getting into, and it's not this naive seller anymore. It's this like, I'm not gonna say certain things. I'm calling them because I think this is gonna be the best route for me. And if I don't say certain things and they don't ask, like, they're not necessarily trying to be dishonest, but if you don't directly ask, they're not gonna answer the question. They're not gonna come out and tell you that they don't actually own the house and that they're gonna have to do some weird title things on the back end, or not gonna come out and tell you that their tenants aren't paying rent and that they can't prove that they need to evict them.

Mike DeHaan: [5:54] Mhmm. And I'd say this is even more prevalent with, like, when you have a seller that seems, by all intents and purposes, like, put together, like, they're like a professional and they have a good job. And, you know, sure they might have a tenant that's not performing at the house, made some work. But when they are someone that appears to just kinda have their shit together, there's a higher percentage chance that they're gonna be pulling one over on you. Totally. Because if they were like, otherwise, they would just go through the process they know they need to go through. Right. I was actually joking about this today when I was on the ski slopes is I kind of, like, miss when it was more crackheads because with crackheads, money talks. It's super easy. Right? Yeah.

Dan Austin: [6:29] Dude. When you have

Mike DeHaan: [6:30] people that actually know the real estate process and they know that if they can seal certain things, they'll be able to pull ones over on you.

Dan Austin: [6:35] Makes it

Mike DeHaan: [6:35] a lot harder to get some of these done.

Dan Austin: [6:37] Totally. And you can find yourself into a bad situation because we are we are coming at it from an angle of taking a little bit of risk. When you're doing these things, you're not going through the normal contingency process. You're not necessarily turning over all the rocks, and we know that kind of going into this, and so we need to buy these deals at somewhat of a discount, at a pretty deep discount to take on that risk and still take a profit. However, you get in these situations where if you're flying really fast and you don't do like a good you don't do a good title check, or you don't check the tenants or ask questions about the tenants, you don't do things like, I don't know, just do a decent walk through the house to make sure it's not falling off of a cliff. I mean, we've run into all these situations where sellers have tried to conceal things, and they wanna have a good relationship with the acquisition manager just as much as acquisition manager wants to have a good relationship with them. Because acquisition manager, they feel good. When the seller's like, yes, yes, yes to everything they say, that's when you gotta be suspicious. You know what I mean? They're like, this is way too easy.

Dan Austin: [7:37] Like, that's when you need to start asking deeper, harder questions. Not to blow the deal up, but as you get into the contract, as you start agreeing on a price, then just ask the questions like, hey, I I know this price isn't true, but I hate I hate to have to ask you this, are your tenants actually paying? Like, do you have like rent rolls, or can you send the leases over? You know, that'll just be stuff we'll wanna check. Just ask those questions, get that information up front. It helps it on the dispo side, because guess what your buyers are gonna wanna ask? All of that same information, especially right now, buyers are there's good buyers out there, but they are doing their little extra due diligence, because they don't wanna hang on, or they don't wanna take a shitty property on, because they're not expecting the price and values to go up while they're flipping it. They're expecting their prices to hopefully stay flat or go down a little bit while they own it.

Mike DeHaan: [8:21] Exactly. And so it's funny. I think that you almost need to move away from the no inspections, no questions, cash sort of negotiations just because there's more things that are going to be kinda hidden from view. For sure. Right? Like, now more than ever. Yeah. For sure. Especially if you have these leads that are calling in that seem like they should be more put together. Yep. But, yeah, ultimate at its core, it goes back to what our our old business coach seen it where, you know, 80% of problems in business come when you're passing things from one person to the next. It's just another example of that. Right? But, you know, so that's been our current challenge in our business, two sides of that. And then, you know, the constant lead flow challenges, which have been interesting as there's been just, like, less and less ways to generate leads. When I spent a couple days last week, I was in Park City with Cole Red Johnson and handful of other, like, decent operators on the off market real estate side. And lead generation came up a lot, mostly just because of how commoditized it's gotten. Mhmm. Right? Versus back when we started, like, 2020, like, if you wanted to cold call, it wasn't really, like, good cold calling companies.

Mike DeHaan: [9:30] It was maybe, like, one. Right? Yeah. There wasn't all these specialty, like, pay per lead platforms, and, you know, if you were doing, like, media stuff that was pretty niche, like, the only real data option was PropStream. But now with how many different well, first off, how many different companies have come around that are promising lead generation?

Dan Austin: [9:50] Right.

Mike DeHaan: [9:50] Unless you've, like, saturated it, it's made it hard to be the most effective. Right? There's kinda just more fluff and junk in there, but also to mix with the inefficiencies as well as, like, the federal involvement in different things that have started to really pop up. Yep. You know, they've banned SMS. They're going after gold calling. A lot of these online marketing companies are now starting to face some some legislation issues. Yep. And then the post office is facing more and more problems than ever for doing direct mail. You know, it's just like you are tampered with by all these things that are completely out of your control. 100%. I was talking to my parents down here in Colorado. Currently at their home in Montana, they do not get mail. The the post office does not have enough people to deliver mail, so they have to go and, like, pick up their mail at the post office. This is a new

Dan Austin: [10:42] thing I've never heard of. That's crazy.

Mike DeHaan: [10:44] Yeah. I'd never heard of this at all. Isn't that isn't that crazy?

Dan Austin: [10:46] That's crazy. Because your parents, their house in Montana is like in a development, in a city. What is Bozeman like? Close to a 100,000 now? Yeah. The greater

Mike DeHaan: [10:53] area is probably close to that.

Dan Austin: [10:55] It's not like you guys, they're like in the rural, like, living on a 100 acres and they're like, sorry, guys. We just I I could get that. Like, hey, we just can't make it out there. If you guys want mail, like, come to the city. They live in the town with an airport. It's not like they can't get mail. Like, holy cow.

Mike DeHaan: [11:09] No. But if they want consistent mail, they have to go pick it up. Otherwise, they might just get mail like once a week or not at all, and they just they just don't know. That's wild. So but point being is like there's all these things that are affecting all the shifts in marketing channels. Like, what are the best options? I'm not sure.

Dan Austin: [11:24] Your parents aren't getting our letters, that's for damn sure. I'll tell you that much.

Mike DeHaan: [11:27] They're definitely not.

Dan Austin: [11:28] Especially if they're not in town, like, they're not getting our letters, so they're not selling to us.

Mike DeHaan: [11:32] Yeah. So it's always the thing that is required to stick in any business is to be able to try things and evolve, You know? And I would say that the incorrect way to do stuff is to just constantly be doing the same thing over and over and over and never pivoting or changing anything and expecting stuff to be exactly the same. Right. Otherwise, what happens is your return on ad spend continues to drop and drop and drop and drop while your overhead will continue to grow as you bring on staff and teams, everything else, and all of a sudden, you're making no profit, and then you're kinda running a pointless business.

Dan Austin: [12:10] Yeah. Exactly. Yeah. If you were started in 2020 like we did and only did cold calling this whole time, like, you would have missed out on a lot of opportunity and cold calling, depending on your market too, goes up and down. Same thing with SMS. Like SMS, we saw when we ran SMS, like, markets it killed, some markets it didn't. So if you just heard somebody on a podcast, well, that's all I'm gonna do, you're missing out on a lot of opportunity, and in some cases, your lead only lead source is getting outlawed, and you have no other way to find leads. You have to like spin something up really quickly when that happens, and you and I have been male male guys for since the beginning, and I would say we will continue to be male guys, but that can't be our only lead source because that's our only lead source. We're gonna be dead in the water.

Mike DeHaan: [12:50] Exactly. Just like we faced in December. Right? We had the kinda holiday slowdown, which always happens. And then in January, our mail house, which is based out of the Midwest, they had huge snowstorms there, which put week long delays, multiple week long delays on all this mail that was going out. And even still to this day, like, we're now in the middle of February, we haven't caught up on that batch that we sent out yet. Yeah. Right? So if that was all we did, we didn't have any other forms of marketing, we would be we would be sitting in a really bad spot right now.

Dan Austin: [13:22] You know what's interesting to think about is, like, when we you know, even a couple two, three years ago, I would have been like, yeah. You know, if you had $5,000 a month, you know, go mail, you know, that you're gonna be alright. Now, because like costs have increased significantly with everything, just inflation and just in general, the cost of postage and all that stuff has gone up. Like, I don't know if I would say if you had 5,000 a month that I would spend it all in mail right now. Like, you maybe you do, but you need to have some other hustle on how you're gonna get other lead gen just because 5,000 doesn't go as far as it used to, and the marketplace is more sophisticated. More people sending mail, more people doing cold calling. So you kinda need something else. And if you only have 5,000, you may be spending, say, 3,500 on on mail, and then your other 1,500 is on whatever other systems you need, and you might be cold calling yourself or doing some other type of organic lead gen that's cheaper than just paying for, like, a pay as you go service.

Mike DeHaan: [14:17] Yeah. Well, I typically tell a lot of people, especially if they're if they're new to the industry, if they're kinda like good at the industry and they're good at sales, they can probably push a little bit more into mail and be okay. Yeah. We get a lot of people that come into the scale community that, you know, they understand real estate, but they're not salespeople. Yeah. Right? And so when leads start coming in, you don't wanna be having your practice reps on leads that are costing you 400 or $500 per conversation. You know? And and so what I normally tell people is get like a cold calling company or willing to cold call yourself and really lean into that for the first, you know, three months. And if you have surplus budget, put that in the mail. But doing like a cold calling and SMS in the outbound, it'll be like a tenth cost per conversation. You can get a lot more reps in. Yep. Right? Because otherwise, with direct mail or, like, pay per lead or some of the other ones that are higher higher cost per lead, it's not only that you're having less chances at goal, but you're also gonna have, like, time in between them. Yeah. And so what happens is you never really get better because if you only have, like, three good conversations a month when you're starting out and each one is, like, a week and a half from each other Mhmm. You're basically starting from square one over and over again.

Dan Austin: [15:27] Exactly. And you never get better.

Mike DeHaan: [15:29] And you never get better. It's like if you, you know, go to the gym three times a month, right, and they're all Mhmm. Two weeks apart, like like, you're never gonna actually see any improvement there.

Dan Austin: [15:39] Absolutely. Exactly. It's a great analogy.

Mike DeHaan: [15:41] Yeah. Now just see how build that lead snowball because even if you're not closing deals in that first run of cold calling, there's nobody in your system.

Dan Austin: [15:48] 100%.

Mike DeHaan: [15:49] Next thing you know, have 200 and you can work those on a regular basis.

Dan Austin: [15:52] Yep. Yeah. And and it's about volume in this game. We're doing mass marketing, so you gotta have a volume of leads to be able to work through all of them. That's just it is what it is. Number it's the numbers, you have to have them.

Mike DeHaan: [16:03] Yeah. For sure. But aside from that, you've been actually been working on handful of flips. It's funny. We were kind of out of flips for a while, but you always always feel like you kind of enjoy that side. Yeah. Is there anything that you're doing differently this time around as we're getting more back into doing flips versus when we were doing them several years ago?

Dan Austin: [16:24] What am I doing differently from a a management standpoint, like, have a different contractor that actually our Cody Cody brought brought to us, which is interesting. Yeah. He manages, like, most of it, which is kinda coolest in the way of, like, I'm not having to go and pick out certain things. Like, can be like, hey, dude. Yeah. It's a 30 inch vanity. Go get one that matches the kitchen cabinets. Okay? Where before it's like, hey, you give me all the materials, I'll I'll do the work. And so at a low volume, we're not flipping a bunch at the same time. At a low volume, you know, onesies and twosies, it's a lot easier to have somebody that you can trust to do that. I will say it's taking a little longer than I want. You know, our contractor got in a fist fight with his number one employee on the project, which by the way, they're back together. I saw them both today on the on the job site. I was like, oh, you guys made you guys made up. They both realized they need each other. But, yeah, I would say probably difference being is, I think, going into them, just being a little bit more diligent about what we're looking at and what we're doing and understanding what the market's doing. And so on this one that we'll be wrapping up soon, we actually had a comp right across the street, like three houses down across the street. That was the exact house is ours. So that was a great comp.

Dan Austin: [17:39] Looked at it. It was just like a really shitty flip, you know, like an old school flipper that just thinks you can just throw white shit in it and gray shit in it and make it good. And he still sold it, so that's fine. But looking at going into the market, hey, we've got some compromises we've got to make on some of the repairs that when you uncover, okay, well, let's put a little bit more time, not necessarily money invested in it and switch things up to make it a better product. So looking at it as opposed to trying to get done as fast as we can, how can we deliver the best product available on the market when we are done? So if that takes an extra three weeks, that's okay. Get that shit done and done the right way. So I just walked it today. And I was actually blown away at how badass it's gonna be. And it's not really gonna cost more. I mean, it will just because we had to make some changes than we initially planned. But it's like, this is gonna be a really good product for a family that's gonna move in here, they're gonna walk in and say, shit, this is cool. Now what we're not doing, and I literally had this conversation with our contractor, he's like, what do you think for bathroom vanities? And I was like, oh, man, this is 30 inch this is a 30 inch, you know, white fiberboard vanity with a, you know, whatever plastic top, basic ass mirror, you know, like, not like that we're going to make it look crappy because the whole house is gonna look really, really nice. You know?

Dan Austin: [19:00] What happens in some of these flips, you go into them and you're like, let's just get the cheap vanity, and we'll just kinda like smear some caulk in this hole here and paint over. And you see some of these things and you walk in and you're like, you can tell. Even as an end buyer, you can be like, this doesn't feel good. So we're we're using cheaper materials on this because it's in a cheaper part of the market, but we're doing everything else around it the right way. So when you walk in, you can't tell that the materials are cheaper. You're like, damn, this is well done. It's all tied together. It all looks good. Sure, that vanity's fiberboard and and might fall apart in five years as compared to buying a 6 or $700 one, but it looks really good, and it's still a good product. So I think we're compromising a little bit on the materials budget, but we're making up for it in layout and just doing all the things that need to get done instead of overlooking little things because you're going too fast.

Mike DeHaan: [19:49] Yeah. And I think that's more important now than ever when you're looking at the housing market in general, right, is people do have options Mhmm. On the market. You know? And if you don't have the best quality product Mhmm. People aren't gonna buy your house. They're gonna buy the one down the street that looks a little bit better that's exactly the same house, especially if you're in these starter home neighborhoods. Right? Totally.

Dan Austin: [20:13] Yeah. Totally. And look at what you got. Look at what the product is that you're putting out there and make it worth selling, because if you've been flipping the last two years, you know that you can sell a good product. It just if you put the wrong product on the market at the wrong time, you're that guy that's like, man, nothing out there selling. It sucks right now.

Mike DeHaan: [20:30] Exactly. Just it is what it is. Yeah. Hey. So you've heard

Mike DeHaan: [20:33] us mention our scale community before, and I don't have a lot of time, so here are the quick highlights. In scale, you get all of our processes and systems that we use to do about a 150 deals every single year. You also get a community of investors that are verified crushing it in their markets. Otherwise, they wouldn't even be members. And that way, you don't have to waste time with nonstarters like you find in other groups. You also get preferred relationships with marketing companies and even lenders that will give you 100% financing. If you just heard all that and said, nah. I don't really need it. That's not gonna help me. I don't know what to tell you. You're lying to yourself because all those things are guaranteed to help you explode your business and buy more deals next year. So go to claytonkeys.com/scale, and let's see if you qualify.

Mike DeHaan: [21:15] My rental property that I sold that closed last week, there was two other houses within, like, I don't know, a quarter mile that are literally the same house, same layout, same lot size, same everything. They were listed at $3.99, and theirs, like, looked ugly. Like, they looked bad. Bad flooring. People had obviously lived in them for five or six years, you know, ding the ball. They do basic stuff. Before I listed mine, I went and I did all new flooring in there, completely painted it. Right? Just, like, fixed up all the odds and ends and made it look good. Like, it looked really good when it was done. It cost me $6. Yep. Right? They listed at $3.99. I listed mine at $4.10, ended up selling it for $4.25 in the first forty eight hours.

Dan Austin: [21:57] That's crazy.

Mike DeHaan: [21:58] So I put in $6 to make it look good, and I got $25,000 more. And mine sold in two days, theirs are still sitting on the market.

Dan Austin: [22:07] Yeah. So you netted probably 20 plus thousand in that if you count your mortgage and everything.

Mike DeHaan: [22:12] Easily. Easily. Right? And I and I actually sold it. Those other people, they're still just sitting there because their product doesn't look Exactly. You know? And so I think on the flipper side, that's a really good point, Dan, is that's a really important piece. You know? And it it probably makes sense too getting away from just, like, the gray, white, whatever. Like you said before, talk to a designer. You know? Have your spouse or wife, you know, get involved. Probably has a little bit better eye for color than most of us do who are like

Dan Austin: [22:40] Yep.

Mike DeHaan: [22:40] On the flipping side of it, you know, or or find someone that has that connection that can help you make it look like a home that someone actually wants to live in.

Dan Austin: [22:47] Yeah. You'd be surprised. You could find like, just like an interior designer just like, hey, can I pay you $500 a project or a thousand bucks a project to just tell me what colors and what to do? And it's really important if you're gonna try to keep things. Like, hey, what do I need to do if I'm gonna try to keep these kitchen cabinets? You know what I mean? What am I gonna try to do if I'm trying to keep these this bathroom tile? Like, then they can help, you know, pull stuff in. That's what you and I used to do, it worked out great. Pay like, I can't remember, like $500. Give me all the colors of everything I need for this house, and then boom. I'd still pick out the materials, but I would know like, here's my options, and I wanna pick, you know, the one that's within reason of the price range. And it goes so much faster, there's less questioning. Totally.

Mike DeHaan: [23:24] Yeah. I mean, that's and questioning costs money. Mhmm. Right? Like, that's such a big thing when doing these is it costs time for you to think about stuff. And then indecision, especially when you have contracts that wanna work leads to them doing stuff that makes sense to them, which is usually not the best. Sometimes not great. Yeah. So any good lessons from this week, Dan?

Dan Austin: [23:43] Good lessons. Yeah. I mean, I think it'll go back to the earlier conversation we had on the acquisitions disposition side of things is really fed everything out on the on the seller side before you start blasting it out and doing all sorts of crazy shit to try to sell it. Especially if it's a little bit weird deal when you can see it's a weird deal, like ask the hard questions, figure it out, get it done. Even if you have to wait till you get it signed, then you start asking the hard questions, ask those and make sure you you have open communications. If you have staff members on both sides of your business, make sure that that communication's open and often. Having your kickoff meetings, having the communication on what's going on and latest and greatest on those things. You know, we're moving towards like a templated response to fill in all the information within our CRM, so it can it's not stuck in someone's head and have to communicate with that person one on one to get it out of it. It's like, no. These are the things we always need to know in every single deal, so communicate would be kind of the lesson learned here.

Mike DeHaan: [24:42] Yeah. Yeah. For sure. Right? I think that and asking the hard questions, like you said too, is really, really important because Mhmm. If you don't do it now, you're gonna have do it later anyway, so you might as well not procrastinate on me.

Dan Austin: [24:51] Yeah. Totally. And buyers are gonna ask all the hard questions to you, so you need to know those answers. Just professionalize that whole pass off and that whole hand off once it's acquisitions down into dispositions. You don't have to like blow a deal up because you're asking hard questions at the front end, trying to why you're trying to build rapport. Build a rapport, do the things, get them into the price box that makes sense. Get it under contract if you have to, but then you need to start asking those those questions if there's reason to ask certain questions.

Mike DeHaan: [25:18] Mhmm. Yeah. For sure. Then like again, a good action item for that, like you said, what we're doing. So what are the things that we have on the list that you're going through that you you need to get from acquisition before they kick it over to the dispo? It's like the occupancy status. Mhmm. Leases. Yeah. I'll just go through them.

Dan Austin: [25:33] Yeah. So I would say outside of the normal stuff, which is like I want a link to all the photos, I want bed bath count square foot, anything unique with the property, what's not on the county assessors? When you pull it up, what did the seller is there a basement in it? Can it be finished? Those sorts of things that aren't necessarily quite apparent just looking at the pictures. Major items that when you walked it, you saw that are good and bad. I may not use those in my advertisement, but I certainly need to know them. Because when I walk the property, when I on Dispo, when I see the property, the first time I see it's usually when I walk it with seller or buyers. And I don't wanna, for the first time, having buyers point out things to me, and I'm like, don't know what that is. Right? So, like, understanding, like, that sort of stuff. Like, yeah, there's there's roof. There's definitely been some roof leaks in the living room. This is what the seller said about it, blah blah blah blah blah. Those sorts of things. And then like, I also wanna know, is it tenant occupied? Can we get the leases? Do we have the leases? What and and if we have the leases, we just attach them to the lead. But like, if not, I needed all the information on the leases, like how much are they paying?

Dan Austin: [26:32] Are they month to month? Is there any specific person that's gonna be involved outside of the seller on this? Do I need to communicate with a third party? What does that title look like? All that sort of stuff is huge ahead of time. And then just the the final thing is like, what's gonna help me sell this property? Like, what is that, you know, it factor that you noticed or saw when you walked it?

Mike DeHaan: [26:53] Yeah. And so how we have that structured is literally just in a little form that we need them to fill out when they kick it over.

Dan Austin: [26:58] Mhmm. So that

Mike DeHaan: [26:59] way it's just easy, they're not forgetting stuff. So

Dan Austin: [27:01] Yep. When it goes to under contract, it automatically kicks off one minute later a task for the AM. And in that task, it just shows the list of things, they fill out what's pertinent and then post it in the comments. And now that's forever with the lead, and RTC can take that. The the nice thing is, is what we have is RTC can take that and immediately start building the marketing for me, I don't have to do it. And then I can review those notes, review the marketing, make sure it's what I want the marketing to show and say, and have the right information on it, and then we can just blast it out, it's like a seamless process.

Mike DeHaan: [27:32] Yeah. Perfect. That's a great lesson. That's great way to structure that. Awesome. Well, my lesson this week comes around communication as well, but I guess on the other side. And it's more just like the like keeping track of meaningful and productive relationships, and Mhmm. Not being afraid to follow-up with people when you have these good conversations. And so where this has come up a lot recently. So we have our lending company, our hard money lending company, which we've focusing on this year. We do a lot of co lending with this. And so what that means is that people that wanna invest in notes, you know, get 12% interest that, you know, APR, and they just get a monthly paycheck from that, like, passive investing, but they don't wanna go through the whole hard money lending process, don't wanna find borrowers, don't wanna do, you know, all the paperwork and everything else. Underwriting. Yep. Underwriting. They can basically buy portion of our notes, and they'll collect the interest, and they're still secured in first position along with us. And I've been promoting this a lot through Instagram, at different events, and everything else. And what's always interesting is I talk to people. People always say, yeah. That sounds good.

Mike DeHaan: [28:37] You know, add me to your email list when opportunities come up, and, you know, I'll I'll be interested in seeing what comes through. What happens with all these people once you have the email list? They disappear. Yep. Right? You don't hear from them ever again. So what I've started doing is is I talk to people, I figure out what exactly appeals to them and what their sort of risk tolerance is, and I keep a little note about them. Right? And then when we get loans that come through that I think would fit their interest box, before I go and blast it out, it's not that different from selling properties, right, to wholesale. I know exactly the kind of loans that they want, the timelines they want, and I just hit them up directly, and I'm like, hey, we have this loan coming up. I'm gonna be sending out this week. Wanna do your first shot at it. You can do any amount up to 120,000. Here's all details, let me know what you think. And sure enough, doing that over the past week, I got a $120,000 from somebody that had basically just fallen to the nether. I have a verbal and a $140,000 from somebody else, from somebody that's been, like, on our investor list for several months, and I've heard nothing from. And it's purely because I outreach to them directly Yeah. And very specifically thought of them on this deal. So they feel special. Yep.

Mike DeHaan: [29:48] Right? They feel like I actually thought about them with this, and it's more of a catered relationship kind of conversation. Yep. And I'm also forcing them to actually look at one of the opportunities because I'm bringing it to them directly, and they know that they're the only ones that have a shot at it. Right? So they're gonna give it more time as a result. And I think it's so often people that are in a networking, they kinda just go down this networking rabbit hole, and they talk to all these people, and they add them to an email list, and it's they're in their cell phone, you know, and they follow each other on social media, whatever, but they never actually have the one to one down to the details, like, business conversation, which is really where money is made. Yep. All of these transactions, they're one to one. They're not like one to many, like you're selling widgets. Right? Where you blast something out to 50,000 people and you sell 50,000 widgets. You only need one person to do each deal. And so sometimes it makes sense to go and,

Dan Austin: [30:40] you know, you're asking people to give you a $120. You don't get an email response from email blast. You give somebody a call and be like, hey, man. Here's the deal. Make them feel good about the deal. Make them feel good about you and communicate. So that's a huge that's huge because the same thing goes, you you mentioned it on the Dispos side, but also if you're if you're trying to do anything in real estate on the flipping and investment side, like you need private lenders too, it works the same way, you know, sending out, like, even if you're gonna go get a hard money loan, and you've talked to people that are interested in your deals, like, hey, I'm I'm doing this deal. Do you want in? This is something this is an opportunity for you to invest alongside me. 12% interest, 11%, 10%, whatever it is. You have your hard money lender as a backup. This is just the way to show potential private lenders what you're doing. You know, Mike and I are doing it in our hard money business, and we do it as well for our dispo deals. It's that whole thing of like making that buyer feel special and giving them that call and say, hey, I'm putting this in front of you, cause you and I have talked about this. I trust you as a good person and as a buyer to close on a deal like this.

Dan Austin: [31:40] Are you interested? It's one to one. Makes it feel good. Exactly.

Mike DeHaan: [31:44] I mean, in in every transaction's a one off. Right? Mhmm. It's like, again, it's like you can you're selling the same thing No. Is 100% exactly the same to 50 different people.

Dan Austin: [31:53] Yep. You know? And it's

Mike DeHaan: [31:54] more work, but that's also where the money's made.

Dan Austin: [31:57] Mhmm.

Mike DeHaan: [31:57] You know? And it and it's funny because people ask all the time how we've raised money on certain dealer lists, what that process looks like. And I'm like, I just ask, honestly. Like, it's not like I'm trying to pitch anything where I have some, like, super fancy sales tactic. I just keep note of who has expressed interest in it. And then when the opportunity comes up that I know they want, I ask them directly, very openly, and they can say yes or no. And if they say no or they don't answer, does it hurt my feelings? I still bring in the next one regardless. Right? Exactly. That's how the game works.

Dan Austin: [32:30] Good advice.

Mike DeHaan: [32:30] Yeah. Alright, Dan. Anything else to finish up?

Dan Austin: [32:33] No, man. I'm good.

Mike DeHaan: [32:34] Cool. Alright, everybody. Well, thanks for listening. Hopefully, there was some helpful tidbits for you in there. Obviously, a lot on the relationship side as we've narrowed down to the Spokane market again. I would say that's really starting to show itself more and more. But, you know, I don't know what you think, Dan. It's definitely more work, but it's also more fulfilling. I feel like to get more involved with some of these rather than have stuff be so far removed, like, with our national business where we didn't really know any of the people involved. It was more transactional. It was harder to feel as, I don't know, like, tied to the results.

Dan Austin: [33:07] We're building a more lasting of a business when you're involved like that at the relationship level because at the fundamental, like, business the kind of business we're in, the relationships do matter. And so when you're doing it at a transactional level and you're relying on employees that may or may not be here next year, you're not building necessarily a foundation of sustainment. You know, you're building a SOP and a business model that sustains, but the relationships that really can carry you through the the harder times or the difficult times are are what really are important. So and and you as the owner of your business get to control those a 100%. So that's I think when it comes to the fulfilling side of things, definitely hits on that.

Mike DeHaan: [33:42] Totally. And I'll also say as an entrepreneur, if you establish those good relationships, if you ever decide to change industries, those relationships will carry with you because the They do. Small business entrepreneur space is shockingly small.

Dan Austin: [33:54] And they all get fucking fascinated and interested by other ideas because I know. We all have some level of like ADD and like, you're doing what? Oh, that sounds awesome. Can I come with you? Can I do you know what I mean? People get so excited about it, dude.

Mike DeHaan: [34:06] Yeah. Exactly. They wanna get involved.

Dan Austin: [34:08] Oh, one last thing. Just because Dylan's gone with a vet, if you don't wanna mind, reach out to him. The issue he was having is I think his hairless cat started growing hair. So if you wanna just give him a DM and at Dylan underscore duzz underscore deals, just let him know, you know, we're praying for his hairless cat.

Mike DeHaan: [34:24] Praying for his hairless cat. Perfect. Yep. Awesome. Alright. Well, Dylan, again, sorry if hit a bunch of random DMs. Find out. But alright, everybody. Thanks for listening. We'll talk to you guys next week.

Dan Austin: [34:35] See you.

Mike DeHaan: [34:36] Thanks for listening, everyone. If you want more from us, you can shoot us a follow on Instagram. I am at Mike underscore Invest. Dan is at Investor Man. Dan and Dylan is at Dylan underscore does underscore deals. Choose to follow and send us a DM to let us know what you think of the show.