Biden's new Mortgage Policy, Buying Carol Baskin's Home, Working with a Business Coach

Mike DeHaan: [0:00] Might cost you a little bit more to buy a personal home at the time, but over the long period, I do think that it will cause you to have a larger gain, which I think is okay. Mhmm. And I think the biggest thing that people tend to get worked up about is kinda like the precedence of the matter. Right. Right? Of, like, that it does seem to have that Robin Hood socialist sort of feeling in it. What everyone always says is like, well, if you let them do this, what are they gonna do next? What's going on, guys? Welcome to this episode of the collecting keys podcast. Today, it is Wednesday. It is another episode of the Mike and Dan show where I, Mike DeHaan, and my cohost here, Dan Austin, talk about real estate investing business and whatever else we feel like for the week. Cool. We are currently end of April, and all of the hottest news in real estate right now is about this new mortgage policy that Biden just pushed through. And this is not this is not a political show. I do not have any political beliefs or affiliations of myself as far as all of you are concerned. But it is something that's super relevant to our business. And depending on where you fall on the spectrum or, like, how you look at it, there's a lot of different ways you can view it. So if you are unfamiliar with this policy, and, Dan, can correct me if I'm wrong, but very basically, if you have a higher credit score with a threshold that's, 650?

Dan Austin: [1:27] 680 is what I heard, and by the way, there's tons of things out there that's probably misinformation on this one.

Mike DeHaan: [1:33] Yeah, right, it's all misinformation, do your own research, we'll just give you an interpretation on it, but if you have credit scores above 680, essentially you are now going to have to pay a 1% additional cost on home mortgages. If your credit score is below 680, you're gonna get a was it one and a quarter percent discount on home mortgages. And the general thought with it is they're trying to make it so that home ownership can be more affordable for people that have lower credit, assuming those people are less well off, which is also funny because tell you what, when I used to work at a hard money company, I used to people that were fucking rich, dude.

Dan Austin: [2:06] A lot of investors went low for this one.

Mike DeHaan: [2:08] That had a horrible credit. You know, like, I remember a guy, he sent me his bank account. It's literally his bank account. He had $5,500,000 in his bank account just in cash, but his credit was $6.20. Well, good news. This guy now gets a one and a quarter loan discount on it.

Dan Austin: [2:25] Yeah. Right? Yeah. So, yeah. And I mean, don't get all upset like Robin Hood here, we're stealing from the rich, giving to the poor. So many people jump to the socialism. This is bullshit. I can understand. There's an argument for whatever you wanna say on that side of things, but if you just break it down and don't just look at the misinformation that's sent out there, there's some benefit to us as investors here, huge benefit, and it's, in my mind, at the end of the day, this is just another housing subsidy, which we as investors love housing subsidies. We also love it when the Fed says, we're gonna make interest rates, we're gonna hold them to record lows at 0% on the federal funds rate, so that we can all go and get 23% mortgages again, and cash flow like kings. This is just one of those other scenarios. We're not dropping interest. It is kind of it could potentially be inflationary. I don't know about that. Again, I'm not a macro economist, but what I know from myself as a real estate investor is I see, oh, so lower income people can now afford to buy housing, and those people tend to buy entry level houses. And what do flippers and wholesalers and real estate investors like us like to do? We like to sell people entry level homes at that price point, and we typically sell them to these folks, and now more people can afford our product. So that's kind of a good thing.

Mike DeHaan: [3:40] I think that's one of the most overlooked things with this is, you know, making that buyer pool larger is going to make home values go up for everybody, honestly. Right. Home values, despite what everyone seemed to think about hedge funds and all sort of bullshit. Right? It's all it's all come down to supply and demand at its core. Mhmm. Right? And if demand can now increase because stuff can become more affordable, there's gonna be more people wanting to buy. Your home properties values are going to go up. And especially in like that lower tier price point, that's gonna happen first, and then that will trickle up to the higher tier price point, and then all of a sudden, it'll just keep going. So Right. You know, sure, it might cost you a little bit more to buy a personal home at the time. But over the long period, I do think that it will cause you to have a larger gain, which I think is okay. Mhmm. I think the biggest thing that people tend to get worked up about is kinda like the precedence of the matter. Right. Right? That it does seem to have that Robin Hood socialist sort of feeling, and what everyone always says is like, well, you let them do this, what are they gonna do next? Right?

Dan Austin: [4:40] Yeah, of course. It's a slippery slope, know? But what if there's a Republican office and they spun it a different way, like, that this was some sort of, like, infrastructure act, and we're gonna invest in housing, and and we're gonna give construction people jobs? Because you could spin it that way because when you have these lower tier price point homes more available at a cost that's more available to people that would buy them, that's going to,

Mike DeHaan: [5:02] like you said, it's gonna continue to trickle up and drive demand in all all asset classes. Well, literally, only reason they don't spin it that way, right, over on the Republican side, is because we have

Dan Austin: [5:10] a Democrat in office. That's right. Yeah. Exactly.

Mike DeHaan: [5:13] But even if, like, if it was Trump that had put this through, it would be completely different, and it would be somehow the Democrats would be upset by. It's just like so I know everyone called the stimulus freaking Biden bucks. Those started when Trump was in office, you dumb shit.

Dan Austin: [5:25] I want some Trump

Mike DeHaan: [5:26] bucks too.

Dan Austin: [5:27] I want some Trump and Biden box.

Mike DeHaan: [5:29] Yeah. But like, it's it's so stupid, you know? It doesn't make any sense.

Dan Austin: [5:31] I know. Yeah. I don't discriminate against who gives me free money. But, yeah, I I think the point here too is really, pay attention to how this actually affects you, and don't kinda get behind. I I don't know. Do whatever you wanna do. But, like, at the fundamental of this, like, the fundamentals is, this is, I believe, good for you as an investor. And by the way, for you purchasing a home as an investor outside of your your primary, this is, I think, again, do your own research, Fannie and Freddie loans. So, like, we're typically getting commercial loans in all our acquisitions anyways. Like, it doesn't affect us as far as our loan costs go that I I don't know. Maybe there's some weird way it circumvents it and affects me, but I don't think it will.

Mike DeHaan: [6:06] Ultimately, what I always think with stuff like this is, do not let your life get into a position where this actually affects anything about it, or that this really gets you worked up. Find other stuff to focus on that you can actually control.

Dan Austin: [6:21] This is the goal of why we're all here, I think, too. Think this is the goal why we have the listeners that we have, why you and I are where we're at is because, like, that's our goal. Like, we want to not have to worry about little bullshit like this.

Mike DeHaan: [6:31] Yeah. I mean, and realistically, you don't have to. You can make the conscious choice to not do it and to focus on your things, and it's good to be aware of them. But if you're the kind of person that now goes and expands a bunch of personal emotional energy on this or on these sort of situations, I don't know what to tell you. You you are taking that away from other parts of your life where your entire, like, lifespan could benefit from putting that emotional energy towards it. But instead, you're giving it to the talking heads who don't give a shit about you anyway because, you know, also to you, I'm sure that whatever additional money they're taking from somewhere with this whole thing, it's just going to their pockets anyway. It's not going to help you out. I don't know if

Dan Austin: [7:10] it's right. It's gonna go create a bunch of jobs that aren't necessary in

Mike DeHaan: [7:13] the government. So I don't know. It's a relevant thing for right now. Like, and this isn't a political show. I don't like to get into political related stuff. But I think ultimately, Dan, like, you're completely right. From an investor real estate value perspective, I do think that it is something that could be very beneficial in the long term Mhmm. Because it does increase that buyer pool, and it's going to just force prices to keep going higher, which is what all of us who are holding real estate wanna happen long term anyway. Exactly. Can't complain. Cool. Alright. That's our political world news topic real

Dan Austin: [7:43] estate related. Hope you learned something there.

Mike DeHaan: [7:46] I wanna talk about instead, Carole Baskin, who is a name Yeah.

Dan Austin: [7:50] I gotta hear this story. I gotta hear this story from Old West. I missed the call, our group call on Tuesday, I remember The

Mike DeHaan: [7:56] name that many of you have not heard for a while. If you don't know who Carole Baskin is, That's it. Yeah. There was that that Tiger King show where there I I I never actually watched this show. I just know of her. I feel like

Dan Austin: [8:08] it I'm surprised it didn't win an Emmy. It's such a good show. It was so engaging.

Mike DeHaan: [8:12] It was I mean, it was just like the perfect time with COVID. I just I don't watch it like that because I refuse to support those kind of people. But so so she was like the wife murderer of like the crazy Tiger King guy.

Dan Austin: [8:24] Well, no. The Tiger King is a different character in this show. She's the

Mike DeHaan: [8:28] I have no idea.

Dan Austin: [8:29] She's the crazy wife of one of his competitors and then became competition, I believe. I can't remember.

Mike DeHaan: [8:34] See, exactly. Either way Please correct us on this. Yeah. You can correct us if you're really into the Tiger King. First off, listen to my what I said about politics. Go find something else to care But I just think all the meme stuff should become kind of a a figure. But, anyway, so, yeah, in our instant investor group, we have one of our members, Wes, who comes onto our group call on Tuesday, and he's like, yeah. So I I took a call this morning from Carol Baskin, and we were like, what? Like, actually? And he has he was going through this situation. It's not the actual Carol Baskin, but it's literally the lady's name. But this lady That's her

Dan Austin: [9:08] actual name?

Mike DeHaan: [9:08] Actual name. Oh, crap.

Dan Austin: [9:10] I thought we were just

Mike DeHaan: [9:11] thinking about the name. No. That that's literally her name.

Dan Austin: [9:13] Dude, that is unfortunate for her.

Mike DeHaan: [9:15] And the situation going on with this lady's house sounds eerily similar to, a tiger sanctuary, except it's with bloodhound dogs. So with what? Bloodhound dogs. So, like, like, like, the big, like, hunting dogs, right, that they have. Gotcha. Like, the bloodhounds, you know what I'm talking about?

Dan Austin: [9:32] Yeah. Yeah. Yeah. Yeah. The big ears, they have

Mike DeHaan: [9:33] big ears. Big ears. They're, the ones that they not like they kinda like the fat ones, but the ones that they use for, like, hunting stuff. Yeah. And so she had a bunch of these things. And he's like at her house, had these really weird cages and these dark parts of the house. And she had all these dogs in this outside area and all this sort of thing. And he was going through it. And the motivation with this deal and this is just this is just going back to the good old days of Mike and Dan talking wholesaling. So the thing is is they had someone break into their house and basically try to kill her. And she suspects that it was a hit put on her from her ex husband. Oh. And it was so recent that there's still literally blood on the floor from where she dragged herself to the phone to call for help.

Dan Austin: [10:21] Oh, she actually got, like, hurt. Like, this wasn't like a real, like, a big thing.

Mike DeHaan: [10:25] No. She, like, fought off the person and, like, called for help and, like, did this and it says just nuts. And she said that she's, like, all over the place as you'd expect with this whole thing. She's trying to get out of the house, But literally, it screams Carole Baskin. I was like, bro, when's the Netflix special about this version coming out? Like, is getting crazy.

Dan Austin: [10:43] So the bloodhounds are not in the house now or they were? I'm just curious, like, this whole, like, nightmare of a situation where they, like, there and, like, saved her life, and they chewed off this guy's arm, and there's, like, a finger somewhere under the cupboards or something.

Mike DeHaan: [10:56] Yeah. I don't know all the full detail. Let me pull up our Slack. It was a reverse story. So yeah. Sounds like a hit. Yeah. There's a foot on the door. Oh, man. Yeah. Solitude and then disappeared hasn't seen her accents. Waiting for the divorce to finalize she can get out of this property. And so first off, I mean, it's tragic what happened. We shouldn't laugh about it. But it's freaking crazy. But wow, this is this is like one of those reasons though about why our business exists because the house is in a huge state of disrepair.

Dan Austin: [11:23] It's a

Mike DeHaan: [11:23] crazy situation with the dogs. There was this bad stuff that happened there. She wants to close it quickly and needs a lot of work. What's a realtor gonna do in this situation? Poof. Who knows? Exactly. Gonna be sympathetic Yeah. To

Dan Austin: [11:37] Right? It's probably a lower price point house because it needs work, and so the commission is not that great.

Mike DeHaan: [11:41] Also imagine, I always like to think about this when people are they kinda make fun of investors about why don't they list the house? Imagine this situation with a realtor bringing through retail buyers, where retail buyers always wanna know weird stuff. Like, what's the story with this house? It's like, well Right.

Dan Austin: [11:56] Do you really wanna know? Do you wanna know? Yeah. So let's start with the seller's name's Carol Baskin.

Mike DeHaan: [12:02] Yeah. Right. But no, man. It was such a crazy situation. I mean, I think as of this came up on Tuesday. Think I he's getting assigned around today, actually, so it's pretty sweet. Dude, that's sick. But, yeah, I mean, it should be a pretty basic flip. Carpet, paint, you know, it's gotta fix a bunch of, like, little odds and ends, some windows, clean the blood off the floor.

Dan Austin: [12:22] Get some bleach to clean off the murder

Mike DeHaan: [12:24] And then whatever it takes to clean up dog, farm. I don't know how many dogs there actually were.

Dan Austin: [12:30] Dude, remember that house we bought that had the whole basement? Was that dog poop or cat poop or both? Like, the whole floor It was a dog poop. Just covered in that condom? It actually cleaned up surprisingly well. Cat pee is another thing, but, like, that actually cleaned up well. I mean, it was shoveled out.

Mike DeHaan: [12:45] It thinks it was on slab. If it's on wood, it's different. You gotta start ripping

Dan Austin: [12:48] Yeah. The I feel like, though, like, cat pee even in concrete would be terrible, but, like, yeah. That wasn't bad. Smoker smoking is the worst, but, yeah, the fire. Ugh.

Mike DeHaan: [12:57] Yeah. Some of some of the animal situations that we get into are just crazy. Like, I mean, you know, you remember when we bought Frederick, there was literally a a room full of birds.

Dan Austin: [13:05] Yeah. Like, not just birds, like a lot of birds.

Mike DeHaan: [13:08] Like, 50 of

Dan Austin: [13:09] thing is I swear to god, like, things that I do not like. We've bought a house for things that I'm either definitely afraid of or just don't like, like birds. That's the one animal. I just do not understand why people would have that in their house because they are so frighteningly annoying.

Mike DeHaan: [13:24] Are you afraid of birds? I'm not afraid of

Dan Austin: [13:27] birds, but that I have these no. I have this, like, super bad hatred. So my mom, she would always take in when I was a kid, like, she would always take in people's pets that they'd be like, why? We just can't take it anymore. It's not like we had a ton of pets, but we'd, like, randomly. Like, one day my mom brought home an iguana, and it was, in a cage, and it was, like, small, then grew to five feet. Like Yeah.

Mike DeHaan: [13:47] I do not like that.

Dan Austin: [13:48] I did not like the thing. And then she brought home a bird, a different bird on three different occasions, and one of them was a talking bird. And I'm just all I know is like, they're just so annoying. They're just chirping. 5AM, they're chirping. They're doing all sorts

Mike DeHaan: [14:01] of they're just so annoying. So you have what the kids today would call a trauma. Do need to go see something about it? Is that a trauma? Oh my god. Yeah.

Dan Austin: [14:08] You're supposed to talk

Mike DeHaan: [14:09] about how you can't live a normal life now because of that. Why you go get a therapy dog you bring on the airplane.

Dan Austin: [14:14] Dang it. Good idea.

Mike DeHaan: [14:17] Yeah. But we've had yeah. We've had that. I mean, we had the the people that we had to rehome their dog, Tony, remember, because that dog was just Oh, That was sad. That was super sad. Sweet dog. We found a nice home for him up on the lake.

Dan Austin: [14:29] That was a

Mike DeHaan: [14:30] dog. Remember when we

Dan Austin: [14:31] when we went in the basement, and the we're like, I think he's gonna go to the bathroom because he was just kinda peeing a little bit, and then all of a sudden, the dude just pissed like a five gallon bucket. Tony's like, think I just took him outside. I'm like, I don't think you did, dude.

Mike DeHaan: [14:44] I don't think this dog's been out for, like, a whole day. Yeah. I remember that. It was so much. Yeah. And it was

Dan Austin: [14:49] a good enough dog that it wasn't peeing in the house, which is great. Yeah. Can tell it just couldn't hold it anymore when we walked down there.

Mike DeHaan: [14:55] Yeah. That was super depressing.

Dan Austin: [14:57] It was. Gosh dang.

Mike DeHaan: [14:59] Did I tell you I saw Tony not too long ago?

Dan Austin: [15:01] I think you did. You saw the you saw him, like, on the street? Was

Mike DeHaan: [15:03] walking On down street. Walking down Monroe, had his cane, man, just doing his thing.

Dan Austin: [15:08] Yeah. This is the seller he's probably one of my favorite sellers. This is the seller that went and we bought his place, and he's moving into an apartment. He's an older guy and couldn't handle the house or the duplex anymore and all that sort of stuff. Now, before he even moves out, he went and bought a $50,000 truck.

Mike DeHaan: [15:24] Oh my god. I asked him how

Dan Austin: [15:26] much he actually, I think he said it was like 60, He doesn't even have a driver's license.

Mike DeHaan: [15:30] You buy it. We bought it from one of those, like, kinda sketchy, like, used vehicle places. Right.

Dan Austin: [15:34] Where they, like, make it look really good, but it's still, like, not a nice vehicle. Like, new big tires on the truck and, like, shine it up real nice.

Mike DeHaan: [15:41] Yeah. But I remember we were we were helping him move, you know, when we showed up at his house at 8AM, when we told him that we were gonna be there to help him move, and we knocked on the door, he was still asleep and hadn't packed anything yet. Yeah. So we helped him pack up his whole house and pile it. But then, remember he got into his truck, and we were behind him in your truck, and he literally just did an illegal u-turn across four lanes of traffic to start going the wrong way.

Dan Austin: [16:03] I was like, oh

Mike DeHaan: [16:04] my god. What did you

Dan Austin: [16:05] remember that? Yeah. He did not yeah. He should not have been driving. No. And he owned two cars at that point because he already had maybe three cars at that point.

Mike DeHaan: [16:12] Yeah. Yeah. So But anyway, just reminiscing so many deals that we've done in relatively short period of time.

Dan Austin: [16:19] So much fun. You know

Mike DeHaan: [16:20] what's crazy though is how many deals you remember. I doubt. Yeah. I was actually clicking through just like a lot of our records. Even And though we've been doing this for quite a while, I can tell you details about the vast majority of the deals that we've done. Right. Even ones that, like, I never walked or anything, I just remember little pieces of them. Because, like, everything in the off market world is so weird. There's always, like, high points and inflection points in these conversations that you're like, oh god. Always. And it's it's so strange. Like, even though, like, another one of our our instant investor guys, McKinney, he has his deal that he's he's walking through right now. And this is just like the kind of sellers that we deal with. So, like, the house just has, like, rotting joists and, like, all these other things. Like, the house is, like, about to cave in. Like, there's no way this dude can sell this house normally. But the guy who's claimed the fame is he's, like, a super I'm trying to think of, like, how to describe him. He's like an extremely sexist, but, like, kind of, like, famous author. So he's, like, published all these books that, like, incels read. And seriously, and and, like, a lot of them are, like, they have these, like, weird religious undertones and stuff.

Mike DeHaan: [17:26] But he said he had all these books all over that this guy had wrote that were, like, anti women. Oh my gosh. And oh, shit. What is it? And he's going through, and of course, the guy's completely irrational about asking price and all sorts things. So the guy's insane. And I was chatting with Kenny about it. He's like he's like, yeah. I just want I'm just excited for there to be a day where there's like a normal conversation where someone's like, hey. I wanna sell my house. Do you wanna buy it? I was like, yeah. And then they work at a deal. And I'm like, over the hundreds of deals that we've done, there's probably been, I don't know, a dozen that are like that.

Dan Austin: [17:58] Yeah. Not many.

Mike DeHaan: [18:00] Maybe. Not very many at all. It's super, super rare.

Dan Austin: [18:02] And if that happens, then the whole

Mike DeHaan: [18:04] It gets boring. It gets boring. Right. You definitely definitely can't start a podcast about, oh, yeah. Here's how we talk to a seller. And and also too, I will say, when you talk to off market investors, quote, unquote, wholesalers, whatever, if they don't have those stories, you can tell that they're not actually doing business, and they're probably like daisy chaining or doing something else because

Dan Austin: [18:23] Well, you know another thing that I think about all the time is how I like I enjoy working with other off market or other, like, investors that have done off market or experienced in off market because they know how

Mike DeHaan: [18:35] to get deals done, and they know

Dan Austin: [18:37] so much more about real estate. You go and talk to somebody who either just uses an agent, buys off the MLS, or maybe they're an agent themselves and wanna be an investor, or just somebody that hasn't done this type of real estate, they know surprisingly little about how to get transactions done. Like, so little. And when you when when I say that, I mean, especially when you run into issues during a transaction, because there's issues with lenders, there's issues with sellers, there's always issues with buyers, there's issues with title, lawyers, all that stuff, and not having the experience or creativity to solve those problems. Ugh. I guess we're just gonna have to delay or cancel the transaction. It's not gonna work out. It's like, well, you've got like 200 other options to think about in this situation.

Mike DeHaan: [19:16] Yeah. And what you described there is why I think it's such a farce when people say that wholesaling is like a get rich quick scheme. Because like the marketing and sales side aside, which is challenging, having the flexibility and the knowledge to overcome situations like that or to just like figure out how to realistically broker both sides of the deal. Because as a wholesaler, you're basically brokering the seller and the buyer. Yep. You know, you have the contract with the seller, you have the assignment contract with the buyer. You need to make sure that both sides do what they need to do to get it done. And you need to have enough knowledge and experience about what's required on both sides to make sure that it's actually happening. Right? Because, you know, you can rely on an escrow company to an extent, but as we found, it varies heavily by market. Like, we have some escrow companies like these people we've worked with down in in Baton Rouge that are freaking awesome. They are on it. Super on it.

Dan Austin: [20:09] Definitely not giving them a referral.

Mike DeHaan: [20:10] Sorry. Yeah. Right.

Dan Austin: [20:11] Not live on the podcast.

Mike DeHaan: [20:14] But then we have other ones that we've worked with, and they wait until two days before closing to be like, oh, yeah. We actually recognize there's an issue in title. Mhmm. And we can't close. I'm like, well, why what have you doing for the last three weeks? But those are all things that, when those situations come up, you can overcome them, but you have to know what you're doing. And if you don't know what you're doing, you have to know enough about the general process to figure that out. True. Most of it, you can't just, like, Google the situation, and there's gonna be like a True. A bigger pockets post. Yep. Right? Like, that's not how it works. You have to be able to understand the real estate process enough to recognize the patterns of things that are issues and fix them. And one of the things that I think really affects wholesalers who are trying to scale is I mean, I'm talking to one of our old partners right now about this, is they're not willing to put in the extra work to get deals done. Right? And because they're they're like, oh, well, it's not worth my time. How's your things? Like, that is literally the business. Yep. If you don't wanna do the extra stuff to get a deal to cross the finish line, don't do this. Like, if the seller was completely self sufficient, they wouldn't need you. Yeah. K? The buyer can be more efficient, but that's you know, you still need to vet them because we've had buyers back out last minute because they don't know what they're doing.

Mike DeHaan: [21:27] And that's how it's so how much of a service facing business it is, and I think a lot of people tend to forget that.

Dan Austin: [21:33] Yeah. Well, and I think too, when you think about real estate and a real estate agent, say twenty, thirty years ago, let's just say before Zillow versus now, real estate agents now don't really have to network and broker deals. Just know that if they put on the MLS, it's gonna get on Zillow. Not only are agents gonna see it, but other buyers are gonna see it because it's free for them to see it. They have all these email distribution lists, which mind you, just are terrible to get on because then every broker not only puts it on the MLS, then the email of their little sheet out on it, just fine, whatever, But there's just not a lot of brokering going on. We're on the off market. There's no market. Right? So you are creating the market. You are brokering the seller side and having to procure buyers. And so there's just so many more challenges with that and so much, I guess, opportunity to learn and develop skills in that.

Mike DeHaan: [22:21] Absolutely. And that's the reason why we can make $40,000 on a $150,000 home.

Dan Austin: [22:28] Yeah. Or why we might only make $10 on a million dollar home.

Mike DeHaan: [22:30] Exactly. Right? That's something that so many people don't understand. And I actually get this a lot when people reach out about wanting to work with us in in either a group or in our our partnership program, and, like, some of, like, high ticket markets is biggest thing that always come up is around like margins, and like what can the expected deal size be? And I'm like, it depends, man. Like there are so many variables. Because we we have literally made $35,000 fees on a home that was worth $70. Right, just because of how how the deal got structured and all that sort of stuff. We have also made, I think the lowest we made was a $5,000 fee on, was it like a $550,000 property? We had one over out in Spokane Valley a while back.

Dan Austin: [23:11] That's not our lowest fee, but yeah, that's our lowest probably on that size.

Mike DeHaan: [23:15] Yeah, relative to the size, it's absolutely the lowest. Lowest fee we've ever gotten was $350, which is outrageous. Making money. Yeah, right. Funny thing the funny thing about that one too is that was back when we still paid our sales guys. This is actually a big reason that we shifted this. We pay our sales team a percent of the deal. I'm like, man, we're about to write our sales manager a check for like $60. Right. Like, it's almost ours to give them nothing. Right. Exactly. Yeah. There's so much variation. And if you're creative and you're flexible and you kind of know that process, that's like a whole different level of skill that is you learn through experience, and you learn through study, and through honestly screwing things up too. That's one of the biggest things when I'm talking to new investors, they're always worried about what happens if they get into the XYZ situation. I'm like, you figure it out, and you learn for next time.

Dan Austin: [24:07] Yeah, build a system. Mean, you and I still screw up on things today in our business that we have to like, alright, let's figure this out, let's learn from this, and what do we need to build around it so it doesn't happen again?

Mike DeHaan: [24:15] Yeah. Mean and and it's funny too. A lot of people, they always worry about legal ramifications and that sort of stuff. But I mean, you know, that's why you have earnest money. Right? That's how you why you have our contract. Again, our contract just specifically states that if we fail to close, all the seller gets is earnest money, and they don't have any ability to sue. Right? Yeah. So if you protect yourself that way, sure you might lose earnest money, those sort of things. That's fine. But that's like a very small price for an education on a situation that you can overcome next time, which, you know Sure. You eventually do enough deals and you kinda cover the full spectrum of all the possible hiccups you can have in deals. Yeah. So anyways, yeah, it's been it's been just, you know, interesting watching some of the the guys in our group starting to have their own stories and stuff like that.

Dan Austin: [24:59] Yeah. Exactly. They're building their own experiences. Because, like, mean, every once in a while you hear, like, a easy win that gets bopped off. You're like, damn. That is awesome. Like, I shouldn't even say easy, but just like a good solid win that you're like, damn. I need one of those. And then you see the other or the same folks even, like, working on, like, deals like this. Like, been there. Oh, yeah. I know. So it's just like there's a whole spectrum. And that's why it's also great to get around other people that are doing similar stuff, because you get to see all angles of it, instead of when you're having a bad day thinking, oh, it's just you? It's like, no. Homeboy over there is having a bad day too, but also, my friend in this group is also having a fantastic day. And so you can kinda get all angles, it keeps you going, which is a big part of this business.

Mike DeHaan: [25:43] Yeah. I mean and that's adding too is this business, like you said there, good day, terrible day. There's so many roller coasters in this. And, eventually, you just get kinda seasoned to it. So, like, know, like, this week, we were supposed to have seven closings, and then with some issues with lenders and other things, all seven closings kinda pushed back a week, and we're hoping that they come together. Right. But we'll see. But man, tell you what, a year ago, year and a half ago, that would have been devastating.

Dan Austin: [26:09] Yeah. Well, with all the income coming in from something like that, we would have been like, oh, bro. Like, what are we gonna do now? Because we would have also been lining up some acquisitions or lining other things up, and we would have had to pivot and do a bunch of other it would have had such a chain reaction in our business. Not that we wouldn't overcome it. It would have just been like, uh-oh. Yeah. You know?

Mike DeHaan: [26:27] Well, yeah. But I mean, it would have been devastating on the psyche though.

Dan Austin: [26:31] Oh, yeah. You know? I mean, we've had that happen. It's happened to us many times.

Mike DeHaan: [26:34] Exactly. Where we thought we were

Dan Austin: [26:35] gonna have deals coming together and they just didn't or they got delayed or they're just unknown. Oh, man. Yeah.

Mike DeHaan: [26:40] Yeah. You just become seasoned after a while, and I was like, well, that's just kinda how it goes to another day I in the think you

Dan Austin: [26:46] just really learn the law of averages, honestly, in this business because although you know that it sucks that something like that would happen, deal gets dropped or delayed or something happens, you know you do this enough, it just comes around, you're gonna get a win. And you realize that having a bunch of wins in a row doesn't mean it's gonna keep happening, and

Mike DeHaan: [27:05] that you

Dan Austin: [27:06] have to be ready for the next quarter.

Mike DeHaan: [27:07] Yeah. And then something about real estate too. I mean, and this is the same with like the the broker side as well. It is so streaky. Like, everything like, it's always comes in massive waves. I don't know why cycles of the moon or some BS, but sellers always wanna sign all at the same time. And then they always wanna have the same closing dates. There's just like even marketing will hit in these super big patches where all of a sudden you see like, damn, we're dead. And then all of a sudden, over the two days, you set a record for number of leads you've ever had in two days. And you're like, what the hell has happened in the last three days? Like, have the last two weeks. I have no idea. But this has always been that way for years. And it's funny, you talk to a lot of people in real estate, and they say the exact same thing. I'm not sure why that is. But I I mean, it's a this is such a perfectly inefficient business. You can never predict what's gonna happen next. You can have KPIs, and you can try to, but you can never be super spot on.

Dan Austin: [28:04] Yeah. It is challenging. You're right. We've looked at that even from a marketing standpoint, like, what KPIs can we look at to say, well, if we just spend more money here, like, there's some base KPIs, but, like, at the same time, you're just blown away. Like, that should not have happened, or why the hell did that happen?

Mike DeHaan: [28:19] Yeah. I think that's a that's actually a really valid question. This is so one of the things people another question people ask on a regular basis is, what can my return on investment be if I get into wholesaling? Okay. That's what everyone always says. And that goes to looking for their return on marketing spend. Yeah. I'm like, well, in our experience, like for us, you know, it's between 32 to $3,500 a deal on average. If you look at other people, they're gonna have lower. If they look at something, they're have higher. I think it's good to ask that question to a bunch of people because you can kinda get like an industry average, which will give you an idea. Mhmm. But understand that even for us, right, who's been doing this for a long time, that doesn't mean that literally for every $3,500 that we spend, we're gonna get a deal. You know, we can spend now three times that where we're start to get three deals and get nothing. But it basically comes over a longer period of time. It kind of averages out to that. And I think that's really challenging when you're starting out in this business because people, they need that to be more accurate in order to run their books. But Right. Really, to know the health of your business, you just have to keep operating over a long period of time and get enough historical data that you can see when those numbers start to shift one way or the other, and that's kind of how you gauge your success.

Dan Austin: [29:30] Right. You know? Yeah. And a good example is that you could market for two months. So say you spent $5 on marketing for two months, so you have $10, you don't get a deal. Now all of a sudden you're thinking, if I spend 5 more grand and only get one deal a month, now my cost per deal is $15. Yep, absolutely. Because you operated three months, spent $15, But, hopefully, by the end of that twelve months, I don't know if that's enough time, but about that twelve months, if you were consistent that whole period of time, that's when you're gonna start seeing that trickle back down to the actual industry average, which is typically around 3 to 3,500. If people are quoting you like they have a thousand dollar cost per deal, I'd be suspecting I'd wanna know what their margins are on those deals.

Mike DeHaan: [30:06] Yeah. I mean, they're probably a daisy chainer, and they're just marketing to other wholesalers or something like that. Exactly. But you're right. That that is interestingly enough a similar range that we've seen across people in most markets, and different groups are in in, like, high volume markets, low volume markets. Numbers will shift, like, on the higher end of the spectrum or slower end of the spectrum. But that 6,500 number seems to be kind of the average for sure. So cool. Right on. Any other things that you're excited about, Dan, before we sort of wrap this show up?

Dan Austin: [30:34] No. I'm excited when this show drops. We'll be in Scottsdale. It'll be hotter than heck compared to where we're at recording this, but that's gonna be a fun little mastermind for us next week to help grow our business.

Mike DeHaan: [30:45] Yeah. I mean, I'm excited about it. We're going to this mastermind this next week that is with our business coach with Steve Rozenberg, who you guys might have heard on the show a couple weeks ago. We hired him to be our business coach, and he's putting on a little mastermind down in Scottsdale. And it's it's like the first mastermind that I'm going to that isn't going to be so, like, almost 100% real estate. It's like true business. Because, like, even the GoBundance meetups that we go to, they're not technically real estate, but every single person there is a real estate business.

Dan Austin: [31:13] They have some real estate background, They may not have started there or ended there, but that's yeah. Yeah. And it's funny because Steve was not our coach before we had him on the show, so he aired, probably when we aired, he was our coach, but after we listened to him, we jumped in and started meeting with him and signed up with his for his coaching, because we just liked him so much. And so but he has he's a real estate guy, but also, we're always fascinated by just his diversity and his his reach across, you know, different industries and different people and different celebrities. So, we really, I think, appreciate that because for us, running a business, we are pretty good at real estate. We're not experts in all asset classes and everything, but we're pretty good at it. We got enough of that. Now we're really trying to scale our business, and that's just a different skill set.

Mike DeHaan: [31:56] It is. Yeah. And the thing that's been great too is almost the entirety of it. Like, I don't even necessarily know if he knows that we run a real estate business. He doesn't care. Right?

Dan Austin: [32:05] It's not that Yeah. He doesn't care.

Mike DeHaan: [32:06] It's all from the, like, a business operations perspective. And so a ton of it is focused around how to properly build systems, how to actually build a business structure and get out of the just like hustlepreneur mentality. Mhmm. Which is funny. I would actually say that today, so we hired some new staff members this week, some some virtual assistants from this company called Rocket Station, who you're actually gonna hear a podcast of them here in a couple weeks with Craig Brooks. And literally the best virtual assistants I think we've ever had in terms of, like, like, traditional Filipino VAs. And the way that they came in, they are extremely educated. They already know, like, how our business works because that's what this rock station company trains their VAs in. And I had a little moment after a kickoff call this morning, get everyone going, and I was like, I literally don't think that there is a fire that I have to do right now. Ain't that cool? Which is the first time I felt that way in probably two and a half years.

Dan Austin: [33:05] That's pretty cool. For a fifteen minute Because it takes a while and like, to get to that spot, and it's not easy. I don't think we're completely there. You probably just had, like, a good day. Yeah. You know what I mean? But but it's, like, progress, I guess,

Mike DeHaan: [33:18] though. Totally.

Dan Austin: [33:19] Right? And we're gonna keep doing that. And the right why I say it's good day is because we're step function now. We're gonna step up as we keep growing. And every time there's growing pains, and we're gonna we're gonna work through those. But you're right. Getting to that point, Steve has helped us get there, is pretty cool, especially when you're able to start, like, delegating things that then get delegated.

Mike DeHaan: [33:36] Yeah. That is really cool. Yeah. You know, and and, like, kinda my cadence I don't know if you did. My cadence for the last two and a half years pretty much has been during the workday, Monday through Friday, I am fighting fires, responding to people, keeping people on track, doing all those sort of things. And then the nights and weekends have been around building systems and, like, actually building the business Like doing actual work. Doing actual work to continue to grow in the business. Right? And like I said, I think for today, I might literally be able to do that stuff during the work day During the day? For the first time, I think, ever, honestly.

Dan Austin: [34:11] Well, then you're gonna get all screwed up because we're gonna be traveling next week, so you're gonna have to catch up.

Mike DeHaan: [34:14] I know. We're gonna get back

Dan Austin: [34:15] Short lived.

Mike DeHaan: [34:16] No. I'm actually pretty confident. I think the group will hold together pretty well next week.

Dan Austin: [34:19] I'm 100% confident. We have great people. It's super cool. And it's gonna be tough because our mastermind rules that they sent out, there's a document we had to sign, was like, don't be playing on your cell phone. Which you and I are pretty used to being able to do at all hours of the day, because we're pretty mobile in our ability to communicate with our staff.

Mike DeHaan: [34:37] Which I also appreciate that he's doing that though as well, because, I mean, it's high level business owners that he's bringing down. If they did not set that rule, all of us would be dinking around our phones all day. Exactly. That's such a great point. There's no way you can avoid it. I mean, like, all of us have things to do. We offer, say we're all taking time out of our business to go, and what it would turn into is brought down because they're, like, paying for everything, like, we're paying for our flights down there, but everything else is comped.

Dan Austin: [35:02] Yeah. We just show up and they drive us around and put us in places and we listen.

Mike DeHaan: [35:06] Yeah. And if they didn't have the cell phone rule, it would be cool if brought us all down there, we didn't get anything out of it because we were fricking out our phones the entire time.

Dan Austin: [35:12] I know. Which is so easy to do. Yeah. That's that's great point.

Mike DeHaan: [35:15] Yeah. I'm excited for it though. It'll be good. And and yeah, if you guys go, go check out that show with Steve too that came out a couple weeks ago. We've had a really great experience so far. He's a super bold personality. I like the and if here's here's something I'll say. If you're the kind of person that you like, like the the mindsets for like business coach, like the Jason Treas of like, you know, what do you think you need to overcome that? Which some people are into that. We're not. There's a lot of people like that. The thing I like about Steve is the business coaching that he does is super actionable. It is not like, I'm gonna ask you questions to make you figure your own shit out like a psychologist, like so many of the quote unquote business coaches are like right now. But he's actually like, here's what you do. Here's the actual physical document paper structure. Go freaking put this together in your business. It's like, oh, sweet.

Dan Austin: [36:04] Yeah. And you know what? For all we know, he might have the ability to do mindset coaching. I think he just recognizes that we don't need that. That's true. For all I know, I don't wanna pigeonhole him and not being able to do that. Maybe he does and he can. I believe he can, because he's also kinda tags himself as a motivational speaker. But whatever he's doing for us is extremely relevant and extremely on point. Yeah. So I can't complain about that.

Mike DeHaan: [36:25] Yeah. It's just been good. So, yeah, if you guys link or something like that, though, you should have them up, though. It's been a great experience for us so far, and I'll sign up for our meetup next week. So awesome. Well, that stuff's going on with us, guys, and with our, you know, our other, you know, group members and the world as a whole. So sweet. Yeah. Time keeps on rolling. Keep doing deals, everybody. So right on. Well, thanks for listening. If you enjoy the show, share it with your spear. Go on like, throw it on your Facebook, your Instagram, send it to your grandma. Grandma probably likes listening to some young dudes talk about business.

Dan Austin: [36:56] Yeah. I don't know. Maybe Absolutely.

Mike DeHaan: [36:57] Reminds them of you when you were their age. No. But ahead and share it with everybody that you can. It's always great. And if you want to get some Collecting Keys merch, you should go to store.collectingkeyspodcast.com.

Dan Austin: [37:09] Yeah. Yeah.

Mike DeHaan: [37:10] We have some Collecting Keys merchandise up there. We actually have a bunch of new ideas for shirts that are gonna be going up there soon, which I am very excited about. So we will let you know when those drop, but you should keep an eye on it anyway just in case you, you know, you missed that episode where I announced them.

Dan Austin: [37:24] We need to do, like, limited releases though, like where

Mike DeHaan: [37:27] That's what I'm

Dan Austin: [37:27] thinking. You can only buy it for a certain period of time because otherwise, it just loses its, you know, fandom. You gotta like, you know, just like the square pegging, we also might wanna limit that

Mike DeHaan: [37:36] one. Square pegging.

Dan Austin: [37:39] If I wanna limit that to just a few people that can only have that shirt, because it's gonna be absurd.

Mike DeHaan: [37:43] I listened to that. I don't know was listening to Dartmouth. I listened to that one last week. That part was, like, legitimately funny. Like, I Was it? Yeah. I was on an airplane, and I was laughing to myself. And my my wife's, like, looking at me off, and I'm like, I'm just laughing at myself talk right now on this podcast. But

Dan Austin: [37:59] We have a good time on this show.

Mike DeHaan: [38:00] Yeah. We do. So awesome. Well, go just head out. Store.collectpodcast.com. And beside that, if you wanna start finding your own deals, go to collectthekeyspodcast.com/free. It's your free advice guide. Start collect start getting off market leads. And besides that, thanks everybody. We'll talk to

Dan Austin: [38:14] y'all next week. See you.