How to Close Pre-Foreclosure Deals Without Getting Burned w/ Elvis Clark

Mike DeHaan: [0:00] Really quick before the show starts, in case you haven't heard, we have a growing community of investors called the scale community, which is full of people learning to make massive income with their real estate businesses so they can reach financial freedom a little bit faster than building a rental portfolio solely over time, because honestly, that takes decades. And who has time for that? So if you're an investor who is serious about growing and creating a scalable business without needing to be a slave to it twenty four seven, then go to collectingkeys.com/scale and apply. And if you're a good fit, we would love to have you join the community. So, again, collectingkeys.com/scale. Go ahead and apply, and we'll see if you're a good fit.

Elvis Clark: [0:38] You can have a team of five people probably doing as much as a team of 15 people if they're solid.

Mike DeHaan: [0:44] What is going on, guys? Welcome to today's episode of the collecting keys scale show. So this is your first time to these Monday scale shows. On these, we interview operators in the real estate business, specifically off market real estate, to hear about what is working for them in this current market, due to all the ups and downs and everything in between that we are experiencing in 2024, kind of the post post COVID boom period. And today, we are welcomed by Elvis Clark, who is a good buddy of mine down in Texas. And I originally connected with Elvis at a meetup with Aaron Mouchesdeghi, and he is doing all kinds of awesome things on there in Texas. And you said you kinda doing the full band from Austin to San Antonio. So I'm excited to hear what exactly is working for you right now and how you are handling things in your market that is notoriously struggling for real estate investors at the moment. So, Elvis, to get us started, why don't you give us a quick two, three minutes? Who exactly you are? What exactly got you into real estate and what your team currently looks like?

Elvis Clark: [1:49] Hey, Mike. Thanks for having me on. It's good seeing you. Man, let's just get straight to it. So I've been doing auctions. My primary focus and specialty is like auctions and foreclosures. I've been doing that for about five, six years. What got me started real estate was maybe fourteen, fifteen years ago when I quit my full time job. It was a sales job. And I needed to basically have, like, two years of income or something to be able to buy a house or car right before I quit because I was gonna go do contract work. So as soon as I hit those two years and sell, was looking around for a property, and I found one that was, like, in my hometown. So I'm from Richmond, Rosenberg, Texas area South Of Houston. Born and raised there. I've been in Austin nine years now. So when I was looking for a property, I found this property that was listed on the market for, I think it was 110,000. And I called them up. It was six acres, small little home. Called them up. The guy really needed to sell it. They weren't getting any offers at the time. And at first, I asked, could they do a seller finance? So they said they were open to the seller finance. They asked me how much could I put down. At the time, I think it was like a thousand dollars down. So they actually even accepted a thousand dollars down, and I got it for 90,000.

Mike DeHaan: [3:03] Nice.

Elvis Clark: [3:04] So that was my first property. Got my car, then quit.

Mike DeHaan: [3:07] How long ago was that? Six years ago?

Elvis Clark: [3:10] Fourteen years ago.

Mike DeHaan: [3:11] That was fourteen year how was that even on your radar at that point, like, to think about seller financing? Did you have a mentor or something?

Elvis Clark: [3:17] No. I just I kinda, like, knew about it. And at the time, I think, I didn't qualify for a loan or something, something to do with the job. And I offered was like, well, is he willing to do a seller finance? Maybe the realtor brought it up, but I can't remember.

Mike DeHaan: [3:30] Oh, gotcha. Yeah.

Elvis Clark: [3:31] But I was just like, this is what I have. This is what I can do. And the guy needed to move quick and needed to get rid of the property, so he ended up accepting it. So That's great. I don't think I'll ever find a deal like that again, though.

Mike DeHaan: [3:42] So Alright. Yeah. That's awesome. You're ahead of your time on that one for sure. Yes. That's such like an early adopter of creative financing like that from the relative sense. So you were able to get your car?

Elvis Clark: [3:53] Yeah. So I got my car. I got the property. And at the time, I didn't really know what seller finance was until now. And then I kinda like, know, I go back and look at it, and I was like, oh, okay. That's the way it worked. But I got that, and then I put my two weeks in and quit and started doing, like, experiential marketing for Vince and Brandon. I was traveling a lot to Austin. And in the meantime, I was like, well, I have this land. It's six acres. How can I develop this land? Started talking to people and realized, oh, you know what? It's going to cost me like a good chunk of money or to find someone to even do anything on this property. So I was like way behind on my time. And so a few years go by, I just didn't do anything with the property, just rented it out. And then I had a buddy back in Houston. Well, we had talked about getting a real estate again. We're like, man, it'd be cool to try to flip houses. So we started going around, you know, just bidding on houses, like, in Houston. And at that time, it was so hard. We were going to so many properties because we didn't really have solid contractors and we didn't really know So the these guys that had been doing it for years were coming in there and just outbidding us all the time. And then we met this guy one time that was like, oh, man, you should go to the auctions. And we saw him do it and saw him buy like six properties, and we're like, Oh, man, this is really cool. And he'd been doing it for like eighteen years. So we had a little bit of money saved up.

Elvis Clark: [5:07] We're like, Well, let's just do it. Worst case, I can go back to work and, you know, get some more money. So we went to the auction. You know, we bought a house. We bought a condo. Went through that process, but, you know, he didn't tell us we were gonna need extra money. We used all our buying power. So kinda had to go Nice. We kinda had to go back to work, and then we didn't touch properties for about six months. And then finally got there, rehabbed one of them, sold it, property on that one. And then the other one we just sold out is this because it needed a ton of work. And then we were like, cool. Let's just go back and keep doing it.

Mike DeHaan: [5:40] Nice. So how long ago was that when you started at the auctions?

Elvis Clark: [5:44] I think about five, six years ago.

Mike DeHaan: [5:46] Okay. Cool.

Elvis Clark: [5:47] So I was actually I've been in Austin nine years, but I was started real estate in Houston. It was more Jordan buying there just because I couldn't really afford anything in Austin at the time.

Mike DeHaan: [5:55] Sure. That's crazy, though, dude. Like, I love the fact that you just went in and got after it. Right? Because that's also one of the reasons I guarantee that you're doing pretty well now is that you're not afraid to just take action. Right? And, like, just like, I don't know how to buy a house at auction, but I'm gonna go and do it. I'm just gonna go bid on these things. And that's great. Right? That's a great entrepreneurial trait that I think is heavily taken for granted that most people just don't have that. So that's awesome though, dude. And so your your current business and exit strategy in in 2024, what does that look like? And what's your specific role now?

Elvis Clark: [6:31] Just kinda operator right now. Just come to we slowed down a lot in the beginning of the year. You know, we had a bunch of flips and different innovations going on with the market shifted, and we took some pretty big hit one after another just because we were kind of like in the maybe in the 500 to 600 range on some of these properties, and some of them took almost $100,000 dip. So it just kind of hurt us. And then we just stopped going to auction. We stopped buying properties in general. Like, okay. We need to get rid of this inventory. I started, like, cutting some of our staff and just figuring out that. And then I was just like, well, let's just go back to let's just go back to the basics, which I was like, let's just get one or two people, hired one or two people back, feet on the ground. Like, I have two callers. Right now, I'm just looking at the deals, submitting the offers, and then we're just kinda dis I'm partnering up with other people to disown the properties, honestly. But I have a few buyers myself from the auctions, so I've, like, built up a quite a good friendship of cash buyers from the auctions. So they're still looking for deals, but team is pretty small right now, but she's trying to take it steady. Like, honestly, I was just thinking about it earlier this year.

Elvis Clark: [7:37] You know, you can have a a team of five people probably doing as much as a team of 15 people if they're solid.

Mike DeHaan: [7:42] 100%. And that's what we've learned as well with our big kind of downscaling from our national company just coming back to local, like we're talking about before the show. Our top line with our local company is gonna be 30% of what, like, our big national team was, but the profitability is so much higher. And it turns out we're gonna be making actually more take home pay with less headache. And so why would we not do that? Right? Like, it's just less HR issues, less churn of staff, less hiring, and more actually being a real estate operator, which is, you know, honestly more fun, which is than, like, dealing with whatever teams.

Elvis Clark: [8:17] Yeah. Because, I mean, I feel like the turnover rate in this business, I hear people all talking on time. Like, they're just like, oh, go over this person. You know what? The fact that I actually have brought on someone that was really good on helping us on the team, and they just ghosted or just went, like, offline out of nowhere. And, like, everything seemed like Oh,

Mike DeHaan: [8:32] they, like, quiet, quit?

Elvis Clark: [8:33] Yeah. Everything was going so well too, and I was just like, what the hell? Like, I was just like, it's so annoying because he was doing such a good job, and I'm just not sure if maybe something personally is going on. So I just I'll give it another day, but, like, what is going on?

Mike DeHaan: [8:47] Oh, no. That's this is, like, this week that this happened.

Elvis Clark: [8:50] Yeah. Literally. They stopped communicating last Thursday, and I was just like, what's going on? Did you die? Did you I mean, everything was going so good, and I just don't even wanna go through that process of rehiring again for this position. So

Mike DeHaan: [9:01] You're have to start treating him like a seller, bro. You're gonna have to, like, get new phone numbers. You're gonna have to call him, have somebody else call him, you know, like your little bait and switch text message if you can get him to engage with you. Yeah. That's funny, man. So how are you sourcing all your deals and everything right now?

Elvis Clark: [9:15] Right now, we're just focused on pre foreclosure and tax bills right now. Still looking at some auction stuff, but I just went back. Like I said, I just wanted to stick to what I was good at and which is our focus was always auctions and foreclosures. So just really getting good at that, because like with our model, we kind of offer a whole full service when helping homeowners with the like going through foreclosure, you know, with relocating them, getting them on the credit program, all this other stuff. And I was just like, I don't wanna chase too many avenues. Then it's just supposed to get too much.

Mike DeHaan: [9:42] Yeah. How are you able to be, like, most competitive with, like, the tax sale and and pre foreclosure stuff? Because I feel like that's, like, the niche that everyone I would say it's been in real estate for a long time tends to gravitate to. And there's a lot of people. And then as a result, a lot of new folks that we talk to, whether they're looking at, like, joining up with us in scale or they're seeing me up on Instagram or whatever, they're always thinking, like, pre foreclosure, tax delinquency stuff. And then when we tell them, like, oh, we just, like, market to absentee owners with mail. They go, no. I don't wanna do that. I wanna talk to, like, the preforeclosure people. So I guess how are you able to get deals like that that are actually good? Because the stories that I always hear is, like, people buy stuff at such insane price. It doesn't make sense.

Elvis Clark: [10:23] Oh, I mean, sometimes. They mean that the auctions, but sometimes, like, really, I think our advantage is is actually talking to the homeowner, knowing what to talk about because we don't just we actually when we go into the conversation, we're not trying to just buy your property. We actually talk to you. Like, have you talked to your bank yet about getting a loan modification? What options have you talked I've talked about a friend or family, getting a personal loan to get your loan reinstated. And then after those conversations, then we start going to the other option. So in the beginning, we're building that relationship, you know, that rapport with the homeowner because we're not just like, hey. Do you wanna sell your house? Like, that's the last thing they wanna hear when they're going through a foreclosure. So we kinda try to educate them. Okay. Well, you know, what if I were to give you this $20,000 to reinstate your loan? I can give you a loan, but do you really wanna have to pay me back monthly and then your loan that, you know, you just got behind on again? Do you really wanna go through that? Or we can look at these other options, help you avoid the foreclosure, bring your loan back to good standing, help you get some positive payments on your credit so it's not hit, and then we'll help you relocate you with one of our agents, get you into the rental for six months a year while we put you on a credit program, and then you can buy something more affordable.

Elvis Clark: [11:30] So we go through that whole process and then just really just depending on the situation, we'll look at all options. So Yeah.

Mike DeHaan: [11:37] That's awesome. So you're truly providing a service. Right? Which I think is such a a thing that gets lost in the real estate investment business is it's not always just us and them, but the buyers and sellers. Right? You can provide a mutually beneficial benefit like that. Yeah. Like, the legalities of doing all that stuff, are you actually, like, fronting money to get their loans reinstated? Like, how do you secure that?

Elvis Clark: [11:59] Yeah. Yeah. So we actually use all our own capital. So we're all in house. So we'll basically reinstate the loan. Well, so we do everything. We'll reinstate the loan. And that's the difference. Like, everyone wants to get into these, but if you're not aware, it's kind of difficult. Like, you have some wholesalers that are very uneducated about these foreclosures. They'll go lock up the deal. And we've had this situation before where a wholesaler didn't wanna release the deal, I told him we'd partner up on it. And he was like, no. I gotta buy her. I gotta buy her. And I was like, if you don't have this settled or reinstated before this Friday of the auction, it's gonna get sold. And it did get sold and basically screwed over the homeowner. She just lost her house at auction, and now, you know, her credit's hit for seven years with the foreclosure. So

Mike DeHaan: [12:37] Yeah. Right.

Elvis Clark: [12:37] But we go through all that process. Yeah. We'll reinstate the loan. We'll get that in good standing. Obviously, we have an agreement in contract before we send any money.

Mike DeHaan: [12:45] Yeah. Have you had ones go sideways where people, like, decide they're not gonna pay you and they just continue to squat and then lose their house anyway? Or does that just not happen in Texas? You can just go drag them out and shoot them.

Elvis Clark: [12:57] Or we even submit a reinstatement. We already have, like we're already on the deed of the house.

Mike DeHaan: [13:02] Gotcha. So you get it deeded to you first.

Elvis Clark: [13:04] Yeah. Yeah. So then once you get

Mike DeHaan: [13:06] the deed, you own the property. So they're essentially are they trying to buy it back from you on, like, a lease to own sort of situation or, like, a seller finance, or you're going to sell it and then they're going to walk away with some cash? Or is is literally the incentive just their credit being saved?

Elvis Clark: [13:22] So it depends on the conversation. So there's different ways we can exit, just whatever deal we work out makes sense. Most of the time, we'll offer them some cash out of the equity. We'll look at the equity of the property. We agree to, you know, give them half upfront after we take take the deed. And then but first things first, we agree to the terms. We sign the contracts. We get the deed recorded. Then we first thing, need to mail the check to get the loan reinstated. We need to bring back the home and get standard. So once that's confirmed and we know it's the foreclosure is not, like, in place, then we'll move forward with the terms of, like, getting her half her money and then helping her relocate. Most of time, it's helping them relocate into a new spot, and then we come in, we clean the house, we rehab it, and then relist in the market, or we already have a buyer lined up for the property.

Mike DeHaan: [14:08] Yeah. I was laughing because you said her very specifically, so I'm guessing you work with a lot of, like, old lady.

Elvis Clark: [14:12] But Well, I actually had one in mind, but, like, I was just thinking about her because, like, we had one. Like, sometimes, you know, these are very complicated. Like, it can seem like it's going good, and then they're just, like, all over the place. So

Mike DeHaan: [14:26] What are some of, like, the biggest objections and stuff that you have doing this kind of conversation? Because it's a little bit different from what we do on the wholesale end where 95% of the time, it's like a cash flow sort of deal. The money matters a lot, but usually it's like security or things like that that people are mostly worried about. But with these, you're entering into a longer relationship with the individual. So are there, like, different kind of objections that you face versus the wholesale or, like, cash purchase stuff, or is it kind of the same?

Elvis Clark: [14:58] I think it's kind the same. It just depends on where the conversation they already know that we're gonna kinda basically substitute. We go through the conversation and substitute in their property, take it over their mortgage. Sometimes there has been where they're like, I just want my loan paid off. I just want it. And if there's enough equity and the deal's good enough, we'll go ahead and just pay it off or hard money it out. But a lot of times we don't wanna do that. We'd rather come in with less capital. You know? If we don't if we can reinstate and take over your mortgage payments, then we're only all capital in for what we're paying you on equity and then reinstatement. Right? And then maybe whatever the house needs updates on. So we prefer that, but those conversations do come up where, you know, they're just like, oh, I just want my house paid off. In that case, we do try to tell them like, hey, you let us reinstate the loan, get it back in good standing, and and then get a couple positive payments for a couple months. It'll actually help you. But it just depends. Sometimes they just wanna be done with it. We've had people where they're just like, oh, I'm done. I'm just I'm just gonna let it foreclose. And I'm like, dude, you have so much equity.

Elvis Clark: [15:52] Like Yeah. Right. Don't be dumb. Yeah.

Mike DeHaan: [15:54] Yeah. I hope you guys are enjoying this episode. We are seriously trying to grow this podcast so that the voice of what it really takes to grow a real estate business becomes kind of the norm versus the guru get rich quick BS that everyone is fed on a daily basis. With so many podcasts out there, it is hard for us to get discovered on our own. So a quick ask. Please share this episode on your social media accounts, be that a real story, whatever. And if you tag me at Mike underscore Invest, then I will give you a follow, and I will also send you a DM so that we can have a little chat about your business and any ways I could potentially help you grow. So, please share it on your socials. Tag me at Mike underscore Invest, that's with an s at the end, and I'll follow you, and we can have a little DM a convo about your business. And maybe I can help you grow a little bit, or you could just say what's up to you. That'd be awesome. But appreciate everyone, and thanks so much for helping us grow. So you are actually buying the property subject to the existing mortgage then when you do it. Do you have you had any issues with the lenders doing due on sale or things like that because you paid up the loan and it's kinda makes them investigate?

Elvis Clark: [17:01] You haven't? I would. No. Not really.

Mike DeHaan: [17:03] Not really?

Elvis Clark: [17:04] No. No. We have not. We've had homeowners where they're like, we're gonna call the mortgage. We need to get this loan out of our name. And, you know, I do agree to sub like, I know, like, sub two is the big thing right now. Right? Like, everyone's trying to do it. And, you know, I remember doing this, like, five years ago when this guy was teaching me. It's like the structure is so much better now, but still, like, all these deals too where people get in, like, you do risk you do risk that. Then I think a lot of people don't tell you, like, whenever the homeowners can just decide a year later, oh, I just don't want this loan in my name. They can just easily call a loan and tell them what's going on. I just don't like fooling with it. I had a couple sub twos, and then, like, one couple was getting a divorce, and they just started, like, a whole mess, and the wife started reaching out to the mortgage. It's just I don't know. I try not to keep them honestly no longer than a year.

Mike DeHaan: [17:48] Sure. Yeah. So I I'm asking that because we had a situation last December where we bailed out a landlord that was in pre foreclosure on three properties. We bought them some too, and we paid up his loans. And literally a week later, we got called by the lender wanting to know what our relationship was with the previous owner, and they called all the loans due. Dang. And so that process of paying up the loans, because it was, like, on the brink of foreclosure, that made them, you know, I think end of the year too, made them go and look at the deed, and they saw that we were on title. Immediately looked us up and saw that we were not who they did the loan for, and they called it. So I wasn't sure if you'd face anything the same yet. But and just so you know too, all the bullshit they say about, I'll just deed it back to the seller. Nah. It's not a thing. But they made us pay off $850,000 worth of mortgages in thirty days, which was Wait. So

Elvis Clark: [18:39] I mean, did you try deeding it back?

Mike DeHaan: [18:41] Oh, yeah. They're like, you can do whatever you want. They're like, we're suing him. We're suing you. Like, we're coming after you for this Oh. For violating the loan agreement. And we're like, okay. So we actually played hardball, and we were like, so here's what we're willing to do is basically pay off the principal on the loans, not any of the back interest or anything like that that you're claiming that you now want. And if you don't do it, you'll have to foreclose on us. And just so you know, we are very sophisticated, and we will make it a pain in your ass. And they're like, fine. Just pay us off. And that's what we did. But, yeah, it was a whole freaking nightmare. So I guess I wanna get on that a little bit more before we move on to another question. So, like, what is your process for you securing that since you said it's like a little bit more clear now? Like, how do you make sure that if there is a divorce or there's an insurance claim or even getting a payoff statement that you're actually able to do that when you go to sell the house?

Elvis Clark: [19:29] So, I mean, everything's done beforehand. So, like, we have Sure. We'll get the title checked. We'll get everything done. I mean, we'll figure all this out before we even, you know, take over or agree with the terms. And we wanna make sure too they're you know, everything that they're telling us is correct as well, but definitely wanna get title to look into it. Now, you know, title there are title companies that do this whole process and stuff too, so they'll make sure everything's good. Yeah. So we kinda just go through the process with the title. We don't do any extra insurance because there is insurance with the mortgage from the seller. So we just kinda, like, take over that and pay that.

Mike DeHaan: [20:01] You get insurance, right, with the mortgage, house burns down. How do you make it so you actually get the money? And the insurance company doesn't come and go, well, you're not the insured person, so it sucks to suck.

Elvis Clark: [20:12] Well, I guess that would be a conversation we'd have with a seller.

Mike DeHaan: [20:15] Has it happened yet? Yeah. Right. Because that's always one of my biggest knocks on sub two. No one talks about that piece of it. Right? Or, like, the biggest thing with ours when we were trying to do it, the fucking lenders wanted us to pay them off, but we couldn't get a payoff statement from the note servicing company. Because they were like, we don't know who you are. And we were like, well, we need this payoff. Like, we're trying to pay off the loan. They were like, no. Like, you're not the approved person. And then the seller was like, well, I'm done with you guys. This is your problem. And it was a freaking nightmare, man.

Elvis Clark: [20:45] Yeah. That I always say try to be in good standing with the seller until you get rid of the property. You know, we have, like, one right now where the lady's just been a nightmare, but we just Yeah. We just kinda cater. We had that conversation. Okay. Yeah. We're gonna do this. We're gonna help you. Like, she just made it such a difficult process. She was actually just playing the victim a lot, a lot of situation. And we did so much for this idea, but I was just like, you know what? We don't want her causing issues. Let's just, we'll keep, you know, going until we sell this property. I would just say if you're gonna do one, make sure you're in good communication with the the seller and good terms just because if anything comes up, you wanna be able to work that solution with them. But honestly, just I'll look in these, like, Facebook groups sometimes, people where they're they're like, oh my god. What do do to this sub two? Because everyone's just trying to do a sub two deal now, and it's like, man, it's there's a lot more to it.

Mike DeHaan: [21:30] I know. And they're trying to, like, force them, and they're doing weird stuff. I'm a big, I would say, like, sub two community pace morby hater because I think you just you know, too many people try to do it incorrectly and don't respect how complex and serious of a thing it actually is.

Elvis Clark: [21:44] Yeah. No. It's the same thing with foreclosures. People just go after them and try they'll figure out the situation. Like, they'll go try to lock up the deal, but they don't even know, like, what's on the back end. And then when they go try to sell the deal, it goes to title. Now it's like, oh, wait a minute. This property had this lien, it has this much taxes. The deal doesn't make sense anymore. It's just like, look through all those options before you start wasting everyone's time and even the sellers.

Mike DeHaan: [22:05] Remind me. What is your what'd you say your team looks like? How many people do you have?

Elvis Clark: [22:09] Right now, we're five. So Five? Yeah. So I have three three callers, one feet on the ground in Houston, one here in Austin, then one in San Antonio.

Mike DeHaan: [22:22] How do you keep all these people organized and get them trained up on this kind of stuff? Because this is like what you're talking about is a more advanced version of real estate. Right? It's not like a wholesale cash offer where you go and you run basic comps and you do 75% minus repairs. But you have a whole customer service piece to this. There's a lot of legalities around the pre foreclosure sub two stuff at tax delinquencies. Are you able to, like, just find people that already know this in Texas, or do you have, like, a pretty regimented system for getting people trained up?

Elvis Clark: [22:54] It's kinda hard, man. With the foreclosures, I am still involved a lot.

Mike DeHaan: [22:57] Sure.

Elvis Clark: [22:57] Right now, the people, like, one of the Houston guys, you know, he's been killing it. He wanted to get into real estate, and now every day, he's just sending me leads, or he's, like, going and starting to door knock and chase these people down, showing up to their houses. You know, the best way I tell everyone we'll do weekly Zooms, training, stuff like that over it. But I just told them, I was like, look, if you're gonna take this seriously, the best way to learn is just get someone interested, and you're gonna sit down and watch me do the whole process with them, what questions asked, what's the best solution, and just get them used to that. And then a lot of times, I'll just have them when they're communicating with the seller, I just have them I'll text them or send them my aide, tell them to say that, do this contract. I'm having them do the actual experience themselves. Mhmm. So I kinda actually just walk them through the steps of doing the deal, but reviewing it.

Mike DeHaan: [23:42] Sure.

Elvis Clark: [23:42] So and it's such a small team, so it's not, like, hard right now. Like, it just I have to just manage it, right, with them and then just stay on top of them, but that's fine right now since we're a smaller team. I would actually, goal is to get one or two solid people that can at least eventually just take over this, know the options when they're looking at the deal, know what to do, and then they just send it to me for approval. And then I was like, okay. Looks good. Right? But since it's more complex, like, what are the questions? How are we gonna exit this? What's the process like with the attorney and stuff like that? Kinda still more involved. Yeah.

Mike DeHaan: [24:13] That's always hard with sales reps in general anyway because their incentive is different from yours slightly. Right? Like, they're incentivized for a deal to close period. You're incentivized for them to get the best deal possible. I mean, even to this day, we still hold our underwriting pretty close to our chest. And, like, the the sales guys that we have, they can go and they can get ranges, but we're still the one that has to approve the contract price. Just because otherwise, what happens is they'll get like one big commission, and now they only want big commissions. Actually, they'll be undercutting things or they have money problems at home. They're trying to get every deal forced through that they can because they need to get a paycheck.

Elvis Clark: [24:49] Yeah. And that's honestly, that's kind of been the, like, difficult right now. Like, this new guy that's coming in, I was like, man, you're coming in probably like one of the worst times, but it's good. I was like, let's get the rep in because, like, we're submitting a lot of offers. Like, I think right now we're doing, 70% just to be safe right now. Like, we just got this born in a deal. The ARB was maybe 155, 160. We offered maybe 110. We'll cover close to cost commission, and maybe needed 10 to 15 k, like 10 ks at work. So someone they took the bid. Someone offered $1.30. I'm just like I'm just like, this is just so tight. I don't know. Maybe they're holding on to it, but, like, some of these deals just does don't make sense. And I'm like, I'd rather not be stuck in a bad deal because I've been there, and we'll just keep submitting until we get one really good deal.

Mike DeHaan: [25:33] Totally. Well, I know what that person will probably do is they'll get to a week before closing, little price drop in the $1.10 anyway and create a shitty situation for everybody.

Elvis Clark: [25:39] Yeah. Because, I mean, we're still we still do off market deals. Like, I have referrals and agents that send us stuff, so we'll just, like, submit offers. Usually, they're not our best deals, but sometimes they can be. But, you know, if we can make a 10 k fee or 15 k, you know, that's still money right there. But it has to make sense for an investor as well because, you know, being a flipper myself, I'm just like, I'm not gonna share a deal if I don't think there's any, like, beat up or bomb.

Mike DeHaan: [26:01] Mhmm. Well, yeah. For sure. I mean, now that that's the whole model now, dude. You go and you start a meetup, and you just sell your shitty deals to all the sucker newbies that

Elvis Clark: [26:09] roll up. Man, I get so many deals. I'm just like I'm honestly I just tell people I was like, I'm not trying to go through all this work to make 10, 15, 20 k after rehab. Like

Mike DeHaan: [26:18] Yeah. Yeah. For sure. But, no, that's a whole model that I've seen preached by people recently is like, if you become, like, the authority in your industry, you have more buyers because you can sell them to all the newbies that come through. But But then ultimately, what happens is all those newbies start losing their ass on the deals they buy from you. But, yeah, that that makes a lot of sense. It's funny. To you, it probably feels simple. To an outside perspective, I would say you have a much more complicated real estate business than most people that I know. Just because you're getting more into the the weeds of these kind of transactions. You're having these kind of longer term relationships. So I guess with all that, what's been, like, the best system that you think that you've integrated, whether that's, like, a CRM, whether that's, like, an organizational tool, whether that's been, like, a mentor, like, a coach that's really kinda helped you grow this way? Because what you're describing is less common than just, like, finding YouTube videos or listening to podcasts to figure out what you're doing.

Elvis Clark: [27:14] I mean, I listen to all that stuff still every day. I was actually catching up on some of your episodes on this. Like, let me just, check it out. I mean, I feel like you can never stop learning, especially in, this industry. We dealt with a lot of auctions, and a lot of this was kind of new for us, you know, a couple years ago. Like, we never really wholesaled or anything. So it was just such a different system because we weren't you know, wholesaling's a whole whole different ballgame, in my opinion, and been adjusting into that a little bit, but I would say definitely CRM systems work. We when we first got stuff started, were using, like, Podio, this whole setup, and honestly, it was annoying. It was like Trash. It sucked. It sucked. And then we were a smaller team, and I went ahead and just, like, created my whole, like, smaller CRM system on Notion, which I built out the whole And thing myself on it worked fine. It worked perfect for a pipeline, and then we're using, you know, smartphone dialer, stuff like that, communication and down. But remember, we weren't doing like mass lists of like 5,000 leads. We our leads are smaller because we're doing like bounties of foreclosures. So it's a little bit more to handle. But definitely a CRM, you need something with the leads, follow-up, all that stuff. And then, you know, we in the beginning when we started trying to go a little bit more wholesale route, we were I think we were doing, you know, direct mail, which that is great. It's a long term game. And the thing is we were just kinda like fitting it all over the place.

Elvis Clark: [28:38] So that was like a learning curve as well. Totally. So

Mike DeHaan: [28:41] Yeah. That's a whole other skill set. So nice, man. So you're literally just I mean, you're the epitome of an entrepreneur, dude. You're like, I can't quite find something that matches what I wanna do, so I'm just gonna build it myself with tools that are out there.

Elvis Clark: [28:51] Yeah. So I think we're gonna be switching to RE Simply. It's just a better system. We're gonna be switching to that.

Mike DeHaan: [28:57] Mhmm. That's what we use.

Elvis Clark: [28:58] Yeah. Yeah. And then communication, we use, like, Slack and then, you know, WhatsApp.

Mike DeHaan: [29:02] Awesome, man. No. That's good stuff. Alright. So we're gonna go into our end of show questions here to round up this conversation. So first question, which is always a crowd favorite, what is your craziest real estate investing story? This can be a big win, crazy tenant, wild transaction where you thought you're gonna lose it 18 times, the time you found a capybara breeding, you know, situation in a living room, whatever you got. Let's hear it.

Elvis Clark: [29:31] Man, we've seen quite a few things, especially with the auctions, just like hoarder houses. You've seen some of my videos. I mean, we'll walk through these houses in these really nice neighborhoods. Man, crazy story. I would just say one house, we gave this guy, like, two, three months to move out, and he never did. We show up to the house. Everything was still there. Like, every item was there. He was, like, making his own beer and stuff in his master master bathrooms and all kinds of crazy shit and just had all kinds of, like, ammo and, I don't know, like, fake grenades and stuff.

Mike DeHaan: [30:09] Fake grenades?

Elvis Clark: [30:10] Yeah. So I don't know. Though, I would just say that's probably the most interesting one. Just there was all kinds of random shit, and this guy was literally giving us so much trouble and just, like, coming to the property, threatened. And I was just like, man, was like, I hope he doesn't, you know, blow up this house or something.

Mike DeHaan: [30:24] And in Texas, you gotta worry about that stuff too, man. People are passionate about their firearms and everything down there.

Elvis Clark: [30:29] Yeah. So I don't know. We've had quite a few I mean, dealing with auctions and foreclosures, you're oh, like, it's it's kind of normal dealing with situations like that.

Mike DeHaan: [30:38] So Yeah. For sure. Yeah. Run of the mill. I like it. Cool. If you go back to the very beginning, what's one thing that you do differently? And you can't say, I wish I would have kept everything, like, something that would have helped grow your business faster.

Elvis Clark: [30:51] Yeah. I honestly if I would have gone back, I would have probably I would probably would have stayed in my w two a little bit longer

Mike DeHaan: [30:57] Interesting.

Elvis Clark: [30:58] And tried to leverage, more of those credit lines and loans. Because, you know, being in in sales and contracting business, I never was able to get loans, so that's why I was always, like, just saving my cash and invested it or trying to buy something. And that's kinda primarily why I got into auctions. And I think about it now, you see all these people promoting, like, I explained in the process, like, you know, leverage before you quit your w two, leverage, these credit lines, leverage, you know, loans, stuff like that. I would say that would have helped me out a lot in different opportunities. But, you know, I didn't go that route. I've just always been at sales and commission. And the way I see it is it's like, well, if I lose this cash, can always go back and make it again. So

Mike DeHaan: [31:37] Yeah. I can definitely agree with where you're coming from. My always argument against people being on w two at the same time is it is a hard business to build out part time. Right? And there's always like a security blanket with a lot of people's w two that prevents them from taking any real risk that unfortunately is necessary to make money in this business if you're serious about it.

Elvis Clark: [31:59] And I would say, like, you know, wholesaling too. Like, wholesaling is a great way to get in. I had no idea what wholesaling was. I just I probably got into real estate one of the hardest ways, but I thought that was normal. Know? I just was like, Oh, go buy a property at the auction cash. You know? And I definitely recommend I always talk to people. It's like, you know, get into wholesaling, learn, you know, the basics of the back because you can get in with like little little amount of money and get started that way and plus learn the process. And then if you wanna buy auctions and stuff like that, then you can, you know, go to someone to show you.

Mike DeHaan: [32:29] Mhmm. Absolutely. Awesome. Alright, Elvis. Last question. Where can people find you, follow you, and reach out to you?

Elvis Clark: [32:34] You can reach out to me on my Instagram at the Elvis Clark. Shoot me a message if you have any questions about foreclosures, auctions, anything like that.

Mike DeHaan: [32:43] Cool. And I guess just to reiterate, you operate, you said, from Austin all the way down to San Antonio area?

Elvis Clark: [32:49] Just San Antonio, Austin, and we just started back in Houston as well, like, near where my hometown is.

Mike DeHaan: [32:55] Sweet. Alright. It's that entire corridor of Texas there. Yeah. Right on, guys. Well, you heard it here. If you guys are doing any deals down there, hit up Elvis. He would love to, maybe buy some deals from you, sell some deals to you, and maybe even help you out in a couple foreclosures if he's feeling friendly that day. So, Elvis, dude, thanks so much for coming on the show, man, and congrats for your success. It's funny. I didn't realize all those details of your business. So it's always fun to go into like a deep dive conversation. So everyone reach out to Elvis. Don't be shy. Remember, people come on these shows because they want to engage with you. Otherwise, they would just sit at home and not waste their time going on podcasts and things. So hit them up, let them know that you're doing deals in the area, and I'm sure it'll help you out. So thanks for everybody for listening. We'll talk to you guys next week.

Elvis Clark: [33:36] Awesome. Thanks. Bye.