My Journey in REI: Entry 2

I recently went to a REI meeting and at the end, a veteran in the business, after telling us of his mistakes and achievements, said something that made me understand why I’m not a millionaire yet.

“You have to make a lot of sacrifices to become successful“

The road to success in REI is not an easy trip at all. Many would have given up a long time ago. Especially after their first deal not closing. After my first two didn’t go thru, I didn’t cry and give up. Yea I hated it, but I realized my mistakes and learned how to not make them again. One thing you have to learn is this is a numbers game. The more numbers you do the more money you’ll see.

After not having too much success in my particular area with home owners, I decided to attack short sales and REO’s. Now don’t get me wrong. There are thousands of leads out there waiting for me or you to come scoop them up. Since my first two deals didn’t go through, my funds didn’t allow me to do the other most important part of real estate investing.

Marketing. I couldn’t market for sellers like I wanted to so I had to start doing something that requires less money. Being that I get lists all the time from other investors or realtors showing properties, I decided to go after buyers. Finding cash buyers is extrememly important in REI. Now while trying to sale my first 2 properties, I picked up a lot of different cash buyers with different tastes in real estate. Now just because they say their buyers doesn’t mean their going to buy any house you throw their way. Trust me. I know this. Your going to have picky buyers, buyers that produce and see potential and numbers for what they are and the worst of all; tire kicker buyers.

The picky ones: are the ones who want properties in upper class neighborhoods for 30% of market value. To me, this says they are scared to take chances. Send them your properties anyway. You never know.

The good buyers: the ones who know what they want and if you bring it to them, their ready to sign on the dotted line. These you want to keep happy. There are wholesalers with one good buyer that they provide to. That’s all they really need but you always want more.

Now the worst of all. The tire kickers: They talk like they want the house, make you waste your time showing them something they practically purchased over the phone, then they say their not interested. These I label as a tire kicker immediately and on occasion, delete them from my list. Let the next wholesaler deal with them.

Now I don’t know exactly where my REO’s/short sale venture will take me but that’s the beauty of taking the “Road to Success“. Sometimes you have to take chances. “Fortune favors the bold” as my buddy Chris Bruce would tell me. With a list of over 40 buyers, I’m 99% sure I can sell something though.

In closing, I want to tell you 2 things to keep in mind as a new investor that I happened with me and many other REI’s.

1. Your first deal is likely to be the hardest deal you’ll ever do. My first deal didn’t even close and it put me throught so much that I was ready to say forget it but I stayed in contact with the buyer and seller and the seller is ready to purchase something as soon as I get something to his liking. He had the check ready for my first deal by the way…. He’s no tire kicker
2. Your first deal is likely to be for the smallest amount ever. Remember that. Not saying it’s going to be that way but when your deal closes for between $0 and $1000, just accept it and move on to the next. Learn a lesson from your mistakes like I did.

Tagged As: dennis knows, dennis marshall, dennisknows, my journey in REI, new to real estate investing, real estate investors