Welcome Back to the Discount Property Investor Podcast. Today we talk about Doing Deals with Heather Fraley. Thank you for sharing some time with us today. Today the hosts interview Heather Fraley from Kansas City. Heather is a student of The Discount Property Investors and has gone from 0 to Full-time real estate investor almost overnight!
David: Alright guys, welcome back to the discount property investor podcast, this is your host David Dodge, and Mike Slane, don't forget to check out the discountpropertyinvestor.com if you are looking for properties in St Louis Missouri. And as always the freewholesalecourse.com if you are wanting to get started in real estate and learn how to invest in real estate with little to no money down -- check out freewholesalecourse.com, we have put together a ton of content on there, we want to teach your how to start doing your first wholesale deal immediately. We're talking about Doing Deals with Heather Fraley.
So today we have a special guest on our show, her name is Heather Fraley, she is actually a student of mine and Mike. the discount property investor students. So we have Heather on the show, Heather has been coaching with us and Heather is closing her third deal tomorrow.
David: Tomorrow, awesome.
David: Heather is kind of -- I wouldn’t say full time right? You are kind of doing this part time would you say?
Heather: No Dave, I jumped right in, so I am doing it full time.
David: No that's good, that's good but I am just saying like -- whenever you first started with me you weren’t.
Heather: No, I wasn't.
David: That's what I was getting at. So now you are doing it fulltime, but whenever we first started talking and I started coaching you, you were just kind of like -- you didn't not too much about it, I was teaching you the business and you were doing it part time, but now -- because of the recent successes that you have had, you are full time?
Heather: That's right, yep.
David: That's awesome. So Heather has done two deals and she is closing on her third deal tomorrow so congrats Heather you are doing awesome, keep up the good work.
Heather: Thank you.
David: So I want to ask you some questions about some of these previous deals ok? So a lot of our listeners are new to real estate, they are new to wholesaling and we want to teach them how to get started and what to do. So let's start by talking about your first deal. Tell us a little bit about that if you don’t mind.
Heather: Yeah so I actually -- I have been a licenses real estate agent for a couple of years. So I have been constantly funnelling through the MLS and searching every single day I have a protocol, to where I just search through the motivated sellers -- I set up the alert on my homepage. So I would say it was about a month ago I found a motivated seller, it was listed through the MLS, it was listed at about 98,000. I ended up talking the seller, which happened to be an agent down to 62 grand.
Heather: That's how I eventually got my first deal.
David: So -- you found that person on the MLS? Is that correct?
Heather: Mmmhmm. Yeah that's right.
David: And -- how did you know they were motivated:
Heather: You know to be quite honest, I didn't.
David: That's ok.
Heather: But I always reached out to the different agents -- try and engage the mechanics of the home, what work is needed, whether the person is willing to work with investors and if so, I have to treat lightly because of you know -- compliance IM and agents so I have to be very careful. But I do try and gage the personal situation of the seller and -- I had known as an agent, you can view and see the property history. So i knew the property was originally purchased a couple of years at 39,000. So whoever bought it had to put some work into it -- but I know that their margin was going to be pretty big.
David: Sure, sure absolutely. Ok good deal. So you reached out to the agent that was representing them because it was on the MLS, and how did it go -- what was the next step in the process that you took to -- present the offer to them?
Heather: Yeah so I -- again the agent was a seller so he was making all the decisions and --
David: Oh, the agent was the seller?
Heather: The agent was the seller. So it made it really easy to at least have decisions and have answer answered quickly, but after he said yes I am willing to work with investors, I ran some comps on it, I went and sold the property and basically said, hey look I can offer your 55, I started pretty low.
David: Got to start low.
Heather: Yeah -- always, and then I started -- of course he declined it, then he had reached out like -- sent another e-mail to me -- I could just sense that -- it wasn’t like an absolute no, like a lot of people when you speak to them and you put the offer together that you do -- they are like yeah right, click. Or no way and this guy was like, nah I just can’t do that. I could sense he was semi interested.
David: He was motivated; he just didn’t like your offer.
Heather: That's right.
David: Ok, then what happened next?
Heather: So then i followed up probably like a week later and he was like no, I haven’t had any traction on it, just kind of getting an update from him and then -- we ended up discussing the price again. I said ok look, what are you willing, what is your wiggle room, and I always like to explain the numbers and where I am coming from with it. Then I think after two weeks of back and forth he finally agreed to -- I think it was 62,000. It was originally again listed for 99.
David: 99 to 62 that is 62% almost, that's awesome. So then you got the property under contract, what happened next?
Heather: Got the property under contract, for the past few months [00:06:33.19 - inaudible] and I have been working together daily, ghost posting and really built my buyer list up and in that duration I kind of took the time to learn my buyers, exactly what their investment strategy is. I would say I have a list of 200 in the course of five months.
David: That's a great list.
Heather: But you know, there is maybe ten that I know in and out. So I put together a marketing flyer and marketed [00:07:02.28 - inaudible] my investors who are interested in that area had someone out there the day after, then literally a contract on it that same day.
David: Your first deal, you had a contract on it within -- what?
Heather: Well -- within 48 hours.
David: Within 48 hours, awesome -- how long did it take to close?
Heather: Oh these guys -- it took them seven days. I think one of my top buyers to my knowledge -- they are good, they pay cash and close really quickly.
David: So seven days later, you closed and you got paid.
David: Love it.
David: Five grand, that is the first deal, that is so awesome. Mike, do you have any other questions about that particular deal?
Mike: No, I think she covered it well. Congratulations.
David: Now she has done another deal since then as well. She is having one closed tomorrow so she is going to get paid again tomorrow, but she got another deal, so let’s talk about that other deal that you had done, give us a little bit of detail about that, was that also a lead that you had found off the MLS?
Heather: This was a lead through -- I had posted -- I can’t recall if it was a property I had under contract or a posting I had -- someone reach out to me, they were working with this real estate agent that had a motivated seller, so there was two points of contact -- he had this property which was a -- [00:08:39.28 - inaudible] which is in Johnson country here in Kansas city which is one of the top areas. But it was basically a home for recovering addicts. Dave I know you are familiar with this one -- anyhow I ended up locking that property under contract for 155, the ARV was 200, 215 -- and then as soon as I closed on it and found a buyer for it -- the actual seller actually ended up filing for bankruptcy.
David: I remember this one. That's right, I remember you calling, you were all mad, you were like -- my second deal, it's falling apart Dave, what do I do? I said, stay consistent -- just because they are filing bankruptcy doesn’t mean you can’t buy this property. Maybe you can’t buy tomorrow -- but stay persistent, you know -- don’t let it fall in the cracks and you didn’t and you closed it so I am super proud of you good work.
Heather: Thank you.
David: Let's continue so they filed bankruptcy, then what happened? The process slowed down dramatically right?
Heather: Dramatically like -- a couple of months in fact. It took a while but -- [00:09:47.00 - inaudible] their own system basically -- they had to do their due diligence and they had an attorney involved but -- at the end of the day I ended up [00:09:56.09 - inaudible] this deal because I got this property under contract for 155, I found a buyer for it probably three days later and that was a cash buyer offering 163 -- well the next day, which is interesting and like to the listeners, this is a testament to your ethics right? I get another buyer that is a buddy of mine that lives in San Francisco -- he offered 168 or something --
David: So more?
Heather: So more -- but I couldn’t, I had already agreed to this individual so --
David: But at the end of the day, you closed the deal on that one. You had to wait a little bit but you were persistent, you didn’t give up and how much did you make on that deal?
Heather: Well that ended up being 5 grand because I had to pay [00:10:51.17 - inaudible] that referred it to me, and then -- closing cost so it was a profit of 5.
David: So you ended up netting 5 grand I love it. Then you have a third deal closing tomorrow, congrats by the way. You are absolutely killing it. What I love about coaching you -- is that it started off a little slow, most people do. But now that you have done a couple of deals and you are confident -- and you know how to do these deals, you have hit the ground running. So since you did your first deal, you have done two more deals within a matter of weeks. And I wouldn’t be surprised if over the next couple of weeks you will be doing a deal a week. Just got to keep up that marketing.
Heather: That's the thing Dave, it is interesting because with my story and my situation, my deals haven’t come from marketing, but I know and I listen to everything you say, that’s the best return right? Putting your money into marketing and getting the deals. But interesting enough, my two have not come from the marketing that I have sent. So it's interesting that I am still going to -- with this deal closing tomorrow I will reinvest that in marketing --
David: I love it, but that's a great point though for our listeners Heather is that, you don't have to have a ton of money to start in this business. If you don’t have 1500, two grand whatever the case is to do a letter campaign or a postcard campaign, or even hang bandits signs or whatever the case may is. You can still do deals by finding them online which you did for both of yours. Sounds to me like your first one was MLS offer that you made, and the second one was from like a ghost Craigslist post right?
Heather: That's right.
David: So you don't need a big budget to do deals, however if you have a budget, you are going to do a lot more deals.
Mike: So for the listeners who may not know, Heather -- you keep referring to it as a ghost Craigslist post, what do you mean by that?
Heather: Ghost meaning that I just post a -- basically a property maybe one picture, two pictures or pictures of a property then basically discount it right, like 20-30% in good areas or [00:13:02.26 - inaudible] Kansas City but in good areas. Put a little bit about the property, motivated, needs work. Then just lower that price then you get quite a few buyers, then you leverage that -- you have a conversation with them and really gage what their investment strategy is, what their financing tools are things like that
Mike: Great, a great tip, a great way to start building that buyers list when you don’t necessarily have the properties out there yet.
David: That's what I did when I first started to, whenever people would call and they would say I want to buy this deal -- I would say oh i sold that deal already, I sold it a couple of days ago. I need to pull that add down, thanks for reminding me. But -- since I got you on the phone, it sounds like you are interested in some property, are you looking for some more deals? I come across them all the time, let me get your name, number and e-mail and when i get them I will send them over to you. That's what you did and she got a deal on it, it's awesome.
Heather: Yeah well thank you Dave, you have been instrumental -- you guys have just been instrumental in helping me, I appreciate it, I wouldn’t be where I was if it wasn’t for you, like honestly.
David: Cool, well we appreciate it. We are happy that you have been successful, and we want to help you keep growing and doing more deals and -- you are doing this full time now, so there is no reason you can’t do a deal a week.
David: You are going to notice to as your confidence has builds as I have seen it build over the last several weeks -- really most of it is over the last couple of weeks. After you start doing these deals and you understand this business -- it’s really pretty simple. The business isn’t that difficult -- it can be hard, but at the same time the business is very simple. Find a motivated seller, make an offer on the property, get it under contract and market the property out to your buyers, find a buyer, get paid. That is like the nuts and bolts of the business. Really not that much to it so -- well Heather we loved having you on the show, we love hearing about your success, we are -- a company that does 20 wholesale deals locally here in St Louis Missouri -- so we know what we are doing. We would encourage you to go to the discountpropertyinvestor.com to check out some of the deals that we have on our site currently. If you are new to wholesaling like Heather, check out freewholesalecourse.com, and if you are interested in becoming one of our coaching students, we would love to coach you. There is also information about coaching at freewholesalecourse.com. We just really want to encourage anybody that’s listening just to take action, like Heather -- you can do deals without a ton of money and or investing a ton of money into marketing. However, if you have a marketing budget, you will see your amount of leads, your amount of deals, and amount of profits -- escalate -- dramatically based upon having that budget.
Mike: Absolutely. Heather, before we wrap up lets go ahead and -- I want to ask you. We usually try to end each episode with an action item, something for someone who is new to real estate. What should they do? I guess my question to you is what would you recommend to someone who has never done a deal -- to do to get started investing in real estate?
Heather: I mean an action item is just -- honestly find a mentor such as you guys or someone else. Someone who is doing deals and someone who can break it down in lament terms because -- there is fear, all of our decisions in this world are motivated by fear. So having someone who can -- I had the confidence myself, I had someone to lean on so I encourage someone to find someone who is currently doing deals in your market and just get a mentor. Some people just propel you and catapult you to -- taking action you know. Yeah that is what I would say is the most important thing.
Mike: That's awesome.
David: Great answer.
Mike: Is there anything else you want to add before we wrap it up the show then?
David: Congrats by the way.
Heather: Thank you.
Mike: Yeah, that's awesome.
Heather: Yeah, I appreciate it guys, just reiterate to everyone, just take action and do something, instead of doing nothing and -- failure, you are going to fail but you are going to get back up and be resilient. Once you get that first pay check you -- golden, making the first deal happen.
David: Consistent, persistent actions. One of my favourite sayings of all time, consistent persistent action, that is the key to success in any business folks. There is no secret, that’s it. Consistent, persistent action.
Mike: That ties in with our closing quote I believe. "Don't stop when you are tired, stop when you are done."
David: I love it. Heather thanks for coming on the show today, you have an awesome success story -- we love having you as a student, so keep up the good work and I am looking forward to seeing you do more and more deals, and make more and more money.
Heather: Thank you guys, I appreciate it.