How to Get the Ex-Wife to Sign! This episode focuses on the importance of Follow up and teamwork! It also focuses on the power of persistence. In this episode, we talk about a recent deal that we closed that made us over 10K in wholesale profits. How it took us 4 months to get the deal to the finish line and most importantly how we did not give up in the process of working this deal. It will only take 2 minutes was the joke in this episode and it really took 4 months. Lots of very valuable lessons to be learned in this episode.
Mike: Alright guys, welcome back to the Discount Property Investor podcast. We are happy to have you guys here. How you doing this morning, Dave?
David: I'm doing great, Mike.
Mike: Good, I am doing pretty good myself. All powered up this morning. Got the workout in, got the coffee in.
David: Ten points.
Mike: Oh yeah, ten points on the daily success sheet, buddy.
David: That's right.
Mike: That's right. We think working out is one of the most important things you can do for yourself in the day.
David: Totally agree with you on that.
Mike: If you are watching the video, if you are watching our videos on YouTube you can see that obviously I don't work out that often.
David: You work out enough.
Mike: But we are getting back into it, starting to feel pretty good. Anyways, what are we going to talk about today, Dave? We got--
David: So we have a really challenging deal that we almost gave up on several times. But persistence got the deal done. It's a true story of how important follow up is in this business. Follow up is so massive in this business.
Mike: It is. So this deal, we will just call it a deal. We are kind of calling it a case study or deal or whatever you want to call it, it's awesome. I absolutely love it for a couple of reasons.
David: You came in and saved the day. We will get to that.
Mike: For a couple of reasons; we got paid, so I love that. I love getting paid.
David: So true.
Mike: The other reason I love it is because I kind of got to throw one Dave's things back in his face.
David: Which one is that?
Mike: You always say, it will take two minutes.
David: Oh yeah.
Mike: Sometimes it takes Dave about an hour to get stuff done, it will take him two minutes. I got to use that one I said, it will take two minutes and it really did. So let's go ahead and see what was going on, Dave.
David: I love that, that's awesome
Mike: Let's talk about this lead then. Do you remember where this lead came from?
David: This lead was about ten miles west of our office in terms of where it was at on the map. Where we go it was from a divorce campaign, a mailer. So I actually pulled up the e-mail. The initial contact was on the 9th of March.
Mike: Great, so we--
David: Today is the 22nd of June.
Mike: We sent direct mail then is what you're saying?
David: Mm hmm.
Mike: And the person reached out to us via e-mail. Is that right?
David: They didn't call us, they didn't go to our website. They just went right and e-mailed on the bottom of the letters we have, contact.
Mike: Sidebar, so that's one of the things we think is really important. We have changed all of our direct mail now to include literally any possible way that someone could contact us, we put it on there.
David: That's right. I think we have five or six methods; phone, e-mail, fax, website address which has forms on it, what am I missing?
Mike: Phone, fax, mail, then mailing address.
David: We may respond by mail a couple of times a month, then respond to e-mail a couple of times a month. Occasionally people fax us stuff. The more ways you can give somebody to communicate with you the better. Their preferred method may not be the same as your preferred method and vice versa. So this is actually really great that we are talking about this, Mike. Of all the methods we used or I used to reach out to this wife after the fact, it didn't work but yours did. Let's circle back.
Mike: We will circle back to that. I find it entertaining.
David: Makes for a good episode
Mike: Got to throw it into Dave's face, love doing that, love giving people trouble. Alright so it was a direct mail lead. The person had e-mailed you. Who had e-mailed you then?
David: The husband e-mailed me, he said I got your mail. Look at this, a month or so back. I kept it because I knew something was coming. I guess him and his wife started their divorce process. The bottom line is, all cards on the table, I have to sell this house. My mortgage is X. We can actually talk numbers somewhat. His mortgage was 197 on this particular house. He knows that it's damaged, and he knows that it's not in the best shape. Looks like he has not lived in this city for two years at this point. So he has moved, him and the wife aren't doing well. He said he thinks every room is going to need something; either paint or flooring or lighting, or just something. It's a four bed, two full bath house with an additional half bath. So it's a great house, it just needed quite a bit of work. That was the initial e-mail he had sent over to us. I am looking through my e-mail chain here and-- there has got to be 40 e-mails back and forth. Look at this, Mike. What do you say? That at least 40?
Mike: Yeah, that's 40 or 50 e-mails.
David: Yeah it's a ton. So we went back and forth with the guy who doesn't live in the city at all about the property, that we wanted to see it. He didn't live here so he didn't have a key. The wife at the time basically had the key, she got some relatives living in the home. She met me there and me and my wife walked through the property. From there we made an offer to the seller for about 150 grand I believe it was, perhaps a little less than that.
Mike: She said earlier he owed about 200?
Mike: Your offer was how much?
David: 150 I think, 145.
Mike: Alright, so again-- just because the seller owes 200,000, doesn't mean that's where your offer needs to start.
Mike: Again, we know this person. We are not trying to take advantage. We are trying to do something to help them clear this property, get rid of it, put it behind them, and again, help our business grow. We are not trying to take advantage, but the point is; this guy owes 200,000 and he is in a situation, it's a divorce, he has basically already abandoned the property, but his wife still has relatives living there, right?
David: She's in control. She owned it too, which doesn't make sense, because in this case we needed a marital waiver, which is the entire point of this episode, getting this paperwork signed, this one piece of paper. He even had documents from his judge stating-- from his lawyer in the process of the divorce that she had zero interest, she had signed those papers. But the title company would not accept that. If you are married and your name is not in an LLC, you have to have your wife, or spouse if you're a woman sign a marital waiver form unless they are signing as well. So that’s a little tit bit right there.
Mike: So that's in Missouri anyways.
David: Our State.
Mike: What are they called? Community property State? So I think it kind of depends on the state. But this was our situation, this was our reality is that-- this seller had the property, bought it prior to marriage or something like that because it was in his name?
David: They were both on the--
Mike: But he had paperwork stating that she no longer had any interest in it.
Mike: She's basically living there, again her family is living here.
David: He hasn't been here for two years by the way, which is kind of crazy.
Mike: The husband? He has been gone out of the picture for two years.
David: Talk about a motivated seller.
Mike: But he has got this property that's a problem. So what's the problem though? What's the real problem?
David: The problem is that he is-- trying to prevent a foreclosure on his record. He is making these mortgage payment for two years. Whenever I first met him he was current. But he quit making them. He started talking to me and I gave him a solution to his problem of buying the property. Even though that solution was not break even for him. He is still loosing, but at least he could not have the foreclosure or keep making these payments.
Mike: So the money was not a huge problem for him. It was the saving his credit, and saving his ability to purchase the next home, or the next car, or his credit cards don't jump from 19% to 40% or whatever the hell they jump from and too you know?
David: Yeah, not being able to get another house loan for five or six years.
Mike: Having no control of that. So that's his problem. Basically that he-- because he was married, then divorced. They are in this situation now where he is not making the payments or something, they are not making the payments.
David: Basically he was going to let the house go into foreclosure. I made him this offer, and he realized that the house needed everything in the very first e-mail he sent. He said I realize that every room needs something; flooring, paint, windows or whatever the case might be. So we took everything to the title company. The title company said we can get this deal done, however the seller needs to bring roughly $40,000 to closing.
David: To be able to sell it to you.
Mike: Hold on, we kind of skipped ahead though. So we made the initial offer, then we negotiated back and forth, or did he sign it right away? How did that go?
David: No, so that was another thing about follow ups. I sent him--
Mike: Yeah you got 50 e-mails there, so I know it wasn't--
David: So I sent him an offer, then there was a period of time where I sent him five or six, five in a row basically right there, two in a row, two in a row and so on and so forth. So there would be times where I would say-- so I sent him the offer and he didn't respond back to me for a couple of weeks. I just kept following up. Then for the most part-- I finally got him to respond, and he just said, I owe 40 grand more than that. I said, well I am not coming up on my offer. You can either let it go and destroy your credit. Sorry that's terrible but that's an option. Or I can try and help you somewhat, and you can pay the difference of what my offer is, and not have a foreclosure on your record. Yeah you have to pay that amount of money, but you are saving you credit.
Mike: Exactly. So Dave has put a lot of effort into this. Again, Dave is relentless in his followup. There are some e-mail chains where he goes five in row without hearing back from the seller. I am setting-- laying the foundation here. So Dave is relentless. Again, this is a good property. We know they need to sell, there is a need, a real motivation there. So we know it's a good property. We like the property, we love the property at the price we offered at the 150. So again, Dave just keeps following up. Right, so then eventually he replies to you, correct?
David: He responds back and he negotiated me up two grand. He tried to get me to pay 160 to get to only have to bring 30 to the table. So he is trying to get me to come up 10 or 12 actually, and I came up two. It was funny, in the emails he said, at least I tried. You got yourself two grand, man. Awesome.
Mike: Again, it is the right price for him and it still works for us.
Mike: So we are going to go through with the deal. So then you move on with the title-- I'm sorry, you took the contract over to title, and that's kind of what you're talking about there.
David: Yeah, so I'm thinking this is a done deal. This guy is going to bring almost 40 grand to closing, and I am going to buy this house and I was going to keep it as a rehab, or wholesale it because I had a pretty good margin, not an amazing one, but it was a good margin, or I will just keep it. It was a great house for the price, and it didn't need that much work. And the 197 that he owed wasn't the ARV. The ARV was 240, 250. So he owed less, but in its current condition, as is. It wasn't even worth 197, it was worth 150.
Mike: Right so-- if they were able to get the wife and the family out, then just list it as it's at, it wasn't going to sell.
David: It wasn't going to sell. They wouldn't have broken even.
Mike: Right, it's not going to sell for 250--
David: The house probably needs 50, but again there is $100,000 credit.
Mike: Right, which is-- again, the ARV being the after repair value, that's what Dave is referring to. Not going to sell for that. Okay so we get it to title, right? Title runs there stuff--
David: Say we're good to go, just need to sign this one piece of paper. It's actually the wife because they are not divorced yet, they are in the process of getting divorced. Which is kind of weird they were on the divorced list, but they were for some reason. The divorce list doesn't necessarily mean you get divorced. It means you filed for divorce.
David: That is what is recorded with the--
Mike: That's what's on public record, that is what is published on the--
David: So they had filed. We had their information and sent them mail. They hadn't finalized it yet. So we needed to get this one thing signed. So-- I sent her an e-mail, because the ex husband or the husband that lived out of State two years prior gave me the contact information. Him and her didn't really have great relations. So it was hard for them to even talk to each other, made it even more difficult. But we-- I sent her and e-mail--
Mike: That's tough. All my ex wives and I are on good terms.
David: I bet.
Mike: My current wife, she loves when I make jokes like that.
David: You love each other, don't you? So in the very first e-mail she responded back to me. I wrote a couple of paragraphs, just--
Mike: And you met her at the property though?
David: This is prior, this is me-- so I just said this is my name, here is who I am, the company I'm with. I spoke to this guy who is the husband or ex husband, he told me to talk to you about accessing the property so I can go walk through it, so on and so forth. In the first e-mail back it says, he is my ex husband now. She then gave me a time, we met, then we walked through it. So this is prior to me giving an offer. So we are going to jump ahead. I get the offer so on and so forth. Title company gives us that paperwork and we are like, alright, every deal always has a hiccup or some sort. So this hiccup is just getting this lady to sign and come to closing.
Mike: Right, Dave was just going to go out and meet her again.
David: Right, she refused to-- sign this paperwork. So I sent her, one, two, three, four, five, six, seven, eight, nine e-mails in a row.
Mike: Here's what happened though in the meantime. We got it under contract, we thought okay great we are going to market it out. We had it sold, right?
David: Yeah we had it sold, we have it wholesaled. So while we had it under contract-- at the time we took it to the title company, they didn't get back to us for a few days. At that point we are like, alright this is going to be a great one, we will close on it. However, let's throw it out there in the market place, see if we can make 10-15 grand on it, somewhere in that range, and not have to rehab it. Make it a quick wholesale, that's what we love and that's what we do. If we rehabbed it we could have made double that, maybe 2.5% times that. But you have to then buy it and pay the insurance and the taxes, the electric bill.
Mike: Your contractors and your-- yeah.
David: Yeah I mean it's great and you can make way more. But it's more work than just flipping some paperwork. So with that being said, I am going to sum up my follow up with this woman. I was trying to get her to meet me. She had then communicated with the husband and wanted to see what I wanted to her to sign, but didn't tell me, so I had to get that from him. So I am sending her over copies of the contract, copies of this marital waiver form, copies of basically anything and everything to prove that he wasn't making anything. She wanted to make sure he wasn't making anything, so it was kind of sad in a way, but it is what it is. So at first I offered her $250 to sign, then I went to $500, then I went to $1000. I guess I screwed up because I said visa gift card versus just cash, which I don't think was a big deal, but she didn't like that, so she didn't respond. Then my very-- actually my second to last e-mail was kind of funny, because I just wrote, I don't understand why you are punishing me, I did nothing to deserve it from you. My other e-mails were super long, trying to explain everything with no response. I had her respond to me, right here. I had her respond to me twice.
Mike: So we know it's a good e-mail.
David: We know she's reading it.
David: So I sent her basically nine more. At the very end I was like, alright this is the last thing I am going to do. I can hire a lawyer to basically contest. I don't even know the verbiage but contest the courts or the judge to let the husband sell the property without the wife signing the marital waiver, with whatever paperwork he had already from his lawyer. So basically--
Mike: So this is really--
David: A court order to the title company, because they wouldn't insure it; that's the main thing. The title company would not let it sell. We could have claimed it.
Mike: It's the title company that is the issue unfortunately.
David: Exactly. The paperwork a lawyer has doesn't mean anything. The title company doesn't approve it, they don't underwrite it properly or whatnot--
Mike: Right, and our buyer again-- they want a clean title, they near a clear title to close on it, and they want it to be insurable.
Mike: So that was the issue was when the underwriters at the title company got into it, they sent it to their legal team, they said they paperwork wasn't good enough. So they needed this piece of paperwork signed, the waiver signed on this one for that to happen. So basically our purchase contract would have been-- again we could have bought it, we could have closed on it, but we would not have clean title, so we would not have been able to provide a clean title to our next buyer either, or an insurable title. So it's definitely-- it was worth doing all this.
David: It was, absolutely. It was a great deal. Persistence, followup, and different ways to contact people.
David: Teamwork too. So let's circle back. After I sent all these e-mails, the last e-mail sent, I am going to hire an attorney to fight this, and I am going to give them approximately $1000 retainer which is going to be a sunk cost for me, regardless if they are able to provide me with any positive or negative information. However I didn't tell her that. I just said we are going to give the lawyer $1000 to get started on removing this paperwork from being an requirement. Or that could take two weeks, or I could just give this $1000 to you. I am going to give it to a lawyer versus you. Why would you not want it? Who in their right mind wouldn't want it? Didn't respond.
Mike: That was basically Dave's--
David: That's when I came in the office and threw a little fit like a child. I was like, I can not believe this women will not respond to me!
Mike: He was, he was very upset. Again, he was not rude to her, he was nothing. So he was up to 500 and I kind of knew what was going on. He was up to 500 and I was like, that's a lot of money. He was sending this e-mail for $1000. I said, Dave maybe that e-mail is not good, trying to figure out what's happening. I said, why don't you let someone else reach out to her? You were going to ask your wife to reach out to her as well.
David: I had my wife calling and texting.
Mike: Yeah so we were trying multiple ways.
David: We were being nice, we weren't stalking by any means. We were saying, hey we have some cash for you, we need to you to sign one piece of paper. We will even come to you at your location at your time. If you want to meet at Walmart or Starbucks, or you can come over to my home if you want. I am trying to make her comfortable. That's it period.
Mike: So this is once a day, not like every five minutes or something. You are just-- you are following up. Just trying, hey can we get this paperwork signed? You no longer and interest in the property. I literally said, hey David it will just take two minutes, just Google her. You will find a way to contact her.
David: I tried to find her on Facebook prior and I couldn't.
Mike: I literally just Googled her name, and it came up in Linkedin as a Linkedin connection. I guess it was a second degree connection. She used to work at a place I used to work out.
Mike: So I said, hello looks like you and I used to work together.
David: You sent her a message via Linkedin.
Mike: Via Linkedin I sent her a connection request. I said you and I used to work at Linkedin, how are things going? My business partner was trying to reach out to you about getting a piece of paperwork signed. Can we grab a cup of coffee and reconnect. Something like that.
David: Very simple.
Mike: Very simple because I think it's limited to 300 characters or something, or whatever it is on Linkedin. Took about five minutes. She responded back and said--
David: Guys, when you are doing your campaigns, your mail campaigns, your advertising campaigns. Whatever it is, if it's a billboard, if it's a postcard, a website; give people the most possible ways to reach you. Their method may not be the same as your preferred method. Go ahead, Mike.
Mike: Yeah, so again I sent her a simple message, replied said yes I would be happy to meet you as long as your partner is not there. I don't get it. So again, I took a screen shot and sent it to Dave and said, hey Dave it only takes two minutes.
David: It only takes two minutes.
Mike: She still wanted the money. So unfortunately I wish Dave didn't offer that thousand, because that was literally around the time. That was at the same time.
David: It all came together and that's all that matters.
Mike: Long story short, it was-- again, you just have to try multiple tactics. Dave for whatever reason, I guess he came across-- all those e-mails I have read them, they are all very friend. Just, hey can you help me out here, I just want to buy the house. I don't know your husband or like him. It's all very cordial, professional, just hey can we do this? So for whatever reason she was not comfortable with Dave at somepoint. So I sent message, maybe it's because we had a connection in the past.
David: Or maybe because it wasn't me. I could have been any of the above. We don't know.
Mike: Exactly, but the point is, it's nice to be able to bounce things off of team members. If you don't have a team member-- ask your spouse or someone else if you are in this situation rather. Just ask someone else, hey can you reach out to this person for me. Again, it might just be something that they are uncomfortable with. So for whatever reason, this was the way we got the ex wife to sign. So how did we get the ex wife to sign? This was it right here.
David: Lots of lessons, here guys. Let's review some of the lessons here. Persistence is key; this deal took us four months basically, right?
Mike: About four months.
David: My communications with the wife were basically over three of those months. Communications with the husband were for all four months. There was probably 40-50 different e-mails, text messages, and messages sent to these individuals.
Mike: Right. Then I sent one message to--
David: You cleaned up. You are the true closer in this situation.
Mike: I sent one message and coordinated with her, set up a time, we had a mobile notary go out and make sure everything was official, because it was a marital waiver for the title company, they want to make sure we are not forging it. So a mobile notary do it. Again, we basically paid her for that signature. Got it done.
David: That's right. So with these being said, guys. Follow up is another huge lesson. Let's take a quick break here and talk about some sales statistics that I really love. This rings so true, and this lesson I think re-affirms these statistics here. So 2% of sales are made on the first contact. Let that sink in for a second, 2%. Only 3% are going to be made on the second contact. So you don't get much more of a jump between one and two contacts, alright? 5% of sales on the third contact. 10% on the fourth contact. This is where it really hits home here, guys. You go from 10% to 80% of sales are made between the fifth and twelfth contact. So if you are going to contact somebody five times, you are probably going to contact them twelve times. But if you stop at one or two or three or even four, you have less than a 10% chance of closing that deal. Those are really awesome statistics, I love that. This goes to show you; this says between five and twelve contacts is 80%. I contacted these people 40 times.
David: What are the odds that you don't get the deal?
Mike: That is the 1% of sales.
David: 1% of sales don't happen when you contact somebody 40 times. So very good lesson here, guys. It's all about the follow up in our business. We close around 10-12 wholesales a month. It varies; sometimes less, sometimes more. The average deal is three or four months old. It's just the way it works. We get one call closes, absolutely. But we also have worked some deals 7-8-10 months.
Mike: It's a pipeline, you are basically building a pipeline. So one call close it out, then quick wholesale, that's still 45 days. So you are still going to end up contacting the person a couple of times. Again, none of them are overnight home runs.
David: Here's the real numbers. There is 51 e-mails between me and the husband, and 14 between me and the wife.
Mike: Oh that's cool, Google are counting it up for you, gmail account.
David: That's just e-mail. That doesn't include phone calls, that doesn't include text messages. So the text messages are even more--
Mike: That's just on Dave's side. That doesn't include title company reaching out, that doesn't include us reaching out to the title company, doesn’t include me reaching out to the seller, texting back and forth, setting up a time to meet with her.
David: So much stuff. There is a lot that goes into these deals. So this is another lesson in this particular case study here. Just about timing. A lot of times these deals they don't happen quickly. Is everything we did pretty simple? I think so. We sent some e-mails, we just tried and tried and didn't give up. Nothing that we did was really that hard. It wasn't easy don't get me wrong, but it was still simple what we had done. So great case study, we did get her to sign, we did close on it just yesterday. We had a nice little wholesale, just over 10k wholesale. The cash buyer that we sold it to was super happy. The seller was somewhat happy; they got out of their problem. He doesn't have to keep making these payments as he had done for two full years, and he prevented the foreclosure. He came to the closing with some money, but that's the cost of leaving the home vacant for two years.
Mike: It's not happiness necessarily right now, but they have benefited. He knows-- again they--
David: Want to know another cool titbit? I don't want to give away too much information. But the notary we had sent to get the marital waiver signed and notarize, also notarized the divorce papers there. So that was kind of cool. At least the seller was able to get out of his end of it.
Mike: So again, they all benefited from it in some way.
David: We provided solutions.
Mike: Right, it wasn't a win-lose. It has to be a win: win. We are never going to be able to twist someone's arm into a win-lose situation, it just doesn't really happen. So again, it was a win: win situation, the seller gets to move on. This is one less thing he has to deal with, with the ex-wife now, and her having to deal with the ex-husband. So it's one more problem they get to put behind them. Again, win, win, win.
David: Win, win, win I love it. Well thanks for listening guys, that was a great episode.
Mike: Yeah, I love being able to throw Dave under the bus. Only took two minutes, buddy. Alright, thanks for listening guys.