Deal #3 and #4 done, $5K made with lessons learned

Deal #3 and #4 done, $5K made with lessons learned

Hey DGers I want to share with you these 2 deals that Ive completed in about a week ago that made me some easy money but also taught me some valuable lessons just in time before 2014 is over. Well these 2 deals that I'm talking about came from a seller who called from my bandit signs that I put all over my city. He initially called me in July 5 1/2 months ago and told me he had 3 properties to sell. I went to see the properties 2 months later after he called due to his busy schedule. I then only saw potential on 2 of the 3 properties to make some money on. I asked him if he was open to holding the note on one of the properties since it was owned free and clear, then i asked if he will be willing to do a lease option on the 2nd property since he still had a low mortgage on it. He said yes to both of my proposals. The reason he wanted to sell was because he was tired of dealing with these 2 properties and owed taxes plus water bills on both properties. So I told him I may not want these deals for myself but I could find him buyers for the 2 properties and he said thats fine. 3 weeks later I went out and found a buyer I knew from my real estate investing club that I go to every month, she is from my city and always telling me on how she is looking for owner financing deals so I told her about the 2 deals I came across, she was very interested and told me to get her into both properties. I got her into both properties 3 days after I spoke to her and she ended up only liking one of the properties because the other one had too many fire code violations so she said. So I set up the deal where I would just be getting a finders fee so I wouldn't have to get too involved with the paper work. We agreed to me getting a $6k finders fee because the deal I got her was so good she didn't mind paying me a $6k finders fee. Well 3 weeks later right before the deal was going to close the seller and buyer had a disagreement on a couple of clauses in their contract and wouldnt come to a compromise, so the deal fell apart. I was a little bit discourage about this deal now because the seller was being difficult on making this deal work so I kinda said to myself I may not find someone else to close on this deal.

Well about 1 month later I spoke to someone else I met at my real estate investing club meeting and mentioned to him about the 2 properties I had and he was interested so we exchanged number. I then called the seller back and told him if he still wanted me to help him get rid of both properties still and he said yes. I then called the new buyer I met and told him when he would like to see both properties and he said ASAP. I got him in both properties 3 days later. He said he would take both of them, I was excited. So I told him everything the was owed on both properties and how much the seller had a mortgage left for one of the properties and I wanted $6k finders fee for each, then he counter me with $5k for each soI agreed. I drew up 2 separate bird dog contracts for both properties for $5K fee on each, then I heard from one of my investor friends that bird dogging is not legal in my CT where I live. I called an attorney and he said its true. I still drew up both contracts with the buyer and had him sign it just to make him feel like he couldn't cut me out the deal. Well 3 weeks later before closing the the buyer finds out that the seller owes more on taxes and his mortgage than he said. Another obstacle for me too face. Well both attorneys went back and forth for about a week trying to make the numbers work for both parties but it wasn't getting anywhere. So the buyer called me and said can I give him the sellers number so they can work it out themselves and said yes but I told him to keep my fee with him confidential from the seller just because. The buyer ended up texting me back the next day saying he can only pay me $2,500 for each deal to make this deal workout and that he would make it up to me on any future deals I bring him. They basically cut my fee down to make the deal work for the both of them instead of the seller cutting his price down or the buyer paying extra. I was upset this happen and told the buyer that was wrong and he said they already agreed so the attorneys are proceeding with the closing. The buyer then told me that I should be happy because I was asking for too much on my bird dog fee and that I was really suppose to be getting much less. I told him not to worry on what I'm making as long as he is still getting a good deal. I then realized it was my fault for not getting both properties under contract and taking control of them, then assign both contracts so my fee wouldn't be a stake. A big lesson learned here.

I'm still grate full I'm making $2500 as a bird dog fee on each property.

Lesson #1: What may not be a deal deal for one buyer, may be a great deal for another buyer. Never give up on a deal just because your first buyer said its not a good deal. Keep running the deal by more buyers.

Lesson #2: If your making more than $1,000 on a deal do not try to bird dog the deal, get the property under contract and wholesale it. That way you would never have a buyer trying to negotiate your fee down or going behind your back and changing the deal with the seller.

I have deal number 5# in the works and would be posting about it as soon as it closes.

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Reynold Orozco


That's Great

Congrats to you! That's noble of you to still act as a "problem solver" even with the profit cut. Some folks would have walked away due to a smaller profit than expected.


Thanks Reynold

Great post. Sometimes the lessons and strategies we learn from taking action along with the people we meet are worth more than the fee!

Happy New Year!
Michael

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Knowledge is power, but execution trumps knowledge. Tony Robbins

http://www.mdhomeacquisitions.com Seller site
http://www.mdhomeacquisitionsbargainhouses.com Buyer site
http://www.mdhomeacquisitionshousehunter.com Bird Dog Site
http://www.mdlodeals.com Tenant/Buyer site


Narmond Thank you

Thank you. I can't see how anyone would walk away because their fee got cut, unless you have another buyer lined up to pay the initial fee you wanted. I would rather make some money then no money. I probably could of went and found another buyer to pay me exactly what I wanted but I was little exhausted with this deal already an wanted to get it over with.

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Reynold Orozco


Congrats!

YOU HAVE done the work and SHOWS 'how it can be done'

HAPPY NEW YEAR!

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Mike
https://tvallc.isrefer.com/go/RehabLite/renvestr/ Free tools


Congratulations Ray

Great advice on when you think deals are dead!

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www.tw4homes.com website
https://tvallc.isrefer.com/go/RehabLite/reigirl/ FREE SOFTWARE FOR WHOLESALERS, REHABBERS AND AGENTS! Present professional looking deals to buyers and lenders as well as run your numbers and get the ROI.


Thanks Mike and Tammy

All the deals I done so far were completed just when I though the deal was going to fall apart. Being persistent is key in this business. Happy New Years to you guys as well.

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Reynold Orozco


Congrats Reynold!

Yeah, $2500 for a bird dog fee is high. The most I ever asked for was $1k. But if your cash buyer agreed to it, that's great! Smiling Way to go with pushing thru all the obstacles!

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Teresa
College Station, TX
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"Declare that you will prosper despite every difficulty that may come your way. Don't just survive; thrive!"
-Joel Osteen


REYNOLD CONGRATUALTIONS !!!!!!!!!

and thank you for posting your story. it really inspires all of us to keep pushing forward....

WALT


Ray

yes great post love it. Way to go on making 5k for both deals like you said you learned like I did last May when I only got 3k for bird dog fee but for a package of 29 homes and I know I could have gotten way more if I had just put it under contract, lesson learned, I always try to put it under contract first If I can't for some reason ie earnest money or they wont take my POF then I bird dog it.

Congrats!!!! like Michael said the experience is key.

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Tony

Go faster do more! GFDM!


You're very welcome.

You're very welcome.


great

awesome and stay with it, much success,Jim

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jbischoff


Michael

Your absolutely right about the lessons and experiences it self is more valuable than the fee. Happy New Years to you too

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Reynold Orozco


Thank you Teresa

Both deals were suppose to be wholesale deals thats why I had each deal at $5K each then I told the buyer that I would just introduce him to the seller and I can step out the way to let them work it out. Thats how it ended up seeming like a bird dog fee towards the end. Happy New Year

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Reynold Orozco


Congrats.

Ray, sometimes you can't trust others when you have a deal. Best to be safe than sorry. We all learn. I am very cautious when it comes to introducing seller to buyer. I always think "why do they need me"? You are providing a good deal that's why. Make sure you have it locked before and introduction or they can just boot you out of the way. I'd take 2,500 per deal. Some is always better than none, right. Nice job on making the deal work regardless of the issues.

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To get something you've NEVER HAD
DO something you've NEVER DONE.


Sac-Townsfinest

Thanks

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Reynold Orozco