More Contracts Wont Make You Rich...But This Will

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If you’re new to my channel my name is RJ Bates III. Myself and my partner Cassi DeHaas are the founders of Titanium Investments.

We are nationwide virtual wholesalers and on this channel we share EVERYTHING that we do inside our business. So if you’re looking to close more deals - at higher assignments - anywhere in the country… You’re in the right place.

Who is Titanium Investments and What Have We Accomplished?

Over 10 years in the real estate investing business
Closed deals in all 50 states
​Owned rentals in 12 states
​Flipped houses in 11 states
​Closed on over 2,000 properties
​125 contracts in 50 days (all live on YouTube)
​Back to back Closers Olympics Champion
Trained thousands of wholesalers to close more deals

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With over 2,000 Videos, this is the #1 channel on YouTube for all things Virtual Wholesaling. SUBSCRIBE NOW!    https://www.youtube.com/@RJBatesIII

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Chapters

• 0:00 More Contracts Won't Make You Rich
• 2:01 Wasted Efforts and Energy
• 5:05 Setting Proper Precedents
• 7:35 Focus on Quality Deals
• 9:55 One Big Deal Over Multiple Small

Transcript

Speaker 1: 0:00

More contracts won't make you rich, but this will. So there are a handful of shiny objects that completely decimate wholesalers in their business, and the number one thing that I think absolutely distracts wholesalers is flip-flopping from different systems, different lead generation tactics, always trying something new when they're not getting success. But then, once you overcome that hurdle, the next thing that I feel like just completely destroys wholesalers is chasing different exit strategies. Right, we started getting some contracts, we started getting some assignments, closing funded deals. We're seeing success, but then we feel like we're leaving money on the table. So we've got to learn novations, we've got to learn sub two seller finance, maybe even throw in some hybrids, maybe even, hey, we need to figure out how to underwrite deals for short-term rentals or mid-term rentals or pad splits and all these different shiny objects. These are the ones that I feel like destroy wholesaler businesses early on Today, which I've previously done in this series videos about those topics Today is kind of the more advanced decimation that wholesalers kind of partake in, which is getting signed contracts that aren't movable deals, where we try to manufacture deals or we look at it and we say we can get this under contract now, maybe we could convert it to a creative deal further down the road, or it's just a notch on the post to say, hey, I sent out five contracts today.

Speaker 1: 2:01

One of the things that we experienced in 2021 and 2022 was anything and everything that we could possibly get under contract we did, except they weren't always great deals, and it wasn't because necessarily the numbers weren't good. Maybe it was because it was in a location, maybe the location was too rural or it was a small city, or Maybe the location was too rural or it was a small city, or maybe the market was softening and it wasn't attractive to your end buyers. So one of the things that I've really, over the past couple of years, tried to impose upon you guys is paying attention to the buyer activity and really running your numbers. Where in buyers buy using the web formula, and this is where I feel like a lot of wholesalers kind of don't pay attention to the. What could be negatively impacting their business is are you getting properties under contract that are good deals, or are you getting properties under contract just because you can and you feel like, hey, this could work out, and what ends up happening?

Speaker 1: 3:14

There is, there's always some sort of allocation of our energy, our attention span. If we get a property under contract, someone inside of our organization has to coordinate the recon, get pictures done. Someone inside of your organization then has to put together the dispositions packet and then focus on contacting the end buyers and doing dispositions. If their focus on recon and dispositions is on a property that probably shouldn't have been under contract, it's wasted efforts and that energy. Right, there could be the difference between a good deal getting assigned for maximum value, or even a good deal getting assigned for maximum value or even a good deal getting assigned at all.

Speaker 1: 4:05

There have been times where I know for a fact that we have had to terminate a deal that should have been dispo'd, but because the dispositions team was spread too thin, maybe recon didn't get done quickly enough, the attention span, the energy was not spent on the appropriate properties that should have been moved, and I've always said this I would rather have no deal than a bad deal. Now it's funny that I say that because I'm also the guy that does nationwide marketing, because I want to open up as many opportunities as possible for us to get properties under contract. However, this is where I want you guys to understand you are the buyer in the transaction. When I say embrace, no, I want you to be paying attention to should I get this particular property under contract? And that starts with does the seller have motivation to sell the asset for a discount? Next up, am I getting it for the correct price? And finally, am I getting it in a location where end buyers are buying and it's going to be able to be dispo? This is what you should be paying attention to when you are talking to the sellers.

Speaker 1: 5:26

However, when you're struggling early on, it feels like anything and everything that you can contract. You're going to pay attention to what I am saying because I know it feels counterintuitive to your success where it's like RJ, I need a win, I need a victory, and I've been there. But you're setting the precedence for when you remove yourself from the seat that you're currently sitting in and acquisitions. If you are willing today to sign a contract on a property that otherwise you probably shouldn't, for various different reasons Maybe the seller doesn't have motivation, the numbers aren't quite accurate, or there's not enough buyer activity for you to be able to see that you're going to be able to dispo that deal you are setting the precedence inside of your company that that is okay, now imagine that you have 20 different people inside your wholesaling operation that are now doing acquisitions for you. You're running a massive operation, we have been there and what happens is is you will get properties under contract and you will make promises to sellers that you cannot perform on and this increases your average contract to termination ratio, where preferably you keep that somewhere in the 70% of contract to close ratio. 70% of the properties that you get under contract may get to closing.

Speaker 1: 6:50

The 30% that ends in termination realistically should not be because you can't perform. Should be because the seller can't perform. Whether or not the seller decides to back out, the seller won't give you access. There's an issue with tenants, there's a title issue, something along those lines should be the reason why those deals end in termination, not because you could not find an end buyer or your numbers were incorrect. Now sellers are going to lie and it's going to happen to where you find out that, hey, this property needed a lot more rehab than what I anticipated. That's part of virtual wholesaling and we have to account to that. That should be accounted for inside of that 30% of terminations.

Speaker 1: 7:33

But if you're doing the acquisitions correctly and you're following the closer's formula. You should be setting the precedence with the reverse rapport section, where you're explaining the process, and renegotiation based off of the walkthrough is a viable option. It's no different than how Opendoor or Offerpad or any of those large I buyers actually navigate these contracts. They do the exact same thing and we should be doing that as well. So, realistically, the only time that we should end in termination is because of something out of our control.

Speaker 1: 8:10

This is what I want you looking at and paying attention to when you're comping and underwriting. Yes, it's important for you to come up with an after repair value and a rehab estimate and coming up with that offer price. But it's important for you to come up with an after repair value and a rehab estimate and coming up with that offer price. But it's also paying attention to all the little nuances to make sure that you're getting a property in the right location that could be dispo, because more contracts is not going to make you successful. It honestly can slow your business down and what can end up happening is you get a property under contract that could be a $15,000 or $20,000 assignment, but if you're trying to dispo something that otherwise you should have contracted and you're trying to move it more often than not, those difficult properties that we shouldn't even be attempting to try a dispo we're only trying to make like five, maybe $10,000 assignment. It hinders you, it takes your attention away from that potential 15 to $20,000 assignment so you can move this little deal over here and then when you finally find the time to move on to that good deal, you don't have the time, the energy, and so what happens is both deals end up suffering and they extrapolate that over many, many deals over the course of time. It will cost you in your bank account more than anything. So, yes, going back through all the different things that I've said inside this series, more exit strategies won't make you rich. More leads generation right.

Speaker 1: 9:46

This one right here is the one that people sleep on because it feels like a victory when you get a property under contract. You hear me talk about it 125 contracts in 50 days. There were deals that suffered because of the volume that we had coming through. There was absolutely deals that I should not have contracted during that 50 day span. There was not enough buyer activity. There were some numbers that were questionable, to say the least.

Speaker 1: 10:20

So really take your time and put yourself in the position of being the end buyer?

Speaker 1: 10:26

If you are the end buyer in this, are you really going to invest in it? Would you buy this deal over all of the other future deals, the other leads that you're going to talk to later in that day? Would you invest that amount of money into this one lead? Really embrace that role when you're talking to sellers and what you'll end up finding out is you'll get more deals under contract at the right price that are easier to dispo and you make more money.

Speaker 1: 10:58

That's what's going to make you more successful is having the correct deals under contract, not just more to have that vanity number to say look how many properties I have under contract. I would much rather dispo one deal a week for $25,000 than five deals for 5,000. It's the same amount of money in my bank account, but less work, less stress and less people that we have to make promises to that we can perform. That is how you ultimately succeed as a wholesaler. So, that being said, let me know what your thoughts are in the comments. Show me some love. Make sure you like the video. We'll see you guys on the next one.