The Fastest Path To Cash In Real Estate

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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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Transcript

Fast Cash Versus Every Strategy

SPEAKER_00 0:00

And today we are going to be talking about the fastest cash or path to cash in real estate. And of course, we're going to be talking about the difference between wholesaling, flipping, rentals, wraps, novations, creative finance, all the different exit strategies that exist inside of real estate investing. And the reason why I want to discuss this is because I have seen like this wave over the past six months where there are people trying to figure out how they can get into real estate investing, one way or another. And again, for those of you that tune in to the King Closer Reacts every single Saturday, I am not saying that wholesalers are real estate investors. Okay. We identify as wholesalers. We understand we're not taking on the risk and the liability and everything that real estate investors do, but we are in the same industry. So that's what I'm referencing there. But I've seen this wave of people that are new. They're trying to find their way into real estate investing. And within that, they are discussing all of the different exit strategies. They want to learn sub two, they want to learn novations. They because of ego, they they want to at some point in time flip a house, they want to own rentals and maybe even do some wraps. And it's fantastic. They want to do everything, but why? And that's normally when I ask that question, I don't get much of a response. There's not much of a thought process behind it, except for the fact that, well, everybody on social media is telling me how great this strategy is or that strategy. And so, of course, I'm supposed to do all of these things. Now, if you've been following me for any period of time, you know that I preach the hedgehog concept. One thing. Creative finance doesn't work. Of course, they everything works, just like every form of lead generation works. But what I do want to discuss today is why I believe wholesaling real estate is the fastest path to cash in real estate. Because it is. Danny

The Hockey Lesson On Specializing

SPEAKER_00 3:31

can let you know in the comments how big of a deal uh this is. He had to be chosen to do it. It's like the best players in the Rocky Mountain district in the United States. And the first night, the the gentleman that runs USA hockey set them down. And he said, All right, boys, you're 13, 14 years old. At some point in time, you have to make a decision that you are going to be a hockey player. If you're in this room, it's because you're one of the most talented hockey players in all of the United States. I'm not saying you can't play football, you can't play baseball or basketball, but at some point in time, you have to make the decision that I'm going to be great at hockey. And I am a hockey player. At 14, you're kind of at that age. If you're in this room, you've got to make that decision. And so he he applied that pressure onto them, letting them know like, hey, in order for you to truly develop the skills and the talent and the reps that are needed to go on to play college hockey, junior hockey, to maybe even become a professional later on in your career, you have to specialize. You have to say, This is what I'm going all in on. But then inside of real estate investing, it's very, very rare for me to see people say, I'm going to go all in on a strategy, I'm going to become great at that because on social media it's it's otherwise. Why would you only go all in on wholesaling? Why would you only go in on one strategy? You should learn all of the things because it gives you more tools in your tool belt. Well, that's what we're here to discuss today.

Wholesaling Wins On Speed To Cash

SPEAKER_00 5:34

So I've got five points that I want to give you guys, starting off with point one. The fastest path to cash is wholesaling, and it's not even close. And so, one of the things that I kind of want to convey in today's message is I kind of want to make wholesaling sexy again because something has happened over the past couple of years where everything else became the new shiny object, the new thing that we're doing, and really none of it is new, it's just new faces telling you that it's sexy to do something else. Like prior to middle of last year, I never heard someone say I'm a slow flipper, but now all of a sudden there's slow flip groups, there's people out there teaching you how to do slow flips. Now, we've had to take on several people inside of TU from these slow flip groups because they weren't seeing success. Why? Because of an extremely slow cash conversion cycle. When you compare that cash conversion cycle to flips, buy and hold, slow flips, wraps, creative finance strategies, all of these things, it's not even remotely close. And then on top of that, the capital that is needed in comparison to these other strategies, even things like novations, people want to talk about how you can convert these leads into these different strategies and you can make a lot more money. That is true. That's not my argument here. My argument is if you're in a position where you're newer and you're trying to develop a skill set in a business, why would you not want to attempt to do this in the fastest possible method out there? Where, hey, I could go get a property under contract on Monday, assign it on Tuesday, close and fund it on Friday. Now you're like, RJ, though, that's rare. It's happening right now inside of Titanium University. One of the members when got a property under contract, uploaded it to titaniumdispo.com. It got picked up by Braden and Abby, who've been on the Tuesday live over at Mr. House. It got assigned today, $11,000 assignment fee, and it's closing and funding on Friday. That cash conversion cycle could never be touched with the other strategies. And on top of that, the only real true expense that the TU member had up front was the cost of systems and the cost of leads. Now I know that there's going to be people out there that discusses and kind of talks about the upfront cost and how it's hard to get properties under contract and all this other stuff.

Every Deal Starts With Lead Gen

SPEAKER_00 8:39

That's true. But my second point is every residential deal starts in the same place. And so if you want to do these other strategies, guess what? You're still going to have to generate leads, you're still going to have to find a motivated seller that wants to sell you a piece of real estate for a discount. So it all starts the same place. So wholesaling kind of shows you that foundation of how to go out and find great deals. Cassie had over a close to a three-hour implementation call today. Now that's not common, but she was deep diving into comping and underwriting needs by a newer member that was wanting to discuss a lot of things that quote unquote he heard on YouTube from other people that were discussing, like, hey, you don't need to comp this deal. You just need to run it on the income, and you need to run it on the cap rate. And she's looking at it and it's like, but in order for this to be a wholesale deal, we need to be getting the property under contract for a discount, despite the income and the cap rate. And so she's going into detail about this. And this is a skill set that you learn when you're wholesaling to truly understand how to comp and underwrite deals to find out what is a deal. Imagine if this member had gone out and decided that he wanted to do something else in real estate investing besides wholesaling, and then listened to other people on YouTube talk about how you could underwrite these deals without company. He would have been taking on all of the liability of that deal and been in a world of Ert, have no equity. How could it even be lended on? To get lending, he would have had to bring cash. What if he doesn't have that capital? These are the things that people are finding out the hard way. I mean, I don't know, is that really happening? Absolutely. We just came across this with a cash buyer. Okay, a cash buyer that was going to buy a small multifamily property that we are currently wholesaling in Texas. Well, this cash buyer currently had three different small multifamily properties under contract. She ended up, they were all being bought from wholesalers. Okay, she ended up terminating all three. Why? Because she didn't know how to comp an underwrite and she did not know how to actually perform on contracts. The poor training. She had never done a transaction in her life. And she's immediately jumping past wholesaling, going into buying holds, building long-term wealth, the things that are spewed out there on social media, she's gonna have all this passive income. And then when it gets down to it, she doesn't know how to get a loan, she doesn't understand cash to close, she doesn't understand how to estimate for rehab, she doesn't know how to find contractors, she didn't know how to get an appraisal, she didn't know how to do anything, and so she ended up in a world of hurt, and despite the fact that we tried to help her throughout the entire transaction, she ended up just panicking at the end. It's like I'm in way over my head because the moment that I sign these documents and I wire this money in, I'm taking this money from my husband's IRA. That's our life savings. I don't know how to do any of this. You guys aren't gonna be there to hold my hand, you're just a wholesaler. I'm gonna be out here on my own. Yeah. Each deal starts at the same place. If you've never gone out and found the deal, done comps, underwritten it, and then assigned it to an end buyer, then how do you know what is a deal and what is not a deal? And you've never gone through a transaction without taking on all of the liability up front. So not only is it the fastest path to cash, but it's also the one that protects you from getting into a world of hurt, just like that cash buyer, just like the TU member today that was taught how to comp and underwrite and ignore comps and just look at the uh cash income from the rental and the cap rate. This is wild stuff that is taught across the internet and it doesn't protect the people long term. Now,

When Monetizing Leads Breaks Focus

SPEAKER_00 13:33

point number three is some people want to monetize every single lead that they get. Okay, well, why would we let leads go to waste? It makes sense, right? RJ, if I could monetize this lead into an ovation or RJ, what if I could monetize the leads that want to and deserve to sell the property for full retail? What if I monetize that by building out relationships with realtors and giving those over for a referral fee? All right, so I've heard all of the different strategies. There's there's so many different ones as how we can monetize every single lead. The the one that is most common nowadays is creative finance. They want close to retail. Why don't I just buy it sub two? They own it free and clear. Why don't I just offer them seller finance and see if they'll sell it to me on terms? Your price, my terms, right? We've all heard these things and we've seen it get taught. Except there's really lacking thought process behind it. See, on the creative finance side with sub two, I always love to ask people when they say, Well, why don't we just buy that sub two? What's your exit strategy? And then we just kind of sit in silence. Well, we could we could rent it out, right? How would you know that? We don't know what the P I T I is, we don't know what the rent rate is. All you heard was full retail and they have a mortgage. Why not just buy it sub two? How are we going to make money with this? Seller finance, they own it free and clear. Let's just have them sell it to us on terms. For what? How are we going to make money? They want too much money, but they are still slightly discounted. Why don't we just do innovation? Okay. Every single time that your company decides to do something different than a wholesale cash transaction, you are now taking your eye off the ball to go figure out how to do something else. Now, a good example of this is if you're new to wholesaling, think about how you felt the first time you picked the phone up and you called a seller, you place that phone call and you tried to buy their house. Think about the first time you've ever written out a contract. The feelings, the emotions that you had when you were reaching out to these sellers. Think about the feelings that you had the first time you ever got a signed contract, and you started calling cash buyers, and you tried to do dispositions. Each one of those was a massive learning experience for you. It doesn't come naturally for the majority of us. So you start learning, and you learn through a lot of failure, probably. The first time you ever call a seller, you probably didn't handle that situation very well. You probably had a ton of nerves, and it probably just ended up with an awkward hangup. But now we decide that we're going to take the eye off of our ball there. We're no longer going to play that game because we want to monetize the leads. Now we want to go do a novation. So you get a seller to agree. They sign all the paperwork. You figure out the paperwork. Well, have you ever called a realtor before to discuss listing a novation? Figure out if they're going to be the right fit for you. Have you ever worked with a title company or a closing attorney on closing and funding a novation that you've listed? Have you ever gone through that? Probably not. And so now you're taking the eye off of the ball over here, which is calling more sellers to try to get more wholesale deals to go do something else. And every single strategy that we try to go out and figure out and add on to our tool belt, that's what happens. And I've consistently seen this happen to wholesalers. We're doing well. Now we're going to add other things. Six months later, we're not doing nearly as well as we were. And what happened? Something bad happened with one of the new strategies, one of the new tools that we added to our tool belt. And it caused delays, it caused issues. We had to figure out how to close this ovation. We had to try to figure out what was going on with this seller finance deal or this sub two deal. A good example of this is that sometimes I hear people say, hey, I'm going to do a sub two and I'm just going to wrap it. Or hey, I'm I'm going to get this deal and I'm going to do a wrap on it. Well, I can speak personally about that strategy. I love doing raps. But again, this strategy is advanced. It does take your eye off the ball. And so if your business is not in a place to where it can sustain where it is today without your daily interactions, should you be doing this? Probably not. So here's the reason why. I've

Wraps And The Real Cost Of Risk

SPEAKER_00 19:14

got two wraps right now, one in West Virginia, one here in Texas, that I'm looking at potentially having to foreclose on because they're not making their payments. Now, what does that look like? Both of them, the down payment when we executed the wrap and all of that was years ago. Years. And so the property has appreciated. They've paid down the principal balance. They were wraps, so I had underlying mortgages on both. I have significantly paid down those underlying mortgages. So there could be if if I end up foreclosing on both of them, it could turn out to be beneficial for my company. I could have a significant payday on the back side of this. However, I am now having to speak to attorneys. I'm having to have letters sent. I'm having to put money, capital up front to file for foreclosure. This is not just, hey, there's nothing to worry about here. We're just going to foreclose. There's processes that have to go through this. For example, the one in West Virginia. The guy that bought it from me on the wrap says, hey, don't worry about it. I know I haven't been making my payments, but I'm actually under contract with somebody that's going to buy the property. Now I'm going to make a bigger video about this, but just a brief overview. The contract that they sent us is my contract. So they they bought one of our products, probably titanium profits. They're not a titanium university uh member. So they probably bought titanium profits. They're using our contract, but then they added in all of their novation paperwork. Now, the price in which this property is under contract is astronomical. There's no way in the world that this could actually be sold. And I sold it on a land contract because it's in West Virginia, and I didn't sign off on this. So this person doesn't even know what they're doing. They can't do. I have to give them the right to be able to sell this and list it as an ovation on the market. And so they're thinking, hey, we're going to go do an ovation on this property over here. They don't have the right paperwork. They don't have the rights. So now I have to hire an attorney to send a cease and desist letter to them because they don't have the rights to do what they're doing. They're literally listing my property on the market without my permission. This is the kind of stuff that you can get yourself into when you're just like, oh. Oh, this is. I'm just going to start doing novations. Or if you're in my case, I'm just going to start doing wraps. So I tried to do a wrap in West Virginia. I had to learn out. You can't do a wrap. You have to do it under a land contract. Okay. We get our down payment. We get years of payments. And then the payments stop. And now we have to go do a foreclosure in West Virginia. In wholesaling, it's very, very rare for you to ever end up in situations like this to where you just quite frankly don't know what you're doing and get yourself into trouble that significantly stalls out your business. So when I look at this and it's like, let's try to monetize every lead. Be prepared for what happens to your business when that goes wrong. Are

Why Options Crush New Investors

SPEAKER_00 22:53

you in a position to where you can handle that? Step four or point four options kill focus, especially for new people. I mean, new people want to come in. I saw this. We we onboarded a new class to TU last Monday. One of the first votes from a new member was Hey, I think this could make a great novation. How do I know if it's going to be a good novation or not? You shouldn't even know what the word novation is because you haven't done a wholesale transaction. You need to be solely focused on trying to find a motivated seller that needs to sell a property for a discount. And then hopefully you can figure out how to run the numbers well enough because you're ignorant. You don't know what you don't know yet. So you've got to figure out what is a deal and what isn't a deal before you're starting to try to figure out what is this other thing that I could potentially do? You don't even know how to do the easy deals yet. Why would you be trying to convert this into a novation? And why is that what works for the seller? The basis behind the closer's formula is we get in and we find out that they have a property that they want to sell. How much did they want for it? And are they motivated to sell this for a discount? That is the entire basis behind the closer's formula. And yet I see it time and time again where that's not the point of focus. It is definitely not what we're thinking about. We are thinking about how can I monetize every lead? How can I make some money? And then because of options that exist nowadays, it kills the focus of the newer people in this industry. And because their focus gets killed, normally they don't last longer than a couple of months. I said it the other day on one of my other videos. Wholesaling is not easy. One of the reasons why wholesaling is not easy is because of everything else that exists out there that will distract you from wholesaling. It actually really is easy when you are solely focused on it and that's all you want to do. But when you look at all the options that exist out there, all the different voices, all of the different things that you could do, it will absolutely distract you to your death. Point

Cash Wholesaling Unlocks Everything Else

SPEAKER_00 25:23

number five: cash wholesaling is the core skill set that unlocks the rest of everything else that you want to go do. If you can become great at wholesaling cash deals, oh, it becomes extremely easy to figure out how to do novations, how to buy properties subject to the existing mortgage, seller finance, flips, rentals, buy and holds, wraps, Airbnbs, all the things that you want to get distracted about early on. If you can focus for long enough to become somewhat decent at it, it will unlock your abilities to go do all of that distractions. But when I see my competitors in the education space saying, don't get started in wholesaling, get started in creative finance or novations or this or that. You can absolutely do that if that's what you want your core business to be. But I personally believe that if you start off with your core business being focused and the foundation is set around cash wholesale deals, it unlocks and makes everything else so much easier because the skill sets translate between all of the different strategies. It's just a lot harder. There's more risk, there's more liability that comes along with those other exit strategies. The facts are if you want cash and you need cash fast inside of real estate investing, this wholesaling is the way to do that. Hands down, could you make more money doing something else? Yes. Can you sustain the potential losses that come along with doing that? That is the question nobody ever asked me years ago. And I wish somebody would have. If you go do all these flips and you buy all these rentals, can you sustain the loss? Because if someone had asked me that and I had answered honestly, the answer would have been no, I cannot. But nobody said that. Sure. But I'm explaining to you the reason why I believe wholesaling is the place to get started. My question to those other people is why do they believe you should skip this? Why should you skip the easiest path, the fastest path to cash being in your pocket to learn the skill sets that are needed to all to do all of their other exit strategies?

The Case For Starting With Wholesaling

SPEAKER_00 28:28

So at the end of the day, I am still an advocate for wholesaling and wholesaling cash deals. A very, very small percent of our deals are ever creative finance, and extremely small. And it's not because we don't know how to do it. Shit, tomorrow I'm selling one of my properties that I bought sub two back in 2018, maybe 2017, so eight or nine years ago, before sub two ever became sexy, before it was ever a group and there was hats and paste and all of that. We've been doing that. It isn't about the fact that we don't know how to do it, it's about the fact that we have done it. I'm speaking from the experience of the results of doing all the different strategies. And so if you want the fastest path to cash, it starts with wholesaling. Translate those skills over into everything else that you want to chase, and you'll be in a much better place in the future.