Dominic's NEW and IMPROVED Guide for Beginners!

Hey everyone!

Two years ago from today (11/05/2010) I wrote "Dominic's Guide for BRAND Newbies" and it seemed to really help some people out. I got tons of positive feedback from seasoned investors, as well as the beginners I wrote it for. So I am going to take a few hours out to write a new and improved guide for people just now getting into this. Most of the information in the old guide is accurate, but I have learned a few more things since my original post and wanted to rewrite this with the most up to date information I have. So here, I give you (drum roll please) "Dominic's NEW and IMPROVED Guide for Beginners!"

In case you haven't read my old post, HERE is a link if you want to check it out.

Okay, here we go... For those that don't know my story:

I am 22 years old right now, I have been interested in real estate since I was 17 (in 2007), and I finally got started investing when I was 20 (in 2010).

Like most of you, I was up late at night one night and saw Dean's infomercial for "Be a Real Estate Millionaire". Everything he was saying made sense, so I decided to do a Google search for his name. Well wouldn't you know it? This website popped up! After about an hour of digging into the forums, I realized that this community was FULL of like-minded people helping each other invest. I made absolutely no hesitation to buy the book.

A few weeks after ordering the book I was called by Dean's success academy asking if I wanted to join. Unfortunately, I was still in high school and couldn't afford it.

So a year passed, I graduated from high school, and I ended up getting a great job working for a proprietary trading firm in downtown Chicago. Life was good, I had a GREAT job for my age, and I could COMFORTABLY afford my own apartment, not something many people my age could say straight out of high school.

Well, that great feeling didn't last long. Even though I had it going for me, I wasn't satisfied and couldn't figure out why. I always wanted more for some reason! (That hasn't changed haha)

One day it hit me, the people I was working for were making MILLIONS, yes, MILLIONS of dollars, and I was making a mere 46 thousand. Well that's not fair now is it?!

I was tired of making these people money if they weren't going to SOMEWHAT evenly distribute it. I was sick of working the graveyard shift for 2 years straight. I was sick of being told only when my work wasn't good enough, and not appreciated when it was. You get the point.

Thoughts like that were what made me come back to this website repeatedly to try and get my life back on my own track. A few days after coming back here, something would go good in my life, and I would completely forget about this site, and go back to my old ways of living.

In 2010, that all changed when I was catching up with a friend, who is now my business partner, Makeba (aka investorinmissouri). We got to talking and found out that we were both interested in real estate. I think on that same phone call, we decided to start up a partnership and start doing this together. She was using another course at the time, and I told her to check Dean Graziosi out. She just laughed and asked me if it was that guy on TV. So I told her, "Makeba, it's only a 20 dollar book..."

Fast forward to today, and we have completed I think 14 deals in the last 2 years and 3 months, with another 9 in the works as I write this. Most of those deals were done very recently, but I'll talk about why it took us so long to get rolling a little later.

Okay, now that you know a little about me, let's get down to business!

Sections:
1. Overwhelmed?
2. Scared?
3. Building a Buyers List
4. Getting a Good Realtor
5. Finding Good Deals
6. Finishing Your Power Team

1. Overwhelmed?
   So, you think there is too much information on this site, and now you're overwhelmed? DON'T BE!!! When I was new at this, I would re-read the information on this site even if I knew it by heart, because I simply had no idea where to start. I felt that if I was learning, at least I was doing SOMETHING productive.

   Don't get me wrong, learning is a very important part of this. But there is only so much knowledge you need before you can start doing this, and surprisingly, you can probably learn it in only a few hours!

   After you read this guide, you SHOULD have the confidence to be able to go out and get started. You will still have questions, that's expected (I don't have the time to put everything in here). Heck, I still have TONS of unanswered questions, but that doesn't stop me. I just know I will learn the answers along the way.

   Think about when you first started a job, any job. You probably had NO IDEA what you were doing, but after a week of doing it, you began to figure it out, and eventually you learned so much that you could actually train other people to do your job if you wanted. Well I hate to break it to you, but it's the same thing with investing!

   Knowledge + Action = Results

   That's it!

   NOTE: On the other side of things, don't go out there and start taking action if you don't know the basics. Doing that will give you results, but they will be bad results.

   So just ask yourself if you have enough information to get started, but be truthful to yourself!

2. Scared?
   So you've got all the information, and you're ready to get started, but you're too scared to take action? DON'T BE!!! Fear of the unknown, fear of failure, and fear of embarrassment are all absolutely normal, but will you let those fears take over your life?
   • Fear of the Unknown
     The easiest way to get over your fear of the unknown is to partner up with someone! Of course, you'll have to split the profits, but if that's what gets you started, who cares?! I wouldn't be where I am without my partner, she has done more for me than she realizes and words can't express how thankful I am!

     We share the reward along with the risks. We also have very similar goals, and that helps tremendously!

   • Fear of Failure
     Let me tell you this: YOU WILL FAIL!... Sound a little harsh? Well it's the truth, nobody is perfect. You won't fail all the time, but I can guarantee not everything will go as you planned.

     Okay, now that you know you'll face failure from time to time, what are you going to do about it? I'll tell you, you need to be prepared to LEARN from your failures.

   • Fear of Embarrassment
     For everyone worried about embarrassing yourself over the phone or in person: You might mess up, you might sound unprofessional, or even nervous at first... But you can't let that hold you back!

     By the time you make 5 phone calls you will get the hang of things, and you'll get that professionalism in your voice. It's all about confidence! Let's be honest, whoever you might have embarrassed yourself in front of won't remember you in a month.

3. Building A Buyers List
   This is by far the most important thing to do in the beginning. Why? Here are just a few reasons:
   1. Unless you plan on keeping the properties for yourself, who are you going to sell them to?
   2. When wholesaling, you only have about 14 days to sell the property before you can back out, so you'll need a buyer in place BEFORE you find the deal to make sure the deal goes through.
   3. Talking to buyers, and having a list of buyers with cash, will increase your confidence when talking to not just Realtors, but everyone!

   Dedicate your first week of getting started to just building your buyers list, and that should put you in a good position to move to the next step.

   Now you're probably wondering, "Why would people want to buy a property from me when they can just go find it themselves?". The answer: TIME. We all have 24 hours in a day, but we all use our time differently. People with money don't have much time to do what you do, becuase they are busy doing what they do to make that money. Your buyers list might include local professionals such as doctors, dentists, lawyers, small business owners, and of course other real estate investors.

   There are a few main ways we like to find buyers:

   • Calling "For Rent" Ads
     Think about it, who are you going to talk to when you call one of these ads? Either a management company, or the landlord/owner/investor themselves. You are almost guaranteed to either find someone looking to buy more properties, or someone looking to sell their property. Very rarely, will you find a landlord that doesn't want to buy more properties NOR sell what they have. You can usually tell if you are talking to a management company or the owner, but if you aren't sure then ask when you call.

     NOTE: Unfortunately, I am going to avoid giving you guys exact scripts on what to say, because I learned it all from Dean's books and courses. I don't want to post what some of us have paid for. But I will try my best to explain how to talk to these people without giving too much away, in respect to Dean. Remember, this is a guide for beginners, it's not meant to be advanced/intermediate education. What I am writing should be more than enough to point you in the right direction.

     If it is a management company, just explain to them that if the owner is looking to buy anymore properties you can send the management company any leads you get, and they can forward them to the various investors they work for. This is in the management company's best interest because it makes them look good to the investors, plus they get more properties to manage if any investor buys any more properties.

     Okay, so let's pretend you call one of these ads, and you find out you are speaking directly with the owner. Keep it short and simple, no one likes to be on the phone with someone they don't know for extended amounts of time. You want to make the conversation about them, don't talk like a salesperson. You also don't need to go too much into what kind of properties they want, because you should have a good idea from their For Rent ad. Basically just tell them that you are good at finding deals, and want to know if it's alright if you send them the next one you come across.

     Remember, if you mess up the first call. Keep calm, and move on! There are plenty of for rent ads every day to mess up more than once.

   • Cash Solds List
     This one requires a Realtor, but basically you will have your Realtor send you a list of all the properties that were recently bought with cash.

     Then you have to do some research to see if the cash buyer is an investor or not. You can accomplish this by looking at the tax records, and looking to see where the tax payer lives. If the owner lives at the same address of the property they just bought, then they are not an investor. Investors will usually never have the same address as the properties they buy.

     Once you filter through the list to see which ones are investors or not, you have to either send a letter to the address they live, or you can try to find a contact phone number (which is a little harder to do).

     In the letter (or phone call), just explain that you noticed they recently bought a property on (insert address here). Then continue to give them your pitch on how you come across deals all the time, and if it's alright if you send them the next one you find. You get the point.

   • Ghost Ads
     Whether you do this over the internet on websites such as Craigslist or Backpage, or if you put out bandit signs, it works the same way:

     Put out ads that say "3/2 Ranch, 50k, Owner Desperate!" Replace 50k with whatever is a great deal in your area. When people call on your ad, you tell them that the property already sold. Then tell them you have a knack for finding good deals, and you can send them something the next time it comes up.

     You might have to ask a few questions to see what kind of deals they are looking for, but I'd say it's a safe bet to say they like 3/2 Ranch's for 50k!

4. Getting A Good Realtor
   You don't need just ANY Realtor, you need a GOOD and QUALIFIED Realtor, and those are hard to come by, so be patient! Most Realtors will try to crush your dreams and tell you what you want to do just doesn't work in today's market... DON'T LISTEN TO THEM! You don't want to try and convince them otherwise, it's impossible, so just move on to the next one.

   WHAT TO DO:

   • Start with Keller Williams and REMAX offices. Those agents are typically trained to work with investors.
   • Call the office, not the agent directly. Ask the receptionist to put you through to an agent that works with investors.
   • When you are speaking with the agent, you are ONLY looking for their mindset on the initial call. Remember, you are qualifying THEM, not the other way around. Tell them that you want to buy/fix/sell properties within 60 days to make a 25k profit (even if that's not your plan). If they tell you that's not possible, say "thank you for your time" and move on to the next one. The reason you want to see their mindset right away, is so you don't spend weeks or months with them, and realize that they have the wrong mindset.
   • Here is the criteria you should give them when they ask:
     • Price Range: Starter homes
     • Area: The hot areas (the area with the most transactions)
     • Vacant properties
     • Properties listed "As-is"
     • Any properties with price reductions
   • When they finally send you the listings you asked for, send them a homework assignment. Email them asking for the list of cash solds we talked about before. This has two purposes, it makes sure your Realtor is willing to do work, and you also need that cash solds list to get more buyers.

   WHAT NOT TO DO:

   • Don't tell them you learned all of this stuff from a guy on TV. They won't take you seriously. No offense Dean
   • Don't mention the word "wholesale" when you first talk to them. They will think you are difficult to work with.
   • Don't explain everything you want to do on your initial call. That will overwhelm them. Keep the first call short and sweet.
5. Finding Good Deals
   You have two different ways of finding leads:
   • MLS listings
     These are the listings you get from your agent, and you will tell your agent which offers to place. Negotiation is done through the agents, and is less personal.
     NOTE: You will need some cash for earnest money if one of your offers get accepted. Most foreclosures/REO/bank owned properties require up to a $1000 earnest money deposit, so beware of that. If you don't have any cash to use as earnest money, I would skip the MLS and focus on the For Sale By Owner strategy below.

   • For Sale By Owners
     Also known as FSBOs, these are found using your own marketing. The majority of the ones we find are from putting out 25 bandit signs in busy intersections that say "We Buy Houses Cash, Any Condition, XXX-XXX-XXXX" with a local Google Voice number on the sign. We have gotten up to 30 calls in one day, but that is above average. You should expect about 5 calls per day on average.

     You can typically negotiate with these people over the phone. When they call, ask them a little about the house, and try to get their price as low as you can by asking good questions, such as "How much would it take to get the house back into mint condition?". That question will automatically reduce the price they had in their head when they first called you. That is just one example, but there are other questions you can ask to negotiate without them even realizing it.

   NOTE: Don't quit your job when you find your first deal! Make sure you can supplement your income with real estate before you do it full time.

6. Finishing Your Power Team
   I'm not going to go into this too much, because it's not that important in the beginning believe it or not. Most of you want to make money RIGHT NOW, right? So go out there and put offers! You won't get any deals done without placing offers. The three main things you need in the beginning are buyers, a Realtor, and make offers.

   Don't get me wrong, the other members of your power team are important, but don't let that hold you back from in the beginning. Once you have a good Realtor, the rest of your power team should start to fall into place. And chances are your Realtor has a pretty large Rolodex full of great contacts!

   The members of your power team will include:

   • Buyers
   • Realtor
   • Title Company and/or Real Estate Attorney
   • Property Management Company
   • Contractors
   • Insurance Company
   • Bird Dogs
   • Interns
   • Appraisers
   • Property Inspectors
   • Mortgage Brokers

Phew! Are you still with me?!

I know I didn't cover everything, such as how to do the math, or the nuts and bolts of wholesaling. But I'll leave that up for you to find! It's all here on this website, and in the books. If you truly want this to happen, I have faith in you to find the information you're looking for!

Like I said before, the majority of our 14 deals were done very recently, and that's just because for some people it takes a while to get it right. The thing that really got us going was partnering up with other investors. If you've been struggling at this for a while now, don't give up! We are some examples of where persistence can take you.

"Never give up on something you really want. It’s difficult to wait, but more difficult to regret."