This time it’s the systematic interrogation of a couple of guys who are currently extracting big profits out of one of the nation’s worst markets.
Meet Erik “MLS Sniper” Stark and Steve “REO Shotgun” Mills
This was a big, meaty interview, well worth hearing.
And just so you know, there’s nothing for sale inside. It’s an actual case study of how these two guys are tearing it up and bringing in 6-figure profits wholesaling in today’s arena.
Erik and Steve, Part 1…
Erik and Steve, Part 2…
One interesting point is that both of these guys are KISS Flipping members. 😉
Also, in case it’s helpful, I’ve pasted my own notes from our conversation below. Glance through ’em real quick and you’ll get a pretty good snapshot of what’s inside the interview.
Cliff’s Notes by JP:
Brief history of two “Average Joes”:
- Started as bad Realtors
- Been in the game for 3 yrs
- Teamed up as partners a year ago-ish
- First deal as partners: March ’08 (MLS find)
- First REI eduction: “Wholesaling for Quick Cash”
Currently:
- Buys and sells 7-10 deals a month on average
- Average profit range: $6k – $15k per deal
- ($40k-$100k/mo?)
Tactical:
- Make a point to PAY WELL for referrals, and get called first as a result
“As wholesalers, who are most of your buyers today?”
- Landlords
- Bargain hunting retail buyers (Wholetale)
Market Snapshot:
- Average house price for 3br/2ba 1,200sf 2car: $120k – $150k, but recently dropped to $70-$80k; retail $90k
- Rental market (lower end) houses can commonly be picked up for $5k to $15k right now.
VERY INTERESTING:
- Uncovered a unique niche recently selling to the parents of fist time homebuyers, who turn around and owner-finance it back to challenged end-buyer.
“How are you effectively selling your wholesaling services to area landlords?”
- Saving them time
- Saving them effort
- Finding better deals
2 Awesome Tips:
- The exceeding value of branding themselves locally as, “The guys who can close in 48 hours”
- The impressive impact seeing this as a “relationship business” has had on thier bottom line.
“What are your best working deal finding strategies today?”
- REOs (special broker relationships built as “the guys who can close”)
- “Mining MLS Loopholes” (I never thought of this before!)
“What’s your business overhead like?”
- Remodeling costs
- Paying bird dogs well
- Commissions
- Salary (to themselves)
“How’s your partnership structured?”
- 50/50
- Erik focuses a lot on marketing, closings, back office stuff
- Steve finds the money, negotiates deals, the “people” stuff
Noteworthy!
- “The Velocity of Money”: The value of putting it back to work as soon as it comes in.
- The Kiss of Death: Partnering with someone who’s too much like you
- Partnership Strength: Complimentary skillsets and genuine accountability
“What educational resources have had the greatest value to your business?”
- A local mentor (name not mentioned)
- Bob Norton
- Steve Cook
- Preston Ely
- Than Merrill
- Chris Daigle
- Cris Chico
Note: Only took from each guru what they felt they could apply to their current model. (i.e. never lost focus on their primary plan, but rather pulled from these guys to amplify and improve their plan)
“What advice do you have for others who want to follow a similar path?”
- Connect with local top dogs
- Get your first deal under your belt and LEARN from it
6 Profit Killing Mistakes Others Typically Make:
- Writing too much on your bandit signs
- Not ensuring others are well paid
- Trying to be a “lone wolf” and do everything yourself
- Disregarding “gatekeepers” or treating them poorly
- Don’t sweat the small fees/costs on a deal (pride themselves on taking a beating)
- Not having an ongoing hunger for knowledge
“How did you go from only 1 to 4 private lenders in an 8 month period?”
- Stumbled upon their first private lender b/c they were aggressive
- Some of their best lenders are their buyers
- Story of how they creatively financed a small apt complex with their buyer
- It’s not a secret formula, it’s taking action and money magnetism
My own private money-getting tips:
- Farming REIA connections
- Closing attorney’s client network
“How should wholesalers find buyers in this market?”
- Reverse MLS search for cash buyers in last 7 days
- Call every “for rent” sign in the n’hood
Hope you enjoyed! Please comment below!
As always JP, the value of what you choose to share, supplemented by your summarization [rendered from an expert perspective, I might add], shows your commitment to helping others prosper . . . through providing exposure to proven, successful methods for us to ‘model,’ should it be our choice to do so.
There is great promise for leveraging one’s time, resources and results by learning from the paths of success laid by others before us. As revealed, this holds true concerning both what TO DO and what NOT TO DO. We must be willing to learn from both the successes and failures of others who have ‘been there.’
These audios and your Cliff Notes provide lessons worthy of any investor’s attention, providing insight into numerous issues that generally apply to virtually any investment business. Just as water has many uses, so do the ideas conveyed here.
Excellent.
JP,
Thanks again for some great content. These guys are great. They have validated many of the things that I am doing/trying for my own business.
Great Interview!
Gary
Been doing wholesaling for 4 years and I can attest to there is ALWAYS something else to learn as someone has a better mousetrap.
Thanks for the info guys. Very good interview with Steve and Eric. Building your network and leaving enough meat on the bone for everyone is critical.
Very good interview indeed. Thanks for the cliff notes as well. They’re very helpful.
Brandon´s last blog post..Tim Mai
Nice interview JP… makes me wanna go out and flip some houses!!!
Matt K´s last blog post..Bessemer Week 7…. and other updates
I think the advice was great and this is a huge topic for real estate investors in this market. Since we aren’t cashing out of deals this is a great way to supplement our incomes.
Great info JP. Always worth tuning in to your materials. Quick question if you get a second to e-mail me. I’m a bit confused on how to do a reverse MLS search. Can you clue me in. Thanks much
Excellent information, would appreciate having you guys on video to post on my investors blog. Great to to see young creative guys using common sense and persistence to do good business.
.-= GLS´s last blog ..Amazing Diamond In The Rough =-.
I really love this post. The only thing i wouldn’t do is have a partner. I truly think you can wholesale yourself. I wholesale my houses to the same guys so the deals are done before they get started. Finding buyers through the MLS is a very good idea because you know your dealing with someone real. Another good idea is to find your buyers at the auction. Which is a killer way that I find my buyers.
Explain how you access reverse MLS? Do you ask a realtor to do it?
For sure. That’s what I do!!
Eric and Steve have “nailed it”! They have what ir REALLY takes to do this business correctly. New invstors need to study what is outlined here and TAKE ACTION NOW! Procrastinating over the right time kills more dreams than anything else in this world.
There will never be a “perfect time” a “right time” to start wholesaling houses! Just get out there and Freekin “DO IT”, and don’t sweat the small stuff. YES… there will most definitely be a learning curve to deal with! Show me any business that can make the owners six figures in the 1st year and I’ll show you a business that’s going to have some up’s and down’s associated with it!
I have wholesaled over 450 deals in the last 8 years and I have made many mistakes during the process! I have also made a lot of money in the process! The money and success melted away the mistakes and the drawbacks. It’s a trade-off you have to be willing to accept.
Eddie
How can I find Steve Mills and Erik Stark of Michigan?