The real estate industry is not without competition, which means an integral part of a real estate investor’s skillset is knowing how to navigate the many options to find hot deals well before your competitors do.
Welcome back to Raising Private Money! In this episode, Chaffee-Thanh Nguyen is joining us to discuss the proven strategies I’ve been using for years to root out hot deals, from doing research to thorough prospecting. Tune in!
Key Takeaways:
- The secret strategy for finding hot deals before other investors and its two main components
- Step 1: Get the local Foreclosure list and maintain it.
- Step 2: Market to motivated sellers through a direct mail campaign
- Step 3: Meet and Negotiate with Prospects
- Step 4: Get the property under contract
- Step 5: Consider your exit strategies to turn a profit
- How private money can come into play in this strategy
- How to overcome your fears about real estate investing.
Check out my book: 7 Reasons Why Private Money Will Skyrocket Your Real Estate Business and Help You Build Incredible Wealth!
Get it here for FREE: www.jayconner.com/moneyguide
Sign up for the Private Money Academy and get 4-weeks free: https://jay-conner.mykajabi.com/offers/AMM4hCPW/checkout
Timestamps:
0:01 – Raising Private Money with Jay Conner
0:45 – Today’s Guest: Chaffee Thanh-Nguyen
4:18 – Free Online Class
8:51 – Two Main Components
11:03 – Marketing Direct Mail Letters
15:55 – Negotiate The Deal
17:35 – Buying Subject-To The Existing Note
22:13 – Analysis Paralysis
24:06 – Take Action!
5 Proven Strategies to Find Hot Deals Before Other Real Estate Investors
[00:00:00] Jay Conner:
If you are a real estate investor or you want to be a real estate investor and you’re interested in learning how to find deals before any other real estate investor, even though they exist, Don’t go anywhere because I’m getting ready to plug you into this very secret strategy on finding deals before other real estate investors know they exist.
[00:00:29] Jay Conner:
Welcome to the Jay Conner Show. I’m Jay Conner, mostly known as the Private Money Authority broadcasting to you on this show from Morehead City, North Carolina, my hometown, and I’m excited to still yet again have you as my guest, host, and co-host. Chaffee from Chicago, Illinois. Hello Chaffee.
[00:00:52] Chaffee Thanh-Nguyen:
Hello, Jay, and hello everyone else out there.
[00:00:54] Jay Conner:
Chaffee, thank you so much for being available to come on the show with me again. Have we been having fun or what?
[00:01:00] Chaffee Thanh-Nguyen:
It’s a blast. Jay, it’s always a pleasure working with you. Yeah, we always have a good time.
[00:01:05] Jay Conner:
Same here. Chaffee, same here. Chavie. So in case you are new to the Jay Conner show, what in the world are we doing here on the show?
[00:01:14] Jay Conner:
We talk a lot about secret strategies for real estate investors. Talk a lot about investing in single-family homes. They need rehabbing, how do get ’em rehabbed quickly on time, and on budget, we talk about finding deals. Of course, as I just mentioned at the beginning of this show, we for the first time, Are going to pull the curtain back and reveal my stealthy strategy for finding really hot deals before other real estate investors know they exist.
[00:01:45] Jay Conner:
Of course, we talk a lot about funding for deals, private money, and not relying on banks or mortgage companies. We talk about selling them fast. So we reduce our caring costs and we talk about automation, we talk about commercial deals, et cetera. And Chaffee, one thing I really enjoy having you here on the show as well is the reason we talk about, mindset, and personal development, in fact, chime in here for a moment, Chaffee, and give the listeners and viewers a little taste of, the mindset stuff that we’ve talked about in the previous shows.
[00:02:20] Chaffee Thanh-Nguyen:
We’ve started off talking about some of the books that we like to read, and some of the influences that we’ve had, and really it boils down to understanding yourself. And your abilities and your skillset and your strengths and weaknesses so that you can take what you share on this show and in your live class, Jay, and really implement it.
[00:02:39] Chaffee Thanh-Nguyen:
So it’s not just a matter of knowing what to do, it’s actually doing it and understanding the process of doing it. And more importantly, when you hit that wall, when you hit that challenge, or when you hit a problem or something that pops up.
[00:02:53] Jay Conner:
Do you stop or do you keep moving through? Do you get around it?
[00:02:57] Chaffee Thanh-Nguyen:
Do you get under it, through it over whatever it takes, right? And that’s that mindset piece. That’s the gray matter between the ears moving you forward. So that’s why we talk about it here because you get that down. If you understand that piece, then you can get through those challenges and you make that deal happen. And that’s where you succeed at.
[00:03:15] Jay Conner:
Exactly. There’s a bridge between knowledge. And implementation. Exactly. And so that’s why folks, that’s why Chaff and I include the personal development mindset piece. As we’ve said, until you own the real estate between your ears, you may not ever own any real estate as in dirt, right?
[00:03:35] Jay Conner:
So Chaffee before we plug them into the finding deals before other real estate investors. Let’s ask folks, if you are viewing us on YouTube, please subscribe so you don’t miss out on any of the information that we’re coming out with. Also, give us a thumbs up and and the like the video and also we’d love to hear where people are tuning in from.
[00:03:58] Jay Conner:
In the comment bar, if you’re watching on YouTube go ahead and put hi, your first name, and what city and state you’re from. And if you’re listening on iTunes, subscribe. Rate and review, subscribe, rate, and review. Chaffee, before we get into this show’s topic, let’s go ahead and plug people into what we promised.
[00:04:17] Jay Conner:
So we’ve got a free online class folks, a free online class on demand, waiting for you to go and watch and take notes and learn about this secret strategy on the show. Today, I am gonna give the 30,000-foot view. But if you really want it, step by step and dive in deep. Here’s where you wanna go, folks. Go to www.JayConner.com/Podcast. So Chaffee, let’s go ahead and jump in. So what are we talking about today?
[00:04:59] Chaffee Thanh-Nguyen:
Jay, you teased about it a couple of times, so I think you should really talk about how you find deals before anybody else does out there. So always dive right into that.
[00:05:10] Jay Conner:
You must have E S P ’cause you read my mind, right? So here’s the deal folks. Carol Joy and I, have been investing in single-family houses here in Eastern North Carolina for the past 15 years. Little over seven and a half years ago, we actually started training real estate investors or new real estate investors, how to do the business like we do.
[00:05:34] Jay Conner:
We do five to 30 live events a year. Chaffee and I are here. Co-hosting the show with me because Chaffee is at all of my live events, he’s my head coach. He does free one-on-one strategy sessions, at the live event. And so Chaffee gets to meet all of the attendees and my students that come to the event and he gets to hear the common questions.
[00:06:00] Jay Conner:
By the way, Chaffee, that reminds me, speaking of free strategy sessions at the end of that online class, That we just gave out Jake hunter.com/foreclosure podcast. They will be able to claim a free strategy session with us one-on-one, of course, over the telephone. So that’s another reason y’all want to go watch that free online class folks is so you can take advantage of the free strategy session that you learn how to claim that at the end of the class.
[00:06:29] Jay Conner:
But anyway, as I said, we’ve been investing for 15 years. And here’s how I started out. Carol Joy and I, first hired our real estate attorney to learn about foreclosure, the way it works in North Carolina. By the way, folks, and y’all excuse my telephone ringing, but I’m right here in my office, so the telephones ring.
[00:06:51] Jay Conner:
There’s one piece of advice I give people. Chaffee, you’ve heard me say this, and that is, One way you can learn about how the foreclosure system works in your state that I don’t recommend is to stop making your mortgage payments, and you’ll learn very quickly how the foreclosure process works. But, I don’t recommend that way.
[00:07:13] Jay Conner:
So I hired my real estate attorney. When I started out to explain it, I went to the clerk of court at the courthouse and I went there, totally humble, not pretending to know anything about how the process works, and I went there with the mindset since we’re talking about the mindset of serving other people I’m not coming there.
[00:07:34] Jay Conner:
This process has not gotten anything to do with taking advantage of people. This system is about, and this, and the way I do the foreclosure business is coming from the perspective of having a servant’s heart. In fact, when myself and my team talk to a potential seller, the owner of a house that is, and they’re in foreclosure.
[00:07:57] Jay Conner:
Then the first thing we ask them is, do you want to keep your property? Do you wanna keep your house? And if they do, of course, we tell ’em we’re not attorneys, we’re not, I can’t give you any legal advice, but I can give you some experience as to how you might, could keep your home. And there’s nothing in that in, in that for us, if they do that.
[00:08:16] Jay Conner:
So this system we put together, Is we started 15 years ago and Carol Joy and I put it together and we’ve been using it ever since. Of course, we’ve t tweaked it or improved it, but it accounts for 25% of the deals that we do. So the system itself, Chaffee.
[00:08:41] Chaffee Thanh-Nguyen:
Yeah. Jay, I believe I’ve heard you talk about there being two main components of this system, so you wanna share what those two main components are for everyone?
[00:08:50] Jay Conner:
Sure. So there are two categories or components, your words, better component. There are two components that make the system work. First of all, there is the tracking. Of the foreclosures. So that’s the first component. We gotta track ’em. All right. The other component is marketing or direct mail, right?
[00:09:15] Jay Conner:
So when we started out 15 years ago, Carol Joy actually herself went to the courthouse. Now, I told her from our meeting with the real estate attorney, I told her, here’s the information that we need to get on every file. So in North Carolina, it’s in, it’s in the Clerk of Courts area, and of course, it’s called the Special Proceedings Room.
[00:09:38] Jay Conner:
All right? It is a public record, so everyone has access to it. So we decided what information we wanted, okay, to track and to keep current. All right? And so Carol Joy put all that together. Now, a few years ago, Carol Joy didn’t have to go to the courthouse anymore. We hired a courthouse assistant that actually goes to the courthouse for us, and some folks will say, I don’t have the money to afford to hire a courthouse assistant.
[00:10:10] Jay Conner:
Our average private per deal now is over $60,000. You know what? We pay the courthouse assistant to keep all those files current. A whopping $75 a week. In a month’s period of time, who would not be willing to trade $300 a month for 60 thousand dollars in profit? That’s not a bad deal, Jay.
[00:10:32] Jay Conner:
Yeah, I think it’s a pretty good ROI. Return on investment. The other component is the marketer’s direct mail letters. So that was the piece that I put together. And of course, we’ve approved those letters since 15 years ago, but here’s what’s crazy. We get an unbelievable 57% response rate to these letters.
[00:10:51] Jay Conner:
That’s cumulative. So some will respond to letter number one. Some will respond to letter number two, and number three, and there are eight of them. Of course, when they respond, we stop mailing. Now, let me be totally transparent, Chaffee, when I say a 57 response rate, the Response does include vulgarity. Okay. So yes, some people do not appreciate the letters or the offer of a solution to their difficulty, and they’ll say, take me off your list.
[00:11:21] Jay Conner:
And not a very nice way, but the percentage of those responses is very small. So those are the two categories. Tracking each file, what’s the current status, when’s the hearing date, when’s the sale date, and the letters, mailing those out. And we’ve automated that.
[00:11:36] Jay Conner:
We have a courthouse assistant getting the information, and we have a lady that manages to mail the letters out. Okay. So the whole process is automated. Even down to when they respond to the letters. Either they have a choice of going to a 24-hour recorded message hotline, or they can speak live to, One of our answering services that have our script and et cetera.
[00:11:57] Jay Conner:
But those are the two, those are the two main categories.
[00:11:59] Chaffee Thanh-Nguyen: You’ve broken it down to actually five steps for your system. So let’s on, on the show, let’s go ahead and share what those five steps are. So this, the listeners can, just follow the five steps as they go through. What’s the first step that you do?
[00:12:36] Jay Conner:
Since we don’t have time here on the show, in the online class, I’ll go into detail about what kind of information you need to get at the courthouse, what kind of information you need to track and et cetera. So step one, get it and maintain it. And we track ’em. We track these open files until they are closed or dismissed.
[00:12:58] Jay Conner:
So even when people file for bankruptcy, stay in the foreclosure process. We still track them because Chaffee, unfortunately, as even after people file for bankruptcy, unfortunately, most of the time they do not keep the monthly payments that the judge put together, and then the house comes back up for sale, on the courthouse steps.
[00:13:23] Chaffee Thanh-Nguyen:
Usually, bankruptcy is a foreclosure is a stalling process just to keep them in the house a little bit longer. Exactly what’s step two, Jay?
[00:13:29] Jay Conner:
Yeah, so you got the list at one. Now step two, now we’re going to market to the motivated sellers, and that’s where the eight-letter direct mail campaign comes in.
[00:13:43] Jay Conner: And again, starting out, we, we did those letters ourselves. And if it’s a new real estate investor or new to this process, you can do the letters yourself, but it’s very easily, automated.
[00:13:55] Chaffee Thanh-Nguyen:
So these eight letters you’ve refined over the years though, correct? It wasn’t just you decided to sit down and write eight letters and it worked.
[00:14:02] Jay Conner:
So actually I started out with one letter but I learned quickly that really. Part of the magic in marketing is sequential mailings. And so of course I was only getting like a fourth of the number of responders. I was missing out on three-fourths of the people responding.
[00:14:26] Jay Conner:
And of course, not only do sequential mailings work, no matter what business you’re in and you’re wanting to promote these letters, each letter is now closer to its hearing or sale date. So as these letters are going out, their motivation is getting higher to do something right. To do something. So yeah, the magic of the eight leaders gets the response.
[00:14:51] Chaffee Thanh-Nguyen:
Moving on then, in the entrance of time what’s step number three?
[00:14:54] Jay Conner:
Yeah, step number three is how they respond. They respond. You have a conversation with ’em over the phone and you talk about, are they wanting to sell their house, et cetera. Do they need help with moving expenses?
[00:15:09] Jay Conner:
So you negotiate the deal. That, that, that’s step three is negotiating the deal. Go to the house, view the homes and the repairs. So you’re going to, in step three, you’re going to use my analyzer software to figure out what’s the most you can offer on the house. And I will tell, and tell our viewers and listeners here, a lot of the time people that are in foreclosure will sell their house for what they owe.
[00:15:37] Jay Conner:
They will sell their house for what they owe just to be done. Yeah. So get the foreclosure list market to them with a direct mail campaign and negotiate the deal. Awesome.
[00:15:50] Chaffee Thanh-Nguyen:
What’s step number four?
[00:15:50] Jay Conner:
So step number four is to get it under contract. All right. So control the property, get it under contract, and get the offer to purchase you.
[00:16:01] Jay Conner:
Depending on your exit strategy, are you gonna get, use an option, a purchase, or are you gonna use an offer to purchase? Most of the time I use an offer to purchase because I’m going to want to own the house. Okay. There are multiple ways to control it, and multiple ways to buy it. We should do a, we should do a show Chaffee soon on buying subject to the existing note.
[00:16:21] Jay Conner:
Cause we probably have a lot of viewers and listeners that have never heard of how you can control a property without having to use private money to buy subject to the existing note. Control the property, get an option, get it under contract, et cetera.
[00:16:37] Chaffee Thanh-Nguyen: Awesome. And then step number five?
[00:16:40] Jay Conner:
Yeah. And the final step is now once you own the property, you’ve closed on it or you’re controlling it. Now you have multiple exit strategies, so you know, you can wholesale the deal, which if. Viewers and listeners, if you don’t know what wholesaling is, that’s simply controlling the property and assigning your contract to another real estate investor, getting an assignment fee, and now you’re out of the deal.
[00:17:03] Jay Conner:
You can wholesale it, you can keep it in, rehab it. If it needs rehab, you can sell it on rent to own. So you have multiple exit strategies to choose from. And I go into those as well in detail on the online class that we just gave out.
[00:17:19] Chaffee Thanh-Nguyen:
Awesome. And Jay, real quick, just to tie it all back into private money, where can you use private money in this process?
[00:17:25] Chaffee Thanh-Nguyen:
What steps can you use the private money in?
[00:17:28] Jay Conner:
Sure. So some owners will not sell to you subject to the existing note. They won’t let you control the property by buying it on a lease option, for example, or an opportunity. They want in order and some will not sell to you for what they owe.
[00:17:44] Jay Conner:
They want more than what they owe. Now, I will tell you, since they’re in the foreclosure process, I’m not gonna give ’em much money over what they do owe, because what we will tell sellers, Chaffee, when it goes to the sale of the courthouse steps, how much money is your lender going to give you? Lenders not gonna give any money. So whatever money I give you and it’s and again, I’m not trying to take advantage of people. I wanna help ’em and I do I’ll help ’em with their moving expenses or whatever. But if they will not sell subject two, the existing note, then I use my private money.
[00:18:18] Chaffee Thanh-Nguyen:
Now you could use private money, even if it’s a subject two if it’s below the threshold. Correct?
[00:18:23] Jay Conner:
Absolutely. And I do that a lot. So let’s say I buy it subject to the existing note, which by the way, folks, simply means in a nutshell, When we buy a house subject to the existing note, we buy the house, the deed or the title transfers into our entity.
[00:18:41] Jay Conner:
All our LLC, our land trust, whatever we’re using, and the mortgage, the current mortgage stays in the seller’s name and we agree to make their payments until we have a cash-out buyer. And you know the question, when I first learned about subject two, Not to get into subject two, but the first question I had was unworthy is gonna sell me their house and agree to leave the mortgage in their name and I make the payments.
[00:19:09] Jay Conner:
The answer is a motivated seller. It wants debt relief, but yes, I’ll buy a house subject to the existing note. Then I’ll get private money from a private lender. And folks, if you don’t know what private money or private under is, just go listen to the four previous shows. We talk a lot about private money in the four previous shows, but I’ll get it if it needs rehab or I need some costs or marketing, expenses covered.
[00:19:34] Jay Conner:
I’ll get 25 or $30,000 from a private lender too, and I’ll give them a second mortgage in a junior lien position, so I can have an existing mortgage in place and then the secondary mortgage. So I’m glad you asked that question again, folks, for the detail of this foreclosure system, just go to the online class and it’s in the show notes and as well, Chaffee, those are the five steps from the thousand-foot view, but.
[00:20:02] Jay Conner:
We’re about to run out of time, as we always do. What I like to do is, as we said, talk about some mindset, and personal development. So I’m gonna, I’m gonna hit, I’m just gonna shoot you from the hip cha. Alright. Okay. So here’s my question. In your experience and of course, Chaffee’s been a real estate investor. What year did you start investing in real estate? Chavy 2002. 2002. So you’ve been doing it a long time as well. From your experience, especially for a new real estate investor, what emotional challenges or fears or what roadblocks might a new real estate investor be thinking about doing their first deal, their first foreclosure deal, and what’s the best way for them to overcome that?
[00:20:50] Chaffee Thanh-Nguyen: That’s a big question. Let me break it down into two things that I think are critical. The first thing that comes to mind is people, when they’re first starting out, tend to overthink things. They tend to overanalyze things, and so they take no action.
[00:21:11] Chaffee Thanh-Nguyen:
We call that paralysis analysis or analysis paralysis. So they have the system, they have this process, they have something, and they crunch the numbers and it takes them two weeks to look at one deal. When the real investor, somebody like you, Jay, can take a look at it and, five minutes and figure out this is a deal or not, right?
[00:21:31] Chaffee Thanh-Nguyen:
And so you’re looking at, multiple deals in the time it takes ’em to look at one deal. And by the time they figure out, oh, this is a pretty good deal. Somebody else already has the deal, right? So analysis paralysis. And so that, that brings up the key of using a system, a system like your foreclosure system or, a process that you’ve put together that walks them through step by step so that you know your software, right?
[00:21:53] Chaffee Thanh-Nguyen:
That analyzes it for them so they don’t have to think about it and just follow the process. And that’s the key for a beginning. Investors just. Following that process. And as I mentioned, the second thing is using a system, right? And when you have that system and you’re working with somebody that knows what they’re doing, you have a coach or mentor like you, Jay, right?
[00:22:11] Chaffee Thanh-Nguyen:
Then you can use that system, ask any questions to your mentor coach, and do the deal quickly so that you’re not sitting around. Paralyzed with this analysis process and you’re moving forward. That’s what I would recommend following a system, getting a mentor or coach that’s gonna help you use and implement that system, and then taking massive action.
[00:22:32] Jay Conner:
Awesome, Chaffee. You answered that a lot quicker than I could have a cause that was like a 32nd question for a one-hour answer. Cha, we need to call this show a wrap. We are out of time, but parting comments?
[00:22:47] Chaffee Thanh-Nguyen:
Parting comments, like always, I said if you like what you’re hearing, rate, subscribe, rate comments thumbs up, all the above.
[00:22:55] Chaffee Thanh-Nguyen:
And as I mentioned in the last show take action, right? Go to the free online training learn more and then start implementing it. Really doesn’t put any extra money in your pocket. If you do, all you do is listen all day long and don’t do anything. So take that next step. Listen to class, get rolled into the strategy session, and let us help you move forward.
[00:23:17] Jay Conner:
Excellent. Chaffee, as always, thank you so much for taking the time to join me here on the show. And folks, as we’ve said, go to www.JayConner.com/Podcast. So here’s to send you all again on the upcoming show. If you really wanna learn more about Chaffee and myself and why we’re qualified to be delivering this information to you.
[00:23:47] Jay Conner:
Go back a few podcasts and you’ll hear all the background there. So again, thank you all for listening and viewing, and until we see you on the next show, here’s to taking your business and your real estate investing, and your mindset to the next level. Bye for now.