#124: Become a Transaction Engineer with Wholesaling Lease Options

Welcome to The Accelerated Investor Podcast with Josh Cantwell, if you love entrepreneurship and investing in real estate then you are in the right place. Josh is the CEO of Freeland Ventures Real Estate Private Equity and has personally invested in well over 500 properties all across the country. He’s also made hundreds of private lender loans and owns over 1,000 units of apartments. Josh is an expert at raising private money for deals and he prides himself on never having had a boss in his entire adult life. Josh and his team also mentor investors and entrepreneurs from all over the world. He doesn’t dream about doing deals, he actually does them and so do his listeners and students. Now sit back, listen, learn, and accelerate your business, your life, and your investing with The Accelerated Investor Podcast. 

Josh: So, hey, welcome back to Accelerated Investor. I am so excited to be with you and have a good time chatting with my good friend Joe McCall today. Joe is an expert at a very particular strategy that is going to be a fantastic way for you to make money in the middle, during and after the Corona virus. The strategy is called wholesaling lease options. And my guest today is Joe McCall, the author of Wholesaling Lease Options, and my good friend. I’ve known Joe for a long time. Joe, what’s going on, man? Thanks for hopping on Accelerated Investor today.    

Joe:  Josh, thanks for having me here, man. I really appreciate it. I’ve admired and respected you, your business for a long, long time. You’re one of the leaders in the industry and it’s an honor to be here.    

Josh: Awesome, Joe. Appreciate you saying that, man. Yeah, I’ve known Joe probably probably eight to 10 years. We’ve been an affiliate events together, real estate mastermind’s together. And I wanted to bring Joe on in particular today, because we know that if you look back just a few months ago before covid, we were expecting that there was going to be a recession sometime in the next maybe six to 12 to 18 months. We’ve just been on such a long expansion. We knew a recession was coming. And I kept thinking back to two thousand eight, nine and 10 when we were in the middle of the last major recession. And short sales was a great strategy to invest in and lease options and lease options because people can both acquire properties and sell properties using a rent to own or lease with option strategy. And now, of course, we’ve seen, you know, Joe, we’ve seen these thirty five million unemployment claims. And when you have all these unemployment claims, all of a sudden those people are not really going to be eligible to acquire a bank loan because they have a disruption in their employment. And so they’re still gonna want to buy properties, but they’re going to have to use a more creative strategy to do it. So you’ve written this brand new book. It’s just out. I gonna encourage all of my audience to to purchase it. Well, we’ll do a call to action for that and put it in the show notes. But, Joe, tell us just about what is a lease option? What is wholesaling lease options? Let’s talk about the high level strategy first.    

Joe:  It’s one of my favorite strategies. It’s what I used to quit my job in 2009. I’ve done a lot of wholesaling short sales. I tried short sales. Never could figure that out. I had a lot of friends are making a lot of money with it. But, man, I struggled with it. I tried rehabbing. I lost money on all my rehabs. I felt like rehabbing was adult day care. Managing your day care sometimes. But there’s guys that can do it successfully like you have. And so I just admire guys like you that can do it so well. So I did wholesaling, started doing some deals with wholesaling and started making good money. But I felt like there was a point where I was spending so much money on marketing, getting so many leads that I was throwing away. There’s gotta be something I could do with these leads that I’m throwing away. They didn’t have much equity or if they did, they weren’t willing to give any of it to me. And so I was just throwing these leads away. I thought, what if I did a lease option on those? Right. And instead of wholesaling it a deal to a cash buyer investor, what if I just wholesale the deal to a tenant buyer and as I started flipping lease options. So what a lease option is as you lease a property for a period of time with the option to buy it in the future. And it could be a couple years, five years, 10 years. So you lease a property. So I would enter into an agreement with a seller who maybe didn’t have much equity, maybe wasn’t super motivated, so motivated they’re going to drop their price to 60, 70 cents on the dollar. So I would enter into a lease option agreement with that seller for a while, I’d lease their property for one or two years. And I’m a tenant buyer and I have the right to sublease or assign that contract out so I can either stay in the middle or I can assign my interest away. Just so your country around and advertise the house for as a lease option as well. And I’d find a good tenant buyer that was on the verge of getting a mortgage. You know, they had the money to put down. They were just six to 12 months away from getting a mortgage.    

Joe:  And then I would sell or sign my contract with the seller to the tenant buyer, and then I’d be done and out of the picture. So I started doing these in 2009 and I was working as an engineer for an electrical contractor building big power plants, and I was making good money. But in 2009, nobody was leaving or quitting their jobs or worried about getting losing their jobs. I quit my job in 09 because I started making more money doing those deals part time than I was making in my full time job. And after about three months, consistently making more money doing that, you know, flipping deals, I thought, man, this is it. That’s what allowed me to quit my job.    

Josh: Yeah. And so when so we did a bunch of this two and two thousand eight, nine, 10 and coming out and even into, you know, all the way up until about 2014 15.    

Josh: And what I used to think was we’re working with sellers who can’t sell. Because I don’t have a lot of equity and they can’t afford the Realtor Commission or the houses get some deferred maintenance and they need to get more out of it that’s actually kind of worth that a retail buyers have to pay. So we’re gonna work with sellers who can’t sell. And buyers who can’t buy. Yeah, because those buyers can’t get a mortgage. And we’re gonna see more of that coming out of this Covide-19, where these buyers can’t buy. But they’re used to living in a home. They want a home. And so you’re really matching those two people up. And if there’s enough equity, you can stay in the middle of it. So talk about just, Joe, the difference between wholesaling a lease option, which a lot of I think our audience will understand, but describe it versus a sandwich lease option when you stay in the middle of it. And when do you determine when to do which strategy? Like in your book, I’m sure you cover that. But tell us a little bit more in this interview. Like, how do you determine which strategy to actually execute?    

Joe:  Yeah, it’s kind of simple, right? So if there’s equity and cash flow, I want to stay in the middle. For me, my minimum criteria, depending on the market, you know, if it’s in California, the numbers are different than if it’s in Ohio or Missouri. Are you still in Ohio?    

Josh: Yeah, you bet, good memory.    

Joe:  I have a lot of friends live there. Over there. Up there. Over there, up and over. That’s us. So anyway, I if it has equity and cash flow, then I want to stay in the middle. And typically what I’d like to see is 10 to 15 percent in equity and 20 to 25 percent of the rent for cash flow. So just round numbers. And by the way, I only do this with kind of median priced homes. I don’t like doing these options on lower end rentals. Right. I’d rather do owner financing maybe on the lower end rental properties for the simple reason that tenant buyers are more likely to buy the house if it’s a nicer home that they want to live in with middle school districts. Right. So anyway, I like that sweet spot in Ohio, Missouri, it’s going to be maybe one hundred and two hundred fifty thousand dollars, maybe a hundred to three hundred thousand dollars. That price range is going to be right where kind of I want to be. But if it has about 15 percent equity, so round numbers, I’d say 200 grand. I’m going to open up my calculator here. If it’s two hundred thousand dollars, I want to be at two hundred times point eight five. I want to be I’ll give the seller a contract for one seven. That gives me about 15 percent equity. If you’re making a cash offer on a 200 thousand other house, you’re going to be probably more down to like 150, maybe even less potential. Yeah. So, yeah, I want to be it like maybe one seventy five. Right. And if it rents for let’s say eighteen hundred a month. Eighteen hundred times point seven five. I want to be I’ll pay the seller about thirteen fifty a month in rent. I get about 350 dollars in cash flow so I want to get about 30, 30, 30 grand in back end equity. Three hundred dollars a month in cash flow. And so in a wholesaling lease option, you have one profit center. And that’s the assignment fee. The sandwich lease option. You have three profit centers, cash now, cash flow and cash later. By the way, I don’t know if you remember Richard Groop.    

Josh: I do.    

Joe:  Does that ring any bell? I talked to him a couple of days ago and I’m going to be interviewing him soon on my podcast.    

Josh: Nice.    

Joe:  He’s one of the guys I learned that from way, way back in the old days.    

Josh: The ultimate strategy. Yes. He called it. I remember right back there. Yeah.    

Joe:  Anyway, so there’s three profit centers, cash now, cash flow and cash later. Cash now is the money the tenant buyer puts down upfront. Cash flow is the difference between what I’m paying the seller and what I’m collecting in rent from the tenant buyer. Usually 300 bucks a month. And cash later is gonna be the difference in what I’m buying it from the tenant seller for and what I’m selling it to the tenant buyer.    

Josh: Yep. Perfect.    

Joe:  And typically an average assignment fee, five to 10 grand on a lease option assignment wholesaling these options. The average total profit on a sandwich lease option deals gonna be 30 to 50 grand.    

Josh: Yeah. What’s great about that to Joe is what I found and what I continue to fund with our marketing is there’s a lot of people that call that say, yeah, I want to sell. The house is worth one seventy five and I owe one sixty eight. And you’re like, well, I can’t buy that at a discount. The guy’s not going to bring thirty thousand dollars to the closing table so I can buy it at a discount. And going all the way back to 2004 when we really got started with the real estate business, we’re like, I want to market all these motivated sellers and everyone’s going to want to sell us their house. And, you know, nine out of 10 people are like, yeah, I want to sell. But they didn’t have enough equity to make that low cash offer to really, truly do a true wholesale deal or a rehab. And a lot of properties also didn’t need that much work. And so what we found, we really kind of threw all those leads away in 2004, all the way up till like two thousand eight nine. Then when the first Great Recession hit, it was like, okay, now we’ve got to capitalize on these. We started doing this exact strategy and it worked great. And so, Joe, what are your thoughts on the impact on the economy because of Covid-19 Corona virus? And why does wholesaling lease options or sandwich lease options become even more prevalent, an even better strategy when there is a potential recession?    

Joe:  That’s a crazy thing. I don’t even know if I understand the full reasons why, except that the guys that I know that have done a lot of lease option deals over the last 10, 20 years, they all say the same thing. Mostly it’s option deals I’ve ever done was between like 2008 and 2012. Right. You can do lease options in any market up and down, cold, hot. You know, I’ve done them all, but for some reason, they’re easier to do when the market is going down. When we’re transitioning out of a seller’s market into a buyer’s market. I think one of the reasons are, is that sellers become more motivated and it gets it gets harder for buyers to get financing. I’m seeing that right now in St. Louis. It’s getting a lot harder for buyers, even with good credit, to get financing. Inventory is really tight, but there aren’t, there is no jumbo market right now and is completely shut down. Right. I mean, it’s little. Just. And maybe this is a phase. I don’t know. But we’re seeing a lot more old leads becoming reactivated again, you know, old leads that we’ve been following up with there all of a sudden, saying, yeah, I’m interested now in selling and and a lot of sellers, again, that have no equity. They’re more open, more likely to say, yeah, I might consider doing a lease option. This is really important strategy. The concept I want to kind of explain to people. I don’t go into deals looking for lease options. Right. I mean, when I’m doing my marketing, I’m not approaching it first from here, I want to do a lease option. I’m looking for motivated sellers. I know you guys are so good at this and what you do and how you teach it. Like, we’re not we’re deal finders, not deal creators.    

Joe:  So when I’m talking to a seller, I’m trying to find out do they need to sell their house or want to sell their house? How much equity do they have? Which solution might be a good fit for them? And so after talking to them and figuring out what their situation is, how much equity they have, what’s their motivation, how quickly do they need to sell? I might only talk about a cash offer. I might only talk about a sandwich lease option, or I might only talk about a wholesaling option, OK. So it’s important to be thinking more like a transaction engineer and more like, all right, what’s going to be the best solution to their problem? Right. And you may not the best solution to their problem may be the listing with a realtor. And that’s when you do say, hey, you should probably just sell it with a real I don’t know if I can help you. Right. There’s a lot of power in that negotiating by the way. Yes. So I’m not approaching the seller trying to make them do a lease option. I’m approaching like, how can I help them solve their problem? Yeah, I don’t have a problem. That’s fine. Move on. Not a big deal.    

Josh: Be a transaction entrepreneur. Right. Transaction engineer. Especially for people who are new, who you know, I talk about this and some of my webinars and trainings and that, you know, there’s real estate investors and then there’s a transaction engineer, transaction entrepreneur, a real estate investor, or somebody who’s maybe an active or even a passive investor who has money and is trying to get a return on investment or build a portfolio. They have cash to maybe have a balance sheet. It doesn’t have to be their cash. Maybe they have private lenders. They’re trying to get a return on investment for their private lenders. They’re trying to flip a house or do a rehab or an apartment. That’s kind of where I’m at at this point in just trying to build a massive portfolio of apartments and rentals.    

Josh: And all I care about is how big is my balance sheet? How much cash flow do I have? And then there’s where I where I was in two thousand and four getting started. And then again in 2011, when I survived cancer, I was more of a transaction entrepreneur where I was just resourceful. I was creative. I was trying to solve problems. I was trying to make something out of nothing. I was trying to make money with none of my own money. And that’s where a lot of those people are when they get started. And it’s it really it’s it’s that’s just when you get started, either it’s really any time in your investment sort of life journey, if you will, where you need quick cash. And that could be a very experienced investor who’s just in a cash crunch and they could market for deals and do it wholesale release options and make some quick money while they’re waiting for their next apartment to pay off or while they’re waiting for something to refinance or get some cash out RE5 proceeds. So it really has a place in the entire lifecycle of an investor. And it’s not just like a newbie strategy.    

Joe:  Oh, yeah, here’s some. That’s pretty cool. I had a student. One of the strategies I teach in my courses, a consulting strategy. And if you’re talking to a seller or an investor, that maybe they’re not super motivated and they’re like, I’ll just do you know, I like the idea of doing a lease option, but I don’t want you making all that money. Right. So I had one student who was talking to an old wholesaler who had a bunch of old leads. Right. And they’re like, why don’t you just give me your old leads and I’ll just lease options on and we’ll share the profits somehow. Like that. So then the guy said, well, what if I just I’ll teach you. Because he was interested in these options. Well, what if I teach you how to do these deals? Anyway, he got a twenty five hundred dollar consulting fee to just teach this guy how to do a lease option one of his deals. Nice. Sometimes this is when you look at a dollar per hour. You’re only talking about spending a couple hours with these guys. And you can teach them how to do the least options, give them the contracts. Or sometimes what I do is I just give them the state approved real estate, realtor contracts. Right. And so you can do the lease options with these. Use this lease and use this purchase and sale agreement, you know. And but you can get consulting fees from sellers and investors by just teaching them how to do the lease option, because it actually is really simple. But they have no idea which contracts to use or what to put in the contracts or how to market the home, how to you can give them your references and your resources for a mortgage broker and credit repair company and tenant screening company and like so you can make money with consulting fees. Yeah, pretty cool.   Are you ready to automate and exclude your real estate investing? We’re searching for extremely motivated individuals who are sick and tired of wasting time and want to finally see real results from their real estate investing business. We’re searching for investors, looking to get to the next level and become a bigger, better version of themselves while being a more successful real estate investing entrepreneur. Apply for mentoring and coaching at JoshCantwellCoaching.com forward slash podcast. That’s JoshCantwellCoaching.com forward slash podcast.    

Josh: Joe, I know in your book again, check it out, Wholesaling Lease Options, we’ll put the link in the in the show notes. Yeah.    

Joe:  There you go. Josh, I worked so hard to write this book, man. I spent like months. It was ridiculous. And I, I got it back from the printer and it was only like a quarter of an inch thick. So disappointed.    

Josh: It doesn’t look big enough now, but it’s a lot of impact. Right.    

Joe:  It’s all killer. No filler.    

Joe:  Right. And it’s it’sit’s all good. Content is not a lot of whitespace. Not a lot of images. Yeah. And I just say spell out really simply and clearly how to do these deals and you can’t get this on Amazon. You can only get it on my on my Web site.    

Josh: Yeah. Perfect. So do I know one of the strategies that I’ve heard you talk about on other podcasts. You know, some of your Facebook posts is just about kind of partnering or using Zillow as a lead generation strategy. So let’s let’s just talk about some tactics real quick and then we’ll kind of we’ll kind of wind up here. But what are some of the best tactics today to find lease options or find deals? And also look. Because I’ve seen so much publicity from you around kind of using and partnering with Zillow for lead flow. Tell us about how do you how do you do that?    

Joe:  Zillow is one of my favorite sources for leads. And also there’s Craigslist, a Facebook marketplace, Zillow, sometimes even Redfin. But what I’m doing is I’m not placing ads. Right. But I’m contacting landlords and for sale by owners. So I’m reaching out and contacting them. And actually, my VA’s are doing my virtual assistant. So we’re sending out emails, text messages and voice messages and letters sometimes even, where we’re just finding the people that are advertising rental properties and facility owners on Zillow. And the crazy thing, Josh, if you were to go look at right now, today, go into your market and look up all of the rentals that are listed on Zillow. And I’ve tested this several times. Many times you’re going to find about 20 to 30 percent of those rentals are not yet listed as absentee owners in the county records. OK. You know the title, the address has not changed yet. The mailing address is the same as the taxing address. Right. The property address is the same as the mailing address for the taxes. Right. And so you’ll find some really, really nice homes that are listed for rent on Zillow that aren’t absentee owners yet. OK. And here’s the cool thing. All of those rental properties have one thing in common, and it’s that they’re vacant. Vacant properties is the Holy Grail. That’s like the list you want to target. Well, they’re right there in front of us on Zillow. So especially now when you can offer a lease options with a lot of these sellers. You know, maybe I’ve owned it for 20 years and they’ve decided to move. They bought another house. They couldn’t sell it as quickly as they wanted to. And now they’re just renting it out or something is going on where they wanted to sell it, but they couldn’t. And so they’re not getting any marketing from other investors right now because they’re not on the absentee owners list. Right. Which is the most competitive list to target.    

Joe:  So I like to reach out to them. I have my VA go to Zillow. You can find the phone numbers and find the addresses and e-mails and you can send the messages through Facebook message. But we sent a text. We send a voicemail, a personalized individual voice mail, not a mass robot, voice mail, ringless voice, nothing. It’s more like, hey, John, I saw your property on Zillow at one, two, three main street. Looks like a beautiful house. You wouldn’t consider selling it, would you? Or would you ever entertain an offer to sell it? And I’m just sending them a text saying, hey, would you think about selling efforts a for sale by owner? I say something like, Hey, John, I saw your property on Zillow. I’m an investor. Is your price negotiable? Or I might say I’m an investor. You wouldn’t consider maybe leasing it for a couple of years and then selling it, would you? Right. I’m looking for at lease purchase. And so my va’s will go in and send 50 to 100 text messages, e-mails and voicemails a day. And everybody that kind of raises their hand says, yeah, I might be interested, maybe tell me more. Then we call it. I call them. Right. And talk to them. That’s how it works. And so I love Zillow because I can go in and find tens of thousands of properties right now. And as I keep this database of phone numbers, their property managers, realtors, investors, wholesalers, you know, my database of people get keep on getting bigger and bigger, which gives me more people to follow up with as the months and years go on.    

Josh: That’s fantastic. I love it. Joe…   

Joe:  Can I give you another resource?    

Josh: Yeah, please.    

Joe:  Military by owner dot com. OK. Military by owner dot com.    

Josh: Tell us about that. I’ve never heard of that before.    

Joe:  It’s mainly a place where people on military bases will advertise their houses and you’ll find a lot of homes in there that are listed for rent and for sale by owner, sometimes by realtor. Now, these are all going to be properties that have virtually zero equity because they are bought with loans. Right. Hundred percent financing. Let me just say this, though, like I want to just warn everybody who’s an investor, you better treat her that’s like with respect, like don’t be a doofus and get their property under contract. And like I’m just saying, take extra special care of our vets and then don’t go to the military by owner dot com unless you know what you’re doing. Does that make sense?   

Josh: Yeah. I’m on that site right now, just kind of poking around. I’ve never, never been on here. So, yeah. Great resource. Love it. And I do agree yet. I mean, take care of take care of our vets. I mean, the only reason we can go fight the fights that we’re fighting right now, even with, you know, in the Middle East and then the I guess more of the publicity war with China is because ultimately you have this massive military behind you that you can, you know, step up and use it when the time is right.    

Josh: So you can kind of puff your chest out if you’re the president or Congress and kind of demand things and kind of push your weight around, because ultimately you’ve got all these amazing vets and military might behind you to step up in case we ever need it.    

Joe:  I don’t want that vet out there in the battlefield or at work and to be worried about their property and whether this investors are screwing them over.    

Josh: Back home, I mean, like, not cool.    

Josh: Joe, how about, like, top strategy today for finding buyers or top strategy? You think that’s going to be working in the next maybe two to 18 months as some of these distressed properties are on the market and people can’t get loans because of the Covid-19?    

Joe:  Well, that’s my favorite two ways to find buyers signs. Signs have always worked and they always. Yeah, the sign in the yard signs in the neighborhood. One of my favorite signs just says rent to own three percent moves you in. Real simple phone number. Right? Right. Then they know when they see that sign you’re expecting. You might even say five percent moves you in. That would set that sign. Works really well. Handwritten ugly signs always pull better. And you want to make sure you have a CRM behind you with special phone numbers for each of those signs, that you capture those numbers and you can market to them later. The second thing is Facebook marketplace. Facebook marketplaces pretty much replace Craigslist. He is in terms of where people go to find and list properties. So Facebook marketplace, which I get so many testimonials from students that say I can’t believe the response I’m getting on Facebook marketplace. I have to mark I it’s so hard to have 30 conversations at one time with people that have money that want my house. Yeah.    

Josh: Fantastic. So, Joe, as we kind of wrap up here, I’ve got three questions for you. I call it the Accelerated Investor Trilogy. One of our programs, one of our courses is called the Accelerated Investor Trilogy Wealth Models. So these questions are kind of playing along with that trilogy idea. So the first of the three questions is this. Who was the best mentor that you’ve ever had and why do you think they had such a big impact on your life?    

Joe:  I have so many of them. Yeah, the first guys it comes in my mind is Cris Chico, a mutual friend. Yeah, sure. I bought his course. It was called absentee owner profits at the time. And he called it virtual wholesaling later. But I was at this point where I had I was a professional student, Josh. Like, I had tons, of course. Yeah. And I bought everybody’s courses and I would always try to mix and match. I’ll take a little bit of what that guy does, a little bit of that guy, a little bit of this. And I’ll get this. You get this endorphin rush, these crack cocaine high and you buy stuff. I’d love to buy stuff, you know, and then you never crack it open. You never implemented. You just go through halfway halfhearted. And my back was against the wall. I was hemorrhaging cash, man. It was bad. And I said to my wife, I’m going to buy one more course and I’m just gonna do what this guy says to do. I’m not going to change anything. I’m not a question anything. I’m just gonna do A to Z exactly what he says to do. And it was Cris Chico’s course. Nice. And I didn’t like his postcards. I thought it was ugly and I though it was too simple. I didn’t like his contract. It was a one page contract. I didn’t like like there is a lot of things because I’m very analytical and it’s to a fault. And but he just laid it out step by step. Use this postcard. Use this list. Use this script. Make this offer, use this contract. And, you know, so I just said, screw it. I don’t care if I don’t like it. I’m just gonna do what he said yes to A through B and I didn’t, I stopped worrying about step seven and eight. And before doing steps one and two, I threw out the fact that I had to have all the answers and all my I’s dotted and all my T’s crossed. So I said, Alright, I do this postcard. I did it. And I was just worried about what’s the next thing. I stopped asking, what if what if this what if that. And so then I did my first day of my first wholesaling deal, the end. It’s a long story, but, you know, I just followed the formula and I remember so clearly, Josh, like it was yesterday, like, holy crap, this works. Yeah. Like, I, I spent tens and tens of thousands of dollars on education, but never really had success. I was never, I always want to be that guy in the speaker’s presentation who was holding the check. Yeah. All of a sudden I became that guy with the check. I thought I was so excited because this works. Yeah. And I learned a real valuable lesson from that. Like I learned that just follow the formula and why. Why would I think that I’m smarter and know how to do it better than the guy who’s already done hundreds of them? Like it was very humbling. But I learned a lesson like when you when you have a mentor, just do what they say. Right? Like stop changing it and stop asking questions. Just do it.    

Josh: Right that it reminds me of that once I listened to another podcast. It was an interview even before podcasts were popular. This is going back ten years ago. It was an entire one hour. It was almost two hours actually. How professional divers were modeling Greg Louganis’ diving. Greg Louganis was world class diver, multiple gold medal winner back in the eighties I believe, and maybe the early 90s. And they talked about everything. If you wanted to be a World-Class diver, you had to know everything there ever was to know about Greg Louganis, how he slept, how he ate, his workout routine. You know, what were his relationships like? How often was he in the pool? What was his workout routine when he was in the pool or what how many dives did he do of each type? And they said, look, you don’t need to reinvent the wheel. Just do everything exactly the way Greg Louganis does it. And that’s your best chance of becoming a world class diver. And essentially, you just said the same thing. Like, I’m not going to reinvent my own eating habits, my own workout routine for real estate. I’m just going to do exactly what Cris Chico tells me to do. I would assume that he knows better than I do. And that’s that’s just fantastic advice. Second question, Joe, in the trilogy is what’s your favorite book or seminar that you’ve ever been to on any subject? Now, it doesn’t have to be in real estate. Matter of fact, I’d prefer to not be in real estate. But your favorite book or seminar on any subject. And why was it why or why is it your favorite book or seminar?    

Joe:  Two. Can I give two books? Yeah, for sure, and the same author. Done. All right, Pumpkin Plan and Profit First.    

Josh: Oh, right. You know, I just it just had a virtual mastermind with some of my mastermind students yesterday, and one of them brought up this authors, Michael Michalski. Michalowicz. Right. So tell me about this. I haven’t read these yet. I’ve got to get them on my audible account.    

Joe:  Oh, man. So the Pumpkin Plan is a book about focus, GEND. It’s it’s a similar it’s similar to the one thing. Mm hmm. But I felt like it was much more practical. And it’s just a book like it talks about these giant vegetable farmers. And they’ll go and spend a thousand two thousand dollars on one seed from some guy in Vermont. And they’ll get the seed and they’ll plant it. And a pumpkin plant will grow many branches. Right. And you see these little pumpkins coming up and they find the one promising pumpkin that looks like it’s got the best promise, whatever. And then they’ll cut off every other single branch to that plant and focus all of that energy and attention on that one branch to that one pumpkin. And that is what causes the pumpkin to grow. And it’s just in these pumpkins get huge. You could fit inside of these things here. And he relates that to business, finding your sweet spot, focusing in on that and forgetting everything else. And I’ve seen that. I’ve had to do that so many times in my business. And every time I’ve done that, when I cut off the things that are maybe making money but are not more of a distraction, that’s a whole 80-20 principle. Right. Focusing your energies on that, one thing I’ve always been in my business has grown been more profitable. And I could give you story after story, an example of that. But pumpkin plan was really, really good for me. Yeah. Second thing. Profit first. That’s so important. This will this book will guarantee that every business that follows it will be profitable and simple. Most of us think of revenue minus expenses equals profit. This reverses that. It says, all right. Your revenue minus your profit equals expenses. So you get your revenue coming in. The first thing you do is you set aside like four different buckets. First bucket goes to your profit. The second bucket goes to Uncle Sam. They got to pay Uncle Sam and most entrepreneurs, and I’m not going to ask you, Josh, cause I don’t want you to be on this, put you on the spot. But I’ll bet you a glass of iced tea, when you were first getting started in business, you might have gotten into a little trouble with the tax man.    

Josh: The tax bill popped up that year. Woah!    

Joe:  Yes. You get this unexpected tax bill. It’s everybody’s double triple what you thought it would have been and you scrambled to get the money to pay it. Well, we’ve all been there. Right. But how do you avoid that? Well, you just take it, you know, 10, 15 percent of every dollar that comes in and goes into the tax account. Right. Ten, fifteen dollars goes into the profit account. And then you pay yourself first and then whatever’s left over, maybe thirty five. Forty five. Fifty five percent of your money goes to overhead and expenses. And so many entrepreneurs and small business owners get that backwards. They, they, they pay themselves last. They pay the profit last. They pay the tax man last. That is a recipe for disaster. Yeah. Like right now it’s just as a rogue of a job of kind of explaining that and two phenomenal books. They will they will change your business. Nice.   My newest and most powerful real estate investing book, The Flip System, is now available. And for a limited time, you can grab your free copy at get flip system dot com forward slash podcast. Using the same proven principles, secrets and investing strategies I’m sharing in this book, I’ve been able to personally close over 750 highly profitable real estate deals over the last 15 years, make over 400 private lender loans, raised over 30 million dollars of private money and acquire over two thousand units of apartments. Get my newest book now for free for a limited time at Get Flip System dot com slash podcast. That’s get flip system dot com slash podcast.    

Josh: Last question is, what’s the one tip on personal self development? The one personal habit or hack or thing that you do with your calendar, your schedule, your own personal habits to kind of be your best self?    

Joe:  That’s good. Couple of things I thought of. First thing is I read the little bit of the Bible every morning and I just pray. Yeah, it’s super important to me. But it also kind of just gives me a more a better perspective on what’s going on around me. Stressful out there. Right. Especially being an entrepreneur, small business owner. You have so many more things to worry about. And when you could just set aside some time to stop, meditate, pray and think. I’m reading a really good book I just picked it up. The Road Less Stupid.    

Josh: It’s about strategic thinking, right, from an entrepreneur and business owner. But this thing, I’m just kind of meditating thing is really, really good for me. And the other thing is I just picked up about three weeks ago, I got a membership at a golf course club. I’m starting to play more golf. And that has been really good. You know, the crazy thing Josh is, like when I play and I play like three or four days a week now because I need to get in better shape. I’m walking. I’m not doing the cart. And it’s forcing me because I have less time now in the data work. It’s forcing me to be super, hyper efficient because I’m thinking while I’m playing like, okay, what do I need to do when I get back? Because I only got three days, four hours left in the work day. Right. And so when I get back or before I leave, I’m like getting the most important things done because I don’t have much as much time, but I’m more productive than I have been in a really long time. I’m giving more away to my team, like, OK, I need you to take care of this. And you don’t need to get, I don’t need to be on that conference call. I’m busy right now playing golf and they’re taking care of the things. Right. And I realize I don’t have to be involved in all of that day to day minutia.    

Joe:  And then a friend of mine gave me this quote was so good, like, this is what he tells his team. Don’t give it to me unless it’s six inches away from the hole. He’s a big golfer. And I love that because, like, he’s telling his guys, don’t give that to me unless it’s six inches away from the hole. Like, I just want the easy putts. I just want the easy shots. Yeah. You take care of getting it there. I’ll be the one to make the final decision. Don’t bring me problems. Bring me solutions. Make it six holes. So anytime somebody brings him a problem he’s like, go back, figure it out. Six inches from the hole. Yeah. That’s what he tells them.   

Josh: Yeah I love it. People are way more resourceful and smarter and you know, just the ability to figure things out than they actually give themselves credit for. So people are constantly want like improvement or I mean approval, approval, approval.    

Josh: No, you can figure out 90 percent of it on your own. This is the project. And when I had Kevin O’Leary speak at my event and we were talking before we went on stage…    

Joe:  He’s a perfect example.    

Josh: Yeah. He would say look like the best thing you can do for employees is have a clear path, clear, clear goals, a clear job description, and then leave them alone for 90 days to do their job, get 90 to 95 percent of it done.    

Josh: And then you come in at the end to kind of clean things up and maybe add a little things, massage it, adjust it before it becomes final and becomes part of your business or before you sell the product or before you launch the thing or whatever. But people are so capable as long as they have a clear path to what the goal is and to be able to take that thing down, that that’s great. Joe, the other thing I want to point out as we kind of wrap up here is Bill Phillips Body for Life and EOS sports nutrition.    

Josh: He once said that I never had a great idea by actually thinking about it. Think about that. I never had a great idea, by actually thinking about it. What I did was and he went on to describe what I would do is I would just get into the joy of my day. And in your case, could be golf or reading the Bible or, you know, in the shower, you know, in the bathroom. You’re kind of your mind is just free to flow. And he talked about how I get my best ideas when I wasn’t in the muck of work. I was able to do what I really enjoyed. And then the ideas just came. They just flew into my head out of nowhere. It was like, holy cow, where did that come from? But because you were, you know, subconsciously maybe thinking about success, but you were enjoying your life. You were maybe playing golf. Working out. Those are the best times. So the more time you take, especially when you’re sitting in the CEO chair, you’ve got to do more and more and more of that. And it doesn’t feel like work, but you’ve got to give yourself the free time and the mind and the capacity to have those ideas pop in. That could be a revolutionary idea in your business. And what you’re doing, Joe, when you’re golfing, is giving yourself the capacity to have that pop in. So then you can go to your team and be like, hey, what if we did this? Hey, what about that? Where you’d never think of that stuff if you’re actually in the muck of the actual day to day part of the business.    

Joe:  You know, I wonder if it’s not. You may look at all these guys that are golfing and they’re all successful, obviously. Right. But I don’t think they’re they’re golfing because they’re successful. I think they’re successful because they golf. Right. In a certain sense, you know, that’s not true for everybody, obviously. But like, there is something to be said with taking walks. Spending time reading, just not, just disconnected from work. I mean, some of the most productive, insane, smart people are not behind the computer 10, 12 hours a day, hustling and grinding, working. They spend most of their time thinking and just thinking about, OK, how can I make the move? Because really, if you look at all the time that you work during the day, you’re only really productive just a couple, three hours out of it. You could be working 10 hours, but really, you’re only productive use is about two to three hours. And that’s across the board. There’s University studies on that and everything. So how can you be most productive during that two or three hours?    

Joe:  I tell you this, we went on. I’ve been to Europe like three times once for five months, once for three months, once for two months at a time. And then we went on an RV trip for three months. And when I was traveling like that, it wasn’t like I was taking a vacation from work. But I would I would only have a little window, especially being in Europe because of the time zone differences. I only had a window of two or three hours to actually get much work done. And I was always shocked and blown away by how much product, how much more productive I was during that time than I was when I was in the office all day. And when you’re on an RV, you know, I had to go to a coffee shop or go somewhere else where there was good Internet. And then you want to be sitting there for five, six, seven hours. Right. And I could only sit there for two or three hours. But, man, I was hyper focused. When I had a phone call, straight to the point, you know, what’s our objective here? What are the decisions that I need to make today, right now on this phone call? And I was able to get so much more done because I relied on my team and I delegated better and I focused on what was most important.    

Josh: Yeah. That’s fantastic advice, Joe. Well, there you have it, guys. Joe Macall. Check out his book, Wholesaling Lease Options. We’ll put the links in that in the show notes.    

Joe:  Can I give you the link real quick?    

Josh: Yeah, absolutely. Joe, please do. I didn’t know you had one ready.    

Joe:  Yeah, I do. It’s real simple. W.L.O Book dot com.    

Josh: WLO book, wholesaling lease options, W. L.O. book dot com. Check it out, get your copy and itsgonna be a fantastic strategy here. It’s a fantastic strategy all the time, but even more so coming out of this recession corona virus. So Joe McCall. Thanks so much for joining me today on Accelerated Investor.   Hey, Josh here. And do you want to win a free Accelerated Investor T-shirt? All you have to do is give Accelerated Investor, our podcast, Accelerated Investor a rating and a review on iTunes. OK, do that now. Then send us a screenshot on Facebook or Instagram or Twitter. What we’re gonna do then is every week we’re going to pick our favorite rating and review and we’re gonna send that person a free T-shirt and maybe again, some other cool fun stuff as well from Accelerate Investor. So, again, don’t forget to take a screenshot. Leave a rarting, review. Take a screenshot. Send it to us so we know exactly who you are. And then once a week, every week on the podcast, we will announce a new winner. Don’t forget to take a screenshot and send it to us so we know exactly who you are. We’ll announce a new winner every week.   

You’ve been listening to Josh Cantwell and the Accelerated Investor Podcast. Leave a comment on our iTunes channel and let us know what you want to learn next, or who you’d like Josh to interview. While you’re there, give us some five-star rating and make sure to subscribe so you can be the first to hear new episodes. Follow Josh Cantwell and his companies, the Strategic Real Estate Coach and Freeland Ventures on all social media platforms now and stay up to date on new training and investment opportunities to start your journey toward the lifestyle you’ve always dreamed of. Apply for coaching at JoshCantwellCoaching.com.

As this market bends and flexes, creative financing is going to become more important. When you’re working with sellers who can’t sell because they don’t have enough equity, and buyers who can’t buy because there are now gaps in their employment, lease options can bridge the two problems.

Author and wholesaler Joe McCall from Real Estate Investing Mastery started with wholesaling when he realized how many valuable leads he was throwing away. He saw tenant lease options as a way of making a deal work when a seller just didn’t have enough equity, and it opened up the creative ways lease options can fix common buyer and seller problems.

Joe likes to use Zillow, Redfin, Facebook marketplace, military sites and other rental sites to find leads. He explains a little of his techniques to find nice, vacant homes to put an offer on. Over 20% of houses never get registered with out-of-state landlords, so Joe has some tricks for finding these absentee landlords.

Pinpointing the seller’s motivation can help you figure out the best way to make a deal they can’t refuse. When you start calling yourself a transaction engineer instead of just a real estate investor, you create that shift in your mind where you try to figure out how to make things work instead of saying that a deal can’t be done.

Joe shares his 2 favorite business books that he promises will change your life. And if you’re interested in learning more about lease options, you can get Joe’s book Wholesaling Lease Options for free by clicking on the link in the show notes.

What’s Inside:

  • In a potential recession, the potential for lease option deals explodes.
  • How transaction engineers differ from real estate investors.
  • Finding vacant houses creatively will give you an edge over other wholesalers.
  • What would your business look like if you gave yourself more time to think?

Mentioned in this episode​

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