Attn Wholesalers: Create A Hands-Free Business With Rafael Cortez
Episode 528: Attn Wholesalers: Create A Hands-Free Business With Rafael Cortez
Working with a hustle mentality will only get you so far. What you need is a hands-free business system so you can take your time back. Mitch Stephen welcomes Rafael Cortez, who started real estate investing in his 20s. Hustle is a season, not a business strategy. You need to have a systematic linear shape. What will you do for steps one, two, then three? Automating and delegating tasks gives you the space you need to scale. If you want to know how to create a hands-free business, listen to this episode!
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I’m here with Rafael Cortez. He is over in Phoenix, Arizona. This young man is a go-getter. He started out working at the grocery store at fourteen, and then became the youngest fireman in Yuma, Arizona. Are you the youngest firefighter in the region or state?
It’s the county. I don’t know about the state. I was nineteen. I was the youngest firefighter walking around.
He is an Organizational Psychologist. I’ve never heard that before but it sounds very interesting. He is talking about how to take that entrepreneurial mindset and organize it so it’s not all over the place like most of us attention-deficit entrepreneurs are. It’s how to reel ourselves in. We are going to be talking about that. How are you doing?
I’m doing great, Mitch. Thank you so much for having me. I appreciate it.
I’ve told a little bit about your background. Where did you find real estate?
I became a fireman at nineteen years old. Right around 20 or 21, I was sitting down with one of my captains. We were trying to figure out what to do with the time that we were not at the firehouse because you are 24 on, 24 off. You have a lot of time in between to do something. He was like, “We should probably launch a business or something.” We started talking about a couple of possibilities. I ended up launching a non-emergency medical transportation business. Eventually, I left the firehouse. I launched that business. In the process, I started making some cash and whatnot. I was sitting on money and I didn’t know what to do with it.
My background in construction was from high school and college. I would do framing and concrete work as a summer gig. I took on that. I was like, “I have done that before. Let’s give it a shot.” I started flipping houses around 2009. That’s when I got started in real estate. It was because I had some cash to invest. I went out and bought a house from a wholesaler. I didn’t leverage anything, which was silly. I bought it in cash and I did the whole fix. I financed the whole thing. It’s not the way to do it but I didn’t know what I was doing. I just wanted to do something.
How old were you then?
In 2009, I was 26.
In your first house, what did you pay for it?
2008 happened and all that stuff. We were at the tail end of that whole section. It was probably at the end of 2009 when I got into it so the prices were super low. The bad thing about it was it was in a horrible place in town. It’s the worst place in town where nobody wanted properties. I paid $62,000 for that house. It’s in South Phoenix. It’s crazy how price points have changed since then.
What did you spend on it?
I did all the work myself. The ARV on it or the retail price point was about $95,000 to $100,000. I spent close to $20,000 to $25,000 on the rehab. It wasn’t something terrible. It’s nothing crazy but it wasn’t what I expected. I was expecting to make $20,000 or $30,000 on a profit for my first flip, not pay any contractors and do everything myself. It took me forever.
There are all kinds of lessons here. 1.) You don’t need to buy the cheapest house in the ugliest part of town because it’s easier sometimes if you move up the ladder a little bit. 2.) Don’t do the work yourself, for God’s sake. You were working for carpenter wages. 3.) You have to have big margins in this business because things don’t go the way you think they are going to go. They never do. I have been doing this business for many years and have 2,500 houses in my share of rehabs. I never hit the rehab. There’s always a little bit more than meets the eye. You go a little step further and over-remodel because it’s tempting to put in the nice countertops or go ahead and blow out that kitchen that you didn’t plan on.
One of the nicest ideas on this is at least on your first deal, you made some money, which was proof-positive and the affirmation that you can go in there. You can make as much as you want but you made some money. Thank God you didn’t make $100,000 on the house because that might have ruined you. I have seen it ruin 100 people. None of this is news to you. What I admire is that you got started at a young age. I didn’t find my butt with both hands until I was 34. I wish I had tried a lot of businesses and things. They never panned out. They weren’t me.
I’m a slow learner. It took me a while to get through. I didn’t even give up when my first deal went bad. I managed to escape it. I got with a con that wouldn’t give me my principal nor my profit. I conned the con. Their weakness is big money, quick money and easy money. I made a new deal but he had to pay off the first deal. The new deal was much bigger. I acted stupidly. He bid on it. He paid me off so he could get some more money in my pocket and then that deal fell through.
Always read the fine print. It’s something that I have learned along the process too.
The best cons are good at what they do. They can even fool smart people.
You said something important, which is not giving up. A lot of times, as entrepreneurs or real estate investors, we walk in there and feel like we have the whole thing laid out. It’s theoretical, “I’m going to do this. Step one is going to be this. Step two is going to be this.” Mike Tyson has a great quote. He says, “Everybody has got a plan until they get punched in the face.” Once that happens, the story changes. It’s the tenacity and the drive that you need to stay in the game and not give up. Ninety percent of the battle for entrepreneurs is not giving up on that thing that you find. I love the space of real estate. It’s a great vehicle and that’s my playground.
You specialize in wholesaling. I’m going to guess that you have managed to systematize that so that you are not out there running around all the time. Let’s talk about that business because almost everybody starts as a wholesaler. I didn’t happen to start that way but 99.9% of people do. It’s a good and nice place to start.
The barrier to entry is low. It’s one of the key things. To me, I started flipping and I had some cash. I was sitting on some cash. It’s usually zero to a small amount of cash that you need to start getting leads in. There are ways of doing it that are cost-effective. It’s something that makes sense monetarily. It either takes elbow grease or some marketing dollars to get it done but it’s doable. It’s not one of those things that you need to have super skillsets to accomplish. Once you have it laid out, you can take a systematic approach to it.'Everyone’s got a plan until they get punched in the face.' - Mike Tyson Click To Tweet
The first property I bought was from a wholesaler. I didn’t even know what the settlement statement was. I just saw all kinds of numbers in there and then I stashed it. The second settlement came over and they bought it from this other guy. I asked myself, “Where are these people getting the properties that I’m buying from them because they are not the seller? I wasn’t going direct-to-seller.” He was like, “It’s one of my wholesale properties.” The second wholesaler told me what wholesaling was. I was like, “On the second deal, there was a fee of about an $18,000 assignment. Are you getting $18,000 out of this thing?” He goes, “Yes, that’s my fee.” I was his buyer. I didn’t know what I was doing.
I went back to that first deal and bought it for $62,000. There was a $23,000 fee on that for an assignment. The guy had locked that in the $40,000 and I ended up paying the markup. I was like, “I made less than the wholesaler in this deal because they did.” I did a lot more work. I went through the risk of putting $100,000 in the line to make about $10,000 back. When it was all said and done, I was like, “This doesn’t make sense.” I started looking into it.
Long story short, I started doing wholesale deals and figured that I like the fact that I can come in and flip my agreement or my vested interest in the contract as opposed to swinging a hammer and dealing with contractors. Everybody picks their poison. You have notes and financing and all of that in place. People do fix and flip. I love the process of wholesaling, negotiating deals, finding problems to solve for sellers, and then getting paid in exchange for that. It’s what it comes down to.
One of the drawbacks that I hear all the time about wholesaling is that it’s a job that you have to do it over and over again. If you systematize it, you can get it down to where you are the business owner and the machine is running. Am I going in the right direction with you?
Yes. Here’s the thing. With the nature of the beast and what it takes to do wholesale, it’s one of those things that if you get confused, you are going to end up in that hustle mentality or that hustle cage.
That’s good for a while because you are learning your business. You are learning the ins and outs, getting your teeth kicked in, making mistakes, talking to people, and learning what the objections are. You are learning how the business works from the ground up, which is important.
You have to go through the trench work. Hustle is a season, not a business strategy. That’s the thing. You are going to get burned out if you are always hustling, going after the deal, not having a systematic approach to it, and not being able to delegate and automate. If you treat it as a business, it’s something that can be done as a hustle. If you are going to drop me in the market that I don’t know about, I have the skillset to go out and find a buyer, get a property under contract, find a seller, and then make the deal happen. It’s a skillset that I have.
If you are going to strictly hustle, it’s doable. However, if you want to take your time back and have a business and shape it, you have to be methodical about it. That’s one thing that happens with most wholesalers. They stay in that hustle mode for a long time. Instead of being okay with splitting commission fees to acquisitions reps, paying lead managers to pre-qualify their leads and plugging them into this machine, they do everything. What happens when you do everything? If one section breaks, meaning your marketing, disposition process or the way that you negotiate deals are off, nothing else works.
We are going back to the Ford assembly line here. When you have a systematic approach and it’s linear, you know what is coming, “Step 1, 2, 3 and 4.” You can plug people into that process and step away from it gradually, little by little until you are running the company and it’s not running you. You have people in place making commissions and money. You still cherry-pick because we cherry-pick the deals. We are direct-to-seller. We have the opportunity, first and foremost, to see what deals we want to keep, “Are we going to keep that into a portfolio? Are we going to fix and flip it? What are we going to do? We are going to wholesale it.” It’s how the business works.
One of the biggest objections that I see even in my office is because we made our acquisition guys. We bought 25 houses in January 2022. It’s a very competitive market. It’s tough as it has ever been. It was one of my biggest months with 25 houses. Maybe it’s neither here nor there for you but I’m taking all these houses down with private money. We sat down with the three acquisition guys working for my company. The least guy made about $150,000 and he was down three months with COVID. The most made $220,000.Hustle is a season, not a business strategy. So you need to take your time back. Click To Tweet
We sat them down and said, “You all have to get a VA making phone calls. You have made money. You are not broke. You have got some money in the bank.” We also coach our people on how to save, maintain and not just watch this money disappear. We need them to get on top so that we can stay together for long periods. We have started to see them burn out. I said, “You are all going to have to get it.” We got three VAs and we trained them all together. Not one VA works for one of them. They work for all three of them. They rotate the leads.
They have already picked up six extra deals in the first month of training these VAs. They are making 800 phone calls a week. These guys were supposed to make 100 calls a day and then they were down to 200 a week, which I suppose was only 100 a week because they are not going to tell me they were only doing 100 a week. We didn’t see it. You started to get them to do it. Now, they are the happiest guys in the world because they do not have to make those phone calls anymore. They are doing the part of the business that they like, which is meeting people, making deals and signing contracts. It’s where they make their money.
I see it often, especially with students who are hiring and bringing people on. What happens is they will have acquisitions do the lead sourcing. They are doing the cold calling, having the initial conversations, and plowing through hundreds of records. By the time they get to an actual deal, they are tired and worn out. Needless to say, it doesn’t give you a clear perspective of what your opportunities are. At that point, you have your snipers doing grunt work. It’s not a good way to do it.
Let’s break down the numbers here for a little bit. Let’s say that you are cold calling. You have an operation. Your marketing is cold calling. If you bring in a VA, a cold caller is going to reach out to 1,000 people. The way that we have it broken down is we have cold callers, a lead manager, and then acquisitions. The cold callers reach out to 1,000 people and say that 100 of those want to sell the house or want to have a conversation about whatever. Those 100 go to a lead manager. The lead manager will pre-qualify it, have a discovery conversation with them, and then see if it makes sense to have a negotiation thing based on condition, motivation, timeline and price.
Our snipers are the acquisitions. They are the ones that are trained to close and that we want to keep busy. Out of those 100, maybe 10 make it over to acquisitions. My acquisitions rep, the top moneymaker, is only talking to 10 people as opposed to talking or reaching out to 1,000. In terms of workload, that makes a lot more sense because they are trained. They are being paid for their skill, not necessarily for their time. They are being paid for the skill that they have because I want them to lock and be busy. That’s one thing. They don’t burn out that easily.
The second thing is when you have a process like that and you see a low amount of prospects, let’s say that the acquisition is only talking to three people a day, you know you got to ramp it up. How do you ramp it up? You go back to marketing. You ramp up the market but you don’t kill them to do it. It will give you a good perspective base. If you have the KPIs and all that stuff in place, you know where your bottlenecks are. You know where to come in and then fine-tune.
If you need to ramp up marketing to get more pre-qualified leads and get more to that number of acquisitions, that’s what you do. If you have enough leads on the sourcing with the VAs, is there something happening in your conversation when you are pre-qualifying that it’s not making it over to acquisitions? You can pinpoint stuff when you have a process in place. The last thing that you want to do is burn your talent and it can be done very easily like that.
Rafael is offering a Wholesale Business Blueprint for free. You go to 1000Houses.com/WholesaleCoach because Rafael offers coaching in this department. There are several things. When you were talking, I was thinking a million things. I hope I don’t miss all of them here. One is a great place to start. When you don’t have money, you are a professional deal finder because the guy who finds a deal controls a whole bunch of property with a piece of paper. It could be very lucrative.
The second thing you said, which jumped out at me was, “Hustle is a season.” What you don’t want to do is wait until you get so burned out that now you think, “I got to get some systems here.” There isn’t anything left of you to do a system. You have to start building your systems while you still got that vigor and passion, and you are not worn down to a nub. If you wait until you are completely burned out to start systematizing, you will even be crappy at that because you have no juice left. You are jaded and crazy. You are thinking about quitting but you don’t want to quit because the money is too good. Your tank is empty. Don’t wait until you are empty.
I love that, “Hustle is a season.” Make part of your hustle to start systematizing before that season runs out. If you are expecting VAs overseas to close your deals, they are not good at that. They are not closers and salespeople. They just sort through 1,000 phone calls to say, “Here are 100 that answered the phone that didn’t chew my butt out.” They want to talk to somebody or there’s a chance they will talk to you. They are going to weed it out. I like the manager that you have. My acquisition guys are taking it from there. They are making the call and trying to close.
I interviewed Larry Goins one time. He had two VAs on a split-screen behind him live. I was interviewing him but I could see them. They were muted and his VA was on camera. Whenever they find someone that wants to talk, they mute their prospect. They open the mic to Larry and say, “Larry, we got a hot one here. Do you want to talk to them? Here’s the rundown.” Larry takes them right then. It’s not how I want to do it because I don’t want to be stuck in an office waiting for these people but there is a plus to it. At least we didn’t have to try to call these people back. They are engaged and on the line. Sometimes it’s hard to get them back on the phone.
There are all these nuances. You got to find what works for you. If you are looking to get into this business or you are not doing as much wholesale as you want, please consider talking to Rafael. Go to 1000Houses.com/WholesaleCoach. You will be able to get your free giveaway. The Wholesale Business Blueprint shows you the outline of what your wholesale business might look like if you are not doing everything. You are going to need this blueprint sooner or later. Yours may or may not look exactly like his, but then maybe it will because with a proven track record, you need to stick to it as close as you can. Every business is different. Do you agree or disagree?
I agree. You are going to have different markets and talents that come in. You are going to do some pivots. That’s granted. It’s going to happen. However, the principles behind the structure are going to be similar. I will do a quick little breakdown of what they are. Stage number one is sourcing. You are sourcing the leads somehow in some way. It’s pay-per-click, driving for dollars or cold calling. This is where the VAs get plugged into. All they are doing is gauging for interest. It doesn’t matter if they want $1 million, they raise their hand and it goes to a lead manager. That’s the pre-qualifying process. That’s stage two. They get a source. They get pre-qualified, and we go for condition, motivation, timeline and price.
If 3 out of the 4 matched, we send it over to acquisitions because there’s a conversation that can happen that can be negotiated. There’s a problem there that we can come in and solve. By the time they make it over to acquisitions, they have been touched twice. It’s a higher-quality lead. They are not plowing through all of these records. They go through the acquisition process. The contract gets locked and it goes on to stage four, which is dispositions. We start to sell the deal. We have a very methodical approach as to how we sell the deal in different markets throughout the United States. That happens.
Most business models stop there. They get paid, get the settlement statement, wire it into the bank account, and then they’re like, “Let’s do it again.” I feel that it’s very important to have the last two, which is the measuring part. Stage five is measuring. You track your KPIs, “What happened throughout that deal? Where did the deal come from? What campaign was it? How much did we spend on that campaign to generate that deal? What is the ROI that thing has given us?” You have metrics and KPIs. What gets measured gets improved.We need to have a sense of direction, perspective, and purpose to go through the process. Click To Tweet
I’m always interested in how many touches we touch it like, “When did we first contact him? When did the house sell?” Your salespeople and VA start to see like, “We stayed with this guy for eight months and he finally caved in.” You can’t give up on any of these leads. You would be surprised how many come in months or years after the original conversation. They have their circumstance closed in on them too tight or they get too fed up or they finally realize that their property is not worth $1 million, then they are getting real.
The oldest one we have had come back that we made $90,000 on was a little over four and a half years. They were waiting for someone to pass and then they had to wait for estates. There’s always a black sheep in the family and they had to get work through. Finally, it came up and we got the call. That VA that started that call and connected with that person, he paid four and a half years later. I’m always interested in that. I believe in tracking the measurable and what it does for your business.
It’s running a scorecard and then keeping tabs. This is what the hustle mentality will have you do. “I don’t need to track numbers. I got to get it done. I got the deal in. My KPI is my bottom line.”
They don’t have time and a system.
What happens is you can’t step away from it. The measuring part gives you a pulse of where your business is, “This is how my business is doing.” It also sets the standard for what you are going to require. Because I have the metrics that I’m tracking, I know that my cold callers have to dial 300 people at least a day, have 10 conversations, and generate 1 or 2 leads with each one of the cold callers. That’s a basic KPI for the operation that we are running for each caller. If you quantify that by 6, you know they are supposed to be getting anywhere from 10 to 12.
It’s based on something tangible. It’s not just an idea that popped up like, “I think you should be getting this.” It’s based on past results. You have a baseline. You can hold people accountable for that. When you plug people into a new hire, “This is what is doable based on the system that we have. This is what you are required to do. These are your tasks and responsibilities.” You can go off to Hawaii, take a trip, and you are still going to be generating results because you have a way of keeping people accountable.
If they are not hitting their numbers, you have a decision to make. You live with their lackluster and improve or you got to get rid of them and find someone else or you train someone else while they are there. Once this guy gets up to speed and starts up before him, then you let him go. There are a whole bunch of different ways to look at it.
They don’t have results because of two things. One, they are not hitting the numbers. If they are not hitting the numbers, not making the dials they are supposed to be making or not having the amount of volume they are supposed to be making in terms of activity, it’s an attitude issue. If they are hitting the numbers, meaning that if they are required to dial three people and still no results, it’s a training issue. Even that will clarify what kind of action you need to take to improve the business. If it’s an attitude issue, they are out. Hire fast. Fire faster.
We go by, “Hire slow and fire fast.” We put our guys through the winger and stuff. There are always shades of how to do everything and you got to do how it fits. We tried to see if we could find the right person if we spent a little bit more time and did some personality tests or something. There were some people that I hired that I would never have hired but the test said to hire. One of those guys is my premier guy. He is still around for five years. He is a mechanical engineer that got laid off in the oil crash. I thought, “This will never work,” but the test says he will and he did.
I was horrible in hiring, which is why I went that way. Everyone I hired, I liked. I thought they were cool. We put them in. They didn’t do crap. I said, “I got to quit hiring and find some other way to hire based on my hiring.” If you want your Wholesale Business Blueprint, go to 1000Houses.com/WholesaleCoach. You will also be privy to Rafael’s podcast, website and everything that he has. If you want to know more about him, get over there, get your blueprint, and then also do some research.
People will say, “Wholesaling is just a job.” That’s what it is if you are the wholesaler and the guy wearing all the hats but you can make wholesaling a business. Rafael is not the only one who has made this into a lucrative business and they are in Hawaii while they are knocking down hoards of cash. The other side of it is you don’t have to do one million houses to have a successful wholesale business. Even if you are wholesaling 2 or 3 houses a month only and sometimes if you are part-time on one, it can change your whole life. It can change the whole way you live and your whole retirement prospects.
If you decide you want to ramp it up and take it to another level, there’s always that coach out there that’s going to take you to the next level. I like to say something about wholesaling that I want some of the wholesalers to think about. I coach how to seller-finance. I take all the wholesale deals from people like Rafael and the ones that I find because I figured, “If the wholesalers can find these deals, I can find these deals. I just have to learn how they are doing it. I can cut them out.” That’s what I was thinking.
You see those wholesale fees and go, “It pays well to find these houses to originate the purchase.” I want to plant a seed. I’m not knocking any business or saying any business is better. You have to do what is right for you. Even Rafael said that he wholesales his deal and moves them into a different strategy of buy-and-hold or fix-and-flip. I want to present the owner finance strategy because when I get a down payment on my house, 10% is the minimum, I’m averaging a little under 15%. That looks a lot like a wholesale fee in most cases.
You probably got it down to a science and your wholesale fee is more than $8,000. When you ask around the country, what is the average wholesale fee? It can be right around $8,000. I understand the pros are getting more but my down payment looks a lot like that wholesale fee. I average about $500 a month of positive cashflow in each deal. I’m still owed 360 months of $500 a month of positive cashflow of which I’m not a landlord. I’m the bank. $500 times 360 months is $180,000 I still have coming to me after I have received what looks a lot like a wholesale fee.
Maybe a strategy for you all is to do wholesale but when you find that cherry, go ahead and seller-financed it. You still get an upfront fee called a down payment that’s non-refundable that’s yours. You have got some cashflow coming in. That is more passive than most strategies because you are a payment collector. You are collecting the mortgage. No one ever calls the mortgage company and says, “My air conditioner has broken.” If they do, the mortgage company is going to hang up on them. They are going to say, “It’s not my house. It’s your house. Fix your air conditioner.”Having a vision helps you make it through temporary rejection. Click To Tweet
I would love to throw my hat in the ring for your plan B. You are wholesaling. You get your feet on the ground. You are cherry-picking. You have got some money in the bank. You need something to do with it. I like to throw my strategy in there to say, “Maybe consider seller financing instead of being a buy-and-hold guy or fix-and-flip guy to create some cashflow.” Fix-and-flip is not cashflow. It’s one time. It’s a bigger check maybe. I would rather be a seller financer than be a landlord on houses or apartments.
Let’s say that you are cash flowing $300 or $400 and it is leveraged or something, if an AC goes out, you are screwed.
That’s the problem I presented. I presented both sides. A lot of millionaires have been made with rental houses. I’m not bashing it. I’m just saying there’s another side to the coin. The biggest myth portrayed in the real estate guru world is the buy-and-hold because they say, “You are collecting $1,000 and your payment is $600, so you are making $4,800 a year.” They go on from there. You glossed over every repair that could ever happen as it would never happen. That’s typical.
In the seller finance business, when you receive a check for having to foreclose on somebody, it’s your money because it’s the payment. It’s a different strategy. I have done 2,500 deals in my hometown of San Antonio since 1996. That’s the strategy that I love but if I was starting, I couldn’t start at that strategy. I would have to start as a wholesaler. I would find the deals and I would have to partner with a money man and give him a large portion of that 50% of the deal. I did that a lot, 50% of a profit is a lot better than 100% of zero.
You can partner with doctors and lawyers who have the money but they are bringing nothing to the table. You will not learn anything from them about the business. Who you want to partner with are people that are flipping a whole bunch of houses or have flipped hundreds of houses in their career because you are going to learn something from that partner. You will tap his network, brain and bank account for the money. All of that is great. If I had a choice now that I know the business is good as many or most, it’s okay to go get a doctor. In the beginning, I would rather partner with a guy that was a pro in my business so I could learn.
It has been great. I appreciate your enthusiasm, professionalism and what you have done. If you are out there and you are interested, please go to 1000Houses.com/WholesaleCoach. Connect with everything that Rafael Cortez has to offer. Be sure to get your Wholesale Blueprint so you can get an outline of what the business looks like. It’s not rocket science. It’s what you choose to study and become good at. If you have a passion for this, this is a good place to start. Anything you want to say to the folks out there, maybe the people that are fumbling around or not having that much success in real estate or they are thinking about going into real estate?
This is going to sound cliché. It starts with the vision. I don’t want to talk about the business vision. I want to go to the individual vision. What do you want for your life? What does your life look like? Where do you see yourself in the next years? Is what you are doing going to get you there? Do you see yourself in the same place in the next years? Is that good or bad? Have those deeper conversations. A lot of times, the tendency is to go after the money or amount, “I want to make $1 million, $100,000 or whatever.”
There’s no emotion, attachment or personal anchor linked to that. That’s where a lot of people fizzle out. We need to have a sense of direction, perspective or purpose as we are going through the process, not to figure out our life purpose. That’s a whole different conversation, but to have a purpose on the actions that we are taking. “Is this vehicle the right thing for me?” If you have that in place and you figure out what that looks like and at least have a decent idea, you are going to be okay.
I have a philosophy that the most important thing in your entire life is while you are working your job, to figure out in your part-time, you’ve got to burn your candle at both ends a little bit. You’ve got to figure out in your side hustle how to replace the income from your job so that you can walk away from your job. That might only be $3,500 or $4,500 a month. Scrap all the million-dollar ideas and figure out how to get your freedom number. That’s not vacations, boats and all that stuff. It’s, “What does it take to pay my bills, mortgage payment, insurance or car?” Whatever it is you think you can’t live without, insurance or electric bill, the basics. If you figure out what that number is, it’s usually not that big. All of a sudden, things shrink down. They get more doable in your limited belief system.
The reason why that’s important is that if you hit that $4,500 or $5,000 a month and you don’t have to have the job, you freed up 2,600 hours a year to become a pro. That’s when you go get with a Mitch Stephen, Rafael or whoever you think is right for you and learn as much as you can from the internet and free stuff. There are all these creative strategies down to 1 or 2 and then study those 1, 2 or 3 until you find the one. You scrap everything else and drill down deep as you can. When you run out of free knowledge and you are not learning anymore, then it’s time to hire a coach because he will take you to another 1,000 feet down because he has been there.
That’s my tiny philosophy about if you want to get free, you start with trying to get in a business or side hustle that will replace your job. Most people have to do that by working part-time. Those 2,600 hours are incredibly important. We have all heard that 10,000 hours will make you a pro, expert or one of the best in the world. At 10,000 hours on the violin, you should be one of the best in the world if you have any proclivity at all. At 2,600 hours a year, you are talking about four years to become a monster at what you do. It’s the one thing that you have to agree on. To put in 2,600 hours, it can’t seem like work. You got to be having fun and be on fire about it because you can’t put in 2,600 hours going through the motions.
It’s that personal thinking that helps you make it through the rejection and the people that say, “Piss off. I don’t want to sell my house. Stop bothering me.” That can start taking a toll and build a tax. It’s having the end goal in mind, “Where do I want to get that’s going to get into that space?” It doesn’t take that much. Most people I asked, I’m like, “How much do you need monthly to cover your bills?” It’s $5,000 to $6,000. The average deal in most markets is about $20,000 on wholesale. How many deals a month do you need?
If you are going to wholesale houses, wholesale the expensive houses because $20,000 is nothing on a $300,000 or $400,000 house. It’s exciting to talk to you. I hope that we have excited someone out there. What turns me on is I have worked with people that started with nothing that became multimillionaires and are living whole different lives. I have those people sometimes fly or drive across the country to shake my hand to thank me because I have only talked to them on the phone or online. They come to personally thank me because their whole life is not even remotely close to what they were.
You need the input from people that have been there because you got to keep your head screwed on straight. You can’t let people piss on your brain. You can’t sabotage yourself either by not budgeting, not spending money or not having discipline. There are a lot of things that go into it. It’s all a life experience. It’s not just about making money. You can become a better person on a whole lot of fronts by getting focused and disciplined and achieving a goal that you didn’t even think you could do at first. It’s way out there for you.
I would like to thank LiveComm.com for sponsoring this episode. It’s all about mass texting, phone capturing and lead generation. It’s another dimension in touches, all for $0.02 a prospect. It’s probably the cheapest money you will ever spend to stay in touch with your prospects or possibilities or to connect with people. Check it out. I average four days on the market in my seller-financed homes. I don’t have any signs in any yards. I used to but I don’t have to anymore. I have 10,000 people that want to know the next time I have a seller-financed property.
I can text them for $0.02 each. I can text them all at one time if I want. I can tell all 10,000 of them in a matter of seconds, “Here’s another house I have for sale.” They are all wanting my house. They all want to know I’m not spending money on one person that doesn’t want to know. No matter how many text messages I send out saying, “If you are no longer interested in this, please reply with stop and get off my list,” I still have 10,000 people on there that are sincerely interested. It’s the best money you will ever spend. We are out of here. See you later, Rafael.
Thank you so much.
About Rafael Cortez
Raised in Yuma, AZ, Rafael Cortez is a second-generation entrepreneur. He began his first job at the age of 14 at a local grocery store. From 15 to 18 years of age, his work experience included everything from construction to supervisory positions in retail and customer service, all while attending the Fire Science Program at Arizona Western College.
At the age of 19, Rafael became one of the youngest firefighters in Yuma County, where he spent the next 5 years of his professional career. While providing EMS and fire services in Yuma, Rafael recognized a need in his community and began working on his first entrepreneurial project, a non-emergency medical transportation business.
He launched Netcor Transports LLC in 2007 at the age of 23 and maintained constant logistical and economic growth until he successfully sold the company in 2014. Rafael is currently an Organizational Psychologist and real estate professional holding ownership in multiple companies in various verticals. He has profitably invested in wholesale real estate over the last several years and is now passionate about using his investment knowledge, entrepreneurial spirit, and training as an organizational psychologist to help others learn about real estate investing through Wholesaling Inc and his multiple coaching programs.
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