JF2324: 4,000 Wholesales With Ron Walraven

Ron Walraven Real Estate Background:

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“To be diligent and not to give up” – Ron Walraven

TRANSCRIPTION

Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless. This is the world’s longest-running daily real estate investing podcast where we only talk about the best advice ever, we don’t get into any of that fluffy stuff. With us today, Ron Walraven. How are you doing, Ron?

Ron Walraven: I’m doing great. How about you, Joe?

Joe Fairless: Well, I’m doing great as well, and grateful to have you on the show. A little bit about Ron – he’s a full-time wholesaler. He’s got 20 years of experience. He has a portfolio consisting of 10 rentals and has completed over 4,000 deals since 1999. 4,000 deals since 1999. He currently wholesales 150+ deals a year. He’s an active guy. He’s based in Troy, Michigan. So with that being said, Ron, do you want to give the Best Ever listeners a little bit more about your background and your current focus?

Ron Walraven: Yes. I started out as an auto mechanic straight out of high school. I worked that job for 17-18 years. And then I hurt my back really severely in 1998 and had some surgery, and when I came out of surgery, the doctor told me that I couldn’t work on cars anymore. And during that time of working on vehicles, I was always a hustler. We always got paid by the job, so nobody ever handed me a paycheck. So when I was sitting around recouping, I thought, “You know what, I always liked to do real estate.” So I took the class, took the test, and then fell into a local broker that was doing lots of foreclosures with banks, around 1999-2000. I ended up with 2 million accounts from lenders that were doing what we call B and C paper, which would be investor type loans… And then of course the market started imploding in the Detroit area. I became a high volume REO broker, which is where those transactions of 4,000 plus came from doing three 400 deals a year for the banks.

And then as the market turned in ’08, ’09, I got out of the REO business and started doing wholesaling, which is what I’m doing today. Our company is generally strictly a wholesale company, but we do have a few flips here and there, which just makes sense, and then we’ll keep a few of them as rentals at the end of the day.

Joe Fairless: Let’s go back a little bit… 18 years of one occupation, and then something happens and you are no longer able to do that. After 18 years; you were doing it since high school?

Ron Walraven: Yes.

Joe Fairless: What type of feelings does that bring up? And then how did you have those feelings and move towards some positive results?

Ron Walraven: Well, at the end of the day, of course, I lost my income, and I was making six figures a year working on cars, which is very unusual. Of course, I grew up in Detroit, where all the cars were made, so it was kind of easy to get to that volume. But I’d been always interested in real estate, because I was just a hustler; I was always trying to do stuff. I would flip a car too, because I’d come across cars where people didn’t want to complete the repairs; I buy it from them, and then fix that car and resell it. So I already kind of had a mentality of sales in a sense.

And then, of course, just liking real estate, you watch those info commercials – because I’m certainly sitting around watching TV at night – and I thought “Hey, let’s just do that.” And then, of course, along the way, I was losing my house, because obviously, I lost my income… So I became almost my first REO client, in a sense. I managed to get out of that, with my father who loaning me some money to pay the realtors commission, of all things… So in the last 20 plus years, the only house I haven’t closed and gotten paid was the one that I almost lost in 1999.

And then the rest is history from there, because I kind of fell into that broker — the guy that I ended up being [unintelligible [00:06:49].05] agent with at the beginning – him and I got along so well, and he did a lot of REOs, and it just kind of fit my personality.

Joe Fairless: You almost lost the house; your dad loaned you money to help get that transaction to the finish line. What type of impact does that experience have on your career as a real estate professional?

Ron Walraven: Well, for sure, the part of the process that a real estate agent that works for banks does is he has to contact that homeowner. So of course, I had already bits of built-in empathy for the process, knowing what it’s like to get beat up by the bank, bombarded with notifications, and then you’ve got this guy standing on your porch going, “Hey, the bank wants to know when you’re leaving.” So having that empathy already in place has afforded me that ability to read into them and to understand their pain, so that obviously I could facilitate it to the best of the ability. Now, obviously, my fiduciary was to the bank… But at the same time, people are human.

Incidentally, fast-forward about 2010 and 2011, as things imploded again in regards to the market that we all know that crashed, I did actually lose two houses in that crisis, a primary and a rental. But by that time, I already knew how the system worked in regards to how the banks process that particular side of it, so I milked it for every penny I could get for cash for keys, because I knew what was going to happen and what that contact was.

And incidentally, one of those brokers that contacted me for my primary was a very good friend of mine at the end of the day… So it was kind of interesting how you get humbled, and also use those types of things to your advantage, in a sense, because you can take advantage of it in a good way. So the answer to your question is I just had the empathy walking in the door with people at the very beginning, and I knew what that felt like to almost do that.

Joe Fairless: So you had built a business up until 2011, and then there is hard times locally, especially… Looking back on it now – we’re now in 2020, about to be 21 – what are some things that you’ve learned from that 2011 experience?

Ron Walraven: Well, I think that now as a wholesaler, since the COVID thing has certainly turned us upside down again, I was a little more prepared mentally this time around as things have obviously kind of declined, for sure… But I think that learning how to build a team – because prior to that I didn’t really have a team per see, because roughly until about 2008, early ’09, I had a team of nine people working. I had two buyer agents, three admins, a bookkeeper, and a contractor to do all of that REO business, because we were doing three 400 deals a year. And to do that kind of volume, you really have to have processes in place to make that happen. So once it imploded, I revamped both times. I didn’t file bankruptcy in ’99, nor did I in ’09 or ’10. I just kind of pushed through it. I just worked with the vendors that were calling me, just kind of did the best I could to keep it moving and floating… And then as I dwindled everything in 2010, through ’11, [unintelligible [00:10:19].12] down to myself, that’s when I just repositioned myself, “You know what, I’ve got a database of about 500 or 600 guys that bought those 4,000 houses. I’m just going to use that and leverage it.” Because I was asked a million times at closing with REOs, “Ron, why don’t you invest?” My answer was always “Well, I’m too busy doing this. I don’t have time to do that.” Well, of course, the good Lord chose to push me to the ground… And I just picked myself back up and said “Hey, I guess I’ll wholesale and invest.” Right?

So I didn’t fumble my way through it. I knew how to do contracts, because I had read so many of them, I knew how to maneuver through that minutia of the practical side. But what I’m not good at, and I’m still not good at today is marketing. So driving those leads into my system is what was a challenge for me when I first started wholesaling.

Joe Fairless: Let’s talk about that. You wholesale 150+ deals a year; you’re getting leads, clearly. How are you getting the leads now?

Ron Walraven: Well, we’re realizing that that was my weakness and that my strength was deal-making. I just went looking for that guy that wanted to partner up and to do the marketing side of that, and know how to do that. So I hooked up with another local guy, a younger guy. I’m in my upper 50s, he’s right now about 30-ish. So I hooked up with him, he was very good at the detail side of driving leads in… So we just kind of figured out that the lead sources are all the stressed-out people. So who is that? That’s probates, that’s inherited houses, that’s landlords that are tired, that’s tax problems, that’s foreclosures, which I already knew… So we just kind of figured out how to find those stressors. And then we joined a group called Collective Genius back in late 2016, and that really catapulted us up into the direct mail side of things.

We ran direct mail campaigns in Google and Facebook up until October of ’19, which was driving in 4,000 or 5,000 leads a year. We hit those 150 actual closings. Our first niche was really doing probates. My partner and I actually wrote a book. [unintelligible [00:12:37].08] estate in Michigan, so we wrote this little book that we use as our marketing piece initially, and sent those out to the 150, 200 probate cases that were opened up in Oakland County, Michigan, and just sent them the book with an empathetic letter. And that worked. Once we started doing the direct mail, that’s when things really exploded in regards to the responses. So the first couple of years we might have done 50 or 60 deals, which would have been late ’13, ’14, first part of ’15. And then when we started doing the rest of it, that’s when it just kind of took off and we did 80 deals, and then 130, and then 150 last year. We have systems in place on the back end to do all that too.

Joe Fairless: I think I heard you say you were doing direct mail campaigns up until October 2019. That was bringing in 4,000 to 5,000 leads a year. If I heard that correct, that is past tense. So why did you stop?

Ron Walraven: Well, the direct mail just seemed to dwindle in his responses back to us… And then there were a lot of people — because obviously the Collective Genius is a group of the top guys in the country, and everybody was saying…. Well, not everybody, but a lot of people were saying how much it was different. And then Google and Facebook were kind of even dwindling there, too. So we just couldn’t spend the money for the return anymore. So we just shut it down slowly. We were sending out 100,000 postcards a month from roughly mid 18 until September of 19. So we were doing that consistently, because people leave those postcards on their table, right? Even today, we still get calls from those postcards that we sent. And then just recently, we actually did a TV commercial that we started running. We actually shot that commercial in late February, and then we ran it March 31st. Now, everybody knows what was going on on March 31st of 2020, it’s called COVID. Right? So most of the United States was shut down. So guess where everybody is sitting during COVID? In front of their television. We pulled in 600 leads in 30 days with that TV commercial.

Joe Fairless: Wow. Where did it air?

Ron Walraven: It was on two local TV stations in Detroit. We ran that spot roughly about 15 times a day for 30 days in a row, and our CRM system will text me when somebody goes online and sends in a form fill. I could always tell when that commercial was running, because my phone would just blow up with text coming in. But of course, that was me kind of keeping track of my intake guy. And then I would give him some feedback if an address that looked particularly juicy to me; I would just say, “Hey, you need to work on this one pretty good.”

But we stopped that commercial at the end of April, just because we had so many leads… So we started working those. And today we’ve probably closed just under 20 of those, with about 120,000 in return on a 30,000 spend, just for that one particular lead generation.

And then we started up that commercial again in August, because we had shut it down just because we needed to work those leads we had. So we did it again, and we didn’t work as well through August through September, because obviously not as many people sitting at home. But we just pulled down a $40,000 assignment off of one of those TV ads just the other day. So it does work.

And then just talking with some of the guys across the US, the direct mails actually started to kind of be better again, because I think COVID has weeded out a lot of the newbie type wholesalers that just couldn’t afford to keep moving. So we’re going to proudly start the direct mail and more texting. Because right now, TV, texting and cold calling is where we’re at for the most part… Because we had a mailing list of about 25,000 people that we got from a data source where we skip traced all 24,000 of those names and just started cold calling them and texting them. And texting and cold calls are not quite as — because it’s very intrusive, in a sense… So the texting people – there are some mean people out there. When you text them something trying to get them to call you back, they are very, very… I call them angry birds. That’s what I call them, angry birds.

Joe Fairless: [laughs] Well, you are interrupting their day by texting. I get texts on some of the homes that… I don’t own any homes anymore. I do all apartments. I sold my homes in October of 2019, right when you stopped your direct mail… And I get text messages from wholesalers asking me if I’m looking to sell my home, they’d love to have a conversation with me. I’m not an angry bird, I just block their number. But there’s been a couple of times where — if I was ever really bored and I got a text message like that, I’d just mess with them. I would just keep going back and forth of ” Oh yeah, I’d love to sell it to you.” And I think that might be illegal to sell a home that’s not yours, so maybe I shouldn’t go down that route.

Ron Walraven: [laughs] For sure.

Joe Fairless: So TV, texting, cold calling… And then you’ve got a list, so you’re skip tracing to get those numbers. And you said it was $30,000 spent on the TV commercial, it got you 600 leads approximately in 30 days. How much to produce the commercial?

Ron Walraven: It was about 5,000 bucks after the actual production. It was like $3,500 for actual commercial production, and then the management part of that production. So it was pretty cool. It’s a 30-second spot that basically says the website nine times. It’s typical… I’m not going to say it’s cheesy, but it’s just typical commercial stuff, where it just beats it into you. And I think, of course, that’s why it works so well during COVID, is because there were so many people sitting there, as opposed to the normal day-to-day life of people, right? And a lot of those were Detroit leads. In other words — because I live in a Northern suburb, and we generally get better deals out in the suburbs as opposed to the city… But I have a really good quality lead referral for Detroit properties. And we have a deal set up where we just basically hand it to him, he gets the deal done, and it gives us half of whatever he collects. So it’s a pretty sweet deal for us.

He had a day job up until about six months ago; he quit his day job and started wholesaling full time. So we figure we pulled in 600 leads, we gave him roughly about 250 of those just to work. And of course, they’re not high-quality stuff, because of the television generation part of that, but he’s a good follow up person, which is really our claim to fame on our end, is just the follow-up. We can talk to them initially, for sure, to kind of get their motivation. But then my intake guy, he’s just a bird dog guy. He loves to have a reason to call you, so that he can kind of have another conversation with you about your house, or whatever, right? And we use Podio for our CRM. And we’ve got it all set up to drip, and to text, and do all of those things that we all do. And it’s very methodical and very system-oriented. It’s the same thing every time. And he’s good on the phones. He used to be an insurance salesman and a car wholesaler, so he’s got a lot of drive, like a real guy would, and to dig to the bottom to get the best deal.

Joe Fairless: Is there anywhere that maybe I’m not looking to look at your TV commercial? Or maybe on YouTube or somewhere?

Ron Walraven: YouTube? Yes.

Joe Fairless: What do we search?

Ron Walraven: Go to Waymark Homes, the YouTube channel.

Joe Fairless: We’ll find if we go to your YouTube channel.

Ron Walraven: Yeah.

Joe Fairless: Alright, cool. Taking a step back, real quick, what’s your best real estate investing advice ever?

Ron Walraven: Just be diligent. Not to give up. I think I get so many calls in a day where a guy that’s frustrated with his day job, he calls me and says, “Hey, how do I get into wholesaling?” Well, there’s the million-dollar question, right? How do you do that? Well, you and I just talked about it. It’s really all about lead generation. Most people can buy a house at the right price. And to find that buyer is not that difficult if it’s a deal, because there are Facebook pages all over the place… But guys on there will buy that house all day if it’s a deal, right? So the lead generation is always the key. So I just tell them just to keep plugging away, and you get that first deal. You’re going to raise the bar in your mind of how that actually went. And if you need some help, call me. I’m more than happy to talk with you on the phone. Not a problem.

Joe Fairless: We’re going to do a lightning round. Are you ready for the Best Ever lightning round?

Ron Walraven: Yes, sir.

Joe Fairless: Alright, let’s do it. First, a quick word from our Best Ever partners.

Break: [00:21:21] – [00:22:01]

Joe Fairless: Okay, Best Ever way you like to give back to the community?

Ron Walraven: I like helping local investors get deals, kind of just what I talked about. I am part of a local REIA Group that I’m the vice-president of. I do the haves and wants in front of that crowd, and I always give out my cell phone and say, “Hey, if you’ve got a deal that you’re having trouble with, text me.” And I give them my cell phone and I always ask them to text me first, because calling me is probably not going to get me, because I’m usually talking to somebody who’s texted me.” So text me, and I’ll help you if you’ve got a deal, and maybe I’ll buy that deal from you. Or at least I’ll help you dispose of it. So the long story short is I just like helping people, local guys, to do that. Even though maybe I’m creating my own competition. But I can’t buy all the houses, so let’s just help each other do deals.

Joe Fairless: How can the Best Ever listeners learn more about what you’re doing?

Ron Walraven: Well, if you go to that website, which is waymarkhomes.com. We’re local wholesalers. Or you go to my Facebook page which is simply just Ron Walraven, and you can see who I am as a believer in Christ. I’m very dedicated to that. And integrity and transparency is really what I’m all about. We tell the truth and we do what we’re going to say we’re going to do at the end of the day, every time.

Joe Fairless: Ron, I appreciate you being on the show. And on the integrity part, I noticed on your website, it links to the Better Business Bureau profile of your company. People who are on your website can go there, which is really smart. So that’s something I noticed and wanted to call out.

I enjoyed our conversation, I enjoyed learning how you’re getting leads, getting into the specifics, and lo and behold, TV was very effective for you, and then some of the other things that you’re doing, too. I hope you have a Best Ever day and we’ll talk to you again soon.

Ron Walraven: Thanks Joe.

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