I Made $2,500 Off The First Deal
Eric Janson – Eden Prairie, Minnesota
I believe the best way to learn the business of real estate investing is to hear how others have done it.
When these interviews were recorded, I asked Tom, the interviewer, to ask questions that would help the viewer see how these folks got started.
I wanted to hear the struggles, the successes and a clear path and explanation of what they had to do to make these deals happen.
I did NOT want them to be a bunch of people telling you how wonderful Joe Crump was. I wanted content, examples and real life experiences.
I hope we succeeded.
My 6 month mentor program:
A few Case Study Video Interviews with my Students:
“I Made $2,500 Off The First Deal”
Eric: My name is Eric Janson. I’m from Eden Prairie, Minnesota. I heard about Joe’s program online. I do a lot of investing so I was looking for some other options than what I was doing currently, because it’s always kind of been a struggle, so I was looking for other options and stumbled upon him online. I do other real estate investing, so wholesaling primarily was what I was doing at the time.
Eric: I got in the mentorship program about a year ago, so it’s been about one year now that I’ve been in. The first deal I actually did prior to the mentorship program, I actually got as education first. And it took me about, I got the deal under contract and it took about five weeks to sell that deal and I made $2,500 on the first deal. I showed that house myself quite a few times and I had one person that was about ready to do it and then that fell apart. So all together, it probably was about 15 to 20 hours for that one deal.
Eric: The best deal I’ve done so far was just last December. It was basically a very easy deal. I showed the house twice. I was showing the house, I showed it twice and I made $5,000 on it. So it was pretty smooth and it didn’t take much time at all, only a few hours on that deal. My average income per deal is about $4,000 per deal. I’m not closing deals right now very consistently. I mean, I have, I’ve closed seven in the last year. When I look at where my focus has been, I do a lot of other things, like wholesaling, I’m a realtor. My focus always hasn’t been on the lease options and when I look at how much money I make per deal, versus lease option versus other alternative ways of doing real estate, I came to the conclusion that the lease option is much, you make much more with a lease option than I do suing other ways. So I’m now focusing my efforts more on doing more lease options and being more consistent with it.
Eric: The biggest struggle with the lease option scenario is just, I think the biggest thing is get sellers to say yes sometimes. They’ve got a lot of objections. They don’t know you so you’ve got to get them comfortable with you and just getting those lease option memos signed is probably the biggest thing.
Eric: Yeah, actually the first one that I actually, it wasn’t the first memo that I got signed, but it was the first deal that I did. That first deal that the individual that I talked to, I talked to him on the phone a few times. He was not real keen on doing a lease option, didn’t think it was a very good option for the house he had, and the one that I talked to him about, he said, “I already have somebody for it anyway, so let’s not just even think about that one.” And I asked him, “Well, do you have any other houses?” Because he was an investor and he said, “Yeah, I have a higher end home,” but he goes, “That probably wouldn’t work for this option.” I said, “No, it potentially could, it just may take a little bit longer to find a buyer because there’s not as many buyers in that, in a higher end home.” And I just asked, “Can I meet with you at the property?” Because he just wanted me off the phone.
Eric: I met with him at the property. We talked a little bit more and I got him to sign the memo on the spot. I just pulled it out and said, “Hey,” you know, “Are you ready to go? What do you think?” And he said, “Yeah, I’ll do it.” And he just signed it. So that was one where I didn’t think it was going to happen and I walked out of the appointment with the memo signed which surprised me and then sold that deal, and that’s the deal I made $2,500 on.
Eric: So, when I explain a lease option to somebody, I just basically say that it’s, you’re renting the property but they have the option to buy the property. So, they’re a tenant during the term of the lease. And typically these leases are two to three years. And during that time they can exercise their option to buy it for whatever the purchase price is that’s agreed upon. They’re usually a better tenant than you normally get because they do take better care of it. I’ve had a tenant in one of the properties that I did where he actually, in the first month he was there, because I was still communicating with him, he redid the step, he painted the trim on the house, he painted the garage and he fixed the back fence. He power sprayed the patio. So I always share that story with everybody to this day. These tenants take better care of your property, usually, than a normal tenant does. So there are advantages to that. I’m also paid by the buyer so it doesn’t cost the seller anything. And you don’t have to pay a realtor fees. While I am realtor, you don’t have to pay a realtor a fee in this transaction. So that’s kind of how I explain it to them when I’m talking to a seller.
Eric: My goals as a real estate investor are basically, mainly to support my family. I’ve been doing this now full time. I’ve been doing it now full time for seven months. Again, I do other things other than just the lease option. I do wholesale, I’m a realtor. I sell turnkey rental properties as well. But being able to take care of my family, being able to have us be debt free, to be able to do the things we want to do, travel, and then to help others. It’s really fulfilling to be able to help an owner find somebody for their property when they didn’t really know how they were going to do that and on the flip side a buyer to be able to find a house that they didn’t think they were ever going to get. So, helping people and helping my family at the same time.
Eric: Real estate investing, the impact that it’s had on my life, my family’s life in general, I do this full time now. So, that’s, you know, I have more time available if there’s something that I need to do for my kids or whatever, I’m able to. And it’s just, it’s fun and it’s what I enjoy to do, so, being able to share that with them, my wife is here learning this as well, and being able to you know, work with her as well is nice.
Eric: The advice I would give somebody that’s starting out as a real estate investor is to really look at what Joe Crump does. His stuff is very straightforward, very transparent and it works. I’ve done a lot of different courses over the years in real estate investing. I’ve had some success in some of it. A lot of failures in a lot of it. And Joe’s stuff actually really works. I mean, if you follow what he says to do, make the calls, talk to the sellers, you know, get the memo, market the house, if you do the steps that he says, you’ll be successful. I feel that it’s, it will work for you.
Eric: Yeah, when you, one thing that I would say is different about Joe’s stuff versus other investors that teach real estate, they’ve got a lot of good concepts and they teach in depth about things. A lot of them don’t go into depth about the rent to own and the lease option part of it. Most of them talk about wholesaling and then fixing and flipping houses and, you can fix and flip houses, there’s a lot of risk there, but it is doable to make money with it. Wholesaling is a very hard business. Anybody that I talk to, and myself included, anybody that’s done that business, when you’re buying a property under market value and then trying to assign it, you know, or do a double close on it, it’s very difficult to, one, find the property — once you find it, if it’s a good deal, you pretty much can sell it. But, with rent to own’s there’s just a huge pool of potential sellers, buyers, it just opens up the door to a lot more opportunities, I feel, that a lot of the other real estate investing, you know, experts don’t really teach like Joe does.
Eric: This option was new when I first looked it, to me, as an option to be able to be able to make money to be able to do a lease option and to take the down payment as my fee into that transaction. That concept was new to me when I first heard about it. But as I looked into it more I discovered there was other people that were teaching similar stuff and it’s just not widely taught. When an investor’s looking to get into real estate and they don’t have a lot of money but they want to figure out an option to do it, really their options that are told to them are either you become a realtor and you list and sell homes, or you wholesale properties. Those are really the only two options. And this is an option that’s just not widely known, in my opinion, but a great option to be able to do. And the way Joe teaches it, just, it’s makes it, it’s all the steps are right there for you to be able to do it.
Eric: So, yeah, I mean, I’ve been in real estate investing for four years now and for the three years prior to finding Joe, doing a lot of different things and started working with Joe, I started putting some deals together there, doing a lot of other things. Became a realtor. And decided at a certain point with certain income coming in, that it was time to leave my job that I was working as a manager at Boston Scientific and making a good income, having good benefits and decided that this is the time to leave that and venture off into real estate investing full time. So I did that about seven months ago.
Eric: Just in general, working a job, I mean, I worked as a manager supervisor for a number of years and what I discovered about four years ago in that process is that from going to company to company, this is kind of the same type of job. I like some of it, but there’s a lot of it that’s very stressful, very, you’re working 60, 70 hours a week. You’re getting there earlier, you’re staying late. You’re coming in weekends. It’s a lot to do. And so you’re not spending time with your family, plus I was doing real estate on the side, so there was a lot of hours spent away from the family at that point in time. So part, a big driver for me was freeing up a lot of that time, being able to spend more time on real estate investing, to be able to spend more time with my family. So that was the biggest catalyst of making that decision to move from the job onto being able to do this full time.
Eric: Financially, it’s still a struggle from month to month to make sure that everything happens. Financially I’m not quite where I want to be at this point. From a mental standpoint, I’m at a point where I feel like I can do whatever I want to do with real estate. I feel like a lot of options available, especially with what Joe teaches and I feel confident that I can do those and increase my income. I feel that this next rest of this year is going to be a very, very good year for me.