How Novation Deals Turn Rejected Wholesale Leads Into Bigger Real Estate Profits

Robert Abrahamson (00:00)
That’s one of the biggest regrets I have is just not getting on the phone sooner. You know, trying to have the answer to every question or or every possible scenario. You know, once you once you’re getting on the phone and I’m you I’m I’m fine on the phone. It’s just I I like to have the knowledge and every answer that I’m gonna be asked, which is really the the worst thing it could possibly do. So if I had any any bit of advice for anybody it would just be get on the phone. You know, have your basic script. You don’t need you don’t need ten pages of questions and answers and things like that. It’s just getting on there, getting the reps in and and talking to just talk to people. That’s what it’s about.

Joseph Crooms (02:09)
Hey everyone, welcome to Investor Fuel Real Estate Pros Podcast. I’m your host, Joseph Crooms. I’m today joined by someone I’ve been with looking forward to chatting with. He’s sitting right here in front of me, Robert Abrahamson. Hey Rob, you’ve been making some serious moves in your industry, in your space. We’re gonna talk about that. But Rob, glad to have you here. Say hello to everyone.

Robert Abrahamson (02:34)
Excellent. Thank you very much, so glad to be here. Hello everybody.

Joseph Crooms (02:37)
Cool. I think our listers are really going to take something away from how you are approaching business. So let’s jump right into it. So my very first question to you, Rob, is this. So for people who may not be familiar with your world, give us the short version. What’s your main focus this day’s three-part question? And what markets are you operating in?

Robert Abrahamson (03:00)
Sure, got it. Basically what we— we started out wholesaling. We’ve— we’ve built up a nice little system that we’re using. So wholesaling is the main— the main tool right now. We’ve actually moved into Novations as well and that’s actually working out very well. So the two of those together are our main— our main strategies, and then markets, we’re nationwide. We’re not in every single state, but we’re in multiple different states: Tennessee, Oklahoma, Ohio, Florida, Texas, and there’s a couple of others that—

Joseph Crooms (03:28)
Hey, so Robert, for those that are sorta new, how do you c— how do would you put in layman terms wholesaling?

Robert Abrahamson (03:35)
Wholesale basically, you know, it’s— it’s normally gonna be a distressed property where the homeowner needs a solution to sell. Our— our team finds those sellers, and basically we’re gonna put a— a home under s— under contract for X, and we’re gonna sell it for Y. That’s basically what we’re doing, at a higher, obviously, amount.

Joseph Crooms (03:54)
How did— did you f— start in flipping or how did you get into the wholesale business?

Robert Abrahamson (03:59)
I’ve been interested in real estate for quite some time. We’ve been doing this now going on a little bit over two years. But I basically started out like everyone else, you know, I— probably a lot of the people listening with the YouTube and all that kind of thing, courses and— and whatnot. But basically j— I— you know, I started working with some other people, a larger firm. I learned what I could learn, and then I said it was time for me to go out on my own, and picked up the phone, and that’s how it all got started.

Joseph Crooms (04:27)
So since you picked up the phone two years in, where— where are you at now? What— what kind of volume or revenue ha— are— are you producing?

Robert Abrahamson (04:36)
Right. We’ve— we’ve recently added the Novations, which is— is actually very good. It’s adding to our revenue, but we’re probably doing, I’d say anywhere between three to— three to six to seven deals a month right now. And it’s on— it’s— it’s limited because we’re— we’re still growing as far as the internal staff. So at some point, that’ll be going up higher.

Joseph Crooms (04:55)
Do you— are— are just in New York, or are you, you know, is that what you’re doing all states that you’re in right now?

Robert Abrahamson (05:02)
Yeah, I’m based out of New York. We really don’t do much in New York just— just because it’s— it’s not easy to do business with what we’re trying to do. It’s an attorney state and things like that. So yeah, it’s— it’s all— it’s all virtual, it’s all nationwide, and that’s what I wanted to do. I wanted to be able to do that from wherever I was, in the states where it’s actually conducive to do business and it actually works.

Joseph Crooms (06:10)
So in those states, are you doing the same volume, or is that just— is that the— or the— is that the collective figure that you gave us?

Robert Abrahamson (06:17)
Yeah, that’s the collective figure from all the different states that we’re actually operating in.

Joseph Crooms (06:21)
So just a wholesale, and what kind of— how does that produce revenue-wise for you monthly?

Robert Abrahamson (06:29)
Well, I mean, an— an example recently that we did, and down in, I think it was Tulsa, Oklahoma, we picked up a property for fifty-one thousand and we assigned that contract, I think it was for sixty-five. And that was within about a week, you know, to— to somebody that actually does the fix-and-flips. So that’s— that’s kind of, you know, that’s a little bit quicker than normal. Usually it’s a thirty-day process. But yeah, that’s— that’s what’s been working for us.

Joseph Crooms (06:55)
So in the last year or last six months, you’ve been doing three a month, that comes out to what in num— real numbers?

Robert Abrahamson (07:03)
What, as far as revenue? Yeah. Mm-hmm. It could go— I mean, you know, we’ve had a couple of months where we’ve done almost fifty thousand. There’s a couple that are around thirty. You know, average price on a wholesale could be ten to twenty thousand for us, that’s what it seems to be. You know, we don’t hold them long. If we have somebody that wants to buy that’s— that’s gonna be able to close, we’ll— we’ll close the deal and move on to the next one. So anywhere from thirty to fifty a month revenue.

Joseph Crooms (07:28)
So Rob, let me ask you this. What got you into the— the Novations as you call it? Is that the renovation business?

Robert Abrahamson (07:35)
No, Novation is actually— I mean, interesting, I never knew about it. It’s basically being able to get houses under contract similar to what we’re doing now, but partnering with agents who will actually list these properties on the MLS. The— the profit margins are a lot bigger, and these are only gonna work… we call it our retail buyer program, where the homeowner is not in distress, you know, they’re not in a rush, and the property’s actually in— in good shape, where it— they have time, and, you know, we can actually get it listed for them, and the margins are a lot bigger, and we have, you know… it’s not such a time crunch where we can get the thing listed and actually get more money for the— for the end buyer— I mean, for the seller, rather.

Joseph Crooms (08:17)
How long have you been operating at— on in this new— new niche?

Robert Abrahamson (08:21)
Probably the last, let’s say, I mean, actually closing deals, the last three months. Maybe four months.

Joseph Crooms (08:29)
Yeah, and— and— and what do you think… where— where do you see that going? Do you think it’s gonna out— outgrow your wholesale business, or it’s gonna lift some revenue?

Robert Abrahamson (08:36)
No, it’ll never outgrow, but it’s a— it’s a great compliment and it actually adds to our business. You know, when— when most wholesalers hang up the phone and say they can’t do anything with that, that’s where that strategy comes in. So it’s— it’s a actual… I mean, it’s absolutely incredible the amount of revenue that we’re able to add to the model with the Novation thing.

Joseph Crooms (08:58)
So on wholesale, the— the— the normal date is like you said thirty days, am I correct?

Robert Abrahamson (09:04)
Yeah, it— it could be. I mean, it depends on title and whatnot. I mean, our contracts are usually set up for thirty days or sooner to close. It depends on title, you know, if the end buyer’s ready to go. Most of these guys are gonna be cash, so they can close within a week or less as long as title’s good. But the— the standard contract calls for thirty days. If the deal is the r— if we bought it at the right price, it’s gonna close quickly.

Joseph Crooms (09:26)
What about the Novation? Which— what’s the turnaround period?

Robert Abrahamson (09:29)
Those are a little bit longer, and we have to let these sellers know that they’re gonna take longer. ‘Cause usually those are gonna come to a— a traditional buyer that has to actually qualify for a loan, a family, something like that. You know, it’s not a distress situation looking for a quick sale kind of thing. So we usually tell them it’s gonna be about sixty days, you know, thirty to sixty days, depending, ’cause that’s normally how long something like that’s gonna take with the whole MLS, the listing, showings, and things like that.

Joseph Crooms (10:32)
And you’ve been talking about, you know, you— you’re scaling up your— your staff. What— what— what are some of the key positions that you— you need to scale up on?

Robert Abrahamson (10:41)
Mainly acquisitions, meaning, you know, people getting on the phone and talking to these sellers. That’s the biggest thing that we need right now. I mean, the disposition side, we’ve got it all set, we’ve got transaction coordination in place, you know, funding if we need it. But the biggest thing that we could use right now is acquisitions people.

Joseph Crooms (10:58)
An acquisition, I mean like s— sort of like salespeople.

Robert Abrahamson (11:01)
Yeah, well, not necessarily salespeople, but the ones that are gonna contact these homeowners and basically c— you know, call the leads that we’re— that we’re getting in and find the solutions for the people that need to sell.

Joseph Crooms (11:11)
You sound like you’re like lead top-heavy. So how many leads do you— do you have sitting around that he’s like, “I gotta get these handled”?

Robert Abrahamson (11:19)
I don’t wanna say the amount, but we have— we have a— a pretty big team overseas that actually does very well for us. So we have a good lead flow coming in every day, and it— it’s enough to keep— to keep people busy, I would say.

Joseph Crooms (11:35)
Alright, let’s shift this a little bit. So what caught my attention now is, you know, you talking about what world you’re— you— you’re— you’re niche that you’re operating in, and congratulations on the new niche. What’s your main focus these days?

Robert Abrahamson (11:50)
Main focus is just deal flow and follow-up. You know, contacting the new stuff that’s coming in, following through the— the leads, you know, the deals that are in progress. I mean, right now I think we have five or six that are in title waiting to close. So it’s a lot of, you know, it’s just a lot of follow-up in this business. You know, once we get— get the initial contact and contract, you know, it doesnend there. So basically, it’s just following through and getting deals to the finish line.

Joseph Crooms (12:14)
Love it. What caught my attention w— about you was the way you’ve been handling this and your— your business. And what’s also key and, you know, here’s a question: what’s been keeping your machine running smoothly?

Robert Abrahamson (12:28)
It’s just dedication and belief in the system. You know, when you’re first starting out, you know, you— you… not that you’re afraid to pick up the phone, but, you know, you’re not sure what these sellers are gonna say, they’re gonna hang up on you, curse you out. It, you know, it’s just belief in the system and just follow— you know, just following the steps, just going through the process. And, you know, once they start closing, you know it works, so your confidence level, you know, skyrockets at that point ’cause you know you’re able to solve the problem on the other end of the phone.

Joseph Crooms (12:55)
Understood. Now every operator I know has had a moment when things just got real, Robert. Maybe a deal that went sideways or time that you had to pivot fast. Would you mind sharing one of those moments to us or a couple of?

Robert Abrahamson (13:08)
That ended good or bad?

Joseph Crooms (13:14)
Yeah.

Robert Abrahamson (13:15)
All right, well, I— I had one down in Texas. It was gonna be Novation. We had— we contracted at three hundred, our agent was gonna list at three eighty. Everything was going smooth. We were trying to set up, you know, the seller was out of state, which is why that program actually works really well. You know, out-of-state seller needs to sell, he wasn’t in the area, you know, we were gonna take care of the whole situation for him. We got down to that point, there was— he didn’t have a key, he told me— he wrote to me that it was okay to have a locksmith go and, you know, open the door so we can go in and get pictures and get the listing ready.

And the agent went over, “So let me just go by just to see what’s going on.” Knocked on the door, someone opened the door and it turned out it was the guy’s ex-wife. And yeah, so she was squatting in the house and that turned into a complete disaster. We lost that deal. So that was kind of a heartbreaker. That was one of the initial ones that we did. And in Texas there’s certain rules and laws that if they’re married or that, you know, someone’s in the house, you know, they can’t be removed and everything else. So that was— that wasn’t a good one.

Joseph Crooms (14:22)
What did you learn from that, Robert?

Robert Abrahamson (15:05)
Learn from that to make sure that the people, if we’re gonna do a Novation or— or any— any deal for that matter, that, you know, you need to make sure that if they’re divorced, you know, you need the documentation. You know, you really need to follow up before signing contracts that that person’s actually the one that’s able to sign, you know, without having the wife or the ex-wife or— or things like that. So that was a valuable lesson on that one.

Joseph Crooms (15:31)
Thank you for sharing that with the audience. That’s the kind of stuff people don’t normally talk about. And honestly, it’s— separates the folks who are just dabbling from the ones who stay in the game long term. You spoke about getting on the phone, making it happen, and not sure. Can you run us through your mind and when you came to the point, “I got…”

Robert Abrahamson (15:52)
Yeah, that’s one of the biggest regrets I have is just not getting on the phone sooner. You know, trying to have the answer to every question or— or every possible scenario. You know, once you— once you’re getting on the phone… and I’m, you— I’m— I’m fine on the phone. It’s just I— I like to have the knowledge and every answer that I’m gonna be asked, which is really the— the worst thing it could possibly do. So if I had any— any bit of advice for anybody, it would just be get on the phone. You know, have your basic script. You don’t need— you don’t need ten pages of questions and answers and things like that. It’s just getting on there, getting the reps in, and— and talking to— just talk to people. That’s what it’s about.

Joseph Crooms (16:29)
And do you think that you gain more knowledge that way than probably s— you know, sitting down studying?

Robert Abrahamson (16:35)
Yeah, absolutely. Because you’re not sure, you know, the YouTube or the scripts, they’re not gonna answer every question. So, you know, when you’re getting stuff thrown at you, if the conversation’s good, you’ll be able to go back to the person. You know, there’s only so many things that they’re gonna say or situations they’re gonna have, so as you go on, you’re gonna learn how to deal with each one of those things. And whatever I didn’t know or I couldn’t find out, you know, one of the biggest things that I had was trying to find somebody to help me answer those questions. You know, luckily I’m at the point now where I— where I can do that and help other people. But that was— that was one of the biggest challenges for me, is just not knowing, you know, what I was getting into, what the people picked up.

Joseph Crooms (17:11)
Well, thank you so much. So let me ask you this: what do you focus on solving next? What’s the next real goal for you?

Robert Abrahamson (17:19)
Next real goal is just growth. I mean, we’re helping people now. You know, everything we do is a win-win situation. You know, we’re— we’re helping people that need— that need to sell, we’re helping people that wanna buy. So really our— our next goal, or I mean it’s a good problem to have, but it’s really to— to— to grow, you know, to get the growth, to grow the model because it’s working.

Joseph Crooms (17:43)
That’s big, especially that you’ve already got some things in space and you gain an experience. The next move can either compound things or create chaos, depending on how you play it. Now I know a lot of our people listening are either early in their journey or looking to level up, and I think they’re gonna benefit from hearing this. When it comes to building relationships— and you kinda alluded to it, you know, that you said, “Now I can, you know, have people or things to get information from”— but when it comes to building relationships and growing your network, what’s made the biggest difference for you?

Robert Abrahamson (18:18)
Just being honest with people. You know, just— just telling the truth. You know, if you have questions, ask the questions, and just, you know, just being honest. Just being… do— just do good business. I mean, it is… there’s a lot of money to be made and you’re actually helping people. So that— that would be my biggest advice: just— just do good business, you know. Helping people, it’s— it’s been great.

Joseph Crooms (18:40)
And— and— and what’s been the return for you, because you’ve been honest, straightforward, and transparent? What’s been the return for you?

Robert Abrahamson (18:47)
I mean, you know, besides the money that’s coming in, you know, it’s— it’s nice to be able to help people when they’re in a— in a bad situation, you know. But you get it… you’re able to do what you like to do. I mean, to me, I don’t consider this work. You know, I— I really enjoy talking to people, and with that and with solving problems, you know, the money’s been nice as well.

Joseph Crooms (19:08)
Sounds good. So yes, you can’t fake that. Relationships are everything in this space. All right, before we wrap, if someone wanted to reach out, connect with you, maybe collaborate and learn more about what you’re, you know, what you’re doing, what’s the best way to reach you?

Robert Abrahamson (19:23)
I’m— I mean, I’m on social media. I’m not huge on social media. You know, we do have… I mean, it’s my name on Facebook, Robert Abrahamson. They can message me there. I’m on Instagram, I’m @rca_777. So, you know, those are probably the best two ways to reach— to reach out to me. I can, you know, I’m more than happy to message with people back and forth.

Joseph Crooms (19:45)
Listen, I appreciate your time, your story, your perspective, and your philosophy that you’re developing. We need more people in spaces who are doing it the right way. And thanks again for being here, Robert. I really appreciate you.

Robert Abrahamson (19:57)
Thank you very much.

Joseph Crooms (19:58)
Yes, sir. For those of you tuning in, I know you got value for speaking with Robert today. Make sure you subscribe. We got more conversations coming from operators, just like Robert Abrahamson, and he told you how to get in touch with him, who out there building real businesses, helping real people and community. We’ll see you on the next episode of what? Investor Fuel Real Estate Pros Podcast. Rob, tell everybody to talk to him soon.

Robert Abrahamson (20:22)
Take care, guys. Talk to you soon.