How to Wholesale Pre-Foreclosure Deals Before the Auction | Blake Whiting

Blake Whiting (00:00)
And they end up getting the credit fixed. I got a great credit guy. I brought raised him 150 points in four months. they got a traditional loan. We closed. And won’t say the number on here in case my family member listens to it, because that’s the one thing I said. Just don’t worry about what I make, I’ll just solve your problem. But me and that private lender split a pretty hefty profit. And we were able to do that while still selling at a hundred thousand dollars below market to this family member. And that was the first time where I was like, you know what? I took a lose lose lose situation and turned it into a win win win scenario. Why am I not going after foreclosures? That’s what got me into foreclosures. That’s what got me into niching into foreclosures.

Joseph Crooms (02:12)
Hey everybody. Welcome to Investor Fuel Real Estate Pros Podcast. And today I’m joined by someone I’ve been looking forward to chatting with. my name is Joseph Crooms, your podcast host. but I’m hanging out today with Blake Whiting. who has just had a newborn. So he is like on bias. So he’s gonna talk to us today. he’s making some serious moves. I’m gonna let him explain his niche. so let’s jump right into it. Hey Blake, say hello to everyone.

Blake Whiting (02:42)
Hey, how’s it going, Joseph? I think you’re a little generous saying I’m on fire. I think I’m just trying to keep my eyes open right now. But I am loving being a new dad. He’s my first kid. It is an amazing transition. the niche I’m in real estate would be pre foreclosure deals here in the St. Louis market. I am super niched into one market, only St. Louis County at the moment, but I do accept leads and kind of referrals from other counties.

Joseph Crooms (03:08)
So first of all, give us some more on what is your main focus these days?

Blake Whiting (03:12)
So my main focus these days has just been getting hold of these foreclosures as soon as I can. I’m marketing to them. I actually I essentially been pulling all the data myself till recently. I just got a VA who’s been helping with that. And I’m cold calling them, I’m contacting them any which way I can. And we’re typically getting these deals closed in under twenty one days. The thing I’ve been trying to niche more and more into is kind of a mixed lead between a probate lead and a pre foreclosure lead where there’s not a living error on title.

Joseph Crooms (03:43)
We’re gonna get more into that, to get the de right definitions according to you. let me ask you, what has been your buy of income so far? Because you did throw it out to me. So throw it out to us. Well you know, what are you doing monthly?

Blake Whiting (03:57)
So on average monthly, I’ve been to getting a deal every month or every other month. Last couple transactions I was doing was a twenty five thousand dollar wholesale before that was a thirty five thousand. I think for the year so far, we’re just sitting a little over a hundred thousand. So it’s not been everything I’d want it to, but I got some stuff we’re changing up and I’m hoping to end the year closer to three hundred.

Joseph Crooms (04:18)
how long have you been operating at this at that level?

Blake Whiting (04:21)
probably about about the last year and a half or so roughly.

Joseph Crooms (04:24)
rose to you, man. All right, so now let’s talk about the definitions that you were through out as but you threw out in t in whole sentences. But can you explain what’s a probate?

Blake Whiting (04:34)
So probate is a deal where there’s essentially deceased owners and we’re having to have an attorney go ahead and file everything to declare who’s who’s who where where the assets go where exactly.

Joseph Crooms (05:35)
Okay. And c continue. and what was the next one that you mentioned?

Blake Whiting (05:38)
pre foreclosure. So houses that are getting ready to go to auction where the bank has not received payment for months, they filed the legal proceedings they need to in order to take possession of the house or sell the house at auction. And here in Missouri, in most cases, once that notice goes out, we’re seeing an auction happen twenty one days after, and there’s no recourse, there’s no way to change it after it happens. Once it’s done, it’s done.

Joseph Crooms (06:05)
And I think you mentioned one more, am I correct?

Blake Whiting (06:07)
maybe.

Joseph Crooms (06:08)
Okay. I don’t remember it so so we’ll cross we’ll cross that bridge and we’ll get to Sure. Why the niche that you’re in, why are you stacking it?

Blake Whiting (06:16)
So when I first got started in real estate, lot of YouTube videos, a lot of Jerry Norton, I gotta thank that guy because it’s him and Paul McComas is who’s kinda got me into real estate originally, just their free resources. And I was working a job I wasn’t super happy about. I literally started on a whim cold calling Zillow for sale by owners, and after three phone calls I got one under contract and thought I was gonna do everything Everything could start going out. I started marketing as wide as I could, every different state, trying out different things, et cetera. And I had very limited success. and what happened is I’m like, okay, well, let’s just focus on my local market. And I got a I got a business coach, Jon Barbera, and I started niching into three counties. And these three counties I realized the more I niched into exactly the one to go after, the less time I had to try to get to going after all these. Like there’s More than I can handle. And then I niche down to two counties. And then I finally niche down to one. And I’ve just been trying to master the one county before I even go on to the other. And that’s made it so I know exactly what’s going on. Like I have two of their other investors. It’s it’s kind of funny. They’re in the same kind of niche. And there’s times I’ll post a photo in front of someone’s house and I’ll get Brian, this other investor I knew, shoot me a message on Facebook saying, Hey, was that Larry? Were you able to help Larry out? and just get down to just the small nitty gritty and just really such a small area. I’m able to know it intimately, I’m able to find the deals that are really going to be higher margins and I’m not wasting my time just trying to market to thousands of deals. I know exactly what I’m doing after.

Joseph Crooms (07:43)
How long did it take you to come to that realization?

Blake Whiting (07:46)
about a call about a year and a half into it.

Joseph Crooms (07:49)
Mm-hmm. And you know, w what was happening that you say, this is not working. I need to hone in on a specific area.

Blake Whiting (07:55)
Well, two things kinda happened at once. previously I was marketing to it was what was it? It was non-owner occupied houses, so ab absentee owners with ten plus year deed of trust and non owner occupant if I didn’t mention that already. And I was marketing to those, I was doing okay, I was getting some deals going through and it was working out okay. And I kept wanting to go after foreclosures. But I had this call it a hesitation to go after I was just I had this subconscious block of myself where I’m like, if I go after foreclosures, I’m just a jackass praying on the week. I’m taking advantage of these people in a situation where they have no opportunities for themselves. and what happened is I’d learned all the stuff about foreclosures again, a hesitation and I get a phone call from a family member. This family member says, Hey, I see you post on Facebook all the time about real estate can you help with foreclosures? Like, yeah, I think I can help out. What’s going on? He’s like, So I just got this notice on my door. I’ve been renting this house for the last five years. I like have this agreement where I should be able to buy the house, my landlord. And there’s a notice that says that my house goes to auction in eight days. Is there any chance you can help? And mind you at this point I’ve all I’ve done at this point is I’ve always wholesaled every deal. I’ve never had to raise private money. I’ve never put anything in my name besides my personal house. And now I have an eight day timeline to prevent a family member from being kicked out on the street. So Yeah. so I start ringing ringing people’s phones as much as I can from a couple different networks, communities, et cetera. I find private money. well, me back up. I told that family member, hey, here’s what you’re gonna do. You’re going to get a hold of your landlord by any means necessary. You’re going to call their phone. You’re going to text them. You’re going to knock on their door. You’re going to go by their place of business. You’re going to do whatever you have to do. And you’re going to say, My son in law works in real estate. Answer this phone number. And end up getting a hold of the lady. And she is this mom who had a couple kids, single mom at the time, was going through cancer treatments, and she’d essentially got to a point where she’s taking this rent money that’s coming in for this house, and she’s using that to pay her bills, and she hasn’t been paying the mortgage because she expected them to fulfill their contract for deed to basically they pay buy the house from her six months ago. And as I’m talking with her, she’s like, I just don’t know what to do. I just want to get back to square one. I want to get this credit card bill off my back. I want to get this away from this house. I just am ready to move away. And we we come to a number that makes sense. We get everything written up. Contract sign. couple days later, I find a guy who’s willing to l loan me private money on this. same timeline, I find a transaction coordinator who can help close on this in eight days, because we’re doing it subject to and Gets all the way down to the wire. We’re down Monday morning. I’m waiting for money to come through to pay the arrears off. And due to me not asking my private lender whether or not their bank was in the lower forty eight, money gets delayed, things get messy, and the arrears that were supposed to be paid the day before the auction don’t get paid. And I’m back to square one. so I’m back to calling and back to ringing, I’m back to doing everything I can. And about midnight, the night before a ten AM auction. I get a hold of this cowboy, Wesley, and I’m like, Hey Wesley, I know you only help with messy deals, I know you like doing some crazy stuff. I need money before ten AM tomorrow and if you get me money, I’ll take whatever terms you’ll give me. So his terms weren’t an interest rate, it was well, I want half of the deal on the back end. So we get that sorted, getting a JV agreement signed at one in the morning. he gets a hold of his bank on the East Coast, starts getting things figured out, gets money wired. soon as they’ll let him around 7 a.m. Texas time. 8 a.m., we’re getting on the phone with the trustee, we’re getting everything sorted. 9 a.m. things are still not sorted. 10 a.m. things are still not sorted. 1016, house goes up for auction, house sells at auction. Sells for forget what the price was, but it it did sell at auction. And 10 30 after enough threats from our From Wesley and everybody else we had on the phone. they reversed the sale because they did receive the funds.

Joseph Crooms (12:32)
Mm.

Blake Whiting (12:33)
That was that was my first foreclosure transaction.

Joseph Crooms (12:36)
Let me ask you this. Yeah, yeah. Continue. I don’t want to cut you off, please continue.

Blake Whiting (12:41)
So way we ended up doing it is I bought that house and we rented it back to my family member and I told him like this here here’s the deal. This is not my money that bought this. I put the deal together. You were supposed to have bought this, and that’s the reason you’re in this predicament. You got six months to get your credit fixed and get a loan on this. And if you do, great. If not, I’m gonna have to evict you and sell this on the market. I’m just telling you straight up. I’ll do everything I can. I got a credit guy, but this is a serious situation. just bought you more time. If you mess around, it’s on you.

And they end up getting the credit fixed. I got a great credit guy. I brought raised him 150 points in four months. they got a traditional loan. We closed. And won’t say the number on here in case my family member listens to it, because that’s the one thing I said. Just don’t worry about what I make, I’ll just solve your problem. But me and that private lender split a pretty hefty profit. And we were able to do that while still selling at a hundred thousand dollars below market to this family member. that was the first time where I was like, you know I took a lose lose lose situation and turned it into a win win win scenario. Why am I not going after foreclosures? That’s what got me into foreclosures. That’s what got me into niching into foreclosures.

Joseph Crooms (13:46)
Well, you answered my my next question, so that’s right on. Great. So and and you answered two questions too. Tell me a time when a deal just didn’t go the way you wanted.

Blake Whiting (13:57)
So yeah.

Joseph Crooms (13:59)
Not a time, tell me another one.

Blake Whiting (14:02)
Let me see here. I got two that come to mind. One did go the way I wanted, it just wasn’t how I expected. so I’m gonna tell you two, because one one went well, one did not. I’ll let you figure out which one’s which. So I had one recently where, as I actually mentioned it, I’m I get a contract with this guy who it’s his sister’s house. She’s on title, he’s living there, and we’re Essentially trying to do an affidavit of heirship, to close out on it. basically a legal document saying, hey, the deceased owner on file’s been deceased long enough that we can file an affidavit saying that this is the this is the next person in line to own it. Here’s there’s no other remaining family members. They have the rights to sell, it’s okay. we were working with him and it was hard because this guy is he’s a diabetic who’s missing some toes. He’s Doesn’t really have anywhere to go, he can’t pay the rent, he c well, he can’t pay the mortgage, can’t take care of it. I’m just sitting here trying to figure out a way to do anything. And I kept getting to a point where I finally got to a point where I’m like, okay, I can get this guy a few thousand dollars in his pocket. We got an apartment lined up for him. We’re expecting close on this, barely make any money. like eight days before he’s telling me to piss off, and that’s the same day that I end up getting a notice back from the title company that There’s an extra thirty thousand dollars worth of liens that I just couldn’t do anything about. Wow. That was one of those situations where like I did everything I could and it still just didn’t work out. And I just want to put that out there maybe some newer investors that are going through some of those I’ll call them early hiccups. Just know there’s times you can do everything you can possible and it just doesn’t go your way. Like it’s just not meant to be. And that’s it’s not a reflection of your character. not a reflection of who you are. It’s just of part of the game, unfortunately. but other side of that was couple months back I had a different deal I was going after. It was weird. It was a lot of times I’m dealing with deceased owners or partial heirs, etc. And I’m looking at this deal and it just didn’t make sense. The owner on file was a lady who was married, but she was the only one on title. And it was weird because her husband had been on title. He’s on the legal notice they sent out for the foreclosure, but he’s not on the deed. So I’m just scratching my head trying to figure that out. So I end up getting a hold of this this guy I call him up and I’m like, Hey Hey man, my name’s Blake. I’m working alongside St. Louis County seeing what’s going on here, seeing if anybody’s reached out about stopping your auction. He’s like the bank won’t listen to me. They don’t want to talk with me. I’m just ready to let this thing go. You can’t do anything for me. I’m like, whoa, whoa, whoa, whoa. Hold on a second, sir. Like, what what now? What’s going on? And this guy tells me, he’s like, Yeah, my wife da died six months ago. I’ve been trying to talk to the bank every month since. They won’t deal with me. They won’t give me anything. They just give me the runaround. They refuse to do any kind of correspondence with me since I’m not on the title of the title of title or deed. And I have no options here. I’m like, Okay. I start talking with him more. I’m like, Well, would you rather get something in your pocket or would you rather get nothing? Because right now, as it sits, you’re just gonna end up letting that house get foreclosed on and none of those proceeds are going to you. And he’s like, You know what? If you can do something, that’d be great, but I just don’t believe you can. I’m like, Okay, well, do me a favor. Trust me, I’m gonna get through this, we’re gonna get it sorted. And it might get down to the wire, but we’re gonna get you something. So I end up getting that contract signed with him same day. We got about 15 days between then and the auction. And as I start digging into it a little bit, I realize that what I’m wanting to do, I’m gonna have to get an attorney involved. We’re gonna have to do a small estate affidavit. And I’ve never done that. I don’t know anybody that has. So I start I call my probate attorney that I’ve used on three other transactions. I explain what I want, and again, everybody had told me you can’t do this, no one does it, it’s hard to do. I’m like, hey, attorney, Richard, here’s the situation, here’s what we’re trying to do. you think we can get it done in fifteen days? like, it shouldn’t be a problem. Like, well, expat will do this. I’m Okay, cool. You’re giving me a green light and you’re the attorney, and on top of that, he wasn’t even charging me up front. He was gonna just take money out of escrow. Like if you’re not making me put anything up front here, like let’s run it. So we get the ball rolling, and about five days into it, he’s like, yeah, by the way, there’s my stepson. I’m like, a stepson, okay. We gotta get him involved too. I get a hold of stepson, we get contracted, or I try to get contracted, and this guy was just so mad at the whole situation. He’s like that they didn’t tell me my mom died, they didn’t invite me to the funeral. I hate my stepdad. How’s he involved in this? And as I’m talking with them, he’s like, Hey dude, I’m ready to sign a contract, but only under one condition. I’m like, what’s that? like, Only if my dad gets n only if my stepdad gets no money. I’m like Hold on a second here, what? He’s like Yeah, I I’d rather let that house go to foreclosure than let him get a dime. I’m like, Okay then. Wow So here’s the deal. If you can show me on paper that he’s getting no money from escrow, I will do it. Otherwise you can suck a fat one, is essentially what he said. okay. So I call his stepdad, I’m like, hey, you told me that stepson’s gonna be difficult to work with. You wanna hear what told me? he ex I explain it and he’s like, that’s rough. I’m like, well, here’s the deal as I see. either A, we have a transaction we can’t close on, and you’re in the same scenario you were before. Or B, you’ve trusted me this far, you wanna trust me a little more? He’s like, What you got in mind? Like, I’m gonna write up an addendum where you’re not getting anything on paper, but the moment we close this, I’m gonna come by and I’m gonna give you cash. How does that sound? Like like, it can’t be any worse than my old what’s going on now, and we get that s signed, I send the addendum over to this pissed off stepson. He ends up signing, we get it d down to the wire, and Literally that one we got closed on well, we’d sent the small state affidavit paperwork over to the bank. We’ve sent every ounce of paperwork you could send over to the bank trying to get this delayed and just because we weren’t sure if the fifteen days is gonna work or not. And finally got a confirmation to the bank Friday morning before a Monday morning auction that hey, we’re not gonna be delaying. And somehow I got a great title game, great everybody. When we got that hard deadline put in, we closed that Friday and got everybody taken care of. So yeah, again it’s we had deceased owner on on title, two heirs that didn’t want to cooperate with each other, attorney had to file paperwork with the county and still did that all in fifteen days total. It was that was a fun one.

Joseph Crooms (20:00)
Thank you for sharing that too, Blake. Yeah. All right, Blake. we’re running out of time, but I need to ask you this question. where you focus on scaling or solving next?

Blake Whiting (20:12)
I think the biggest thing I want to focus on scaling next is just getting comfortable doing bigger deals or like doing deals with a higher ARV. feel like for me, like I’ve niched into sub three hundred thousand dollar ARV properties because that’s just where I’m comfortable at. But I have opportunities I have one where I’m working right now, it’s a one point six million dollar property where there’s some there’s some messiness, there’s some airship, there’s a lot that’s going on there. And I just want to get more comfortable being on the phone with people where there might be a hundred or a couple of hundred thousand dollars on the line for both me and them. I just want to get to a point where I’m comfortable having that conversation and on top of that, comfortable having a plan moving forward to get it done.

Joseph Crooms (20:50)
All right. So thank you for also speaking to people that is sort of leveling up early in their journey. So I’m gonna let you speak a little bit to that a little bit. Now I know a lot of people listening are either early in their journey and looking to level up. think they’re gonna benefit from this. When it comes to building relationships, Blake, and growing your network, what’s made the biggest difference for you?

Blake Whiting (21:09)
I honestly the biggest thing I’d say there inner beliefs. when you’re first starting out, you have this this false sense of everybody around you, everybody that’s flipping houses, wholesaling, doing deals, you think they’re so much smarter than you, they know so much more than you, they’re so much more capable, and you’re like, The reason I can’t do a deal is my lack of experience or my lack of that. And I feel like I talked to a lot of people who just they overthink it. They think things are much harder than they are. But in all reality, like, whether it’s wholesaling a transaction or even doing a flip, like, it’s really not that hard. It’s you like it’s the biggest thing limiting anybody who’s just getting started out here is what’s between your ears. just don’t think too much. Don’t worry about it. Just keep moving forward. Don’t be afraid to ask the people in the room for help. Like if I can shout out one person, Brian Schroeder here in St. Louis. He runs Faster House, he runs Faster Funds, runs Buyers Club meetup. That guy is one of the biggest get like go givers I’ve seen where he has get get got an opportunity where he’s lending out hard money for people to do flips. He’s hosting a meetup to allow people to network with each other. They have a contractor network to help investors know where to turn to. he has an acquisition company to pick up his own deals and additionally be able to wholesale to others. And he gives out so much free game it’s ridiculous. Like he’s genuinely would be intrigued to see the numbers on how many investors he has brought to the table simply because of the just what he gives out at really no cost. Maybe you can cut twenty dollars a meeting with buyers club cost, but that’s just break it even. find those kind of people before you go ahead and drop ten thousand dollars on a mentorship course. Because all you’re gonna find when you drop your first ten grand on a course is This is what hard money is. This is what it looks like to do a flip, or this is what a wholesale deal is. You could all this information nowadays you could find on YouTube, you could find through just asking the right questions. like just just don’t be afraid to to find the right people in the right rooms and just ask questions that make you feel uncomfortable. Get uncomfortable and get that out of the way quickly, because the more comfortable you get being uncomfortable, the easier this whole thing gets.

Joseph Crooms (23:15)
Hey, well, thank you for sharing that, Blake. Blake, would you mind also sharing with your network of key people like that? Invite them to let them get in touch with investor field. We’ll love to have one on our show, okay?

Blake Whiting (23:26)
Yeah, love to.

Joseph Crooms (23:27)
Thanks. right, so thank you so much, Blake. you gave us a lot of key information. All right, before we wrap up, if someone wants to reach out to you connect with you. Maybe collaborate and learn more about what you’re doing. What’s the best way to reach you, Blake?

Blake Whiting (23:42)
I may regret this, depending on how this goes, but shoot me a text or give me a call or hit me up on Facebook, Blake Whiting on Facebook. My phone number’s 602-775-1973

Joseph Crooms (23:55)
Run it back one more time, like.

Blake Whiting (23:56)
My phone number it’s six zero two seven seven five nineteen seventy three. happy to answer any questions, happy to give some direction. I don’t have anything to sell and I don’t imagine that will be anything time soon. but again just happy to help people out and happy to turn turn in the right direction.

Joseph Crooms (24:12)
Sounds good. Blake, well, perfect. Well listen, I appreciate your time, your story, your perspective, your experience, and how you explained your experience. We need more people in spaces who are doing it the right way. thanks again for being here, Blake. I really appreciate you and I know our listening audience did as well.

Blake Whiting (24:29)
Hey, happy to be here.

Joseph Crooms (24:30)
All right. Well, those of you tuning in, I know you got some value from this. Make sure you subscribe. We got more conversations coming from operators just like Blake Whiting. Make sure you contact him. He’ll be a sincere leader and getting you where you need to go. who out there doing real he’s out there doing real business, helping real people, and also helping communities as well. We’re gonna see you on the next episode. Before we do, hey Blake, tell everybody we’ll see you soon.

Blake Whiting (24:56)
I’ll see you guys soon.

Joseph Crooms (24:57)
All right, so we will see you soon at Investor Fuel Real Estate Pros Podcast. And today we had a great time with Blake Writing. Talk to you soon, guys.