How Does a Bird Dog Get Paid?
Pace Morby explains how bird dogs make money in real estate wholesaling. Bird dogs find deals and connect them to buyers or wholesalers, then get paid a finder's fee when the deal closes. Carly Grundman helps walk through contracts and the payment flow.
Am I coming to Calgary, Alberta? Yes, I am. All right, so let's talk about how does a bird dog get paid? Where does the money come from? How does the money flow? Let's talk about the. The flow of the transaction. And you guys can see exactly how that works. So I'm going to put this, the side chat, on pause.
Okay? Yep.
Thank you, Michelle. The problem is when you answer. Guys, let me tell you how this works, okay? Noah Williams says, how do you determine your bird dog fee? We'll talk about how do you determine your bird dog fee. At least with me as the buyer, we will determine. We will show you how you get paid. But if I answered the question to a brand new person, okay, Michelle says, the buyer pays, but escrow title company sends it.
Okay, cool.
Let me ask everybody a question. Michelle, thank you for saying that. Here is the answer. Does that help everybody? If I say, well, yeah, the buyer pays it and the escrow company wires the money to the bird dog, does that give you the visual that you're looking for when you're a newbie? Or do you need to see stick figures and money flowing? You need to see it, like, really, really basic. Okay, this is. This is exactly why people come to learn from me, is because I understand. I've taught thousands of times, and I see at the end of my teaching people that didn't give me what I needed. I tried again. I tried again. I tried again. Words don't help. Visuals do. All right, there you go. Tiffany Jones says, give me the deets. Pace. Perfect. Thank you. All right, so let's go into the whiteboard and let's break it down. Let's talk about a regular real estate transaction and who are the parties involved? Where does the money flow? How does the bird dog get paid? All right, so number one, let's talk about every single real estate transaction that you've ever heard about is a real estate transaction that starts off with a seller that is selling a house. So we've got the seller involved. The seller decides, you know what, I want to sell because I'm moving across the country. I want to list my property for $200,000. Real estate agent comes in and says, hey, I can take this house and we can go put this on the market.
Right?
The mls, the place where people can see that we're selling the house.
Right?
Zillow, mls, whatever. I teach my students in sub two that you should not be bothering this real estate agent until that real estate agent has probably had this house on the market for about 100 plus days. So this person, one of my students, is learning wholesaling from me, right? So I teach my students how to wholesale, and among a lot of other things, they reach out to that agent because that agent is going through some pain. The house has been on the market for 100 days and the wholesaler says, hey, $200,000 is obviously not selling that house. How would you like to sell that property to me for $125,000 and I can dispo or sell it or flip it right now? Agent says no. Agent says no. Agent says no. The wholesaler keeps following up. And after about three months, finally the seller and the real estate agent decide $125,000 is probably the price we need to sell it for. So are we just calling regular real estate agents and calling regular sellers? Are we waiting for pain points to pop up? Of course we're waiting for pain points. Okay, so, so this wholesaler and this real estate agent strike an agreement. This agreement is called the purchase and sale agreement. Carly, can you please put in the side chat the contract that people will need in order to get this real estate agent under contract? Thank you. Carly just gave you guys all the contracts. It's about $5,000 worth of JV wholesale assignment contracts that you will need in order to do this at some point if you are a wholesaler. So this wholesaler strikes a new contract, okay? And that new contract is for $125,000 because they couldn't sell it for 200. All right, now we already agree that the wholesaler had to follow up, follow up, negotiate, follow up, follow up, negotiate. Market, market, market. Advertise, advertise, advertise, Meet, meet the agent. Call, call, call, call, call. Just to get one contract.
Right?
Do we all agree in the side chat that this is a full time job just getting one contract directly from real est? Can we all agree that this is a full time job? The reason why I hammer home on that is because so many people, especially when you're new, will say, why doesn't the wholesaler just sell the deal directly to the buyer? Well, because they're so busy doing what I just laid out for you. So you need to understand how busy they are. Okay, so it is a full time job. All right, awesome. So this is where the buyer comes into play. The buyer comes into play and says, hey, you know what, I'm a fix and flipper. Let's just call this person flip. This person is looking for deals. They are looking to flip houses. And so in a regular transaction the wholesaler would say, hey, Flip, I have a contract and I'll sell that contract. You know, every deal starts with a seller over here and every deal starts with a buyer. Whoever's going to use and occupy that property. The people that are in between is where you make your money.
Okay.
All right, so we already know what Flip does. Is Flip. Does Flip have a lot of time to go out and find deals or is he dealing with permits? Is he dealing with delays? Is he dealing with tile orders? Is he dealing with painters and contractors? Is he dealing with the city? Is he dealing with private money? Is he dealing with neighbors that are upset? Is Flip running a full time job as a fix and flipper? Yes or no? For those of you guys that are fix and flippers, you will obviously say, heck yes, it is more than a full time job. So can we agree why more than 80% of fix and flippers buy their deals through a bird dog?
Okay.
Christy Ward, she says more than a full time job. She's done it. Obviously.
Okay.
Dakota says so is bird dogging. A wholesale is wholesaling, but for only one end buyer. That is correct. You are only working with one end buyer. Now, what does bird dogging eliminate? Okay, what is bird dogging eliminate? Let's pull this up. Dakota has let. By the way, we have a guest coming up here in probably about 30 minutes. So I will get through my session and we will continue moving forward. Dakota, great question. Would love to chat with you about this question. So I'm going to pull you up and see if I can get you to chat with me. Dakota, what's up? Dakota is looking for the way to unmute themselves. Dakota. 5, 4, 3, 2, 1, 0. All right. Well, Dakota, we missed out on you chatting. I'll keep you up here just in case you figure out how to unmute yourself. But the reason why we bird dog is it eliminates every excuse that a newbie has. I covered this on Monday, I covered this on Tuesday, and I'll cover it again right now. New people make up a lot of excuses, right? If I tell you you don't have money, so therefore you shouldn't have to do it. You, you, you don't need to have. Have to do a deal. Cause you don't have money. Well, I also, I also have the solution. It's sub two. It's seller finance. At least options. It's wraps. It's morbi methods, it's all sorts of creative strategies. Oh, yeah, yeah, yeah. But it's my time. Okay, well, I give you Time management. Then what do you do? Well, I don't have a proof of funds. Well, I don't have the ability to negotiate. Well, I don't have the ability to do this. Well, I don't have the ability to do that. How many people have made absolute excuses over the last several years of why you have not done a deal? Give me a me or even type in the word guilty. Give me a little guilty in the side chat like I'm guilty of that. Okay, so when people go, oh, so it's just wholesaling. No, it is eliminate every single excuse you have in the book. You don't have to comp the property. You don't have to underwrite the property. You don't have to have proof of funds. You don't have to know if it's a good deal or not a good deal. You don't have to cold call, negotiate, follow up. You don't have to have a CRM. You don't have to spend any money. It is literally 10 times 10,000 more.
Okay?
10,000 times more simple than wholesaling. You don't have to do anything that the wholesaler does. You are finding a deal for someone else. For those of you guys that showed up an hour late, by the way, we have a lot of you guys that showed up an hour late. We call it, we started at five, it's now six. And some of you guys have shown up just the last 20 minutes. We're at nearly a thousand people today. How many people watched when I asked Carly to find me an RV for my 100 day road trip tour. She is going to bird dog an RV for me so I don't have to go find one myself. She provides value to me so I can go do the things that will allow me to afford buying that rv. It does not matter what you are buying. A bird dog can bring it to you. Okay, so she'll find it by the time the way this call is over. Maybe she's pretty awesome. She's. Oh, this is interesting. Okay, Chris says I have your RV pace a 2017 tiffin. 10 six year balloon. 98000 2017, bro. I don't know. I'm bro. I'm kind of bougie. That's an eight year old thing, right? Like I got. I got kids younger than that, you know, So I don't know if that's a thing. Bring it over to Carly Grundman. She is bird dogging for me. Maybe. Maybe I'll take a look at that. Okay, Maybe I'll take a look at that. Get me a newer one. I'm Bougie. I'm 42. Man. I worked really hard to get to where I'm at. I don't want to be in a 2017 anything. Think about it some me buying a 2017 RV means people have been farting in that thing since 2017.
Okay?
The RV might be perfectly fine, but I don't want to be hanging out in a. In a, in a capsule. A fart capsule. I don't want to be hanging out in somebody else's fart capsule. Okay, I'm sorry. So we understand that the flipper doesn't have time. Now, 80 plus percent of fix and Flippers buy their deals from bird dogs. Not even from wholesalers. They buy them from bird dogs. How do you know that? Pace, where's the statistic of labor and bureau that Trump fired? Is she working for you now? No, she's not working for me. I know this because I own a title company. We see all the transactions.
Okay?
So Flip does not have time to go flip and buy houses.
Okay?
Flip, all right, is trying to buy deals from people that will just bring them to him so he can just buy the house and focus on being a flipper, which allows us to be a bird dog. Now, some of you guys need to understand what a bird dog is a little bit more simply because you guys still don't understand it. Wait, you're telling me that the bird dog simply goes to a buyer first and says, hey, buyer, what are you looking for? Okay, this is what Carly did for me on the rv. Okay, this is Pace. He says, I want an RV with no farts in it. A fartless rv. That's basically what I told Carly. Carly's now going to go find where the deals are. She's going to bring it to me. She's going to make. Make 20,000 bucks. I literally just laid out what bird dogging is to you, and you guys will still go, but, but, but, but, but, but, but, but, but. How many people still are overthinking it? Even though I just gave you the most simple example on the planet, you're still overthinking and you're like. Or did that finally make sense for some people? Tommy Sprague says, if you can spend at least $150,000, I can get you a awesome tour bus tomm friend.
Okay.
What contract should the bird dog use with the buyer? It's the JV agreement that we put in the side chat. Carly put the JV agreement in the side chat. People just don't seem to want to download that. JV agreement.
Okay.
Kepa Swanson. It's in the side chat. Paces contracts, dot com. Okay, cool. So here's how the bird dog gets paid. All right, here's how the bird dog gets paid. Let's go through this. We know the parties involved. We know how simple this is. We know what the the fix and flipper wants to do the fix and flipper wants to buy a house and flip that property.
Okay?
So the flip is standing over here going, give me a house, man. Wholesaler's so busy being in the living room that he's not aware that this fix and flipper even exists. And this awesome bird dog comes in. And this would be you. Okay, if this bird dog is you, please say me in the side chat, say me. Okay, cool. That is who I'm talking to. By the way, if a homeless lady can do this, can you. Can a homeless lady who's living on a cot with a broken phone, no money, no air conditioning, just completely laying there on a cot in a 50 woman shelter. If she can do it, can you?
Okay.
All right, awesome. So here's what the bird dog does. The bird dog goes to the buyer and says, what do you want? I want to know, what do you want?
Right.
In this situation with Carly, I showed her, I want the rv. Go find it for me. Carly then goes find and finds people that have similar type of things. So she says, hey, do you have any contracts on houses that my buyer would want? Here's the script. Hey, buyer.
Right?
That's Flip. Hey, buyer, my name is Carly. I'm brand new to real estate. I'd like to find you similar deals to the houses that you are already buying. I will show you guys again, for the people that did not show up yesterday, where we find these buyers, I'll do it for you guys here in a little bit.
It.
Hey, Flip, my name is Carly. I'm looking for deals for people just like you. Can I bring you similar properties that are under contract from other investors and would you be willing to pay me a finder's fee? Almost like a bird dog fee? Flip says, yes. Are you kidding me? That'd be great. I have 20 flips under contract right now. I'm so busy. I'd love for you to bring me stuff. That'd be amazing.
Cool.
Pretty simple. Carly then says, cool, I have now checked the box. I feel confident in this situation because I have found my buyer.
Okay, boom.
I found my buyer. I am. Good. Then Carly goes over to the wholesaler and says, hey wholesaler, I have a buyer. Here's the script for the wholesaler. Hey, wholesaler, my name is Carly. I'm brand new to real estate. But I have one quality buyer that will buy basically 10 deals this year. Do you mind if I take your properties and bring them over to my buyer and have my buyer pay me a fee? So there's the answer. My buyer is going to pay my fee. But where does that money come from? We'll explain that here in a minute. So the wholesaler says, of course. Okay, this is what it looks like. I have a group chat with a gentleman named Ernest that sends me. I don't know, let's see if he even sent me anything. Oh, he did. Ernest sent me a deal today. Literally 20 minutes ago. He sends me two or three a day. Okay, let me show it to you. This is what I get almost every day from Earnest and 50 other wholesalers or bird dogs, I should say. They literally copy and paste somebody else's address that they have under contract. This is the bird. Ernest is a bird dog, by the way. None of these houses does he get under contract. He goes to wholesalers who have them under contract and he says, hey, here's a house, here's the price, here's the interest rate. He knows I only buy sub 2 deals so he's not going to bring me stuff that's not sub two. He's not going to waste my time. And he says, hey, here's a deal. In fact, let's. I wonder if this is a deal. Let's look at it. Str. Definitely not. Okay. It's a really small property. It's 1218 square feet. So watch. I'm going to, I'm just going to let him know. I'm going to say, hey brother, too small for me. I'm looking for sub 2 deals that I can turn into co living. I need around 2,000 square feet. Oh, sorry, I'm not sharing that with you guys. I apologize. So sorry. So there you go. I will text him back. That's my feedback, right? So this bird dog brought me a property from somebody else and I gave him the feedback. He sent me an I tell him I don't want.
