Bypass Wholesalers and Realtors: How to Get Direct Deals

TLDR

Wholesalers pocket $20K, $40K, sometimes six-figure assignment fees on deals they flip to you. Going direct to sellers is how you capture that money as safety margin on your own deals. It’s the same method wholesalers use: stack a list, skip trace, send mail or call.

Table of Contents

• Why Middleman Fees Are Killing Your Margin
• The Process in One Line
• Getting the List
• Stacking the List
• Skip Tracing and Contact Methods
• Mail Providers and What They Do
• You Don’t Have to Do This
• FAQ
• Related

Why Middleman Fees Are Killing Your Margin

My first deal had a $20,000 wholesale assignment fee on it. That sounds huge, but it’s not even that big compared to some I’ve paid since. I recently paid a six-figure assignment fee on an apartment complex.

Wholesalers are getting great deals. Imagine having that $20,000 back as safety margin in your deal instead of in someone else’s pocket.

The bigger the equity gap you start with, the more safety you have. The less chance you have of losing. Yes we want great deals, but the deeper point is that margin is insurance.

I ran a million-dollar-a-year wholesale company. We did over 100 deals a year. It’s taxing work at that volume, but to do a handful of deals a year for yourself, it’s very doable. And you can get some seriously good deals.

The Process in One Line

Get a list of homeowners. Skip trace to get phone numbers and mailing addresses. Mail them or call them. Wait for calls back. Go look at the house. Make an offer. Close.

That’s it. Everything else is nuance.

Direct to seller is how wholesalers eat. Doing it yourself means the same deals come to you instead.

Getting the List

A list of homeowners is the raw material. A few of the main providers:

Look into each one yourself. The main thing is that they pull records from county assessors, so you get the owner name, mailing address, and usually estimates on mortgage balance and equity.

Stacking the List

Stacking is how you get from a raw list of every homeowner in a zip code to a targeted list of people who are more likely to sell at a discount.

A few stacking filters I use:

• Neighborhoods. Pick specific neighborhoods. Not a whole city. Specific pockets where you want to buy.
• High equity. The list provider estimates equity. Someone with $130,000 mortgage on a $200,000 house has about $70,000 in equity. High-equity owners can actually sell at a discount.
• Years owned. People who have owned over five years. Long-term owners have more flexibility.
• Missed tax payments. That indicates financial pain. High equity plus missed taxes plus long hold time is a real seller profile.
• Out of state or absentee owners. People who don’t live in the house are often tired of it.

Stack two or three of these together and your list shrinks from thousands to hundreds. Those hundreds are your actual market.

Pro Tip

Send mail to the homeowner’s own address, not the subject property. A lot of your targets are absentee owners, so mailing the subject house means the tenant gets your postcard, not the owner.

Skip Tracing and Contact Methods

After you have the list, run it through a skip tracer. PropStream and PropertyRadar have built-in skip tracing, but there are plenty of standalone services.

The skip tracer gives you phone one, phone two, email one, email two. It’s not always the right person. Phone one is usually the target. Phone two might be a parent or a spouse. Some of those calls will be wrong numbers or angry people.

From there you have three main ways to reach them:

• Mail. Send a postcard or letter to the owner’s mailing address. Most passive on your time. Costs more per contact.
• Cold calls. Dial the list. Most active on your time. Cheapest per contact. Follow the rules, scrub for do-not-call, or you can get in trouble.
• Cold email. Lower response. Can generate angry replies. Some people use it as a stacked channel on top of mail and calls.

Texting is basically dead for this. Carriers shut most of it down. That was the heyday. It’s not viable at scale now.

Mail Providers and What They Do

If you’re going the mail route, use a provider that handles print and send for you. Some of the main ones:

Standard postcards run around 50 to 60 cents each. Handwritten-style letters run north of a buck. Higher cost means fewer pieces in the mail, but better open rates on each one.

Every provider lets you template with mail-merge fields. “Hey [Name], I saw your house at [Address].” They pull from your skip-traced list and personalize the mail. You pay per piece and they send.

Common Mistake

Sending one round of mail and giving up when the phone doesn’t ring. Direct-to-seller marketing is a repeat-contact game. The third and fourth mailer is when calls start coming in. First mailers are test fires.

Your phone number on the postcard is your home base. Local area code. A website people can find that shows you’re real. Local address. That filters you out of the “out-of-state investor” bucket and builds trust before the call.

When the Call Comes In

Phone rings. Angry person sometimes. Real seller sometimes. You set an appointment, you go walk the house.

That’s where the fliporithm calculator comes in. I built it originally so I could sit with a seller and say, “What do you think your house is worth after it’s fixed up?” They say $300,000. You run the math together. Renovation looks like $34,870. So based on what we can do, the most I can pay is $179,450.

You’re not selling them. You’re walking them through the math. If it works, it works.

You Don’t Have to Do This

For years I bought houses off the mls straight from real estate agents. Made it work. Grew the business. For more years I bought from wholesalers. Also made it work.

You don’t have to go direct to seller to win. You can build a real business buying retail or through wholesalers. I did.

But at some point, every hand reaching into your pocket becomes the thing you want to fix. Years of my career have been me pulling those hands out one at a time. Going direct is one of the biggest pulls.

The thing that actually matters is doing deals. If you’re stuck in a cycle of setting up mail campaigns before you’ve ever closed a house, that’s the problem. Go buy one. Do the flip. Then come back and figure out how to get better deals.

FAQ

How much money do I need to start a mail campaign?

A few thousand dollars minimum to test. You might send several thousand dollars of mail and get no calls on a single round. Budget for at least three or four rounds before you judge results.

Is cold calling still legal?

Yes, with rules. You have to scrub the list against the do-not-call registry, and each state has its own rules on how many calls, what hours, and what disclosures. Don’t skip that work or you can get fined.

How do I know which list filters will work in my market?

Start with high equity, years owned over five, and absentee or out-of-state owners. That combination works in most markets. Adjust based on what your market is doing.

I’m brand new. Should I skip this and buy retail first?

Yes. Buy off the mls or from a wholesaler for your first deal. Get the construction and selling reps in. Come back to direct-to-seller once you’ve actually flipped a house. Seeing things differently after that first flip makes everything else easier.

What’s the cheapest way to start?

Cold calling. You pay for the list and a dialer or a virtual assistant. No postage. Harder on your time but lowest cash out of pocket.