Maybe you’re trying to earn a little extra to make ends meet, to get out of debt, or to be financially independent. Whatever the reason, you’re considering a nights and weekend job with Uber and Lyft.
There is a simple and more lucrative way to get paid to drive! It’s called driving for dollars.
Whether you have no experience, no money, or too much of both, you can go driving for dollars.
What is Driving for Dollars?
Driving for dollars is a real estate term for driving and looking for a distressed and underpriced house. Normally, it refers to real estate investors but also applies to their designated parties (more on that in a minute).
Houses that look abandoned, but are in nice neighborhoods, have enormous real estate potential. Typically, houses in rough shape–tall grass, boarded up windows, notices on the door, etc.–are abandoned by the owner.
That leaves a golden opportunity for a real estate investor.
They’ll write down the address and any notable features of the house, location, and neighborhood.
Then, they, or someone else they assign, look for the owner of the property. Once (or if) they find them, they’ll make an offer on the house. The offer is a lowball offer.
Many owners are willing to part with the property, even at a lowball price, because it’s a headache to them. It offers them an out.
They either can’t or won’t do anything with the property, and someone is willing to pay them for it. Normally, they’d have to dump a fortune to fix it up and sell it, but someone is offering to buy it as is.
That creates a win-win scenario.
Who Can Go Driving for Dollars?
As I hinted at, driving for dollars isn’t limited to real estate investors. Often, investors will hire a bird-dog. Bird-dogs drive for dollars on behalf of an investor.
Bird-dogs do not need experience, money, or special real estate knowledge. They need to generate good leads for real estate investors. “Good leads” means squatter-ready houses in otherwise nice neighborhoods.
Or, the investor might want commercial real estate. In that case, you’d look for empty strip malls, office buildings, or hospitals.
A bird-dog will locate a promising lead and send it over to their investor to hunt down the owner.
When the investor secures a deal that the bird-dog sent, the bird-dog receives a referral fee. The fee can be as low as $500, and as high as $2000. The most common rate is $1000.
Why would investors pay that much for a picture of a crack house? Because most are flipping the house for a profit.
The normal profit margin for a flipped house is $25,000. So, it’s absolutely worth it to pay a bird-dog for the houses they send.
The reason you want to drive for dollars instead of using other real estate research methods is because the houses you dig up are often not listed on the multiple listing services, the MLS.
The MLS is a massive real estate listing website that thousands of people can look at. Once a property shows up there, the competition for it spikes and spikes high.
When you find it outside of the MLS, there is generally no competition. That can mean a sweet deal for investors.
A sweet deal, in this case, means buying a home for 30 to 90% off it’s after repair value, ARV. The ARV is what the house is worth on the market when it’s in good condition.
How to Get Started Driving for Dollars
There are two ways to get started driving for dollars.
- If you are investing in real estate, all you need to do is hop in your car. Just go driving for dollars and find houses you are interested in flipping or holding.
- If you want to bird-dog for an investor, start by going to your local real estate investing association, REIA.
REIAs have regular meetings with investors, lenders, and bird-dogs.
Introduce yourself to a few investors and ask if they need bird-dog services. Generally, the answer will be yes. It’s a no-risk lead generation method for investors. Plus, they don’t pay you until they secure a house you referred to them.
That said, you will want to have a Bird Dog Agreement. It’s a contract outlining the terms of your relationship with the investor.
It specifies what you do (and do not) do for them, how much you are paid for a referral, when payments are due, and several other important legal protections for both of you.
They can tell you what kind of property they invest in.
When you find a property that matches their preferences, send it to them.
Then wait. Some investors are great about communicating with their bird-dogs, and some aren’t. It varies from person to person.
It can take a while (think weeks, not days) to get paid for a referral. That’s due to the real estate buying process being long-winded.
Eventually, you’ll get a wonderful $1,000 surprise in your bank account.
The more referrals you send, the more regularly you’ll get paid.
Uber and Lyft will pay you quicker, but much less than driving for dollars.
Driving for dollars doesn’t require experience or money to get started. Simply find your local REIA and go to a meeting.
Is this something you’d like to try?
About the Author:
Caleb Jones is an unapologetic Content Marketing Consultant, influential Personal Finance Writer, happy dad, happier husband, and can’t decide between Star Wars and Star Trek. You can find him at his blog monkeyseemonkeydough.com or on Pinterest.