Close Deals Without Having To Learn Everything Through Wholesaling Lease Options With John Jackson

FO 29 | Wholesaling Lease Options


Lease option assignments or what a lot of people call wholesaling lease options is the sweet spot for real estate investors who don’t want the hassle of estimating repairs or negotiating with homeowners. The King of Lease Options, John Jackson, joins Paul Lizell on the show today to talk about lease options and what he loves about them. John started the real estate company called Leasing to Buy in 2003 and have done hundreds of deals since then. Want to close a couple of deals without having to learn everything? Then don’t miss this episode to learn John’s way of doing it.

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Close Deals Without Having To Learn Everything Through Wholesaling Lease Options With John Jackson

With me is a funny guy, John Jackson. He is a former stand-up comedian. It didn’t pay as well as real estate does, so he switched over there but now he’s the funniest guy in real estate far and away you’ll ever get to know. He has a great product, Lease Options. I want him to get in-depth on lease options. John, if you wouldn’t mind, give us a little bit of background on where you started and what got you here when you start investing in real estate?

Thanks for having me on, Paul. My specialty is lease options. More specifically, I do lease option assignments. A lot of people call them wholesaling lease options. I’ve been in lease options since 2003. I started Leasing to Buy, my real estate company in 2003 and I’ve done hundreds of deals. I teach and coach others on how to duplicate my business model. What I love about lease options specifically the way I do them is it doesn’t require any money or any risk. You’re not dealing with an ugly and crappy house. You’re not having to guesstimate repairs. I have no idea what even sheetrock costs. If I went to a house and I had to estimate repairs, 95% of wholesalers out there would be pulling it up in the rear end.

I’ve been doing this since 2003. The reason I love lease options versus wholesaling or fix and flip or anything like that is that it’s incredibly easy and I’m not negotiating with homeowners. I’m simply saying, “Here’s what I do, if you need a plan B.” I don’t have to haggle with them and knocking down the phone and this and that. There’s a great plan B for them. With lease options, you don’t have to estimate repairs on it. You don’t have to haggle them down. I’ve got my real estate business down to where I do as little as you could imagine.

What I did was I trained my neighbor. She’s a single mom with a fifteen-year-old son. She was doing Grubhub and DoorDash to make ends meet. She had tried to do some wholesaling before and it blew up in her face. She told me, “If you ever need a ride somewhere, let me know because I’m already driving all around.” One day I needed a ride somewhere to a house to go put a sign in the yard. She knew I did real estate but didn’t know exactly what it was I did. She heard me on the phone talking to sellers and she said, “These sellers are nice to you.” I’m like, “Why wouldn’t they?” She said, “I tried wholesaling and they were mean to me.”

It’s because you’re cutting their prices. You are not negotiating like that.

They’ll say, “Stop calling me or stop mailing these letters.” I said, “They’re nice to me.” She saw what I do with the lease options and she started learning. In my case, she simply got my training materials and within a week, she’s off to the races and still not knowing everything that she needed to know. The point is within a few months, she closed a couple of deals. She did about $22,000 assignment fees. She has 9 or 10 now locked up. The point is that she went from knowing nothing about lease options to in a couple of months doing deals. Now, she works with me so I don’t have to do anything in my business. She takes care of it all. That’s what I love with lease options. They’re easy and simple. You work with nice houses in nice areas. There are no war zones and it makes life easy.

It’s such a great model. For her, it’s night and day compared to what she was doing with wholesaling before because you’re getting beaten up by these buyers and your prices. It’s a totally different model because you’re not beating the heck out of them on price. You’re working terms with them and then you’re going to wrap it. Your close rates are well higher than your average wholesaler. When you send out these mails, you’re sending it out the smaller list so your costs are much lower and your rate of return is way infinitely higher than a typical wholesaler is.

My main method of marketing is direct mail. To the readers, no matter what you do in real estate, you need to have one absolute core primary method of marketing. That’s your main thing. Anything else you do is ancillary to that one thing and do not ever let those ancillary marketing methods take your attention and focus off your one method. My one method is direct mail. I can teach people Facebook Marketplace, texts and all these great strategies that we can teach because we don’t have to do them. I focus on direct mail because it’s easy that we’ve got it dialed in.

To give you the numbers, we will send on average about 450 pieces per mailing but we’ll do that every three weeks. If you combine a month, out of 900 pieces, depending on which mail piece we use. For example, if we use this tri-fold brochure, which used to be our biggest success rate, this is about $0.90 each but one of the postcards we’re using now is getting an even better response. For about 900 pieces, if we use our postcard, it costs us about $600.

Is it $0.30 per postcard for direct mail?

Not for one that’s going to convert. Ours is about $0.63.

You’ve got a higher-end one.

That’s something that people tend to trip over is they spend time researching and trying to find out how to save $0.02 on a postcard when, if they would use the one that they had and done it properly, they would have results. We submit about $0.63 each on a postcard. Nine hundred pieces go out, 450 then another 450, these are round numbers here. At 900 pieces, we will get typically about six contracts. What will happen is out of twelve homeowners that call us, we’ll end up getting normally 7 or 8 of those under contract.

Maybe if not right away then when they wait another few weeks and their house hasn’t sold yet then they’ll say, “Let’s go with this plan B here.” Our numbers are high. Each lease option averages about $12,000 per deal. That’s going to depend on where you live. We get about 4% of the price. We have some that are about $10,000 or $14,000 or $16,000 but on average about $12,000. You can do this virtually. It’s the easiest thing to do. I don’t have to go see the house because all the pictures are already online. We’re trying to sell the house. There are a lot of pictures. I don’t have to go estimate repairs because it doesn’t need any repairs. I don’t even have to meet the seller or anything.

FO 29 | Wholesaling Lease Options

Wholesaling Lease Options: No matter what you do in real estate, you need to have one absolute core primary method of marketing.


It is one of the better business models. Your cost per acquisition is much lower. Do you know what your average cost is per acquisition in a ballpark? I could do it off the math that we’re doing there. The only reason I asked that is that I remember the last mastermind meeting I was at, the average cost per acquisition was between $4,500 and $5,000. I remember when I used to be in Collective Genius Mastermind, go back to 2015 or 2016, the average cost was about $2,500 per acquisition. The cost per acquisition has gone up enormously for those guys. You’re doing less as far as your mailing and you’re converting higher. Your cost acquisition is a fraction of that in comparison.

I’ve worked with a lot of the home investor guys and it didn’t matter if someone was a home investor or an active wholesaler. Believe it or not, their cost per lead was almost exact for people that knew their numbers. This goes back a few years but it was about $420 per lead. Now, it’s gone to $700 or something per lead. It costs us $90 per lead but we’re closing 80% of them.

Your cost acquisition is $30.

Let’s be conservative and say we got five deals but we’re making $12,000 a deal. We’ve spent $900 to make $60,000.

Your average is $12,000 per spread. If a wholesaler’s average is $15,000 and $4,500 is the average lead’s cost. It’s less than what you’re making on yours. It’s more than twice the work they have to do, probably ten times more work.

Wholesaling is a lot of work and there are people who are fantastic at it. For me, you’ve got to know where your strengths are and what you’re comfortable with. I have no desire to sit there on the phone talking to 100 people a day using a Mojo Dialer trying to skip trace and negotiate with them and everybody else and their brothers. Why don’t I sit here and drink my Evian water? I let Lisa do all the work and I do nothing. I hang out and look good. I go to masterminds and make fun of all the people. I’m the guy that goes to a mastermind with all the gurus and I make fun of all the gurus and say crap nobody else will say to them.

I’ve seen it live in action and they come back to you as much as they can but it’s usually not as funny. Are you wholesaling all of your lease options? Do you keep some?

We wholesale them all and that’s because of the way that we do our marketing call in the sense of the leads that we’re focusing on. Because we’re laser-focused, the leads that are going to come in are going to fit one bucket. On a rare occasion, it will fit another bucket. What I mean by that is if someone’s doing wholesaling and investing at 10,000 postcards, you have all these leads coming in. Those leads are going to fit into different buckets. Some are going to be subject to, some will be wholesale and some will be lease options. It depends on the lead but because of the laser-focused marketing that we do, almost everybody that comes in fits this bucket and that’s it.

That’s part of what makes our life easy. Lisa who works with me now, she’s new. She said even the conversations with the sellers is easy. No other investors even talked to them and we’re offering them full price, no commission at a short-term lease purchase. We do twelve-month lease options. The reason for that is because this is an assignment. The owner wants to see light at the end of the tunnel. They want to know, “When are these people going to probably cash me up?” Plus, when we bring the buyers in, these buyers we vet them. We look at debt to income. We look at credit reports. We’re vetting them just like FHA will. When they get into the house, the clock is ticking and we put them in touch with the lender. From day one, they’re on the road to finance. Because of that, our success rate is unheard of in the business. About 98% of our buyers will buy within twelve months. Whereas if you hear other numbers, it’s like 20%.

How long does your average transaction take from beginning to end on a lease option deal?

From the time that we get the house under contract to market, it takes about on average 30 to 45 days to locate the buyers. Sometimes it’s a couple of weeks.

You vet the buyer, you make sure they’re going to be mortgageable and they have a job. The income is solid and that there’s a history there. Maybe they have a couple of things they need to tweak in their credit in order to qualify for a mortgage and you work with them on that. Do you any credit repair with them or put them in that direction?

We put them in touch with the credit improvement and the lenders.

You hand them off more or less, they work with them and get them qualified. Part of it is almost like a refi but it’s purchased there. I’ve done two of these. I failed in them, test them way back in the day. You started in 2003. I started in 2001. I did mostly fix and flip back then but I did a couple of lease options. I wholesaled the one. I did a lease option on a property that I had that I bought from the bank. They didn’t work out but I made good money off the rent because it was way higher than it would have normally have been.

You've got to know where your strengths are and what you're comfortable with. Click To Tweet

The property value went up. I turned around, sold it later on and made a fortune on it. Not your system, not your thing but I’ve had good success with it. There’s another investor I knew that did them all wrong. He didn’t know what he was doing and got in trouble. He was not doing your system. Your system sounds perfect and you’re not leaving yourself wide open for any issues down the road. You’re handing them off. You’re getting good qualified people in there. That’s a good, strong lease option system.

There are people that teach lease options wrong. It’s setting up the seller and the buyer for failure. They’re not even doing the numbers right. You’ve got to have your numbers. The way I do is incredibly stupidly easy but you better know how to structure. They’re simple but there’s so much misinformation out there because people goof it up. I honestly can’t think of anything in real estate easier than a lease option assignment. I don’t say that because I teach them. I’ve been around long enough to have tried different things. I was like, “This is easy.” I tell people, “If you can copy and paste on your keyboard, you can do what I do.”

Rinse and repeat. You’re doing it over and over again. Here’s a question that I have that I’m sure other people would have too. Your $12,000 average profit, when you collect that or you collect that when you put that buyer in. They’re coming up with that money upfront and that’s non-refundable.

Everything is non-refundable in the lease option. They pay us when they send the contract to bring a cashier’s check or they do a wire.

You let it go through the process. If they fail and they aren’t able to purchase within that year, what do you then do? I’m sure this occasionally happens.

It’s rare. I don’t remember the last time it happens. If something were to happen where they’re coming up on ten months as an example and they’re like, “There are a couple of more things that we needed. It’s going to take a few months longer.” The owner is going to extend the lease with them for a couple of months because the owner wants to sell the property. They don’t want it back. Let’s assume something happened. They got relocated and they couldn’t buy it at the end of the year, as an example. Normally, almost every time that homeowners’ going to reach out to us first and say, “Can you relist it for us?”

You could do it again. For you, that would be a positive thing. For the seller, not necessarily but for you, you’re going to put somebody back in there and do the same thing.

We don’t want to see that happen. We want to see success. We’ve been a member of the BBB for many years at A-plus rating and to be in creative real estate like this and work with hundreds of homeowners and buyers and have that A-plus rating, we’re proud of that.

Not a lot of people out there are doing that. You’ve taught people and another guru, Joe McCall, how to do exactly what you do. There’s other proof out there and he’s selling it. I’m sure his system’s the same as yours, more or less. He’s probably teaching what you taught to him.

We talked about that when we’re in St. Louis because we are good friends. We have mad respect for each other. People will ask us the same thing. They’ll say, “Joe, whose course is better? Should they get my course?” They’ll ask me the same thing. Joe and I tell them the same thing, “Why not get both courses? I guarantee you, my course is super simple like steps 1, 2 and 3. The videos and everything tells you exactly how to do it. I guarantee you if you get Joe’s course, which is going to be more technical because Joe loves tech. This is my CRM. I guarantee you, if you get Joe’s course, you’re going to get some amazing nuggets that you can implement. It’s not about one versus the other.

They complement each other.

I guarantee you if someone has my course and they get Joe’s and they’re going to see some tech stuff where they go, “I’ve got John’s model dialed in. Now I can bring some of these tech things in and add onto this to make it even bigger.”

With what I do in my business, with the virtual wholesaling and being in all these different markets, my use of my VA, I’m telling you, lease options might work for me to compliment my business. It’s something I can have my assistant do or even have my wife do part-time too. This could be a good complement to what I’m already doing, especially if I want to target certain markets because now with what I’m doing in my business. To me, it’s going to be a better and easier acquisition model than it will be for the typical wholesale.

There are a few different types of lease options. I focused on lease option assignments. There are straight lease options and sandwich lease options. There are three different types. It depends on what each situation calls for.

FO 29 | Wholesaling Lease Options

Wholesaling Lease Options: Wholesaling is a lot of work, but there are people who are fantastic at it.


I like the lease option assignment. I know a lot of people do the sandwich ones. They could get a little hairy there depending on what you’re doing.

I tell people, “When you’re starting off, don’t do a sandwich lease option.” It’s like I would never tell someone starting off on day one, “Go get sub too.” You better have some reserves. You better know what you’re doing. You can find yourself in a hole really quick. I don’t want until someone’s starting off in real estate, “If they want real estate, go rehab a house.” No, it takes one bad rehab to bankrupt somebody. They don’t have the experience and the reserves.

You can always expect no matter what your budget is, you’re going to end up going over something. Especially in an older house, you’re going to find something that you weren’t expecting. It’s going to come up. You’re going to be way over budget. It’s going to hurt. If you don’t have the margins there, it could wipe you out.

The way I found out that I didn’t want to do rehabs was by working with a ton of investors and going to lease options or houses and seeing these rehabs in different phases and realizing, “I don’t want to do this.” Seeing right there, they went over and lost money but they had the reserves to do it. They had to lick their wounds and these were experienced rehabbers. It happens. When you get the house and you’re about done rehabbing, you’re like, “What is that awful smell? We can’t get rid of it.” They finally realize, “There are rat nests in all the walls and you’ve got to pull the sheetrock back off.” I’ve seen it.

I’ve been there. I’ve done that. In 2019, a property I was rehabbing up in the Pocono Mountains here. my contractor missed major issues with the foundation and it led to other issues. I was far over budget on this. I lost $42,000 on his property when I sold it. It was a learning lesson. It taught my contractor what to look for, not to look forward and went above and beyond. You don’t like it because they hurt. Luckily, I was in position, I was fine. I could deal with it. I had the reserves but if you are somebody who doesn’t have reserves, what are you going to do? Now, you’re in serious trouble. It was my own cash so I only lost my own money.

It’s more like lease options and you have no risk.

I love this lease option model that you have here. Especially for somebody starting out, it’s a great way to start out. It’s an easier way or if you’ve been burned like your neighbor was doing a regular wholesaling thing, this is a much easier entry in here. You can use that. If you want to do a rehab down the road or if you build up your cash and you can do rehab or you could do other things that you want to do or buy some rentals. It gives you all kinds of ability.

You can do the sandwich lease option. You got to build up some expertise on that and I’d do it. That’s a good way to have some rentals if you’re going to do some. That and subject to will get you the rental properties that you want with the lower cost of entry than I have. Now, I’m buying them right from the bank. I got to come up with all the money down, do the repairs and refinance them and hope I’m pulled out clean. This is different. You don’t have that cash outlet. It helps a lot. It’s been awesome. I appreciate all the info there. Is there anything I’m missing on your course that other people would ask?

I’m the only guy that teaches lease options in Texas.

Texas has different laws.

In 2005, they didn’t change the law. They created laws about lease options. The laws are you can’t do lease options in Texas or you can’t do them over six months. All that is false. You have to read the law. I’m the guy that people go to and even Joe McCall and everybody sends their students to me if they’re in Texas. Ron LeGrand sends his Texas students and all these people send me their Texas students. I’m in Texas and we do one-year lease options. You didn’t have to have specific language, specific verbiage in your documents for Texas. There are a few stipulations but it’s not what everybody thinks there is.

It’s not too bad.

It is doable.

It’s having the right paperwork more or less and then you’re good.

There’s nothing easier in real estate than a lease option assignment. Click To Tweet

Have the right paper and you have to disclose the mortgage information if it was an underlying mortgage.

If somebody wants to get your lease option course, how do they reach out to you and get that?

They can go to

What does your course run?

It’s $99.97 like every other real estate course.

That’s a bargain.

I spent over $30,000 in legal fees, with firms and attorneys for my contracts. The contracts I have for other states are based on those contracts. I’ve got the best lease option documents out there. At the end of the day, in real estate, you’re only as good as your contracts are. If you think you’re a real estate business and you’re trying to get free contracts off BiggerPockets or some BS, you need to think about if you should be in real estate.

In BiggerPockets, a lot of people try to learn and teach themselves these things. It’s not worth it. For the readers, you want to hire the best. John is the best with lease options. You want to reach out to him if you want to learn about it. Don’t try to learn it on your own. If you try and learn it on your own, bad things are going to happen. Learn from John’s learning curve. What he did, the mistakes he made to make sure you don’t make those same mistakes. To me, it’s always super important to hire the right person who does the right thing. I’m willing to pay for it and I buy other guru systems because I might be able to utilize certain things in my business. This one does fit well with what I do.

Don’t be afraid to invest in yourself and invest in your business. People get to act like spending $1,000 on what I don’t even consider a course. In my case, it’s a system because it’s my system that I use every day. I have access to. To invest $1,000 in a system that’s going to make you $12,000 per deal, they freak out about that. They have to go ask their spouse, their husband or wife, “Do you think I should do this?” They’ll go spend $150,000 for a four-year degree on something about Middle Eastern organic green bean growing or something that they’re never going to use but they’re okay with that. They tell everybody, “I’ve got a Bachelor’s Degree in Middle Eastern Green Bean Organic Growing.” People are proud of them for being in $150,000 in debt. $1,000 is, “I don’t know.”

I graduated from Drexel University and my oldest wants to go to the University of Delaware. As I told all my kids, “I loved college. It was fun and was affordable at the time I went, it’s not affordable now. You better know what the heck you’re doing because you can’t bankrupt student loan debt. You can bankrupt hospitals. You can bankrupt them, which makes no sense but you can’t bankrupt student loan debt. If you know what you want to do and it’s outside of that realm of where you’re going to get in college, I’d much rather pay some mentor, $25,000 to $30,000 for a year at least for them to learn how to do whatever specific thing they want to learn how to do than send them to college anymore. My wife doesn’t like it but I’ve become an anti-college guy.

How many people do we know that have a degree that they’re not using it? They got a degree because that’s what their parents wanted. When they started going to college, they had no clue what they wanted to do, which it’s not uncommon for an eighteen-year-old not to know what they want to do. Think about how many people go to college. They didn’t know what they wanted to do. When they got out, they’re not going to use their degree or someone knows that they want to be in real estate. You don’t have to go to college for that. Study and see what you want to get into. Maybe it’s self-storage or apartments or whatever. Instead of spending $120,000 on college, spend $20,000 or $30,000 on the mentor and say, “I’m your new best friend. I’m going to ride your butt until I’ve got all this figured out.”

It’s the way better way to do it and I think we’re heading in that direction. The colleges are already getting hit. If you think about it, for somebody to go to college, they should either want to have a specific thing, be a teacher, a doctor, a dentist or an attorney. We got enough attorneys out there. We don’t need any more attorneys. We can cut that off. If you’re going general business, what does that even mean? I’m not sure how many of these companies look to hire people out of college for any pay. Whereas if you got some experience of business right out of school doing whatever, now you have the experience and potentially you can move to a higher paying job quickly and not have student loan debt. You still have fun in the twenties and still go see John at comedy clubs.

My oldest daughter is in pre-vet school. My youngest daughter is going to be going to college for criminal psychology.

That something you need to go to school for.

FO 29 | Wholesaling Lease Options

Wholesaling Lease Options: At the end of the day, in real estate, you’re only as good as your contracts are.


You have to go to school for that or spend a lot of time with me.

There are specialties and yours is a special niche here in real estate. Mine is a specialty niche in real estate. It’s not for everybody. Doing lease options is not for everybody. Wholesaling is not for everybody is not for everybody. Find your little niche or what direction you want to go into and that’s what you want to focus on more or less.

Do you have any final questions or have I answered everything?

You answered everything that I had and all my things on lease options. If anybody has any further ones, I’ll get them and forward them to you. They can reach out to you at if they’re interested in doing this. I appreciate your time. Thank you for being on the show.

Thanks, Paul.

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About John Jackson

FO 29 | Wholesaling Lease Options








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