Some Hollywood producers showed a little interest and wanted to chat face-to-face in Los Angeles, but an economy class airfare to LA was out of his financial reach.
Luckily, Whannell had a paying gig as a television TV reporter so they managed to scrape enough money together to book their flights.
In a decision that would change their lives, before getting on the plane the duo shot an eight-minute scene from their Saw script (a woman had a steel bear trap on her head and the only way she could stop it crushing her skull was to take a knife and cut a key out of the stomach of another person in the room).
They took 30 DVDs of the scene to Hollywood, believing showing was better than telling. It worked.
They were quickly offered a deal, for Wan directing and Whannell starring in Saw. In what was a master decision, Wan and Whannell opted not to take a big upfront payment, but instead a share of the profits of Saw and future sequels.
Saw was made for just US$1.2 million and it went on to make US$100 million at the box office, and more than double that in DVD sales.
It also produced seven highly profitable sequels.
"One thing Leigh and I had back then was, we were so naive," Wan says. "We did not know any better. We just believed we could do it. Our naivety got us to where we are."
Wan continued to make smart decisions. He was under pressure to direct but he declined, instead taking a producer credit.
Wan and Whannell remain mates and have just finished Insidious: Chapter 2, the sequel to their 2010 horror hit, starring Rose Byrne, while Wan has spent the last few weeks promoting his new horror-thriller, The Conjuring.
Set in Rhode Island in 1971, The Conjuring is based on the case file of real ghost hunters Ed and Lorraine Warren, who were summoned to investigate a farmhouse where an evil spirit had apparently terrorised a family and ultimately possessed the family's mother. The film is so intense and frightening, media members have walked out of screenings in the US.
"I have been so fascinated with the Warrens," Wan said. "When the chance came along to make a movie about their life story, I jumped at it."
Wan, now 36, has also been eager to jump out of the horror genre, something he will soon achieve.
Universal Studios has hired him to be the director of the seventh Fast and the Furious film. Directing a big Hollywood popcorn film was a dream come true.
"I have been wanting to do that since I finished the first Saw film," Wan said. "I didn't go in there pitching or talking about fast cars and the action scenes.
"I went in there to talk about the characters and that's what they loved."
Being the director of a franchise renowned for its muscle cars, the always smiling Wan has a dilemma.
"I drive a Prius ... I think after this movie I may have to get myself a big muscle car."
Movie profile
Who: James Wan, horror director
What: The Conjuring
When: At cinemas now
