Episode Transcript
Speaker 0 00:00:00 Welcome, everyone to the Investor Agent podcast. I'm Steve Seymour, your host here with Tom Notin, and the Investor Agent podcast is to help transform the human mindset from scarcity and lack to abundance and wealth. One conversation at a time. Tom, thanks for being on today.
Speaker 1 00:00:16 My pleasure. Thanks for having me.
Speaker 0 00:00:17 I'm excited to, uh, kick this off because I know you have a lot of knowledge and love to see what's inside that, in that head of his, he's got a, he's got a lot of experience and knowledge. We're gonna try to draw out some information that'll be helpful for you guys.
Speaker 1 00:00:30 Happy to share.
Speaker 0 00:00:31 So, Tom, uh, I always like to give people a little backstory about, you know, what got you into real estate and when did that happen? You know, what, what really kicked it off in your mind?
Speaker 1 00:00:41 Well, like a million people, I always had an interest, right? Everybody's got an interest and never really does anything with it. So for me, it started way back. Uh, I'm more of a tech, tech guy In high school I went to, uh, electrical classes, went to a trade school after high school, had a traveling job, still had an interest, but no opportunity there. And then finally went to school for engineering. So when I was 30, I graduated by 31, I bought my first house, uh, and then started, uh, very, very slowly. I look back and actually think, you know what? I was way too conservative. Really, really. I look at guys that did so much more, but I was just afraid with the money. You know what I mean? So I would do one house at a time, renovate on weekends and evenings. You know, it might take me five, six months, but have a nice rental. Um, I really didn't refi. I tried to get 'em paid off.
Speaker 0 00:01:29 So, so when, when did you get started? Like, what year was that?
Speaker 1 00:01:32 Um, by 1989.
Speaker 0 00:01:34 1989,
Speaker 1 00:01:35 Because I graduated Widener Engineering in 88. So by 89 I had my first rental, 90, 91. So, so
Speaker 0 00:01:42 Slowly, so 30, 31 years, 32 years somewhere.
Speaker 1 00:01:44 Yeah, I guess. Yeah. Yeah, yeah. Yeah. So, uh, but I was always hands on and, um, I always look for where I could find hidden opportunities. You know, you go to the real estate clubs, you do learn, because I remember, you know, some of the deals I'd pick up where I'd put a card in a door jam, get a call a couple weeks later, it does work, you know, but people don't really wanna do door knocking. It does work. It's time, it's awkward, you know, people don't, they're not comfortable with that. They'd rather their mail postcards, everybody's doing that, you know? So, you know, the biggest advice I'd say is do what no one else is doing, and then don't worry about rejection. Um, you know, what did I just tell my son? If you could turn down a hundred times, uh, make 200 calls. Okay. So,
Speaker 0 00:02:27 So that's kind of how you got started. Just bootstrapping it and knocking on doors and leaving cards. Um, yeah.
Speaker 1 00:02:34 A lot of
Speaker 0 00:02:34 Things. And you build up a rental portfolio that way. Right. And
Speaker 1 00:02:37 I build it up very, very slowly. Uh, it's not huge, but they're all paid for. So it's kind of, it's comfortable, but I look back and for the years I feel like I should have accomplished more.
Speaker 0 00:02:47 Well, and along the way, I know you've flipped a lot as well.
Speaker 1 00:02:50 Oh, always. Uh, sometimes I look at something and say, you know what? That's a little high end to be a rental. Uh, now I look back and think I should have kept them, but, you know, but yes, I've been flipping, um, the rehab for a flip is very different than a rental. You put a little bit more in bells and whistles. You put things in there that you really wouldn't give a tent cuz of the wear and tear factor, you know? So, again, very hands-on. Um, I worked in engineering for, I guess about oh five is when I left engineering and decided, you know what? So much for the job. I like the engineering work. I'm just not into corporate America. Yeah. So, you know, a lot of, a lot of realtors and entrepreneurs, same thing. It's just not in the corporate America. It wasn't the field, it wasn't anybody. Uh, I just wanted more.
Speaker 0 00:03:33 Got it. And I want to really, I wanna just, you know, kind of cut right to the meat and potatoes with this interview, because I know in real estate you can go down so many different avenues. You could flip wholesale. Yep. Creative financing, seller financing, deal structuring, entity structure, you know, land trust. There's a lot of things that I know Tom could talk about in depth. Yeah, right. All the way down to what kind of HVAC system should go into different properties and, and materials. And we, we,
Speaker 1 00:04:02 We can't,
Speaker 0 00:04:02 We can't go there. We can't go all there. So, but what I really want to, uh, narrow in on is something that Tom has honed his craft over many years and does something that everyone hates doing. Like in this industry, most agents that I know, if, if you say, you know, do you do short sales? Oh, I don't want anything to deal with short sales. Um, most investors, they don't wanna take the time to deal with short sales. Um, so, you know, Tom, why don't you tell us a little bit about your background in short sales and maybe actually just kick it off with explaining what a short sale is, because we have a whole range of listeners, and some people might not, might not even know what a short sale is. They might think that that's a real quick
Speaker 1 00:04:40 Sale. No, it's just No, no. A short sale is the opposite. It's where the bank takes you short. They don't get paid in full and banks don't let go of money very easily. So it is a long drawn out process. And that's where the joke is. They're not short. Um, my quickest short sale might have been five months. My longest took two years. Okay. And two, the time doesn't bother me. You gotta be patient.
Speaker 0 00:05:00 So the bank takes a short, explain that.
Speaker 1 00:05:04 Um,
Speaker 0 00:05:04 First grade level.
Speaker 1 00:05:05 Okay. Like the one in Broomall that took a long time, uh, the guy owed 3 35. I eventually got the bank down to 200,000. Okay.
Speaker 0 00:05:13 So, so there was a $335,000 mortgage on the house. Mm-hmm. <affirmative> mm-hmm. <affirmative>. And because the borrower was in a distress situation. Yep. And the bank evaluated the property, they, they were willing to sell it for less than what was owed on the mortgage, which was two 30 or two. What was it?
Speaker 1 00:05:29 Well, we eventually settled at 200. 200.
Speaker 0 00:05:31 Okay. Yeah.
Speaker 1 00:05:31 Yeah. That's now the banks don't get there right away. We have to go back and forth and negotiate and haggle and Yeah. And there's a lot involved in the paperwork for that. But we eventually settled at 200. So,
Speaker 0 00:05:41 So that's like $135,000 less than Yeah. The loan balance, but that the bank was willing to accept.
Speaker 1 00:05:47 But you gotta remember what they owe is irrelevant. It just doesn't
Speaker 0 00:05:51 Matter. Explain that.
Speaker 1 00:05:52 Um, somebody could say, owe a half a million dollars, why half the house burnt down? So what's it worth? <laugh>. Oh, right, okay. So what they owe means nothing. So some people, uh, I was at Prudential, Fox and Roach, you know, a big company. Okay. Um, but, uh, I remember one of the agents there, and I won't mention names, she was bragging. She got a short sale closed in six weeks. Okay. It was a $500,000 house. The bank took 4 95
Speaker 0 00:06:15 Whoopee.
Speaker 1 00:06:16 Okay. So it's like, okay, that's fine, that's fine. I didn't say nothing, you know? Um, yeah, the banks will give 12% just to close it, just to close it. That's just no big deal. But most of the time they're distressed properties, they're distressed homeowners. And you really have a, have to have a lot of empathy, a lot of patience, because people don't get in this situation over one issue. It's what I call life events. It's usually two life events or more, meaning they had a health issue, they lost their job. Now the house. So they are really, really stressed out. And I've got stories to get into, but they, they take too long. So you really have to have a lot of patience where people, you have to be willing to really give of yourself and you don't even know if it's gonna close. Okay. So that's why for a lot of realtors, it's not a good business model.
Speaker 0 00:07:02 Okay. Yeah. That's what I found. A lot of agents don't want to do it because they might work on something for three, six months, two years, and then at the end of the, at, at ready to go to settlement, they have a seller, they have a buyer, but there's now a third party that can kill the deal, which is the bank.
Speaker 1 00:07:17 Yes.
Speaker 0 00:07:17 Yes. Uh, approving the sale. And sometimes they don't approve it for whatever reason, you know, usually it's, usually it's based on facts, but sometimes it's based on opinions and, and their, their process isn't there. So, so Tom, tell us, when was your fir, what was your first short sale that you did that you can remember, you know, do, do you know approximately what year you started doing them?
Speaker 1 00:07:39 Geez, I'm gonna guess. Well, when I went to Prudentials oh five. Okay. And I was, I was the new guy in every way. Okay. I mean, new, new, new. So I got the office, the desk in the hallway, you know what I mean, kind of thing. That's, that's what the new guy gets, you know, so whatever, I didn't care. So when you're brand, brand new and you have no business, you take any referral. Well, I started getting the crap referrals, uh, stuff in Chester, which, you know, it's, it's, it's business. But that wasn't really just
Speaker 0 00:08:06 Lower price properties,
Speaker 1 00:08:07 Lower, lower economic, uh, points. And, um, and then can't started coming in with some of the distressed properties. And that's where I started seeing, you know what, this is a lot of work. I get it. Realtors don't want to put in months and months and months not even knowing if you're going to get paid at all, let alone, which is a realtor have to go through, we gotta pull title, um, you have to do inspections, you have to do the municipal. So I have to pay for those things in advance. So I do invest in these listings. Um,
Speaker 0 00:08:37 Just to, and a lot of times the sellers, they don't wanna put any money up because
Speaker 1 00:08:40 They're, they don't
Speaker 0 00:08:41 Any money. They're not walking away with anything most of the time. If, if there's a, if the bank's taking a loss, that means there's no equity there. And the seller therefore isn't getting, there's no real benefit for them. I mean, there is, but it's not usually financial upfront. Right. It absolutely there, there are some programs, or I don't know if they're still around, but you can talk more about,
Speaker 1 00:09:01 Well that's, there used to be the banks would allow them at, like, when I did do one in Broom Mall and the guy, the bank paid the seller 10,000 to walk just to, just to voluntarily cooperate. Not anymore. Yeah, not anymore. Not
Speaker 0 00:09:13 Seeing that. Uh, no,
Speaker 1 00:09:14 No. Then it was 3,500 hours, then it was 2000. Now we're seeing zero. Nothing. The banks are not giving anything because back then, uh, the government was subsidizing those, those, those losses. Incentives. Yeah, yeah, yeah. They were actually
Speaker 0 00:09:27 Given take a loss and then they would get reimbursed. Yep.
Speaker 1 00:09:30 Yep. They get reimbursed. Not now. Now see way back, uh, we're going back to, oh, say oh, five to 2000. Um, the banks were very difficult to work with. If they just got busy, they would close the file and hang up on me. So they were really difficult, just like ignorant, but they were overloaded, overworked, their people weren't trained, and the rules were not in place to allow us to do business. Since then, the laws have changed. And it's not bad. It's not bad, it's still a, a project, but I can get 'em closed. Uh, it's very rare. Uh, I had one last year on Orange Street. Didn't close because the seller would not provide all the financial documentation the bank wanted. And there's, there's guidelines we have to follow. So yeah, there I go, driving back and forth, uh, 20 times. And the seller's wife had the job. She wouldn't cooperate. What are you gonna do? So
Speaker 0 00:10:21 Tell, tell me why. If, if someone has no equity in their home, essentially their house is upside down, they owe more than it's worth. Why would they want to do a short sale? And oh, what are the benefits for them?
Speaker 1 00:10:32 There's a lot of benefits when you really think about it. First of all, why wouldn't you do it? Who wants a foreclosure on their credit? It's gonna pull your credit down and hurt you down the road later in ways that's like, oh man, now I can't even buy a used car. Now my credit card, the interest rate got bumped. There's collateral damage everywhere. And even if it's an estate, I've talked to your executors and say, why don't you just close the estate out properly? I'll do everything for you. And yes, whoever the investor is that's gonna buy the house for the estate is probably gonna pay the attorney to do the probate. Okay. So we really handle, uh, estates so the executors don't have to spend any money and they'll get reimbursed for anything. And, and it goes very well. But I've had multiple clients call me less than two years later, less than two years, and say, Tom, I got another job. I got back on my feet. Remember that short sale you did for me in Havertown? Okay, can you get me that settlement sheet? And the bank letter, the payoff letter, they got another FHA mortgage in less than two years. So here's a guy that Washington,
Speaker 0 00:11:36 The debt's considered settled Yes. Versus defaulted and foreclosed. It's
Speaker 1 00:11:41 Always better to do the short sale. Yeah. To do something than ignore it. Okay. And, and this banks, banks lie a lot. I remember we talked about chest street and trainer. I did one, and I won't mention mention names, but, um, the short was 40 grand. I remembered exactly. I bought the house. Okay. Cuz I wanted to make sure it went. And the house needed a lot of work. And back then it was a slow market. 40 grand, eight months later, the woman got a 10 99 for $99,000. Oh wow. I know the short was 40. So the banks, they abuse it kind of, you know, and I talked to her accountant, we got around it. She never paid anything. So you really have to know a little bit about what's coming afterward too. And, and then help your clients
Speaker 0 00:12:22 Yeah. And explain that to 'em upfront. So for any listeners that are not aware of the potential tax implications, and not that this is, uh, a show on tax advice, obviously consult with your cpa, but explain what you mean by the seller got a 10 99 after the sale.
Speaker 1 00:12:37 Um, the house was sold for $40,000 less than what was owed. So the deficiency was 40 grand debt forgiveness. The ba if the bank forgives it, they have the right to give you a 10 99 as if it were earned income. But I believe it's called a 10 99 C I think, um, she got a 10
Speaker 0 00:12:56 90. So from the eyes of the irs, if, if you have debt and the lender takes a loss, they look at that as a gain. Yes. For the borrower, yes.
Speaker 1 00:13:04 It's a gain to the borrower and
Speaker 0 00:13:05 If there's potential tax lump implications. With that said, there's also, um, some ex exempt ex exemptions on that.
Speaker 1 00:13:14 There are, um, she got a 10 99, but keep in mind, from her position, she gets a ten nine. She says, I don't have many money to pay this. She got no proceeds. Right. So how can she pay the capital gains tax on a 10 99 when she got no proceeds?
Speaker 0 00:13:27 And was this a primary or
Speaker 1 00:13:28 Rental? Primary. Okay. Primary. So, you know, we got around it no problem. Yeah. We took it as if it was a sale of the first and no big deal. So we got around it, but people don't know that. So you do spend more time kind of counseling people, coaching them through it. In this case, I called. I said, gimme your accountant's phone number. I had a 92nd conversation with him. He said, yeah, that's cool. We're good. And then it was, yeah, she never paid a dime. Yeah. You
Speaker 0 00:13:52 Know. Yeah. So a lot of it is just understanding the, the rules and regulations and then making sure that things are done properly so that mm-hmm. <affirmative>, you can, you can have all the right documentation to prove, I'm sure she probably had to prove some level of insolvency and that it was her primary residence. And with that there was an exemption or, you know, um,
Speaker 1 00:14:12 Well, it was her primary and that's what got her out of it. Yeah. She had a job. Okay. She had a bank account, but it didn't never got it. Never
Speaker 0 00:14:18 Got out. Yes. She didn't net anything out of it
Speaker 1 00:14:19 Either. No. She didn't net anything out of the house, but she didn't have to pay any additional tax. Um, and you know, when people are stressed out and things are going wrong, this is just another stress item, you
Speaker 0 00:14:30 Know? All right. So everyone that I talk to hate short sales. Why do you love them?
Speaker 1 00:14:35 Like
Speaker 0 00:14:36 What? Like, I, I talked to Tom and he's like, I love doing short sales. I'm like, you're crazy. You know, it just, well, it just seems like such a headache. There's so many other ways to do business and I know a lot of it for you is trying to help people and it's coming from that, that aspect. But tell it is just dive, dive in. Tell us like, what, what, why are you so passionate about short sales?
Speaker 1 00:14:54 You know what, I got used to them. I, I just, just accept it. They take a long time. So in that sense, you can actually be, take this a little bit lazy. Okay. There's never an email or a phone call that needs to be addressed today. Rare. That's rare. Now I have one today because I have the drive and get ink this afternoon. I have to get signatures back to the bank. We're, we're ready to settle this thing. And, and the bank wants it turned around cuz today's Friday. Okay. But that's rare. So usually timeline is forgiving. Um, the banks take forever to foreclose in, in a, in a, um, in a judicial state. Pennsylvania's judicial, there's states throughout the country that are deed of trust states, they can foreclose in less than 30 days. I've not done any of those. I don't want
Speaker 0 00:15:40 To. Yeah. You, you know your niche and your market and you stick to
Speaker 1 00:15:43 It. Yep. Um, I'm actually helping, uh, do two of 'em in South Bend, Indiana. Um, and there's, um, there's a couple others that I'm working on with some other people that, um, you know, I'll probably be the bank on those or something. We'll see, we'll see. I don't know. Um, but um, I just got used to them and yeah, uh, you get to help people. Okay. And they can be, you gotta have a little bit of a stomach for that because you'll see people in, in when they're really hit and bottom, uh, stressed out about to be homeless. Uh, quite often the houses are really appalling. Um, sometimes they're not. The houses are nice when they're really, really nice. The average agent will keep it, do try and do the short sale. But here's where, uh, I, I gotta emphasize something, if I can go on a little tangent. Agents get this wrong. If you have a perfectly good house, nice condition, it's really mortgageable, whatever they still think we have to give the bank what they want. No, the bank is not your client. The homeowner is the bank is, think of it this way, in a normal settlement, you have all the parties involved. It's all of us against the bank. Somebody's not going to get what they want. And it's the lender. That's why it's a short sale. The lender wants fair market value, they're not gonna get it. Okay. So
Speaker 0 00:16:58 Yeah, there's a reason. It's a distressed sale and you know, for the buyer, there's gotta be some sort of incentive for them to take on that risk of being under contract for potentially six months, 18 months. That's rights. That's not a typical buyer. You,
Speaker 1 00:17:12 You just nailed something. Uh, the biggest problem is you don't want a buyer to walk away. So I prefer working with investors because if the buyer gets impatient and they leave in 60 days, we have to start the whole file over again. Start, start all over. And that's why the average realtor says, what am I doing? I've got 10 times the hours into a short sale. We're on our third buyer. The bank keeps closing the file. Cuz every time you change names on a contract, you start over. So I really do prefer working with investors because an investor doesn't care. They'll wait a year if it's a good enough deal. Well, that's the important thing. See, so if we're shortened a bank and I'm trying to take care of the seller, whatever you do, do your best to get that buyer a good deal. Because if you lose the buyer, you're starting all over. So who's the most critical person inside in, in a, in a transaction? The buyer. Okay. Cuz if you lose the buyer, no one gets paid. So it's the same thing. Here's some parallels, but the big difference I want to emphasize is to realtors, the bank is not your client. Stop listening to the bank. They'll lie to you. They'll tell you things, uh, that are not quite accurate. And because when you first call the bank, the first person you talk to is really customer service. They often don't know what they're, they had the minimal
Speaker 0 00:18:24 Charge. Yeah. They might not even get there lying. They might not just know anything. Right. And it's, they're not intimately familiar with that property. They're, they're reading off of a screen and there's a process they're following.
Speaker 1 00:18:34 They are. And usually the first person you talk to is the newest employee. They have the minimal training. So you gotta know enough to get past that, get to the next level and keep it moving. But, um, they are tough. But, um, you know, bottom line is, um, I get a lot of referrals. I have a number of attorneys now that refer me short tails. Uh, I'm closing on one. We just got approval in, in Ridley Park. Um, the roof has been leaking for six months. It went through three, three floors and the hardware floors are buckled and you know, so, uh, the first lender will get paid in full. The second lender is not happy. Oh, well that's, that's that's the game. Yeah.
Speaker 0 00:19:11 Yeah. Well
Speaker 1 00:19:11 That's the game.
Speaker 0 00:19:12 They lent the money on the property and it was their job to do the due diligence about the asset that they were, you know, backing. So, um, tell for any listeners that are interested in doing short sales themselves, uh, tell them, do you mind sharing? I know, I know you have a lot of different, um, you know, tips and tricks to, to get them done mm-hmm. <affirmative>. But is there one or two things that you can tell some of the listeners that you're willing to share about, you know, here's, here's how I've had success. You know, what are some of the things that have helped me be successful in getting them closed?
Speaker 1 00:19:44 Okay. Um, yeah, back up the basics. What do they say? The first person answered the phone when you talk to the bank is customer service. They're considered a negotiator in, in the asset management department. First level negotiator is entry level, minimum training. Second level negotiator is they read the contracts, they make sure everything's signed. They may even look at the timeline on the dates. Third level negotiator is the one who is more of a decision maker. They know the underwriting. That's who I really gotta get to. But you gotta get all the paperwork correct the first time.
Speaker 0 00:20:15 Yeah. They don't want to, they're trying to, they're gatekeepers, right. To make sure the file's complete.
Speaker 1 00:20:19 Ab absolutely they're gatekeepers. So what I would emphasize is, um, I put, I put together a cover letter. So on every email I send, and they're, I'm still running into two of 'em to say, fax me this. I said, no, I don't do faxes. Let's do email. So put together a cover letter with all the data, the file number, the homeowner, the address, communication, all the emails for yours, party for them. So the cover letter is everything. Okay. The next thing, the authorization form, you know, you can't talk to a bank until you're authorized by, excuse me, either the seller or the executor or an attorney. Right. So the authorization letter, then everything else you have to add is a separate pdf. I used to put them together, scan them through, send one big pdf. They don't read it. I'd lose, i'd lose weeks on that.
Speaker 0 00:21:07 So really what I'm hearing is just make it sup, make the file really easy for them. Make it, make it idiot proof.
Speaker 1 00:21:13 Uh, imagine that, uh, a high school drop out's gonna be the one reading it. <laugh>. Okay. I I hate to sound, I don't mean to
Speaker 0 00:21:19 Be ignorant. No, no, I know, I know what you mean. But they're busy. I get the point.
Speaker 1 00:21:22 They're, they're overloaded often. Sometimes like coming back from the holidays now I don't, I don't call banks on Monday. Okay. The Monday there you can't get through everybody's stressed. Um, so yes, you make it, um, almost idiot proof. Every file and file names have to include the address. The banks will also tell you on every document, the first page, put the loan number in the upper rehan corner. I forget that sometimes. Um, but every document is a separate pdf. So talk to them as if you have to talk to a law firm. They want everything. Perfect. Yeah. And that
Speaker 0 00:21:58 Will, one signature will stop the file.
Speaker 1 00:22:00 Yes.
Speaker 0 00:22:01 One missing piece of paper will stop the file. And, and they're not gonna follow up with you?
Speaker 1 00:22:07 No. The bank often, uh, rarely, rarely communicate back. I'm, I'm the one on the phone with them probably twice a week for every file. Did you get this as the authorization in is you? And then the next question is when we get everything in. Okay. Do you have, uh, do you have somebody assigned to the file on their part? Can I have their name please? Can I have a direct extension? Can I have an email? No, no, no. And sometimes they just won't give you a direct extension. You know, they won't
Speaker 0 00:22:32 See, this is why a lot of agents don't want to do it. It's a lot of work.
Speaker 1 00:22:35 It's a lot of work. And now I'm to the point where, uh, I'm doing a lot more of them. So I have somebody in my office that I'm training. And so we're, we're scaling up. We're scaling up.
Speaker 0 00:22:45 So for any listeners that are, they're like, I like the idea of buying a short sale, or they're coming across short sales, but they don't wanna work with them, how can they work with you?
Speaker 1 00:22:53 Just reach out and contact me. So if you're looking to be a buyer and you want to invest in them, then you know, right now, um, it's a little hard to say. I've got several in motion, but we're not there yet. So I don't really have anything to offer. But once we get them closed, then I'm, now I rehab some of 'em myself, but I'm getting to the point where, um, I'm gonna be doing enough volume that I'm just gonna be selling them again. Yeah.
Speaker 0 00:23:19 Okay. And then for any agents out there that they're coming across a listing that's a short sale, um, how can they work with you?
Speaker 1 00:23:26 I just, I have one now and Glen Olden, uh, Norwood. And, uh, the agent said, you know what? I don't even wanna be involved in it. And I said, fine, I'll give you the full 3% referral. Okay. So she's gonna get her 3% and do absolutely nothing, but give me the seller's phone number. And we're, we're on that now for about, uh, about six weeks.
Speaker 0 00:23:45 So you'll work the short sale and I'll work the short and let them have the listing or, or
Speaker 1 00:23:50 The referral. She don't even want that listing.
Speaker 0 00:23:51 Oh, okay. Just a referral fee.
Speaker 1 00:23:52 It's just a referral fee. Well, what, think about it. Yeah. If you're, if you keep your name on the listing, then you gotta go get signatures. You gotta go. Yeah. So the last one was, she just laid a little burned out on it and she said, here, just take the whole thing. Can I get 3%? I said, absolutely. So she'll get her 3%. And, um, I'm, I'm handling everything else. So,
Speaker 0 00:24:12 Sounds like a pretty good deal for an agent to, to get the commission without having to do the
Speaker 1 00:24:16 Work. It's not bad. It's not bad. It simplifies it because this, unless this is your niche, you know, it's kind of like let's invest in 17 counties. Been your spread too thin. You spread too thin. So most agents do have their client base, they have their niche. This is my niche. Um, but if you run into them and you really don't wanna work 'em, um, just refer 'em to me and you'll get, you'll get your, your 3% commission and um, and you don't have to do any of the legwork. Nothing
Speaker 0 00:24:42 Sounds pretty good to me.
Speaker 1 00:24:44 It's not bad.
Speaker 0 00:24:45 Two decades of experience coming up on two decades of experience. Uh, I don't wanna learn that. I don't wanna take the learning curve. I'd rather hand it off to someone that knows what they're doing. <laugh>, um, any, any last words of wisdom? And this doesn't have to be relating to short sales, but just for anyone getting into real estate investing, cuz that's really what's at the heart of this show. Mm-hmm. <affirmative>, um, you know, you've been in this for 30 years and what are some, give me maybe one thing that you would do over or you wouldn't do, you know, if you could start over with the same knowledge you have today and then, and then what's one thing to really get people off the couch and take action?
Speaker 1 00:25:21 Boy, boy, boy, that's, that's a lot.
Speaker 0 00:25:23 I'd like to ask her. Ask two part questions.
Speaker 1 00:25:25 I know, I know. What would I do differently? I I, in hindsight, I should have been a lot more aggressive. Um, I was very conservative and a little bit slow because I kind of felt like if I make a big financial mistake, I have no safety net. Yeah.
Speaker 0 00:25:38 Okay. But well you were conservative with not using leverage, right? Where a lot of your, your deals were cash. Yeah. And then you would, you know, you kind of took that model, buy 'em cash, rent 'em out, save, save up, buy more.
Speaker 1 00:25:50 But I could have three and four times the properties easily with minimal risk had I leveraged. And so in hindsight, I should have leveraged more. I really should have, you know, but that's life. Um, here's a, here's a brief little story.
Speaker 0 00:26:03 You also built a safe, secure portfolio too. So it's, it's risk tolerance and that was your risk tolerance at the time. But I, I get it. So
Speaker 1 00:26:10 You're exactly right. Yeah. My risk tolerance was very low. But even now I look at it and say, you know what, it's, it's not a huge portfolio, but guess what, uh, anybody working a job out there, what kind of pension do you think you're gonna get? Yeah. Okay. A half a dozen houses will far exceed any pension you'll get in America. And you can do that in one year. I don't care if you make mistakes on a house, cuz way back in Marcus Hook, I was buying him. 24,021 came up, I had it under contract for 28, the bank wanted 35. I said, no, they're going for one 50 to 180. Now what was I thinking? I said, no, I didn't, I didn't want to overpay a little bit because it was still a full rehab. But you know what, in the big picture of things, just get your acquisitions.
Speaker 1 00:26:49 If they cash flow and make money, don't get too caught up on it. Years later, you're gonna look like a genius. So jump in, get started, go to the real estate clubs, talk to people. You're gonna get a different level of comfort there. Even find a mentor. And you know what? Anybody rehabbing and you've done your share of rehabs as well, anybody rehabbing will be happy to show you what they're doing. Say, Hey, can I come over and look at your project once a week and will you show me what you're doing and tell me what things cost? Cuz I have no clue. So if you are zero experience, just, just shadow people and you'll get a world of education. It's like, and you'll start to get a comfort level with, man, this is not that hard. It's not that bad.
Speaker 0 00:27:28 I love your answer. Cuz it, it's, it's so consistent with what I'm always telling people. Yeah. Buy and hold,
Speaker 1 00:27:34 Buy and hold. Yeah.
Speaker 0 00:27:35 And then surround yourself with the right people. Mm-hmm. It is. And and that's like if you, if you hear that time and time again from people with 30 years experience, it's, it's, it's so consistent. And that's why there is no secret sauce. Everyone's looking for this easy button.
Speaker 1 00:27:50 There is no
Speaker 0 00:27:51 Take action. Buy real estate, hold it long term. Time heals all mistakes in real estate.
Speaker 1 00:27:57 Um, there is no get rich quick. It is work. It is work. Whether you're wholesaling, whatever the marketing end or rehabbing, it's, it's, it's time, it's work. But the rewards are long term and they're fantastic. Um, you know, the numbers, how, how many people made their wealth in real estate? I don't know, 80, 90%
Speaker 0 00:28:13 Or something? Yeah, I think it's 90% of all millionaires. It's through real estate
Speaker 1 00:28:16 Investing. Yeah. And after you get through a certain point, it's like, I don't, I don't work hard. I don't, I don't go change to, I don't do nothing. Okay. I don't even set the alarm clock in the morning <laugh>. I just don't care. Okay. Everything will be fine. And the other thing I want to emphasize in, uh, as you get into, whether it's realtors or other people you're working with, never, uh, never turned down an opportunity to help somebody. I have more names in my database and I help anybody and everybody, even my wife says, you spent too much time giving away your time to people on the phone. I say, you know what, not really. Not really. Because if I need something when I call people, I expect them to answer the phone because I help anybody and everybody with the stupidest little things to complex structural problems, electrical problems, H V A C problems. I love it. So I do enjoy it. I really do. But at the same time, if you can help somebody, you should. Okay. Just because, and it will always come back to you.
Speaker 0 00:29:12 Yeah. I love that message. And, and I can say that that's true. Tom, you've helped me a lot over the years. I've called you many times for contractor, just your thoughts on different things, deal structuring. Um, so we'll wrap it up with that. But okay. You know, kind of anything in life, you, you really do get what you give. Mm-hmm. <affirmative>. And that's really what I hear in this is, you know, um, you solve problems, you're gonna get paid and you solve big problems, you're gonna get paid more. Short sales are big problems. Don't take 'em on hand 'em to Tom and he will solve
Speaker 1 00:29:40 'em for, for you. Let me, let me plug my, uh, website here. Can, if that's, is that in the picture? Yeah, that's in there. Okay. Yep. Go to the website, gimme a call, and, um, you know, we'll see if I can help you. I'm pretty sure I can. Um, but we'll take it from there. Thanks Tom. Okay man.
