May 5, 2017
Joe Fairless

Friday Facts – Best Real Estate Investing Advice Ever Lightning Round Q&A

Learn this week’s Best Ever guest’s best ever books, real estate deals, ways to give back and biggest mistakes

Tony Javier from JF972: How to Flip Over 100 Homes a Year in OTHER MARKETS

Best Ever Book7 Habits of Highly Successful People by Stephen Covey

Best Ever Deal Tony has Done – Quick Flip and a $40,000 Wholesale Deal

“There’s two of them. One of them was a deal we made over 100k last year. it was a really quick flip. And actually, the best one we ever did was a wholesale deal – we bought it for 25k, cleaned it up, put it back on the market and sold it for 65k. We made 40k on a wholesale deal. There was only a $65,000 sale price.”

Best Ever Way Tony Likes to Give Back – Advice to New Investors

“I have a lot of people reach out to me that see my Facebook and my TV and stuff and say, ‘Hey, how do I get started?’ I used to blow those people off, and now, as long as I have the time and I can fit them in my schedule, I give people advice… Because the one thing — like I said, when I first got into it I was doing things on my own, so if I can have a quick conversation with someone and either help them avoid a mistake or help them to get started that much quicker, I don’t mind lending that little bit of advice based on my 16 years of experience.”

Biggest Mistake Tony Has Made So Far In Real Estate – Working with Awful Contractors

“I bought a property; I could have wholesaled it quickly and made 20k. Instead, I let my ego get a hold of me and said, ‘You know what? I can make 50k on this deal.’ Again, in Tampa, Florida. I had three bad contractors, ended up spending twice as much money on the project, ended up selling for $40,000 less than we anticipated, and ended up losing $65,000 on that deal.”

“It’s only one of four or five properties I’ve ever lost money on, and it was a huge learning lesson. I basically wrote a $65,000 check for a big learning lesson.”

Click here for Tony’s Best Ever advice: How to Successfully Market for Real Estate Leads with TV Commercials

Clay Malcolm from JF973: How to Make a Pot of Gold with Tax Advantages

Best Ever BookSpectrum of Consciousness by Ken Wilber

Best Ever Way Clay Likes to Give Back – Audiobooks for the Blind

“My favorite way is I have been involved with a company that reads textbooks onto tape, so that blind students can use those textbooks in their studies. I always thought that was cool.”

Biggest Mistake Clay Has Made So Far In Real Estate – Lack of Empowerment to take Action

“I would say not empowering myself to make a move… And I’ll go back to 2008 – I hadn’t practiced moving funds into different investments, and it stalled me. It was an interesting thing, it’s part of my psychology that if I haven’t done it before, it seems bigger than it would be, and if I had been more agile and thinking and been empowered already to make financial moves, I think I could have mitigated some of my losses. It didn’t work, but that was the lesson, for sure.”

Listen to Clay’s Full Interview about Self-Directed IRA Tax Advantages Here

Scott Carson from JF974: Take Notes about NOTES and Debt

Best Ever BookOutwitting the Devil by Napoleon Hill

Best Ever Deal Scott has Done – $12 Million in Notes for $1 Million

“I’ll say probably the biggest deal we’ve done individually – we bought a portfolio of 200+ assets that were worth about 12 million that we picked up for just over a million bucks. It’s been great, we’ve been modifying those loans, we had some that we foreclosed on, but it’s been a really growing period, going from buying one-off loans to small pools… That’s been one of our largest pools so far of assets that we’ve bought.” 

What’s the number one risk in deals like that? 

“The number one risk is not knowing our property values or checking taxes. There’s three things with notes that you’ve always got to double check. You’ve got to make sure your property values are accurate – and that doesn’t mean going by Zillow photos; that means literally having somebody drive by the property.”

“We made a mistake early on in our business where we trusted a realtor to drive by. She took great photos of three sides of the property, but she missed the big, gaping hole on the other side… So using realtors, making sure that we tell them, ‘Hey, please look at all sides.’ We want to make sure it’s a Blazing Saddles house. That’s the biggest thing, knowing your values.”

“Second thing is double-checking taxes. You’ve always got to double-check the taxes owed, and you want to make sure that the borrowers’ name on the note matches up with who’s on the county records. If it’s a different name, that property was probably going to tax sale and your note is now worthless.”

“And third thing is checking title. That’s pulling a title report, or as we call it, an O&E report – Ownership and Encumbrance Report is kind of a watered down title report that just shows us what the condition of the lien history is and if there’s anything else on title that might be blocking our ability to foreclose.”

“Those three things are the biggest things. Having your vendors in place is also critical. If you buy a lot of notes, you want to make sure you have your systems down, because you don’t want to sit around for 6-12 months figuring things out while your fruit is rotting on the vine”

Best Ever Way Scott Likes to Give Back – Charitable Donations and Free Educational Courses

“We have a big, big passion for two sets of individuals: we work a lot with young kids, we always like to donate to Toys For Tots at the end of the year, along with different children’s charities. We do a lot with a Fresh Start out in San Diego where they go out and perform surgeries for children with face deformities, and we also have a big passion for helping past and present military and first responders. We love working with those guys, whether it’s Wounded Warriors or other charities that help out with our past and present military.”

“We provide education classes for free to those guys, and just really love helping those out because they’ve done a big job in helping us have the freedoms that we have today.”

Biggest Mistake Scott Has Made So Far In Real Estate – Incorrect Expectations for Project Timelines

“I think probably a couple of those would be with our Chicago deals. We bought stuff and we foreclosed on stuff in Chicago before, around Chicago, Illinois… I would probably have talked to my attorneys a little bit more that were handling that foreclosure process and what they expected the timeframes to be, and double that timeframe. If they said six months, plan on a year; if they said a year, plan on two years.”

“We’re still going to come out making our money back and giving our investors a good return on their money, but some of the things that have happened up there have been outside of our control and outside of our trainees’ control. It’s just kind of ridiculous.”

Listen to Scott’s Full Interview About Buying Notes Here

Mark Kenney from JF975: Hotels and Multifamily Investing on a PASSIVE LEVEL

Best Ever BookRich Dad Poor Dad by Robert Kiyosaki

Best Ever Deal Mark has Done – Passing Two-Year Projection in Under a Year

“The one we closed on September 2016 in North Dallas. We already raised rents twice, already passed our year two projections, and it’s only been since September. That one I think is going to really be our best deal ever.”

Best Ever Way Mark Likes to Give Back – Providing Educational Opportunities and Supporting for the Disadvantaged

“We help educate people. We actually do some events here and there as well, and starting to do more of that. Anything we know, we’ll share; we don’t hold anything back, we don’t have any hidden agendas.”

“And then outside of real estate, we have a big passion for orphanages. My wife and I both support orphanages in Africa.”

“We also had a big passion and support people of sex traffic industry.”

Biggest Mistake Mark Has Made So Far In Real Estate – Misplaced Trust

“It’s really looking at the deal before the operator, maybe trusting the operator a little too much and not having an operator on the hotel example that really was experienced. Looking back on it, I would not have invested in it, the reason being that they didn’t have anyone else that had skin in the game with them. They had a so-called mentor that later we found out really was not a mentor and unfortunately has a lot of litigation against him.”

“But anyway, having somebody that’s side by side with the operator, with the lead, has done it before, has been there and can help them would probably be the biggest thing. Look for that first and foremost, and then look at the deal and see how it looks.”

Listen to Mark’s Full Interview About Passive Hotel and Multifamily Investing Here

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Disclaimer: The views and opinions expressed in this blog post are provided for informational purposes only, and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action.

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