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BP Podcast 050: Getting Started and No Money Down House Flipping with Mike Simmons

by Brandon Turner on December 26, 2013 · 46 comments

  
Mike Simmons

On today’s episode of the BiggerPockets Podcast, we sit down and talk about the best ways to get started with real estate investing, as well as some killer tips for investing without using your own money.

From picking a niche, overcoming analysis paralysis, and a lot more – our guest, Mike Simmons, will share his story of overcoming obstacles and becoming a full time house flipper in the Metro Detroit area.

Mike has a great story and an incredible strategy for flipping houses using no money of his own, so whether you are brand new or have been investing for years – you don’t want to miss Mike’s creative advice.

Listen to The Show on iTunes

Click here to listen on iTunes.

Listen to the Podcast Here

BiggerPockets-Podcast-Cover 300 300In This Show, We Cover:

  • Overcoming “shiny object syndrome” and “analysis paralysis”
  • Losing $1000 on his first “almost deal.”
  • Finding contractors without losing your hair
  • Dealing with Detroit investing
  • Why Mike had to evict a squatter who broke into his property
  • Finding good deals in any market
  • Using social media to attract private money
  • Using partnerships to get started or to grow
  • How Mike structures partnerships
  • Should you start with wholesaling?
  • And a whole lot more!

Links from the Show

Books Mentioned in the Show

Tweetable Topics

You can read for days – and never do anything. Get out there and DO something. (Tweet This!)
Work with a Realtor who knows you and knows your business. (Tweet This!)
50% of something is better than 100% of nothing. (Tweet This!)

Connect with Mike

Mike’s BiggerPockets Profile
Mike’s Website and Podcast: JustStartRealEstate.com

Email *
  



{ 46 comments… read them below or add one }

Doug Merriott December 26, 2013 at 8:32 am

Great show guys! I found a lot of this information to be invaluable. Particularly liked the experienced mentor challenge, you should run a contest with that one. Definitely thanks to Mike for sharing his wisdom.

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Joshua Dorkin December 26, 2013 at 9:31 am

Thanks for listening, Doug! I’m happy to hear that you found the show to be valuable.

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Doug Merriott December 26, 2013 at 11:45 am

Congrats on the 50th show!

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Mike Simmons December 26, 2013 at 11:58 am

That’s so cool! I guess I didn’t even realize that I was on the 50th show! Very honored!!

Mike Simmons December 26, 2013 at 11:56 am

Thanks Doug! I appreciate the kind words.

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gerald harris December 26, 2013 at 11:40 am

Great Interview

I had been on the fence for over a year before I took action. Relocating from California to North Carolina I continued to second guess my self. My mindset had to change as well. Moving from a real estate agent mindset to moving to an investor mindset had to change. The real key is to get going!

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Mike Simmons December 26, 2013 at 11:59 am

Totally agree Gerald! Have to get out there and take action!

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Mark Pritchard December 26, 2013 at 12:53 pm

Thanks for the show guys. I definitely learned a few things that hopefully I can put to good use.

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Joshua Dorkin December 27, 2013 at 8:07 pm

Thanks for the message, Mark! We’re happy to hear it and appreciate you taking the time to share!

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Brian Gibbons December 26, 2013 at 1:18 pm

This was a great podcast. Not only rehabbing is not for everyone but Detroit MI is not for everyone (did I get that right Josh? lol).

Now Ann Arbor, MI, coeds, beer, Big Blue, did I say coeds?

And JV Partnering for 50 50 profits, moratorium on payments, that is always sweet.

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Mike Simmons December 26, 2013 at 4:08 pm

HAHA Brian. I have to agree!

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Joshua Dorkin December 27, 2013 at 8:09 pm

Yeah, yeah, yeah . . . let the ribbing continue ;)

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Rick Schneck December 26, 2013 at 2:35 pm

Great show and excellent guest! Mike’s humble articulation of successes, challenges, investor structure, and encouragement to take action was inspiring and motivational. Thanks Mike!

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Mike Simmons December 26, 2013 at 7:07 pm

Rick, I appreciate the kind words. I’m glad you enjoyed the episode!

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Joshua Dorkin December 27, 2013 at 8:11 pm

I’m with you, Rick!

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alex anderson December 26, 2013 at 2:55 pm

great tips, especially being vocal about what you are doing, and where your vision will take you and also about getting out and looking through the open houses to see what the other homes look like so you’re not over-improving an area.

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Jason Fraser December 26, 2013 at 3:08 pm

I’m glad I followed the quick tip about listening to the show all the way to the end. Halfway through the chances of Detroit of having a Josh Dorkin Day and giving him the keys to the city went from 0 to 10%. By the end of the show it went back to 0.

All Detroit jokes aside, it was a great show.

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Mike Simmons December 26, 2013 at 7:09 pm

Hahaha! Jason I love that! I don’t know that I didn’t much to change Josh’s opinion of Detroit, but it was fun to discuss. I might just buy Jason that $5000 house in Detroit and challenge him to stay for a week!

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luis December 26, 2013 at 9:15 pm

Great episode to start off the year! Thanks guys and congrats on the 50th show, cheers!
-Luis

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Joshua Dorkin December 30, 2013 at 8:58 pm

Ouch. And I was really excited about getting that key!

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Grant Fosheim December 26, 2013 at 7:00 pm

Congrats on the 50th episode. I really enjoy these longer podcast and hope that is a trend in the future.

Also, you mentioned a place to post success stories in the podcast but I don’t see a link in the show notes. Am I missing something?

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Joshua Dorkin December 30, 2013 at 8:59 pm

Hey Grant –
Thanks for the message — I also like the longer episodes . . . you get to really dig in! As for the Success Stories — I’ll add the link above, but you can get to it here.

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Michael Sadler December 27, 2013 at 9:41 am

Great podcast!

It sounds a lot like there are a few paths new investors can go down that are ‘less than desirable’. Experience can really help.

Congrats on reaching 50! :D

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Joshua Dorkin December 30, 2013 at 9:00 pm

Thanks Michael!

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Dawn Anastasi December 27, 2013 at 6:42 pm

Great podcast! I was starting to think that there should be not one but two $5,000 houses in Detroit and they could be used for the Bigger Pockets version of “Survivor: Detroit”. Everyone is armed with a rock to start with to protect themselves. First challenge: stay at the houses overnight to fend off copper thieves. Whichever team wins gets their rocks upgraded to bats.

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Joshua Dorkin December 30, 2013 at 9:01 pm

Hey Dawn – The game sounds like fun — except if I’m the one stuck playing survivor ;)

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Mike Simmons December 30, 2013 at 10:46 pm

Hey, I thought we ironed this out. LOL

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Tom Keith December 29, 2013 at 6:12 pm

Really Enjoying the show today! Congratulations on the Big 50. Wonderful guest and great questions. Thanks Guys
Tom

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Joshua Dorkin December 30, 2013 at 9:02 pm

Thanks for listening, Tom! I appreciate the congrats.

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Bruce Harris December 30, 2013 at 4:03 pm

Great show guys! Owning two rentals in Detroit is definitely for the Braveheart lol. But like you said Mike only certain areas and dont be gone to long. Ha! Also, let me be the first to take you up on your offer by taking you out for lunch or coffee to pick your brain about learning how to rehab. I stay here in DETROIT and was thinking of doing some fix and flips in Warren and Madison Heights area. Let me know if that’s cool…

Thanks,
And leave my city alone, lol
Bruce

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Mike Simmons December 30, 2013 at 10:49 pm
Dan Dietz December 31, 2013 at 4:57 pm

Great show this week. I got a late start so have been listening to about 3-4 of the older ones each week to gather all the gems of info I can.

Mike, I would like to know more about your thoughts on how your (excellent) strategy on borrowing Private Funds might/will change as you do Buy-n-Holds more in the future? It sounds like almost all if not all of you current ones are ‘short term’ (under a year). Are you planning on using PM for the Buy-n-Holds in any way?

I am currently doing Buy-n-Holds in my Self Directed IRA (one duplex and searching for more). There is a TON of opportunity in my area. I have been working on my plan to seek PM for both borrowing in my SDIRA (HAS to be Non-Recourse in IRAs) and also outside of my retirement funds. I plan to be speaking to a couple/few potential lenders in the upcoming weeks to see how my plans might play out. I am going to be seeking time frames anywhere from 2 years (long enough to refinance/season) and also longer terms of 10+ years.

What are your thoughts on longer term Private Funds?

Thanks, Dan Dietz

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Bruce Harris December 31, 2013 at 5:01 pm

Thanks alot Mike! I sure will. Talk to you soon!

Bruce

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Tere January 10, 2014 at 12:18 pm

I really enjoyed this first podcast. I have been paralyzed for several years, but I am finally getting back in the business. I found this article around the web…. right after I listened to this.
Very enjoyable.

http://www.buzzfeed.com/drewphilp/why-i-bought-a-house-in-detroit-for-500

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Cyrus Sidhwa January 11, 2014 at 3:13 pm

Mike, Great episode – will have to give this another listen!!
My question is about inviting multiple contractors to the property at the same time. Do you actually let them know beforehand that there will be multiple contractors? Does it even come up?

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Mike Simmons January 11, 2014 at 8:47 pm

Great question Cyrus. The answer to both questions is no. I do not tell them before hand, and it never comes up. It honestly has never been in issue, I decided a long time ago that I will never sit at a property for an entire day only to have more than half of the appointments not show up.

I get there before any of the contractors, lead them through and take charge of the situation. I give them all a list of repairs before I start walking them through and then answer their questions all at one time at the end. It has always worked out very well for me.

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Cyrus Sidhwa January 12, 2014 at 11:13 am

Thanks Mike!

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Joshua January 12, 2014 at 10:03 am

Does Brandon pay attention or is he just ADD?

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Joshua Dorkin January 12, 2014 at 10:15 am

I was wondering the same thing, Joshua.

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Dave Jennings January 14, 2014 at 12:05 pm

Hi Tim
Great interview today. I’m new to biggerpockets its been a very helpful site. I was wondering if you could share the contracts you use with your partners and contractors? I would like to get a better understanding of them before I sit down with my lawyer. Thanks Dave

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Klee February 1, 2014 at 4:36 pm

Great show!

I’m going through listening to the podcasts going backwards, so far this has been the best show yet (in my opinion)! I learned a great deal and was motivated. I’m among those who’s shy in pulling the trigger if you will, but realizing that education and mentorship is key to my success in starting.

Might I add you guy are truly hilarious!

Thanks for your commit to educate us newbies and soliciting experienced REI’s to assists us!

Klee

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Joshua Dorkin February 1, 2014 at 5:28 pm

Thanks for the message, Klee! I appreciate the feedback and I’m glad you get us ;)

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Carson February 5, 2014 at 12:00 pm

Mike,

I am wondering what cities you are finding these $50k 3/1 homes with a ARV for 110ish in, and if you see the supply drying up. I live in Ferndale and look at the Ferndale/Royal Oak/Oak Park/Berkley markets. Over the last year and a half, I have seen the standard 3/1 brick ranches go from 40-50 to 60-80 to now well over 100k. It looks like there are still a decent number of the 40-50′s in S. warren and hazel park, but with much more risk of not achieving a high resale value. Thanks for the insightful show. Carson

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Mike Simmons February 5, 2014 at 8:25 pm

Hi Carson, I agree, it is getting harder and harder to find properties in that price range. But I am still doing it. I am increasingly having to rely on marketing to find good properties as opposed to the MLS. These properties are still out there it’s just harder to find them.

As a matter of fact I just rehabbed a house in Ferndale that I bought for $56,000. Put $45,000 into it. And it is listed for $124,900.

In the past I have invested in Warren (north of 696), Southern Sterling Heights, Royal Oak,etc. I continually expand my radius in order to find the right deals for me. I do not buy in bad areas. I would consider South Warren and Hazel Park areas that I would not be interested in flipping houses.

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Carson February 6, 2014 at 9:36 am

Thanks, I Apprecite the response. Ferndale is definitely a hot market. I just completed my first flip in pleasant ridge, but am looking to get into buy and hold. I look forward to reading about your ventures in ’14. Carson

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Deadrick February 11, 2014 at 10:37 am

Mike,
Great info! Do you have a copy of a jv agreement that you wouldn’t mind sharing?

Thanks,
Deadrick Colbert

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