All Forum Posts by: Mike Schorah

@Micah Haworth

How do you figure out the repair costs based off of a Zillow ad?

I'd look for deals first. That way when you network, you'd have information to offer of value and would want others that you're networking with to actually engage with you and build the business relationship.

Supply and demand. I know. I'm a Purchasing Manager. I look at prices all the time. Lumber mills were shut down because of COVID, so the prices of 2x4s and lumber skyrocketed. It went from $12 per sheet of OSB to $44 per sheet of OSB. But the price is going lower (at least in my area) and I heard that they're opening up the lumber mills or whatever issue there was with them is disappearing. But now steel is skyrocketing in price.

The issue with 2007-2009 was that they were giving mortgages to anyone breathing. I know all about that too. I was a home improvement contractor from 2003-2009. So when prices collapsed, people just walked away. Now, people have more equity in the property. It makes it more difficult to walk away. Financing has tightened and banks are more conservative. You actually need a decent credit score and sufficient income to buy a property, even in this hot market.

@Elisabeth Lernhardt

I was frustrated with Zillow too. It seems great to look up properties, but it's difficult to go into details about them and analyze comps. I found Redfin to be much more helpful. You can get a map of similar properties and it's much easier to navigate. I just finished analyzing my first 100 properties (suggested by Brandon Turner on the podcast). I usually start with Zillow to identify them, then switch to Redfin to fill out the details on my spreadsheet when analyzing them.

@Joe Villeneuve

@Joe Villeneuve

They have 4 options. One option is $600. One option is $800. One option is $2k and the last option is $2.5k. The program seems to be pretty intense. Unlimited calls/emails. An hour per month of private coaching. So I'm not sure if this is completely separate from the offer of 50% profit if you find the deal plus coaching...OR...if they'll do a bait-and-switch and when you find them the deal, they'll say that in order to get the training, you have to pay for one or more of these packages.

It definitely seems like work needs to be done. I'm calculating that I'd need $4k-$5k to find a deal using driving for dollars and skip tracing. It doesn't seem like a get-rich-quick scheme.

I'm in manufacturing, but the businesses that I owned were a residential flooring company in 2007-2008 and a general contracting home improvement company from 2013-2014. Not sure about now, but marketing definitely shifted from 2007 to 2013... mainly from newspaper and Yellow Pages to SEO and PPC, but that's the construction industry. Every industry seems to gravitate towards a different form of advertising. But I definitely can see why they'd use a coaching model like this. Going to my $10k profit, if I'm spending my hypothetical $5k, then my profit would shrink to $5k. But if I go for bigger deals, then it would grow (i.e. $40k in profit would give me $15k ($20k which is the 50% minus the $5k D4D/skip tracing).

They did say in the meetup that you can email them and call them anytime with deals and they'd get back to you. I don't know how quick the response would be, but that part kind-of sounded like a no-cost obligation, especially since I clarified it after the meeting when I asked "So, I bring you the deal and I get 50% profit and you show me the rehab process?" "Yes. It's not easy finding a deal." The above mentioned coaching options were what I found on the website after the fact, so I don't know if the website had been updated and I don't know if this is a new program they're offering. There is not a copyright statement at the bottom of the website identifying the year and I know that things could have changed because it has been 17 months since COVID started and since their last monthly meetup. For instance, the meetup used to be at one location in the email and it was later changed to another location (where the meetup actually was) in a separate article. This seemed to be a miscommunication with their staff (which I verified later). I'm not saying that this is reflected on them. They were very professional and knowledgeable about real estate and I had attended one of these meetups in 2017 which doesn't make it come across to me as being a typical guru event. I'm not sure how they're vetting out the tire kickers. From the sound of it, it sounds like they'd just take a longer time to respond to emails and phone calls when they find out that someone is a tire kicker. And when someone is putting in effort, for instance there was a guy at the meetup that was actively doing text marketing and cold calling and he had been doing it for a bit of time.. both of the presenters actively went over and handed out their card to them. They didn't give their card out to anyone else, but did mention their email address to the group as a whole.

My local REIA has been in operation for 10 years. I went there 4 years ago and met the owner.

I went to the monthly meetup which was the first one post-COVID. They said that if you find the deal, they'll JV with you and give you 50% of the profit. So if the profit is $20k, they'll give you $10k. This included letting you know if a deal was good or not and setting you up with one of their coaches as part of a coaching program. The coach would show you the process to flipping a house.

I'm somewhat skeptical. I even told the owner after the meetup that it sounded very generous. He said that finding a deal is not easy. My skepticism comes from being in business. From my experience owning businesses, marketing only usually seems to take 25-30% of a company's budget. And coaching someone is very involved.

They also have a lending business that they're trying to grow so maybe this is a reason why the program is so generous. They want to attract lifelong customers. I also thought that it could be a way to give back. Giving back and generosity seem prevalent in the real estate community. But so do scams.

I asked the owner if I needed to put up, say, $10k in exchange for a piece of the profits. He repeated the terms (Just bring the deal and we'll give you 50% of the profit.)

I noticed that they have coaching packages online (very expensive training sessions... what I would expect from a guru). But their Facebook reviews are very clean and date back 3 years (although they only have 5 reviews... none appeared to be coaching related).

So scam or no scam? Is it worth finding a deal for them or not? 

Citracado sells mortgage late lists.

Have you tried googling "brownsville texas property management company"? I found a company (not sure if I'm allowed to say the name, so I'll redact it) at the bottom of page 1. 124 reviews, 4.9 stars. Not saying that some of those reviews are fake, but at least they're doing a great job of managing their appearance. Even if you have to pay a little bit more money, it's better than not having to deal with a headache. I didn't, but I'd check out their Facebook reviews too. Call them up. Ask questions. 

I never had a bad experience with a highly reviewed company. Knock on wood.

I'd definitely stay away from any referrals/recommendations or just conversations with a person or company without thorough research. Surprisingly, some feel that an emotional connection justifies working with someone even if you're spending thousands and thousands of dollars. Nothing beats concrete proof and data of a good company. 

And if one highly reviewed company doesn't work out, then move onto another highly reviewed company. It's as simple as that. Anymore thought into the strategy is analysis by paralysis, letting the fear hijack your plans and never following through on it.

 You may never get another shot to invest again? Even after 5+ years?

Can you get a hard money loan for a flip or a BRRRR if a hard money lender foreclosed on you 3 years ago?

I'm asking this on behalf of a friend. He lost $15k on a house flip and rather than lose more money, he worked out a deed in lieu or foreclosure or something. I didn't understand the whole story, but he said that he wanted to flip or BRRRR again badly. He said that he learned his lesson and was hoping that it was possible to have a second chance. So I was curious and thought I would ask it here.

Can you get a hard money loan for a flip if a hard money lender deed in lieu on you 3 years ago?