I rarely write articles , especially for the BiggerPockets Blog, that are not related to real life real estate subjects. When you read this one, it may seem like it has more to do with ‘real life’ that is does real estate, but believe me, what good is taking all the right steps and making all the right moves in your real estate investment career if you are not around to enjoy it? This is a story that every real estate investor, whether you are a husband, wife, father, mother, partner, friend and anyone working their backside off every day for someone else, needs to read…
How I Bought, Rehabbed, Rented, Refinanced, and Repeated for 14 Rental Properties
This is the dream right? Going from zero to 10+ rental properties, providing stable cash flow and long-term wealth for you and your family, and building a scalable business model to boot! Learn how this investor did just that, in this exclusive story featured on BiggerPockets!
Due Diligence Comes In Many Forms
My father told me a few years ago that I needed to go get a physical every year and he advised me to go to a physician who had treated several members of our family. My family has some pretty good roots here in Memphis and I am a third generation entrepreneur here in the city. There happens to be a doctor here who was my grand fathers’ physician and my fathers’ physician and now he is mine. Unfortunately, there is a good reason for me to go to him. There is a history of cancer and heart issues that runs in my family and it is always good for a doctor to have a good idea of what to be looking for.
So, I have gone to have a physical every year since the age of 35 and have always been pronounced perfectly fit. My dad has a physical every year too and even though he is one of the fittest people I know at the age of 62, he never skips that doctor visit. We are always looking for parallels to the real estate investing business and have laughed in the past that this is just good ‘Due Diligence’. My fathers’ birthday is early January and he has his appointment every year just before his birthday – this year was no exception. Let me paint a little clearer of a picture for you about my father, the man who started our company.
My Father – the Competitor
He is competitive guy and loves competition and more importantly, testing himself in everything he does. I’ve explained before on here that our real estate investing company is hyper competitive because we simply want to be the best. How that is scored and judged is a matter of interpretation, but there is no doubt that we are always trying to come up with new ways to improve. We simply adopted his driven nature. He has a stack of cards that he keeps. The cards have the message he heard from Joel Osteen that day along with his workout schedule. The man can tell you exactly how many days he has worked out every year along with what he did and if he liked Joel’s message that day or not! People are always amazed that as a company we are so focused on recording and tracking data and I point to him as where it all started!
On his 60th birthday he gathered all of his sons together for a weight lifting competition where he wanted to see if the old man could out lift his sons. He is a competitive softball player and has been competing for the National Championship for the past 10 years in his age brackets and in different competitive brackets. Several times he has finished second and left the trophy in a trashcan in the parking lot because, as he says, “I came here to finish first!”. He finally won the national championship two years ago and that was obviously a huge thrill for our office and a great chance for him to teach everyone that hard work and constant striving to improve can pay off with you reaching your goals. He has related that message to everything we do in life, including investing in real estate and operating an investment real estate company.
Last week he had his yearly physical and the doctor marveled at how fit he was as he approached his 62nd birthday. Is your cholesterol under control? Check. Is your blood pressure low? Check. Any signs of fatigue, dizziness, shortness of breathe? Nope. Blood work all looks good and all other indicators of any problems check out perfect. The doctor told him to head on down the road and we’ll see you next year. Just out of curiosity, my dad thought to ask one more question. He asked the doctor if he could get a dye-test where they checked your cardiovascular system. He had never had one done and thought a little extra due diligence might be a good thing. The doctor told him that they had a better test he could run called a Coronary Calcium Scan. They joked that the higher the score, the more danger you were in and that my dad would probably score a 35, which would be lower than most 20 year olds!
My father completed the test, felt great and left the doctors’ office. Two days later he joined me in Phoenix, Arizona to speak to a group of real estate investors and had some very sobering news. His doctor had called him with a very stern warning. He knew my dad was traveling and wanted to make sure he wasn’t traveling for softball. He told him no straining, no running, no weight lifting, no yelling, no lifting his luggage…nothing. He had a Theracic Aortic Aneurysm.
As if he needed to make matters worse, the doctor informed my father his calcium score was over 480. My dad is a healthy eater, hardly ever drinks alcohol, has never smoked or touched a single drug, hates taking over the counter medication for anything and works out every day. His cholesterol was in check, his blood pressure was well below any danger zones and his doctor had just cleared him as healthy two days earlier. The thing is, there do not have to be any signs of trouble to have an aortic aneurysm. It is by pure chance…luck, that my father happened to ask to do a check up that neither he nor his doctor saw any signs as a reason for getting.
Sometimes Due Diligence Means Doing More Than The Status Quo
So, as far as due diligence is concerned, just like with real estate investing, sometimes having trust, history and the good-ole eye ball test is not always enough. Sometimes you have to ask one or two more questions, just to be sure, just to make sure every rock is over-turned and every scenario has been explored. Due diligence is more than running the routine tests and sometimes requires a little more digging, even when you are dealing with someone who you have a long history with. Due Diligence means asking one more question when every indicator says everything is good.
As it turns out, my father is having open-heart surgery in the next two weeks to repair his aortic artery and to bypass two other arteries on his heart. He did have blockage in his arteries and if he had never asked for that test, there is no telling if he would have been with us long enough to have the test done at his next physical. He has been working as an entrepreneur and investing in real estate for almost 30 years now and we’ve already talked about what a shame it would be to work so hard preparing for a time when he can relax with grand kids only to never be able to enjoy the fruits of his investments.
If you are spending time to build your portfolio, spend some time to make sure you can enjoy it! We would love to hear from any other readers on how this article may effect them…even if it is nothing more than a dedication to do a little more due diligence on your health this year!