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Helping Solve The Affordable Housing Crisis By Investing In Mobile Home Parks With Charlotte Dunford – Real Estate Women

 

Real estate investors have two options: wait and do nothing or be creative and find opportunities. One of the hottest of these opportunities right now is investing in mobile home parks. In this episode, Charlotte Dunford, the managing partner of John Creek Capital and Investment Managing Company, sees a great opportunity in mobile home parks, which is a long-ignored niche that people were not looking at. She shares why she is attracted to mobile home parks, given their nature; it fights off inflation and is also recession resistant. And because of this nature, the mobile home park industry and the market is not as correlated to the overall market health. Tune in and learn how Charlotte tackles the affordable housing crisis by investing in mobile home parks.

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Helping Solve The Affordable Housing Crisis By Investing In Mobile Home Parks With Charlotte Dunford – Real Estate Women

Real Estate Investing For Women

I am so excited to welcome to the show, Charlotte Dunford. Charlotte is the managing partner of Johns Creek Capital, an investment managing company that focuses on mobile home park investments with a total investor subscription amount of over $4.2 million. Numbers-wise, they have twenty park investments, and Charlotte, herself, has also created over $500,000 of assets value in the past. She comes from humble beginnings and is a first-generation American citizen and college graduate after leaving China with just her belongings at age sixteen. Welcome to the show, Charlotte. How are you?

I am doing well. Thanks so much for having me.

I am so excited about this conversation. We have not had anybody come on the show and talk about mobile home parks. I am super excited about that. Before we dive into that, could you tell us your immigration story and all of that stuff?

I came from China. I pretty much jumped on the plane and left for the United States when I was sixteen years old to go to a high school here in America. It was Pennsylvania. I did not speak any English. I did not have money, not even a cell phone, or anything. I remember being picked up from the Philadelphia airport and being dropped off. He drove through the woods like a forest wooded area and to my host family’s house. It is a host family I never met before. To me, it was all new. I had to try to integrate and learn the language, learn the culture, and try to climb up the American society through different steps. First, I studied hard to get into a top college here in the south, an engineering college at the Georgia Institute of Technology.

Shortly after graduation, I was able to land a job here in Alpharetta as a business analyst and also doing real estate on the side. I found that using my salary to qualify for larger deals became more difficult as my salary was not going up at the rate of me wanting to acquire. Therefore, I quit my job. It was risky for me and it was a calculated risk because, at the time, I have only been working for one and a half years. My husband did not have a job because he was still at school. He just graduated, so he did not have a job. I quit my job. My little bit of savings and other investments we had were not enough to launch a company, let alone make it succeed.

However, I was thorough in my education and also learned a ton before I quit my job to educate myself on how real estate works and had to start learning from scratch. Fortunately, I was able to do deals when I was still holding my job. I had some experience. After I quit my job, I was quick to start the Johns Creek Capital and grow the company with my partner from 2 parks in 2019 to 27 parks.

Why did you leave China?

There are a lot of Chinese immigrants everywhere and they leave for different or similar reasons. I wanted to pursue better opportunities because in a communist regime, such as China that I grew up under, owning real estate or having any business, you have to have relationships with the government or your family needs to be very wealthy to be able to make the cut. For me, nobody in China owns their own real estate. They lease it from the government for 70 years. The lack of capitalism or entrepreneurial opportunities and a better environment for people like me to grow in was what prompted me to travel to the United States to pursue a new life.

You made that decision at the age of 15 or 16. That is incredible. I want to dive into this a little bit deeper because I want to understand the mindset. I am a first-generation American. My parents are first-generation. It depends on how you define it, but my parents came here as immigrants. There is an immigrant mentality that happens that us Americans, even me as a first generation, having seen my parents, I do not have that drive. They come here for better opportunities because they see something that is not working in their home country. They do not come here, against popular belief, to mooch off the government to try to take our jobs or to do any of this stuff.

They come here because there is something that is not working at home and they want out so bad. They are willing to leave their families, everything they know, and their culture, even if they do not speak the language, to come to create something better for their life to have more choices. We all know that I am all about choice. In most parts of the world, you do not have the level of choice that you have here in the United States. Most immigrants come here and they work their butts off to create something better because it was so hard to get here. At the age of 15 or 16, how do you make that decision?

I never saw the opportunities in China for me, like a lot of people or kids who come to the United States, they come with their parents or a relative. I came by myself. My parents never came with me. They did not even attend my high school graduation. It is that they are very far away. They do not speak English. They are not familiar with anything here. I came by myself. I made the decision because from a young age, I was inspired to achieve more and I did not see the opportunities for me in China. Even in the school system, I knew that I did not belong there.

This independent move on your own, talk to me about how that shifted your mindset. How did it change your outlook on success?

I had nobody. I had to start from scratch. I had to learn English. I had to get along with the host family and get along with the locals and make myself useful. From a young age, for a girl who had to adjust to that, a young girl who was just trying to make it. I was constantly in survival mode. When you are in survival mode, being embarrassed is the least of your worries. That gives me the assertiveness that is required to do what I do. Also, in that survival mode, I knew that was a decision that I cannot go back on. I have to succeed.

Having this belief of having to succeed no matter what, really propels you towards your goals. I think that changed me forever. I was already a very motivated and driven person, but that made me even more ambitious and driven because the more efforts or sacrifice I put into something, the more outcome I would like to see. There is no stopping me now or ever since I got here.

 

I love what you just said about being in survival mode. Being embarrassed is the least of your problems or your concerns. It is so interesting how many of us will make choices because we do not want to look stupid. We do not want to do the wrong thing because we have got choices. We have got all of our security, our homes, our parents, and our money. We have got the luxury of being embarrassed. When you are just surviving and you are in a completely different place with very little support, you had your host family. That is fantastic.

My parents did not even have that. You have yourself. You do not have the luxury of being embarrassed, of not being bold, of not pushing yourself to the absolute limits just to survive. It is a beautiful story. Talk to me about how you got into real estate. It sounded like you knew about real estate even in China. Could you tell me a little bit about your real estate story?

Chinese always love real estate, especially when I was growing up. Buying a house and holding that house is always a good investment in Chinese society. However, under the regime, you are not allowed to own your own real estate. You only lease it from the government for 70 years and you have to renew the lease. You never own anything. You have a lot less rights. Owning real estate is extremely hard in China. It is much harder than it would be in the United States. I came here thinking that this is an opportunity that I would never dream of having where I was born into.

I made a promise to myself that I have to start buying real estate as soon as I had the opportunity to, which is right after I landed a job after college to use my salary to qualify for my first single-family home deal. After that, I was able to qualify for another deal. It was a duplex. That is what kicked it off. I quit my job and started mobile home parks because it was a great niche. It was a long ignored niche that people were not looking at. For me, that was a great opportunity.

How are you turned on to the mobile home niche?

I wanted to scale the business. I quit my job and I wanted to go into multifamily originally because the logical thing to do at first is single-family, duplex, 3, 4, 5, and then going to multifamily. The thing is in the multifamily industry, the big boys have been in this game for decades. As a newbie, once you get into real estate and multifamily, that was almost impossible. The brokers will not even talk to you unless you have a pretty big portfolio. That was the red ocean there. I am a big believer in blue ocean strategies, which is a somewhere where not a lot of people are hunting the same ocean. The mobile home park was one of those. I was able to hunt in this blue ocean and get in at a very early part of the cycle to make profits.

When did you get in?

I got in, in late-2019. I quit my job in 2019. I bought my first mobile home park along with my partners. My first private equity deal was n August of 2019 and then the second park in November of 2019. The third park was in December of 2019. 2020 was a big year for us. We acquired many more parks in 2021 as well. We have been closing deals and selling deals and doing the real estate game.

You consider buying mobile home parks more like buying land. Is that true?

Yes. Mobile home parks are a parking lot business. It is a land business. It is not as much of a rental business as multifamily would be.

Talk to me a little bit about the benefits of being in a land of business like that. It is just buying empty land. That is a different land of business. This is a very specific case. Talk to me a little bit about how you view buying this land.

A mobile home park is not an empty land. It is more of a parking lot. It already has utilities set up with homes on it. People are paying a lot fee, parks on your lot. That is where the most valuable things come from. It is the occupied lot with a tenant-owned home on it, paying lot rents versus renting out the mobile home or renting out a home. You have to be in charge of all the utilities, repairs, and maintenance within the home versus a mobile home park business where you do not have the home. You do not want to own the home. You are just in charge of the land, the utilities that are in the park, common area maintenance, general, and then real estate taxes, insurance, and the general parking stuff, not the rental stuff.

The reason why it is attractive, not only because it has a lower expense ratio, it is because the lot rents are incredibly low to start with. It has got a lot more meat on the bone than most other asset classes. A lot of the mobile home park owners are mom-and-pop owners and they do not tend to increase the rent a lot. There is a huge gap usually between the lot rent and the apartment rent, which is another housing product in town, and the market rent. You have a lot more room to make them money. The meat on the bone is the difference between the lot rent into the market with the market handle. There is a lot of room to value add the mobile home park. That is why it is a profitable business.

The mobile home park is an affordable housing business. You are providing affordable housing options for your tenants and giving them that privacy, giving them that home ownership, and boosting the pride of home ownership in the community is what you want. I think it is because it is an affordable housing business and the demand for affordable housing, especially in a recession that we seem to find ourselves in this economy. We become more of a recession-resistant asset. That is why it is attractive. It fights off inflation and recession.

Mobile home parks were a great niche; it was a long-ignored niche that people were not looking at. Share on X

It is not recession-proof, but it is recession-resistant, given the nature of mobile home parks because lot rents are incredibly low to start with. People tend to move to less expensive housing options. Also, our tenant base is not as affected by the recession as many other people would be. For example, a lot of them live on social security income. That is a very stable income source. That is why the mobile home park industry and this market are not as correlated to the overall market health as some other asset classes may be.

You said that there were a lot of opportunities for value add. Talk to me a little bit more about that. When I think about value adds, I buy a place as crappy and I make it beautiful. With a lot that there is already a mobile home on top of or renting, how do you do a value add? What is the process of raising those lot rents? Talk to me a little bit more about how that whole thing works.

The value add of a mobile home park is a neighborhood that you are owning. It is the land that you are owning. Think of yourself as an HOA. You are beautifying the park. You are beautifying the environment around the homes. You are fixing roads. You are fixing potholes. You own the road. You are upgrading utilities. You are adding fences to the neighborhood, making it more pretty, and giving it cosmetic upgrades. You can add a new sign to the community.

You can do all kinds of things to make it cosmetically more attractive. Also, you are responsible for more effective management. You want to build this pride of ownership into your tenants so that they take care of the properties and the park. You are also in charge of common area landscaping, trees, and manicure. All those things are up a value add. Those value add benefits you give to your tenants.

That is when you raise the lot rent. You usually do not want to raise it for more than $50 per year because you do not want to give them too much of a raise that they cannot afford it. $50 per year should not be a problem. As far as raising lot rents, you have to stick to the state regulations. Every state has its own regulations as far as how much notice you need to give your tenants before you can raise the rent.

Some states are 30, 60, and 90 days, but most of them are within 30 to 60 days. You want to give them the notice and you want to work with your tenants and you want to be advocates for your tenants. They are a lot more value out in there. Sometimes the park has a vacant lot and it has already got utilities set up. That is a very expensive process. You can get someone else to move their home into your lot. You can give them some incentives in several months of free rent. That is well worth it to have someone bring a home into your park. Also, you can build back utilities. People tend to use less water when they have to pay for utilities. You can submeter. Those are some of the major ways to value add in a mobile home park.

You mentioned a vacancy. Talk to me a little bit about vacancies and rents. If you went into multifamily, you would be like, “We expect 8% vacancies per year, which means that this many units, we are planning on having this many empty.” Talk to me a little bit about how vacancies work in a mobile home park.

For mobile home parks, the turnover and vacancy are two separate things. The turnover tends to be slightly lower in all tenant-owned parks because they own the home. It is like leaving your home behind. If you own the home, you have to pride ownership of this home. You are a lot less likely to walk away. It does happen, but it is a lot less likely than packing away your stuff and leaving the apartment building. You do not own the apartment building or the condo, but in this case, you own your home. You maybe have a mortgage on the home. The turnover is lower.

Vacancy-wise depends on what you buy it as. If you buy at 80% occupied, it tends to stay that way for an extended period of time. The turnover is more regular in a park-owned home than in a tenant-owned home because the tenants own the home. They would want to take their home with them, but since mobile homes are extremely expensive and hard to move, it is almost impossible to move the home.

How would you feel if you moved in with a 20% vacancy? How do you fill those vacant spots?

You can choose to fill it, which is inexpensive, but very much value add approach. There are several ways to go about it. Number one is to advertise the lot for people to move their own home into the lot so they can bear the costs of moving and home purchase. You have to take care of hooking up the utilities and making sure that utilities are working. That is number one. It is probably the best way, but you do not get those opportunities a lot because it is expensive to move home.

Number two is when you buy a brand new home or a used home and move it to your lot yourself, and then sell this home on a rent credit program, similar to a rental home arrangement. You give it to the tenant based on installments or you sell it to them straight up. Those are the two primary ways to fill lots. The second option is a lot more expensive than the first one, but that is more achievable. You will have to do everything yourself.

Where do you buy them?

You can buy them from mobile home dealers. You can buy them from other mobile home park owners. You can buy from other people who want to sell their mobile homes. The primary source will be a mobile home dealer.

 

Where are most of the parks that you own?

Our parks are across ten different states. They are primarily focused in the Midwest and the Southeast. We have a couple up in the Northeast and a couple out West, but most of them are in the Midwest and Southeast.

Why did you choose those markets?

They provide the biggest spread between the cap rate and the interest rate. We want to spread our parks for diversification purposes to diversify our portfolio from a geographic standpoint. Those markets are chosen based on the legislature as well. A lot of times, we do not own a lot of parts in the Northeast, in states like New York or New Jersey, or out West states like California or Oregon or some of the very coastal states. We are in Washington because they are tenant friendly to the point where it makes it extremely difficult to operate in a mobile home park, given the special challenges in this industry. That is why we focus on mostly landlord-friendly places, such as many states in the Midwest and the Southeast.

Could you tell me a little bit more about finding locations and what that process looks like? How do you find the different parks? I understand you want some diversification, which is why you start to go looking. There are some legal things. There are some things about the state laws that impose obligations on some people or not. How do you find the parks, the locations, or the communities? Could you give us some insights on that?

Throughout the time that we have been in the industry, we have built relationships with brokers, sellers, and other professionals in the mobile home park industry that we have enough deal flow going to our desk directly. Once we get those deals, we have a proprietary algorithm utilizing fifteen different parameters to analyze the park and give it a score. The score is going to help us determine how successful this park is going to be. The parameters and the scores are solely based on our own experience and our own data analysis. It is like machine learning, feeding the machine the data that it needs to know the machine starts to learn what is better and was not. It is an algorithm developed by ourselves. It is a simple algorithm, but all the parameters are based on our experience to make a decision.

There are millions of brokers around the country. You are not going to be able to build relationships with all of them. How did you choose which communities to build those relationships in so that those deals would start to come to you?

The brokers we have relationships with usually start with a deal. Mobile home park brokers are not that many. There are a lot of real estate single-family brokers and even multifamily brokers, but brokers who focus or have expertise in mobile home parks are not that many. We usually start the relationship with the deal and see how the broker performs throughout the deal. If we make the deal successful, then usually we would like to continue working with them. The deal is the conversation starter and the relationship starter.

How can people get started investing in mobile home parks?

If you want to start investing passively, you are welcome to visit our website at JohnsCreekCapital.com and talk to me. That way we can get connected. You can invest as an LP, Limited Partner, passively. If you want to start your own mobile home park investing journey, invest actively and turn this into a career, find your niche, and get yourself educated through resources within the mobile home park community. It is a tough asset to manage. You want to understand as much as you can about the asset.

Could you talk a little bit about the challenges of managing a mobile home park? I have friends that have done it and they are like, “It is hard.”

The demographic the mobile home parks have. It is difficult to find good tenants. They are out there. A lot of our parks have wonderful tenants, but there are parks where a lot of tenants are not the most responsible people ever and they would turn your real estate into a mess. That not only does exist in mobile home parks, but I am sure that tenant problems are everywhere. That is in any real estate asset class, multifamily, single-family, or commercial. You have bad tenants and you have good tenants. You want to make sure that you understand the local landlord-tenant laws. Think of the tenants at your mobile home park as a stakeholder because they own their homes there. You want to make sure that there are no bad actors in your company as a stakeholder.

If you have a lot of bad stakeholders, then your company is in danger. That is one challenge. Also, other challenges have to do with the government’s regulations. A lot of times, their job is to find problems in your parks and their job is to find violations that cost thousands of dollars to manage and fix. That is another issue. The biggest money loser in the mobile home park industry is utilities. If you have a utility leak, water leak, or sewer leak, then you not only are subject to the thousand dollars plumbing bills. You are also subject to health department regulations and they could particularly shut your park down. That is a nerve-wracking experience.

The third challenge, last but not the least, is throughout COVID because of the eviction moratorium. Tenants take that as a weapon against the landlords, especially mobile home parks because they take it as they do not have to pay rent. If they own a home that is worth $10,000 and eviction moratorium in some states lasted more than two years. If you have that long of eviction moratorium, they cannot be evicted for non-payment. They can owe you up to $10,000 to $20,000. If they owe you more than what their trailer is worth, they are going to walk away. They are going to walk away, leaving you a problem property, an empty trailer, and trash with things. You are left with an empty trailer that you do not have a title to. You cannot rent out again.

A mobile home park is a parking lot. It is a land business. It's not as much of a rental business as a multifamily would be. Share on X

You have to go through the entire legal process to regain the title, which is another headache and because of the abandoned home, the city is going to cite you for violations of an inhumane environment. You are stuck in the pickle. We have parks where cities go after us for homes that we do not own. During the eviction moratorium, we have no right to evict them, but the city wanted to shut us down for not removing them. We will be breaking the law if we were to remove them. Those are the situations you have to face. You have to be very diplomatic and creative in your solutions to dealing with these people.

Do you have a whole team of people that do those things?

My partner is generally more in charge of the operational side of things. We do have boots on the ground and usually a watch person at each park. For each park, because they are far away from each other, we have a local team. He has good business and real estate experience and management experience. We usually assemble a local team that consists of contractors, government officials, and local park tenants to take care of all the repairs and maintenance issues.

Did you find that during the eviction moratorium, you did have a lot of people not paying rent? What were those numbers like? What percentage stopped paying?

5% to 10%.

That is not as bad as I thought.

It is not as bad as multifamily or commercial. During the COVID pandemic, the hospitality industry went down 70% to 80%. Multifamily went down 15% to 20% and mobile home park revenue went down only by 5%. It is not as impacted, but still, it can be a problem. It becomes more difficult. This is a nationwide problem, not just mobile home parks. All real estate professionals face this issue. It is the lack of labor. Contractors are impossible to find.

Could you talk to me a little bit about what it is like to work with you and your team? If people want to invest in mobile home parks, they want to diversify their asset base, but they do not want to do it themselves. Tell us a little bit about what it is like to work with you and what kinds of returns people can expect.

Working with us, the first step is to go to our website at JohnsCreekCapital.com and have a short conversation with us. We always have an initial phone call with our investors and get to understand their goals, their needs, and their questions. After the initial phone call, we usually follow up with a deal that we have. We will start the relationship from there. Usually, if the investor is interested in a particular deal, the time between they make the commitment, either verbal or heart commitment, to the time of closing is usually 30 to 45 days. You will have access to our online portal where you can have your own investment account, where you have all of your investments listed there.

As far as returns, we offer an 8% preferred return followed by a waterfall structure of 70/30 of 8% preferred return. It jumps by four points each time. It goes up to 12% then the split becomes 60/40. 60 being the investor, 40 being us, and then it jumps by another 4 points at 16%. That is the highest return waterfall in a given year. That becomes 50/50 and stops there.

The preferred rate of return, which is 8%, is accumulative cash on cash rate return, which means that if in a particular given year, the 8% preferred return is not achieved. That means that deficiency whatever the difference is will be carried over to the next year so that the investors will be made whole. However, the 12% and 60% are extra. They are not the preferred rate of return. We will talk more about that on our phone call and all the offering packages we sent you.

What is the minimum investment with you guys?

It is $50,000.

Could you explain the waterfall? People say this on the show so often. I know what it means, but I am sure people are like, “When will someone tell me what that means?”

 

A waterfall is a way to align the interests of the sponsors, which are us and the investors together. It motivates the sponsors to work harder at the deal so that we can achieve a higher return for an investor to trigger a split of profits. The higher return we have, the more split we are going to get. That aligns our interests together. You do not want to work with operators or sponsors who do not have the same interests as you do. You want them to work harder for their dollars. That is the structure that we set up. Think of all the cash as a waterfall. Once you hit a hurdle, every return is a hurdle. Once you hit a 12% hurdle, the waterfall starts splitting. That is why it is a waterfall.

The 8% preferred rate of return means that we are not going to get paid unless you get your 8% and anything after that will be split. Once we get our 8% and then it splits and then 12% it splits again. The higher, the return the more split the sponsors are getting. That is, in a nutshell, what waterfall. It is a return structure to align interests together and make us work harder. Overall, all of our offerings offer an approximately 15% internal rate of return over 2 to 3 years, sometimes up to 5 years of holding time. The annualized return is anywhere from 19% to 20% and above, depending on the holding time.

With a waterfall, you have a preferred rate of return, which is what you are guaranteed each year. If there is additional profit above and beyond that, then they get paid different amounts based on what that is. You said that the annual rate of return is between 19% and 20%. Is that because you sell the mobile home park? Talk to me a little bit about that.

Cash on cash annually without a sale. Mobile home park investment has a cycle. It starts low at the beginning because there are things that we need you to fix and their value add opportunities we need to conduct, which costs money. The expenses go up, which means your returns are staying low in the first year. You are usually looking at 4%. Sometimes we do better than that, but conservatively speaking, that is 4%.

In the second year, you are looking at slightly going up to 6% and then it goes up as time goes on after we finish our value add cycle. For example, the one that we sold, we bought this mobile home park in Iowa. We bought this mobile home park in June of 2020 for $325,000. We had an average of over 8% cash on cash per year, even without the sale for this deal. After a 22-month hold, we sold this deal in May of 2022 for $495,000. This deal delivered a total of over 18% internal rate of return and over 19% annualized cash on cash return.

Tell people how they can reach you. This is all very interesting. I have to confess. I am not sure that I would want to play this game on my own. You would need a team that knows what they are doing, but if you are looking to diversify, this is a great opportunity. Tell everybody how they can reach you.

The best way to find me is to go to our website at www.JohnsCreekCapital.com and hit the contact form. I will reach back out usually within the same business day. I would be excited to talk to you about this recession-resistant asset.

Tell us a few more insights and advice on investing in this mobile home market.

The biggest insight or advice I would give is to understand your niche, your parameters, and what you are looking for. We have a saying in the industry, real estate in general, “You make the money when you buy.” You cannot buy when you do not know what you are doing. You cannot just buy randomly just because something is cheap. You have to have a strong reason and strong logic behind the reasons you are buying a particular asset. Know your parameters, know your requirements, and stick with them. That is the number one thing I would advise.

Do you teach any of this stuff or do you know anybody that teaches about mobile home parks and what to look for?

I personally do not teach yet, but I would not mind that being an option in the future. The biggest mobile home park education, I did not personally go to his boot camps or educational programs, but I heard so many good things about it. Go to Frank Rolfe’s Mobile Home University. He has bootcamps that tells you every single thing that you need to know about mobile home parks.

How did you learn?

I learned from actual experience. That is the best way to learn. You can learn everything on a piece of paper and learning everything. You will not get to understand what it is like until you are in the game. You have to buy. You have to get yourself into the actual investing.

Are you ready for three rapid-fire questions?

The mobile home park is an affordable housing business. You're providing affordable housing options for your tenants and giving them that privacy, giving them that homeownership. Share on X

Yes.

Tell us one super tip on getting started investing in real estate.

Take action. Don’t do analysis paralysis. Don’t overthink things too much and then you never take action. Take the best action that you can find and move forward.

What is one strategy for being successful as a real estate investor?

One strategy is to have enough reserves. The one thing you can always expect from any real estate investment are surprises. You are going to have surprise expenses. To counter that, you need enough reserves in your account to account for that. If you do not have enough reserves, you are out of business.

Do you have a formula for that?

We usually use $10,000 plus 6 months of income, at least, in the account.

What is one daily practice that you do that contributes to your personal success?

Reading business books or reading all kinds of good books that educate yourself and inspire yourself to achieve more.

Do you have anything you want to close with before we go?

We live in a great nation with many opportunities that you cannot find elsewhere in the world. I encourage everyone to take advantage of the opportunities that you have in front of you and take action. Do not be afraid of fail. You want to fail early and fail often, but get up often as well. Take action and move forward.

I think that we get afraid of failure because we feel like it reflects badly on us. The problem is that unless you fail, you will never get to the next level. I think about children. How many times did they fail to walk before they took their first step? What if they had never kept trying?

It reflects back on us. That is back to the embarrassment topic. If you are in survival mode, that is the least of your worries. If you push yourself hard, the reflection means nothing. Do not worry about how other people look at you. You have to know what you want and go for it.

This has been an amazing conversation. Thank you for joining us, Charlotte.

 

Thank you so much for having me.

Ladies, thank you for joining Charlotte and I for the show. I appreciate you. I look forward to seeing you next time. Until then, remember, goals without action are just dreams. Get out there, take action, and create the life your heart deeply desires. I will see you soon.

 

Important Links

• Johns Creek Capital
• Mobile Home University

 

 

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The Road To Real Estate Success And Why You Don’t Need To Quit Your Job To Invest With Jess McVey – Real Estate Women

 

The road to real estate success isn’t always smooth. When we fall on our knees, it can be hard to get back up again sometimes. But the results can be rewarding if we learn from these experiences. In this episode, Jess McVey shares the ups and downs of her real estate story. Jess started buying rentals when she was young. And then she made mistakes when the market crashed. Although Jess started to back up a bit, that was not to be the end of her journey. Now, she has reached the success she worked hard for. Tune in to this inspiring episode and see how she was able to find success as a real estate investor. Plus, learn why keeping your job while doing real estate makes sense and why it might be the perfect advice for you!

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The Road To Real Estate Success And Why You Don’t Need To Quit Your Job To Invest With Jess McVey – Real Estate Women

Real Estate Investing For Women

I am excited to welcome to the show Jess McVey. She is from Northwest Indiana. She started by buying rentals when she was in her early twenties and started flipping shortly thereafter. She made some mistakes when the 2007 and 2008 markets crashed. She took a break for about seven years and started back up, flipping in 2015. She started a wholesaling business in 2021. She’s done a lot of stuff. Welcome to this show.

Thank you for having me.

I’m delighted to have you. I want to let you know how I know Jess. I hope you’re going to talk a little bit about this. She was a student of Zack Boothe. When I asked Zack about his successful ladies and the people that he feels proud of, he mentioned Jess. I’m excited to talk to her all about what her journey has been. I know I read your bio, but could you give us a high-level story? What happened?

It all started when I was in college. I was good at school. I never felt right. I was doing well at a job that I had besides going to school. I was looking for something that was going to allow me to retire early. I was already thinking about retirement at nineteen. I know those kids don’t do that. Yeah. You were the rare exception.

I started investing in the stock market in 2000. The tech market dropped and I did badly in the stocks. I started looking at real estate. I started liking what I was reading. I could see myself doing it. I had more control over the investments. I called my dad. I said, “Dad, I’m coming home from college.” He’s like, “Why?” I’m like, “I want to buy rentals. I want to be a landlord?” He’s like, “You don’t know anything about fixing anything?” I’m like, “Yes, but I’ll learn.”

I came home. He helped me move home. Several months later, I bought my first property. After that, I bought eight in several years. As I learned, I took care of all those properties. I’ve managed all of them. I’ve rented them out, did the repairs, hired people if I had to, and I also started flipping. I did a couple of flips. Fast forward from 2006 to 2007, it started getting bad in the real estate market. People started seeing signs that there was going to be a collapse, and it did. I did make some mistakes but reiterated. A lot of people did. I should have been that hard on myself.

It was way more experience investors than me that lost everything they ever worked for in real estate. I had been doing a couple of years in Boston rentals and a couple of flips, but it was hard on myself. I backed away from it. I kept my properties. I hired a property manager. I went to Chicago and lived. I was 28 at the time, still passive investing, taking care of my properties, but I always wanted to get back into it. I was hard on myself, but I never forgot what I wanted to do.

In 2015, I had an opportunity to flip a house. I did it. I was my uncle’s neighbor. My uncle told me about it. I approached them. They let me buy the property. That set me off, and I did 2 or 3 a year because I still had a small child, a daughter. I wanted to be a full-time mom. She went to school in 2021 full-time. That’s when I took it up a notch.

I was doing 2 to 3 properties, flipping a couple of rentals, 15, 16, 17, 18, and 19, but as of 21, when I added wholesaling marketing, I did twenty. 20 April of 2020 until 20 April 2022, twenty deals. From April until May 2022, I had 10, but I had to cancel 2. I got eight in the pipeline at some point. Either I own them, I’m getting ready to close, or I’ve already closed them. It’s for 2 or 3 months. It’s pretty good.

First of all, I love that you started young, and I know we all can’t turn back time, but it makes my heart sing when I hear about young people that are in it. They’re thinking about their future. If you’re young, if you’re in your twenties, see what happens.

 

Don't give up after making big mistakes. Share on X

 

Don’t give up if you make a mistake. If I would’ve kept going, I would have been retired now. I’ve seven years of experience in doing and making, but still, I’d probably have instead of 24 doors, I probably have 48 or 50 units, 48 properties, or however you want to cash flow, more rentals, but I took a break.

There are experienced investors that lost everything in the crash in 2007 and 2008. Yeah. It’s interesting to me that you, like me did not. You held onto your properties, took some time off, and let them ride. That was good to hear. Why do you think that worked for you? For me, I always say that I wasn’t over-leveraged. It’s because rents went up, and I had a financial cushion. I was able to ride that wave that way. That was hard on people. What was it for you?

Why it worked out okay is because I did buy them net traditionally, I put 20% down. Most people agree with this. Even if you see market drops and maybe flipping doesn’t pan out, usually the rental market isn’t quite as affected. That’s not to say the pandemic didn’t work best with people’s rents. It was a whole different animal. For the most part, we have market downturns or recession rents. Still, people have to be able to live in a place. I wasn’t affected too much with the rental market. They were rentals, and they were cash flowing, breaking even.

Another thing is, which I never had to do is I do have a good job. If I ever had to, I could have put money into my rentals. I never had to until this day. I bought somebody at once that I could have stomp pay for other ones. If I have a $3,000, $4,000 bill, something big, I got the other ones to pay for it. That helped me and a good rental market. With the area I am in, Indiana, it’s not that place to stay rented. There’s a demand for it. It’s safe. There aren’t a lot of turnovers. That’s the reason it helped me get past all that turmoil that happened in the first few years of the recession.

I heard you say that you’re an employee.

Back then, when I had money, I was in bartending, managing bars, and was a yoga teacher. 2015, 16, 17, 18, 19, the pandemic. I could have made that a lot easier by saying the pandemic ended my yoga career because I didn’t want to teach online. I didn’t want to teach outside of the studio. A pandemic happened, and that’s why I stopped teaching yoga. When I did it, it was $100 a week. I was doing my real estate and my rentals, bringing cash flow in. I’ve owned them for a while. Rent has gone up. I lived off that too.

Now my business is I work for myself for gem house buyers. Before I did have, I was a yoga teacher for several years, and a bartender before that would allow me to have the funds to buy the properties in a traditional way. I didn’t know anything about creative financing, wholesaling, or seller financing. I didn’t know any of those all real estate stuff that people learn. I didn’t know that back. I put 20% down on all the properties because I had a good job, and I was 22. What else did I have to do with the money?

Many people have this aspiration. When I quit my job, I’m going to start investing in real estate. The best way to start is when you’ve got a job, and there are many reasons for this. It adds in anything that you might want to add. First of all, yes, there are lots of awesome creative financing ways to go. If you have no way of getting cash, that’s great.

The easiest way to get into real estate is to have a job, qualify for traditional financing, put 3.5% half to 20% down, whatever you can come up with, and based on the program that you choose, buy a house, house hack or rent it out. Primary residences are the easiest to finance and get into, and you need to pay rent anyways. It might as well pay yourself rather than somebody else’s mortgage. Utilize that money to get into the next house. Keep your job so that you can do it again. Until you’re big enough, maybe 1, 2, or 3 properties. You’ve got enough equity in one property that you can fold it back out.

 

 

Real estate does not have to be a full-time thing for me. I tell people all the time, “I work 5 to 10 hours a month on my real estate business. Now, it’s even less.” It’s not a full-time thing. Eventually, you can get to where you’re retiring. You’re working that little bit of time, whatever now most of your time is spent on what you would prefer to do. I love when you talk about, “I was working, and that’s how I got the money.” People forget that’s the easiest option out there. If things go wrong, you’ve still got your income. You’re still making money. I love that you modeled that. Thank you, Jess.

To add to that about you have a job, keep your job, and do real estate when you add that extra layer of, “I have to make money from this. I can’t survive.” You will not think properly. You won’t make a decision that is not as clean. You’re a little more desperate. Especially if you’re trying to learn real estate, you don’t even know about it.

I would hope nobody would be silly. I stopped. I’m doing what they’re doing, and they don’t know anything about real estate. Make sure you have that job, so you’re not working stressed out of that extra pressure of not succeeding. You have no job, and you’re surrendering trying to find a job. Nobody would be silly enough to stop unless they had a whole bunch of money. If you hit the lottery, I suppose you could quit your job but still do real estate.

If you win the lottery, make sure that you do real estate like that. Don’t spend them at. You invest it.

For most people, it’s cars, houses, and buying primary residences.

You’re like, “No, don’t do that.” I’m with you, shoes, purses, and clothes. Yes, you deserve all those blissful things and plan for the future. Your daughter went to school, and now you upgraded your business or up? What was the term you used?

I added another part of real estate investing. Although some people will say, “It’s not investing. It’s wholesaling.”

Talk about why you did that and how that transition happened?  

I got tired of losing deals. That was why I started the wholesaling. I’ll back up and reiterate what that means. I was buying 2 to 3 properties in 2015. Maybe 2 or 3 in 2016. It’s easy to find those 2 or 3 properties. I bought some from some auctions and sheriff sales. I bought one from Auction.com and REOs. I’d got a couple of referrals.

 

Keep your job and do real estate. Stop doing what THEY'RE doing. Nobody would be silly enough to stop unless they had a whole bunch of money. Share on X

 

When I wanted to do more, my daughter was getting older, a little more independent, even a little bit before she went to school full time. I did 3 for 2 or 3 years. Now I want to do five. I was putting offers in and getting outbid all the time. Bigger companies probably have crews working for them, coming with their rehab costs lower than mine. It’s competitive.

I’m looking at wholesalers, emails, and MLS. For the last MLS in multiple listing services, I put an offer that was 53 offers. This was before it was hot. It was like 2018 or 19. I started thinking about wholesaling. I should back up. I did do two wholesale deals, one in 2017 and one in 2019. I have little marketing. I got the property. I was going to keep one as a rental. It occurred to me that I could wholesale it. It was great. I made $17,501 in one month. I didn’t know how to make it a business. I drove around a neighborhood, my neighborhood of rental properties. I was checking on them. I thought, “I’ll look around and see things for sale.” Low and behold, or was. I did that.

In 2019, I did send some letters out, mailers probably behind on their property taxes, and I got one from that. When you interview me, he is like, “Why didn’t you keep going?” I’m like, “I don’t know how to do it. I don’t know how to scale this.” In 2020, when I started watching YouTube, I found Zack. I liked him, and I signed up for his coaching. He filled the gaps in.

I got blessed because of several years of fixing rentals and learning how to flip. I know how to comp, do comparable properties, and do analysis to make sure it’s a deal. I was blessed that I knew that information. The wholesaling part was like, “This is how you find him. You call him. You send postcards. Do your marketing. He filled that in for me.” That’s how it all worked out for me. I hope that answers the question.

I want to add a couple of things. You say you were blessed because you already had this experience. You know how to mentally have an idea of what values are going to look like, what fix-ups are going to cost, and those sorts of things. Ladies, if you don’t have that experience, it doesn’t mean that you can’t do real estate. You have other blessings.

Let’s got to do a little bit more education first. It’s not hard to learn any of this. You don’t have to be a rocket scientist to learn how to go on Zillow and figure out what property sold in three months and how to decide. They look the same square footage. You’re not major calculations. You can learn the stuff in several months. It’s easy stuff.

When I started several years ago, there was none of this stuff. There are no Zillow, Trulia, and Redfin. We are lucky now that we have resources. I want to talk to you a little bit about Zack. You went through YouTube because this is a question that people ask me all the time. I want to find a mentor. I got on YouTube, and there are 50. You put in wholesaling and or whatever it is that you want to do, BRRRR, or whatever it is you want to do. A hundred people out there teaching about this strategy. How do I pick the mentor that’s got integrity, knows what he’s doing, and is going to help me build a successful business? How did you pick Zack?

I didn’t interview too many. I can tell you how I met Zack or how I decided to watch him on YouTube. There’s an app called DealMachine. It helps you add properties if you want to drive for dollars. He was on a podcast like an interview, and I liked him. I’ve checked him out on YouTube. I saw he had a video that said $40,000 in 40 days.

He did this challenge, and I watched all these. I liked him. He’s genuine. He’s not a big host. He’s doing well. When you look at his videos, he’s not huge. He’s not getting 1 million views. He’s small-time still. He’s going to be because he is genuine and authentic. I connected with him. I reached out to him, and we talked on the phone. It was affordable. He’s not overpriced on his coaching, at least at the level I picked. You might have something more maybe, but what he offered me, I was like, “That’s a great deal. Add to me.” I signed up for him, but he’s this easy-going, accessible guy. There’s something about how you connect with people.

 

 

His real intention is to help people. That’s part of why I have you on. I’ve had several people on from his group because I feel that from him. I feel his heart. In every conversation that I’ve had with him, I feel deeply that his intention is to help. What is it that you loved most about working with him?

I still work with him. I texted him because I had a question about a property I had on a contract with a seller. It’s the first seller ever tried to walk out from a contract on me, all these deals I’ve done. The first ones that said, “I changed my mind.” I didn’t know how to handle that. I called Zack. He knows so much. If he doesn’t know it, if it’s technical, he’ll might say, “Miguel, one of his team members, knows.”

He knows a solution that I don’t think of. He’s always got all these different situations. He knows how to properly answer them for me. That’s why I like him. That’s why I keep reaching out to him if I need them. Sometimes I think I know more than I know. Sometimes I’m like, “I should probably have.” I have the ability to reach out to him more if I want. I don’t think to ask for help. I try to figure stuff out on my own, which sometimes isn’t the best. In this case, I knew I wasn’t figuring it out. I needed some assistance. He’s experienced. He’s done so many deals. That’s why I like him.

Is he super responsive?

We have group coaching calls, but if you have a deal on the line and you don’t know, he will call you back. He will make himself accessible to you. When it comes to actual questions about the course or a deal in the works, he’ll probably wait until the weekly coaching call. You can ask whatever questions you want. It’s 1 to 2 hours long. Sometimes, it’s been longer than two and a half hours. He will keep going until everyone answers. For the specific deals where you have something right there at the moment, he’ll make himself accessible.

That’s so rare, don’t you think?

Yes, I think so. Some coaches might be more expensive and not be as available

I have not taken Zack’s course because I’m not interested in wholesaling. I’m in retirement mode. I’m having fun. It’s important to me as we talk about him and I share about his coursework with my ladies that we’ve got some truthful, honest perspectives on what he has to offer. He’s a wholesaler. He loves it, and he loves teaching it from what I understand, but everybody I’ve spoken to. I’m glad to hear that. Tell me, Jess, what advice would you give to a new investor?

I would say the first is to get a mentor. I do believe you should have a coach. You could ask questions too. Yes, YouTube and books are great, but there’s a saying I have, “You don’t know what you don’t know.” How do you know what to learn first? If it’s basic real estate, you could find a mentor for that. If there is something specific, you want to learn, whether it’s wholesaling or you wanna be a real estate rental landlord. You want to have a huge portfolio. There’s a mentor for that.

 

Real estate does not have to be a full-time thing. Share on X

 

There’s a lot of free besides having a coach. BiggerPockets is good. There’s a lot of education on basic stuff but get an education. There’s another saying, “You’re going to get an education in real estate, whether you like it or not. You do it by making mistakes that are costly, or you do the education up front to help mitigate those mistakes.”Another piece of advice is if you do make a mistake, don’t give up. It works. Nobody’s successful. All the people that are successful that we know about in history usually made many mistakes and failures before they hit it. It sometimes takes years for that because you got to be patient.

Everything that you say, I agree with. Success can’t happen without failure. The only way to reach goals is to push yourself out of your comfort zone and what you already know. Otherwise, you stay stagnant in what you are and what you’re doing. When you’re pushing, you’re going to fail. When you were a baby and learning to walk, you didn’t go get up on your feet and start walking. Maybe some of you did, but most of us didn’t. You had to fall down a couple of times. Sometimes it hurt. You start crying.

We’re that same way. Every time we start something new, we have a new ambition or a new set of goals. We’re that same person. We’re not going to be, “I’m up.” You’ve got to learn. You’ve got to when you’re a baby. You’ve got mom standing there saying, “Come on.” Dad molded you on the other side or whatever. Those are your mentors in those days. That’s what you need, even in your businesses.

There are so many things, setting goals and making yourself accountable. I take videos. If people check me out, they’ll see. My video is on my personal page. I plan to put them on my business page, my Instagram. I’ll do videos. They’re live. There’s no script, or I’m going at it. I do that because it makes me accountable because I know people are watching. I’m like, “I got to make sure I do another one.”

That’s my way. That’s a little more high level. People reading could put something out there to people telling what they’re doing. They’re making themselves accountable. People ask them, “How’s it going?” You’re like, “Okay.” You won’t forget. People are reminding you, or you’re posting something on Facebook, and that’s what can be encouraging too. People will like it. This is a little social interaction to help encourage people to be accountable.

Normally, when I talk about accountability, I talk about it with group coaching or whatever. This was such a different perspective on accountability. I love that, Jess.

Thank you. Those videos are my accountability for myself.

Jess. You’ve been amazing. Thank you so much. Tell everybody how they can get in touch with you. I want to hear about your Facebook page, Instagram, and all that stuff. Let people know how they can reach you.

For my business page, Facebook and Instagram. You can reach out to me through my company or me. We’re both on as my personal, and that’s my name, Jesseme McVey. My actual business is Jemm House Buyers. Me, my daughter, and my husband’s initials. It’s also because I look for gems.

 

 

Ladies, you know that Jess is a student and friend of Zack Boothe, who we’ve heard from before. If you’re excited about learning what she learned from him, you can still connect with him and his team. Go to BlissfulInvestor.com/Zack. You’ll get to talk to him or Stephanie, who you’ve already met. They do have someone else who’s going to be working on the phones. I trust that that person will be as fabulous as them. You can go to that link and set up a time to chat with them and see if this business is a good fit for you. We saw what an amazing fit it’s been for Jess. If you’re interested in connecting with them, remember to go do that.

The show notes on the podcast players are, tend to be shorter and don’t always include the links. Go to BlissfulInvestor.com so that you can see the blog posts. That way, you can see all the links, all the gifts, all the connections, everything there for all my show. You can even do is search. My team will have Jess’s contact information and all the links. Do you have anything you want to close with Jess?

I think we did a pretty good job. We covered a lot. If you’re new to real estate investing, don’t give up. I always loved it. Whether you want to supplement your income, or if you want to do a full time, it could be very financially rewarding, and it gives you other rewards as well because you people work for yourself you can spend more time with your family, and you don’t have a boss and all that. Maybe you want it because you want to plan for your future.

To me, it’s the best investment of your time and money out there. They say 1% of the wealthiest people in the world, 90% of them own real estate of the 1% of the world the population. Ut’s a great vehicle to build wealth. Even passive or active investing wholesaling cash in your pocket when you do the deals, regardless of whatever you’re looking for. It’s awesome.

I always say, “There are a million ways to make $1 million in real estate.” You have to pick the strategy that fits best with what it is you’re trying to achieve.

Whatever you pick, if you’re diligent, you will be successful at it. You’ll make money at it. You’ll achieve your goals, whatever you decide to choose to do.

Thank you so much for sharing all this amazing wisdom with us.

No problem, anytime. Thank you for letting me share my story and give some advice to other investors out there. I appreciate it.

Thank you. It’s my pleasure. Ladies, thank you so much for joining Jess and I for this show. You know how much I appreciate you, and I look forward to seeing you next time. Until then, remember, “Goals without action are dreams.” Get out there, take action and create the life your heart deeply desires. I’ll see you soon.

 

 Important Links

• Jess McVey
• Zack Boothe
• Auction.com
• YouTube – Zack Boothe
• DealMachine
• $40,000 in 40 days
• BiggerPockets
• Facebook – Jess McVey
• Instagram – Jess McVey

 

About Jess McVey

We are professional home buyers, and we are proud to say that we’ve already helped many homeowners sell their homes! For us, the seller always comes first, and that means the deal has to work for both of us. Integrity and education are our principals, and they are the reason why we have the reputation we have today, as one of the most respected homebuyers around the area. We give you full support, and there are no gimmicks or hassling.

We always work with fair offers and great prices, no matter the condition the homeowners are in!

NO financing is required because we have cash in hand to make the close even FASTER! We can close it all in just a week, but you can choose the actual closing date. We work on your terms!

 

To listen to the EXTRA portion of this show go to RealEstateInvestingForWomenExtra.com

Learn how to create a consistent income stream by only working 5 hours a month the Blissful Investor Way.

Grab my FREE guide at http://www.BlissfulInvestor.com

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A Guide To Protecting Your House With Leading Property Inspection Expert John Cipres – Real Estate For Women

 

Property inspection is such a routine procedure that we often take it for granted. But no self-respecting homeowner, investor, buyer or broker would deny its importance in all real estate transactions. Just how important is property inspection and what does it entail? Today’s guest gives us the details. John Cipres is a certified property inspector, licensed general contractor, and C-36 license holder. He is a leading expert in his field and his clients have included real estate brokers, investors, homeowners and commercial companies. In this episode, John explains the major components of property inspection and why each of these components is essential. Join in and learn what things you should notice and when you should run as fast as you can!

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Watch the episode here

 

Listen to the podcast here

 

A Guide To Protecting Your House With Leading Property Inspection Expert John Cipres – Real Estate For Women

Real Estate Investing For Women

I am so excited to introduce you to our guest, John Cipres. John worked for over sixteen years as a Field Customer Service Technician for Sempra Energy Gas Company. He left in 1997 to pursue his dream of owning and operating a business of his own. John is a certified property inspector and a licensed General B contractor. He holds a C-36 plumbing license. He is a leading expert in his field.

His clients include real estate brokers, investors, property management companies, homeowners as well as commercial companies i.e., Amtrak, LA Sports Arena, JPL, US Tile, and CP Kelco to name a few. John is also a certified life and business coach. He enjoys traveling in his spare time together with his wife, Laura, mentoring at-risk youth, and coaching young entrepreneurs.

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Welcome to the show.

Thank you so much for having me.

This is so much fun. This is the first time I’ve done something live. I’m excited about this.

We’re going to have some fun.

First of all, tell us what are the major components of the property inspection.

There are five major components on any property. There’s a roof, foundation, electrical, plumbing, and heat and air conditioning. Those are the five major safeties. Run for the money if it’s not adequate for the house.

Those are the things people need to make sure that they get inspected. That’s why they hire you.

The other stuff is cosmetic things. Those are the major components of a house.

As a new home buyer, it’s very important to hire a home inspector because they would know what they’re looking at. Share on X

Tell us what are the fire, health, safety, and water hazards that exist on a property.

Smoke detectors are important. Carbon monoxide is important and stuff like that. If their heater is malfunctioning, it would be spewing carbon monoxide if it has a crack or stuff like that.

This whole carbon monoxide thing with the detectors is a new thing in the industry. We started requiring this a few years ago. All of us have heard about carbon monoxide. Tell us why they started doing this where you have to have a detector and what it causes for people in their homes.

The reason why they started having it is that there have been deaths equated to gas and unburned fumes on the property. It picks up carbon monoxide, which is odorless and tasteless. It’s a killer. After all these years, they have figured, “Let’s make it the law.” It saves lives. That’s the reason that they have it and had passed a law. System-wide, they have one in each property. The way the law is written is there’s one per floor. In other words, if you have two floors, you need one per floor.

Before we started, you mentioned something about the deep dive. You walk into a house, notice certain things, and run as fast as you can. Could you tell us a little bit more about that with regard to carbon monoxide?

Usually, the seller is required to put it on. If they don’t want to do it, then make sure they put it in because it is a requirement by law to have it on the property before you close escrow. If they don’t want to do it, then somebody has to do it. A lot of times, the agents will put it up. That’s one important thing because it does save lives.

What would you consider a minor or a major repair when you’re doing inspections?

A major repair would be an outdated electrical panel. If it’s way outdated, they would need to have a new panel, which includes the wiring. There’s some old wiring out there if they’re not grounded outlets and stuff like that. It’s a major expense to rewire a house and put a panel on. That’s something that the buyer should be aware of if they’re going to buy a property. They need to budget that money.

 

How would they know?

They would call a home inspector like myself to come out and inspect all the major components of the property. We write up a report and get our reports out within 48 hours or sooner. Based on that report, since we’re a licensed contracting firm, if we’re asked, we will put a cost analysis on that report. That way, they know what it costs. They can do one of two things with that. They can ask them to repair it or they can get a credit for their escrow.

If I were walking into a home, how would I know if that’s something to keep my eyes on and think about?

If you go to the panel and you see that it’s old and it’s an original part of the house, it’s a red flag. Your inspector would catch that and then follow. There are some recalled panels out there. He would know if they’re recalled or not and then let you know, “This is way outdated. It should have been replaced many years ago. It’s new.” He would let them know right away. That would give peace of mind for him.

What is the average lifespan of water heaters and tankless water heaters? Talk a little bit about that because that’s a big issue.

The conventional water heaters on the property are usually 40 or 50 gallons. Their normal lifespan is between 8 to 12 years depending on how hard the water is in the area and if they flush it out once a year. That’s on conventional tank water heaters. It’s important to keep track of that. If a water heater is located upstairs in the hallway and they don’t catch it in time, then you have a big water damage issue when they go. We let them know by the rating plate how old the water heater is. If it’s at the end of its lifespan, we would let them know. We have run into water heaters that are 18 to 20 years old in the middle of the house. It’s a big urgency to get that replaced.

As a new buyer, is there any way for me to detect that walking into a house?

You would have to know what you’re looking at. That’s why it’s important to hire a property home inspector because they know what they’re looking at. They will say and write on the report the age of the water heater if it’s new and the risk factor if it’s low, medium, or high for leakage. They will put it on the report.

Team up with a contractor, property inspector, or somebody that you can go with and look at properties together. They can guide you and tell you if something’s a good deal. Share on X

Is a seller responsible for that?

It’s all negotiated. It’s a real estate question. If the buyer says, “I would like the water heater replaced to help close a deal,” then it’s up to the seller to do that. The seller could say, “I’ll give you credit for that.” You can do it yourself.

We’re going to talk a little bit more about deep dives in the EXTRA portion of the show. Before that, why don’t you let my audience know how they can reach you?

They can reach me by going to our website. It’s www.AndreasFaultPro.com.

What stuff do you cover in the newsletter? What would they be getting from that?

There’s a lot of safety stuff. I’m known as the property inspector that saves lives. It would have a lot to do with safety on their property. A lot of homeowners are first-time homebuyers. They don’t know anything about a house. They can get educated along the way from the newsletter. Once a month, we will have some new information on there. They can look at it. It would be very beneficial.

That’s so valuable. I’m spending so much time maintaining. I can’t keep up with what’s going on. We don’t know where to look. If you’re sharing that information, that is valuable. I love that you said that you’re the home inspector that saves lives. Are you ready for our three rapid-fire questions? The first one is this. Give us one super tip on getting started in real estate investing.

From my perspective, one super tip is to team up with a contractor, a property inspector, or somebody that you can team up with and look at properties together. It would be a good tip because it’s like having that education on the house that they would normally have as an investor. That would be a good tip to include somebody, hire somebody, or team up with somebody who has some experience on properties. That way, they can guide them and say, “Is this a good deal? How much money are you going to spend on repairs?” We know that it’s all about the bottom line.

 

That way, when you start walking in a house, you’ve already got that education. You can start eyeballing things and noticing things that you wouldn’t normally notice. Give us one strategy for being successful in real estate investing.

One strategy that I see is getting up early in the morning and making the best of your day 3 or 4 hours before people get up. Do your homework and don’t let the every day phone calls bother you when you can get so much done before your start time. Everybody starts usually at 7:00 or 8:00. I get up at 4:00 or 4:30 in the morning. I get stuff done when people are sleeping. When investing, that can be tied to doing your homework on the multiple listings or going out there. It’s first-come, first-served on properties. Whoever finds the deal first can put the offer in first. The early bird catches the worm.

It’s so funny because I don’t even get out of bed until 8:00 but I do that on the back end. Often, I’m working from 12:00 to 2:00. I still get my 6, 7, or 8 hours of sleep but I’m working in those quiet hours in the evening. It’s finding some time when you’re not going to be disturbed so you can focus. What is one daily practice that you would say contributes to your personal success?

Get up after you get hit. When you fall, get up. Keep on going after your dream and don’t let any negative talk or negative situation take you down. I always say, “Out of every negative situation, if you can find one good thing in that, that’s the golden nugget.”

We’re going to talk on EXTRA more about safety tips that John has to offer us. He has some stories for us. I love that he calls himself the home inspector that saves lives. We’re going to talk more about that in EXTRA but for now, we’re going to sign off. Thank you so much for joining us for this portion of the show. If you are subscribed to EXTRA, please stay tuned.

If you’re not but would like to be, go to RealEstateInvestingForWomenEXTRA.com. You can get signed up there. If you’re leaving us now, thank you so much for joining John and me for this portion of the show. I look forward to seeing you next time. Until then, remember that goals without action are dreams. Get out there, take action, and create the life your heart deeply desires. I’ll see you next time.

 

Important Links

• www.AndreasFaultPro.com
• RealEstateInvestingForWomenEXTRA.com

 

 

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To listen to the EXTRA portion of this show go to RealEstateInvestingForWomenExtra.com

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How To Be A Passive Income Nomad With Mike Wolf – Real Estate For Women

 

You must research and study your way when diving into real estate. Every market offers different kinds of opportunities. But, the question is, are you willing to do what it takes to succeed in your chosen market? Join your host Moneeka Sawyer as she interviews Mike Wolf on how to be a passive income nomad. Mike discusses the importance of adapting to changes and explains real estate investing strategies to help you take it to the next level. It’s never too late to try and quit the job you hate for a venture that will help you attain financial freedom. Join in and learn how!

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Watch the episode here

 

Listen to the podcast here

 

How To Be A Passive Income Nomad With Mike Wolf – Real Estate For Women

Real Estate Investing For Women

In this episode, I am so excited to welcome back to the show Mike Wolf. I’ve had him on the show a couple of times already. Readers, you loved him, and several of you have gone to his three-day workshop. I got great reviews on that. I’m super excited to bring Mike back to have another very cool conversation.

Before we lead into the conversation, I want to introduce him again to those of you who haven’t met him yet. Mike has been investing in real estate for many years. He’s also a sought-after international speaker, including an appearance on the TEDx stage, philanthropist, and mentor to a group of students he affectionately calls the Wolf Pack. Mike helps people create a lifestyle of freedom and helps them get out of the rat race. Mike, welcome back to the show.

Thanks for having me. It’s always great to see you.

It feels like it’s been so long. It’s so good to be able to chat again. When Mike and I were in the green room, he was asking me how Africa went, and I was giving him some stories. It turns out he is speaking in South Africa soon. He doesn’t have an exact date. The thing that he is speaking about is becoming a passive income nomad.

It’s an event for digital nomads so that people can work, have freedom, and travel. He wants to help them go from digital to passive income, so they work even less. I want to have that conversation here for you readers to see where he’s headed with that. That will support us in choosing bliss. Mike, could you tell us a little bit more about your angle on this? First of all, what is a passive income nomad?

First of all, let me define passive income because that’s important. A lot of people don’t really understand it, or they think it’s this myth thing that doesn’t exist. Passive income is the act of doing something one time and getting paid for it over and over. There’s been a couple of times when I posted on social media about passive income. A lot of times, people say it’s a scam or something like that. To give you an example, look at Michael Jackson. He’s been dead for quite a few years now. He made more money in 2021 dead than I did alive, and everybody read this put together.

He made more money than all of us, and he’s dead because he created passive income that keeps going on and on. Now, the state gets the benefit from that. He did something one time. He went into the studio, recorded the album, and people continued to buy those records. We can do the same thing with real estate. When we buy a rental property, we buy at one time. If we’re smart, instead of trying to manage it ourselves because that’s creating a job for ourselves, if we get a good team, not just any team, you have to have a good team in place that manages it.

There are also tenants. They collect the rent and put it into your bank account at the end of the month. It’s whatever it is that your passion is. For me, it happens to be travel. I have the freedom to travel, and I know that money is coming in at the end of the month without me having to do anything to get it. There are numerous ways to create passive income. Real estate is not the only one, but it’s the best one. When I speak to these digital nomads, a lot of them are living their dream. They’re traveling, but they’re staying in pretty mediocre accommodations or living at hostels. There’s nothing wrong with that if that’s what you want to do.

A lot of them are looking for odd jobs, “I’ll be a bartender when I get to this country.” They’re doing a lot of odd jobs and working too hard to support that lifestyle they love. It’s possible, even if you don’t have a ton of money. You just start getting into the real estate game. A lot of people don’t know that, so they end up taking low-paying jobs just to make ends meet.

I’d much rather be a passive income nomad where my money’s coming in without me having to work. Being that person, everywhere I go, I make sure I’ve got a job lined up or try to figure out a way to have a place to sleep at night and have food on my table. That’s what I’m going to be teaching them. It’s how you transition from being the digital nomad to the passive income nomad.

Since most of my readers are probably not digital nomads, let’s jump into how you become a passive income nomad.

 

Passive income is the act of doing something one time and getting paid for it over and over again. Share on X

 

There are some steps involved. Most people don’t have the money in their bank account where they can just buy ten rental properties, at least not the ones that I talk to on a daily basis. Sometimes we have to build up to that. A good example is taking something that normally isn’t passive and making it passive. Let me explain. Here’s one of the strategies I teach my students in the Wolf Pack that I’m most known for. I teach a lot of different strategies, but one of them that I’m most known for is something called tax deeds.

What a tax deed is when somebody hasn’t paid their property taxes in 3 or 4 years. Eventually, the county needs that money to keep their schools open and pay for their police department, fire department, etc. They eventually put these homes up for auction. I’ve had some of my students pick up single-family homes for $7,000. That’s not the down payment. That was the actual purchase price of a home worth $90,000 or $100,000. Normally, there are a lot of moving parts to that. You have to go and drive around and view the properties. You got to pull the title.

There are a whole bunch of things you have to do in order to do that strategy safely. If you’re somebody who likes to travel all the time, you don’t necessarily want to have to go to an auction on a certain day of every month. You don’t want to have to fly back from wherever you’re at. One of the things that I’ve done is I’ve built teams. I’ve got somebody on the ground that goes to the auction on behalf of my students. They’re all over the United States, but my favorite one takes place in Houston, Texas.

I have people as far away as Australia participating in that auction from the comfort of their own homes because I have a team on the ground that goes and views the properties and videotapes it. They pull titles and do all the necessary steps for you, so you don’t have to physically be there, including going to the auction itself. As a matter of fact, my student who picked up the best deal, that $7,200 property, was worth around $90 or $100,000. He lives in California. He was not at that auction. As a matter of fact, he didn’t even have $7,200, so I showed him how to raise that money.

This is what’s possible. You can take just about anything. I used to own a pub. I can’t think of anything with more moving parts than owning a pub, but I had a partner who did all the work. I was the money part. I put up all the money, and we managed to both make a pot of money off this pub that was previously bleeding money like crazy. We turned it around and started to make a lot of money, but I never did a day’s work in that pub ever. That was by design. We agreed on that when we did our joint venture.

I said, “You’re never going to have to take a dime out of your pocket for anything, including the purchase of the pub, but I’m never going to do a day’s work. If a cook doesn’t show up, don’t call me. I’m not going to be there.” We agreed to that beforehand. I took something that normally has so many different moving parts and so many things that can go wrong. If you ever own a pub or a restaurant, as glamorous as it seems, it’s a lot of work. The biggest enemy of owning a pub is employee theft. Alcohol and food all go out the back door and people serving their friends. You have to have somebody there all the time who knows what they’re doing.

I don’t want to necessarily go into all the details of the pub, but you can take something like that. I was traveling while we owned that pub and was still making a lot of money. I very rarely went in there. That’s what’s possible, but a lot of people don’t understand. They don’t know how to build the teams. They think that all these moving parts have to be done by them. A lot of us entrepreneurs tend to be control freaks.

We don’t think anybody else can do it as well as we can. Even when we reluctantly hire our first people because we have to, we’re running out of time, getting burnt out, or getting overwhelmed, we have to hire somebody, or we can’t continue. We then micromanage them to death. Now, instead of doing the work, we’re spending just as much time micromanaging and babysitting. Some of the stuff that I love to teach my students is how you build your dream team that has your back, and you have to take care of them too. It’s not a one-way street. If you take good care of them and they take good care of you, you can build something that requires little time. That’s what I love to focus on.

You mentioned two things that are important that I’d like to get some details on. The first one is he didn’t even have the $7,200, so you taught him how to raise that. That’s the first thing. The second thing is this idea of building teams because I’m in that process myself. I have teams for a lot of the things that I do, but I need more. I’d like to touch on that, at least in the first part of the show. If it’s a deeper topic, and I’m sure it is, maybe we can talk more about that in EXTRA. What do you think?

It sounds great. Let’s do it.

Let’s start with this, “He didn’t even have the $7,200, so I taught him how to get that.” Could you talk to us a little bit about what strategies you helped him with?

 

 

In that particular case, he had come to one of my training. A tax deed isn’t something you should ever show up in the auction and think, “I’ll figure it out as I go,” because you won’t. You don’t know what you don’t know. It will come back to haunt you. There are certain due diligence steps you have to take. At this point, he had the training. He had the education. He had access to my team, so he didn’t have to be there. His job isn’t to go and fly from California to Texas every month and show up at the auction. That’s not a good use of your time.

Much better use of your time and what I taught them to do is I said, “Start going to meet up groups and different real estate investment clubs and places where investors hang out.” Most people are either looking for a strategy. They’re trying to learn how to do a certain strategy, or they’ve got money. They want to invest, but they don’t know how. There are all kinds of different people that show up at these meetings.

If you go to these meetings, the first thing somebody is going to ask you is, “What type of real estate do you do?” That’s the first thing that comes up every time after your name. Imagine you went to one of these real estate investment clubs in Los Angeles and said, “I specialize in Texas tax deeds.” The first thing that’s going to happen is you’re going to go, “What is the Texas tax deed?” They don’t know what that is. Automatically, they’re curious. You say you’re a flipper, and it’s like, “Cool.” That’s the end of the conversation, or, “I have rental properties,” and that’s the end of the conversation.

If you say something that people have never even heard of before, number one, they’re curious. They start asking you questions, “What’s a Texas tax deed?” You can say, “I have access to these deals.” I gave him a bunch of deals that the team has already done. He hadn’t done a deal at that point, so I gave him a list of deals that we’ve already done a bunch of case studies. He can legitimately say, “Here are some deals my team has done because I let him use my team.” You can legitimately say, “These are some deals my team has done. We’ve got this one for this amount and sold it for that. We got this stuff for this amount and sold it for that.”

The only thing stopping us from scaling this and doing more is, “If we had some more capital, we could certainly do way more deals. That’s why I’m here. I’m looking for partners who want to put up some money. We’ll split the profits, and I’ll do all the work.” In reality, he didn’t really have to do any work. His job was to raise money and then call the team. It’s like having an assembly line. You push the button, and away it goes.

You now have the capital, so you call up a team. They now go and view the properties for you. They pull the title and do all the necessary steps. They then go to the auction for you and get you the property. He got his first property using none of his own money. He went on to do a whole bunch of after that. It created a great win-win because that person who didn’t even know what a Texas tax deed was is now benefiting from a strategy he doesn’t know how to do. At the same time, my student is benefiting because he’s doing deals he couldn’t have afforded to do.

You’re taking a lose-lose where neither of them could have done the deal separately, but together, they’re now doing a joint venture that makes sense for both of them. Your job sometimes is once you have the team already built and all the systems in place, your job, if you don’t have money, is to find money to feed the assembly line. That’s exactly what he did. After you do a couple of deals, as you can imagine, he doesn’t need partners anymore. That’s where he’s at. That’s one of several ways to raise money for your projects.

The thing in this particular case is the investors can’t circumvent them. They don’t know how to do it even though he says, “It’s Texas tax deeds. It takes place on the first Tuesday of every month. Here’s where it is.” They can’t circumvent them because they don’t have the knowledge or training to successfully do a deal on their own. They can’t circumvent them, and he’s already got the team. These people don’t have to ever fly to Texas. They don’t have to do any work other than sign a check. It’s a great win-win, and that’s some of the stuff that I love to teach people.

A lot of people don’t think outside the box. They don’t get creative. They go, “I got to go save up a down payment, get a mortgage, and then I’ll buy a property. I then go back to work and work overtime, so I can save about my next down payment.” That will work. You can do that. I call that transactional real estate. You’re doing one transaction, and eventually, you have enough money to do the second transaction. That can work, but there are more efficient ways to do it.

When they’re putting together these private money deals, do you help them with the paperwork, structuring, percentage, and all of that stuff on how to deal with all that stuff? They, too, can feel a little intimidating.

One of the things that I love about the Wolf Pack is that we don’t just give people information and set them free to go do their thing. I’ve been in this industry for a long time and have been doing this for many years. I’ve been training other people for about half that time. For a lot of people, you can take and teach them exactly how to do a strategy step by step. You can give them a blueprint, and they’ll do the work, but at some point, they have to take that leap of faith. They have to send a contract or make that phone call and put in an offer.

 

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A lot of people do all the work and get to the one-yard line, and then they stop because they start to get fearful and think, “What if I screwed up? What if I messed up?” One of the things I do is I personally look at everybody’s deals and vet them to make sure they didn’t miss something. In a lot of cases, I hold their hand, get on that call with a motivated seller, and help them do that call. I had one of my students who had a friend that wanted to invest in him, but he said, “You haven’t done any deals yet. Come back if you’ve done a bunch of deals.”

If he would’ve done a bunch of deals, he wouldn’t need that guy’s money in the first place. I jumped on a call with him and his potential money partner and said, “This person doesn’t have the experience, but I am personally vetting every deal with them. I’m going every step of the way with them. We’ve done 4,000 deals. You’re getting 4,000 deals worth of experience, and just because you’re lending the money to him doesn’t mean your money is at risk.”

One of the things that we do a lot differently is I’m able to hold people’s hands when they get to that tough part. Learning the strategies is the easy part, but having faith in yourself and getting over the fear is a whole different story. After they’ve done a couple of deals, their confidence is where it should be. You don’t need me necessarily every time you’re writing an offer. It works really well.

You gave them contracts and stuff like that, all of those pieces.

We give them contracts and scripts so they know exactly what to say when they get on the phone. Sometimes they’re still scared to do it, so I’ll do it, and they listen in. We give every resource I’ve got and not only that, they get my Rolodex. I’ve been doing this for a long time. I’ve got so many great people along the way, including yourself. I’m very well connected. If I taught somebody how to do Texas tax deeds, I said, “When are you going to go build a team?” There’s not a job description that says, “We go to the auction on behalf of real estate investors.”

Nobody does that. That’s something I had to create. That was a made-up career. I actually found somebody and taught them exactly step by step what they need to do, and now they do that. Building the team for a newbie can sometimes be a little bit daunting, so I’ve done that for them, and they get access. They get to inherit my teams. They don’t have to build them from scratch because even if I taught you, “Here’s how you build a team step by step,” when you’re first starting, it’s difficult because not everybody wants to be on your team.

Especially if you’re doing very small investor, it’s sometimes hard to get good people on your team. When you’re doing a lot of transactions, everybody wants to be on your team and your success. It’s like if you won the Super Bowl, everybody wants to be on that team. The team that never gets to the playoffs, nobody wants to be on that team. It’s the same thing in real estate. When you have a successful business, people start contacting you, “How do we work with you? What can we do to add value?”

You’d be amazed how many people every day say, “Mike, I want to bird dog for you. I’ll work for free. I just want to learn.” It’s interesting what happens. When I first started, I couldn’t get any of my friends or family to lend me a dime. Some people don’t even know me. They see my video on YouTube, and none of my videos say, “Give me money.” I don’t have any videos like that, but people every day come to me unsolicited and say, “I’ve got $100,000. I got $500,000. I got $50,000. How do I work with you?” It’s interesting where these people were when I was first starting, but that’s how it goes in the business. You got to pay your dues, and after a while, you get in the flow, and things start to happen magically.

I have a couple more questions. With the strategy or the strategies that you pick for passive income, do they fluctuate with the events or the economy? For instance, could you do the tax lien strategy during COVID or now after on the backside of COVID? I don’t know if we’re totally out of it, but you know what I mean. Does it work in all situations or economies? Could you speak to that a little bit?

Real estate is very cyclical. What works at one time in history or one market doesn’t necessarily translate into a different market. For example, you mentioned COVID. That’s a great example of, “All the auctions shut down. There were no live auctions taking place during the timeframe.” If you were only a tax deed person and that’s the only strategy you knew how to do, you would’ve gone hungry for a year and a half because there were no auctions. On the other hand, coming out of COVID, all the auctions were back and open again. They have a big backlog of properties that would have got auctioned off. Now it’s a great strategy.

Your timing is everything. The good news is there are many different ways to do real estate. There are always numerous things that are working, and then there are things that are not working. Sometimes things that stop working will work again later. I recommend that if you don’t have the pulse on the market and you’re just getting your information from the newspaper, that’s old news. By the time you see something in the newspaper, that’s already happened. That’s yesterday’s news. It’s important to be on the front lines or be hanging out with people on the front lines and know what’s going on.

 

 

Now, we’re going to see a lot of changes. We were going from a very strong seller’s market because there was such a shortage of properties. That started to ease up. We’re already seeing that in a bunch of different markets. What we’re probably going to see next is a lot of markets are turning into buyers’ markets. There’s going to be a lot of opportunity for pre-foreclosures, foreclosures, and these tax deeds I mentioned. There are going to be subject-to deals.

If you don’t know what that means, it’s an opportunity. Even if you can’t qualify for a mortgage and have very little down payment, there are ways to take over other people’s mortgages, especially if they’re in a distressed situation. I’ll give you a quick example. Imagine you found a place. It was worth $200,000. The mortgage is pretty close to $200,000. These people are unable to make their mortgage payments now. They can’t call a realtor to sell it because there’s no equity, so they would physically have to cut a check to the realtor.

They think they’re stuck. If you’re an expert investor and know how to do a subject-to deal, you go in there and say, “You’re in a really bad situation. I’ll pay off the arrears for you and take over the home and save your credit.” Imagine, on that home, the mortgage payment was $1,000 a month. You knew that would rent for $1,500. You’ve now taken over this property for next to nothing, maybe a few thousand in arrears. You’ve got a property that you’re paying $1,000 on the mortgage, but you’re collecting $1,500 a month in rent. You’ve now got this revenue on a property you put very little money into.

It comes down to being educated on different strategies and knowing what’s going to work in the market based on what’s going on at any given time. With the rising interest rates, a lot of people are scared. To me, I see tons of opportunities. That’s creating opportunity. You have to be up to date on the times and what strategies are working. If you can do that successfully, that’s where the money is. It’s also on the path of progress because COVID has changed many things, like how people work. We could be on a live stage in theory, but now everybody’s so used to Zoom.

Everything’s on Zoom these days, and people don’t have to go to an office anymore. What worked before COVID was advantageous to have stuff in the inner city, close to where the offices are. That’s not true anymore. People are moving to the suburbs now. If you own properties out in the suburbs and you’ve adapted to the changes in the market, that’s where the money’s going to be.

As we see interest rates going up, what kinds of opportunities are you seeing?

As interest rates go up, there are some good things as a real estate investor that come from that, even though we’re all fearful of that. One of the things we’re going to see is that if you buy a rental property, for example, your tenants are going to be a lot less upwardly mobile. They’re not going to say, “We decided to buy a home,” as quickly as they were when we’re at record low-interest rates. Buying rental properties is great if you can get a relatively good deal now. Your rents are going to probably continue to go up as more people get forced into renting. That’s a great strategy.

We’re also going to see foreclosures. As their mortgages come due and the payment goes up dramatically in some cases, a lot less people are going to be in a good position to afford that. We’re going to see pre-foreclosures, foreclosures, and tax deeds. There are a lot of strategies that will benefit from higher interest rates. It’s going to be costing maybe a little more to get in if you’re using financing. The good news is that everything is tied to inflation, and your rents are going to go up probably faster than your mortgage payment would go up by the rising interest rates, and you still can benefit.

I remember the very first property I ever bought. I remember I had a mortgage of 13.25%, and I was ecstatic to get that because the going rate was 14% and a little bit, and I got 13.25%. I was so happy. I’ll never forget the day that interest rates went to 9.9%. They went to single digits for the first time in my lifetime. I felt like a kid in a candy store going to buy every property I got my hands on 9.9%. Now people are concerned, “What if it goes 6%?” It’s like, “That’s still really cheap money.” I wouldn’t ever loan my money at 6%. That’s super cheap money still.

A lot of people haven’t ever experienced double-digit. I don’t think we’re going to have double digits. People were still doing real estate deals, including myself, when it was 13.25%. Even before my time, when it was 18%, 19%, or 20%, people were doing real estate deals. There are always deals to be had. In the newspapers, you think it is doom and gloom, the sky is falling, interest rates are going up, and the world’s going to collapse. No, it’s actually going to create different opportunities that will still be there.

First of all, I love that. Thank you for that. People get caught up in the doom and gloom because all the people that are talking about it are not actual investors. Much of it is economic theory, hearsay, or opinions. There are people that are in the markets that are doing deals, exercising their expertise, doing different strategies, or moving and pivoting them with the market.

 

You have to be up to date on what strategies are working and be on the path of progress. If you can do that successfully, that's where the money is. Share on X

 

Every market presents new opportunities or different kinds of opportunities. That’s what’s so cool about your Wolf Pack or many of these networks that people can plug themselves into. If you have people that are in there that have been in the market a long time with the cycles, they know the different strategies that are going to work given the different circumstances, like interest rates are going up or down. We have a foreclosure moratorium. That’s now opening up. All of that stuff happens, and there are strategies for every single one of those types of situations.

On top of that, everything trickles down. If the cost of living is going up because interest rates are going up, you’re going to get paid more at work. It all evens out. It’s all tied together. It’s not like one thing that’s happening in a vacuum where interest rates are going up, but you’re not going to get a pay cut when interest rates are going up. Your rent is certainly not going to go down if interest rates are going up.

All this stuff is all tied together, and people have all this doom and gloom and fear. For me, it’s like I’ve seen the movie, and I know the ending. I already know what’s going to happen. That’s why being in this business for so long is advantageous because I’ve been through uptimes, downtimes, and times where we’re just stagnant and staying the same. A good investor can make money even when prices drop. When interest rates are going up, you can still make money.

A lot of people, especially if they’re newbies, they think, “It’s going up. I guess I better not get into real estate investing. I better try something else.” I’m glad sometimes that they do because it creates an opportunity for people that are not fearful. It’s like Warren Buffet says, “Be greedy when people are fearful and be fearful when people are greedy.” That’s probably the best advice I’ve ever heard when it comes to real estate investing.

Can you share with us what you did during those COVID months when there were no auctions? What strategy did you use? I’m curious.

It was a very interesting time because I have numerous businesses. The first one was I owned a bunch of rental properties that were passive income. As I mentioned, I don’t collect my own rent. Other people deal with that. That went well. People weren’t moving. People are staying put. A lot of landlords did not get a lot of rent because the government was saying that if you can’t pay, you can’t be kicked out by your landlord. It’s because we have good strategies in place that we’ve used in other times were a lot of people are losing their jobs, such as in 2007. We already had systems in place for that.

We know that’s going to be a repeating trend. There are going to be other times in history, not just a pandemic, that are going to cause mass layoffs at some point in time. We were doing and still are doing lease options, which means that when our tenants move into our property, they’re signing three-year leases. They have a second contract, which is an option for them to purchase it. That option to purchase can be rescinded if they don’t make the rent payments. They’ve got some skin in the game because they have to give what’s called option consideration, which is like a down payment. It’s non-refundable.

It’s like a damage deposit. If they don’t buy the home in the three-year period, they don’t get that money back. We’re very transparent about it. We’re not trying to scam them. They know in advance that if you want to buy a property, we’ll help you get there. We’re going to do our end of the deal. If you don’t do your end of the deal, we’re not going to give you back your money. They’ve got skin in the game, and we are working with them to get them home ownership. There’s a clause in the contract that says if you get more than two months behind, we can rescind your right to purchase it without giving you back the deposit.

We had almost all our tenants paying rent, and very few of them were moving because it was so hard to find anywhere to live. That business was better than ever. In my second business, I sell turnkey properties in Atlanta. What that means is I buy properties 20, 30, or 40 at a time from the banks. We inspect them, fix them, and put tenants in place. My property management team looks after them. I’ve got people to sell these for me, and we’ve sold 1,200 of them in the last couple of years to investors all over the globe.

During COVID, at the very beginning, it was extremely slow. I can remember homes were selling, and I didn’t care because that meant rent went into my pocket. If we don’t sell it, I collect the rent, so I’m still doing okay. It doesn’t matter to me if I sell them or not. Two months in, all of a sudden, the market got hot, and the prices started to go up. Everybody was fighting over properties. I had two investors come in and buy my entire inventory. The banks weren’t foreclosing, so there was a foreclosure moratorium. We couldn’t get more than one here and one there. We couldn’t buy those big packages at home.

We had a good problem on our hands where we were sold out and made a ton of money on that. We also helped a lot of other investors. The problem is that even to this day, we’re still having trouble getting inventory in bulk because the foreclosure process is starting up. That’s the second business that I’ve got. My third one, which is the Wolf Pack, all started because of COVID. I wasn’t planning on doing that.

 

 

Before COVID, I would do tax deed training twice a year. I do a four-day training. After the training, I’d hop on a flight. Now, I’m in Costa Rica. I would go somewhere tropical because that’s my happy place. I would get off the grid for a while and not do any work. I get bored after 3 or 4 months. I will call my team and say, “We should put another date on the calendar. I’m bored. Let’s do another event.” That’s how I was doing things for many years prior to COVID.

When COVID happened, I went back home, which happens to be in Calgary, Canada. I don’t do any investing. All my investing is in the US, but my home is in Canada. I went back there and stayed put for seven months, which is something I haven’t done in many years. I usually go back for a week or two because I have my two grandsons there and my daughter. I hop on a flight, take off for 2 or 3 months, and then go back. I went back first after a seven-month period.

When I first got back there, a lot of my friends were entrepreneurs, and their businesses started to get shut down. A lot of my friends are saying, “My gym just got shut down. My restaurant got shut down. What do I do? I need to reinvent myself.” I’m the guy everybody comes to if they need money advice or business advice. Everybody and their dog were coming to me asking, “What kind of real estate training can I take with you?” I do online estate training because I normally do a four-day live event and can’t do a live event.

I could see the demand was there, so I thought, instead of teaching a person one at a time, why don’t I set up Zoom calls and get a bunch of people on there? That’s how the Wolf Pack was born. We’ve now got around 50 members or so. I purposely keep it small because I work with people, not just in the group setting, but when they’re doing an offer, I’m there to help them do the offer. If I had 1,000 people in there, I wouldn’t be able to offer that service. It’s been great. When I first offered it, I thought, “Okay.”

That was a big commitment to set up a group like that because that’s not my normal thing. I like to be free and be able to travel when I want. I thought, “We’ll do it one day a month and run this for one year. At the end of the year, I’m dropping it. We’re canceling it.” It turns out that I like teaching a lot more than I thought I did. That’s number one.

Number two, I can sit in front of Zoom a lot longer than I thought I’d have the patience for it. I never thought that I would enjoy this, but I loved it, especially when everything was shut down and people were interacting. I had my Wolf Pack. I had my community. This is the family that I chose, not the one I was born into, but the one I got to choose. I was enjoying it so much. We meet at least once a week. Sometimes we meet four times a week, and I’m loving it. To me, it’s knowing to watch my students go in and crush it.

I decided I’m never going to stop doing it, and we’re going to continue to have weekly meetings. I’m heading to Paris, and all my students are in North America. I’m probably going to have to wake up at 1:00 and 2:00 in the morning to teach, but I’m looking forward to it anyway. I built a multimillion-dollar business in the middle of COVID that I wasn’t even attending to build. I hate to say it because it sounds insensitive. I know a lot of people were adversely affected. I don’t mean any disrespect to people going through tough times, but COVID, for me, was beneficial in many ways.

I was lucky enough. I didn’t lose any friends or family to it. It made my businesses boom and helped me create a new business that was not even on the radar. That also comes down to your previous question on how you adapt or keep doing the same thing. You got to adapt to what’s showing up in the world. Sometimes there are things that are not of your choosing that are going to pop up. If you keep doing the same thing over and over again, at some point, it’s not going to work. It’s super important to keep with the times and keep pivoting, which is a very overused word.

When you can do that, it’s amazing what you can accomplish. For me, it gave me that extra bandwidth where I wasn’t traveling. I was bored. I never watched Netflix prior to COVID. Now, I’ve seen so many different shows, but it gave me that extra bandwidth. Instead of using it to watch Netflix, I didn’t watch. Instead of using it just for that, I took time to figure out what’s the demand, and it presented itself. To me, the universe built the Wolf Pack. I didn’t have much to do with it other than I had to show up.

You had to be available and open to it. You’re willing to do your part. You had to be willing to do the work. This is one of those things that we shy away from. I said this on another show before. People don’t want to do the work because it feels hard. I got to tell you, working for the rest of your life or being broke for the rest of your life is harder.

Here’s the other cool thing that I teach my students. If you do things right, you’re building an assembly line. If you have the right team running that assembly line, it doesn’t have to involve you that much. Once you get that infrastructure set up, it’s very easy to build that second assembly line. For the training and stuff, I already had my marketing team. I didn’t have to rebuild that. All the stuff I needed to do to build that new business, I already had that infrastructure on existing assembly lines. Once you get up and running, a lot of people say, “It’s so much work.”

 

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There’s so much work in the beginning. Sometimes it’s not really that much work. If you can get a good mentor, or you can adopt somebody like my students do, and you don’t have to reinvent the wheel, you can get started quickly. From there, it’s just building gaming. You keep adding to it. Sometimes you have to change direction a little bit, pivot, and do something slightly different. I don’t think there’s anything that the real estate market gets thrown at me. I’ve been doing this a long time where we can’t retool the assembly line to do these things slightly differently and still get a result.

A mindset is so important. A lot of people see there’s COVID, doom and gloom, the economy is falling apart, and life is over. If you have that mindset, which is easy to do when that’s all you see on TV, it’s very hard to accomplish anything. To me, every time something changes, I see that as an opportunity. I see it as a way to build something new. That’s what keeps us exciting. It’s never the same day twice. In the last years, there’s never been a day where I woke up and said, “There’s nothing I can do today. There are no deals to be had anywhere.”

I never want to say that. I’ve also never woken up unexcited. I have to pinch myself sometimes. I get paid to do what I get to do. It’s a real passion for me. Even when I got lazy because I had the teams and I wasn’t doing that much hands-on, I was still excited to create those jobs for other people and watch my students succeed. I did a lot of volunteer work, too, before COVID. I’m just ramping that up again because a lot of it involves my travel. It’s important to have something that fulfills and excites you. Real estate still excites me very much.

How many women are in the Wolf Pack?

It’s pretty close to 50/50. We have around 50 members, so there are at least a 20 or 25, which I love because I have so much respect for women. My mother got divorced when I was two. Somehow we always met. I don’t know how she did it, but there was always food on the table. I have so much respect, especially for single moms. I get a lot of single moms either went through a divorce and never had to manage the money before. I always love helping the underdog.

I’m not saying women are underdogs. I didn’t mean it in a negative way, but I know that women have to work harder. They usually have more responsibilities they’re juggling. I especially love the teaching of passive income because I know they’ve got so many other things that are buying for their attention that they’re equally, if not more important, taking care of your kids. That’s super important. We have a lot of females in there, and I’m grateful for that. It’s, in a lot of ways, a male-dominated industry.

In Wolf Pack, our approach isn’t like, “Here’s how you make more money.” It’s very heart-centered. It’s like, “Here’s how we can make a difference and help other people. You can win at the same time as you help these other people.” A heart-centered approach tends to attract more women than other real estate investment groups. I’m very happy about that. I love that. I love the diversity within the group, not just male and female, but different races and religions. We all come together. We all have different beliefs. Everybody is divided over every topic, but within the group, there’s none of that. There’s no politics. People are doing joint ventures together.

I got some people in the group who have lots of money. We have got some dentists in the group, for example. One of them sold his practice, and he’s getting $4 million. He doesn’t want to go on the front lines, auctions, and find deals, but there are other people in the group that have a lot more time and love finding the deals and analyzing them. There are people that are funding my students’ deals.

One of my students picked up a 98-unit apartment building and didn’t use any of his money. Almost all of it was funded by the Wolf Pack. To me, that lights me up to see that this community didn’t even exist a few years ago, and now we have this group of people who didn’t know each other all over North America. They’re doing deals together, and it lights me up. That’s why we do meetings all the time because I get so excited to hear their success stories. To me, it’s fun. I live vicariously through them.

First of all, the reason that I brought you back is because I know how heart-centered you are. It’s been interesting with the readers that did go to your three-day event a few years ago. That was one of the things that they mentioned over and over again to me in feedback. I like to get feedback when my audience attends stuff. You’re so heart-centered, and I knew that.

The person who referred you to me is a friend of yours, and she said that. That’s your reputation, and I know you live up to it. I love that you bring that into the Wolf Pack. Thank you for mentioning that. As women, it is important that it’s heart-centered. We want to make our money and be successful, but there’s got to be some heart in it where we do business a little bit differently. That’s part of what I love so much about what you do.

 

 

You never have to feel bad. I know a lot of people feel bad. It’s like, “These people are struggling. I don’t want to take any money.” It’s important to give but also to learn how to be a good receiver because you can’t sustain your real estate career. If you want to help thousands of people, we’ve done 4,000 transactions, and in most of those transactions, there’s somebody struggling on the other side of that deal. Most of the stuff we’ve done is pre-foreclosures, foreclosures, and tax deed auctions.

On the other end of that transaction, there’s always somebody struggling. That means we’ve been able to help 4,000 people give or take. If I would’ve said, “I just want to give. I don’t want to receive anything,” I could have helped a few people, but then I would have to go back to getting a job. I’d be helping very few people. Money is just a form of energy. It’s like oxygen. You take it in and then put it back out there. The size of my bank account is directly proportional to the number of people I have helped who are in a better spot due to them connecting with me. That’s when you measure it that way.

I know I can make a difference. I give back to a lot of causes that I’m very passionate about. It’s awesome to be too heart-centered, but sometimes you also have to work on yourself too. You have to put yourself in a good spot. Some of the stuff that we teach is that mindset around a lot of people. Women tend to struggle, especially. It was like, “That person’s going to lose their home to the auction. I don’t want to take anything.”

You can do that, but how about you create a win for them, create a win for yourself, and make lots of money, and then down the road, if you want to give it all away, you can? If you want to work for free and make it a cause to help other people that are struggling, you can, but don’t do it at your own expense. It’s like when you go on an airplane, and they say if there’s turbulence, the oxygen mask might come down from the ceiling and put it on yourself first instead of your kid. The first time I heard that, I said, “That sounds horrible. What do you mean to put it on yourself before your kid?” but then I thought, “If you’re not in good condition, you can’t help anybody.”

You got to make sure you’re safe first, so you can take care of your kids. Once you look at it that way, you realize that, “We need to be.” I struggled with this for a long time too. I have had a hard time being a good receiver, but once I learned how to do that, I got to the next level, and that would be able to help a lot more people as a result. Being a good receiver allows you to be an even better giver.

I love that. We could talk forever, but we’re out of time. We don’t even have time for the three rapid-fire questions, so we’re not going to do that, but you heard that from Mike before. There are a couple of things first. Mike, could you tell us about the free gift you’re offering? This is the thing. If you want to connect with Mike beyond his mailing list so that you know when his events happened because we’re sporadic, or you want to find out about what he’s doing, go ahead and get his free download. That itself is very valuable.

The big thing is that it gets you on his list so you can hear more about him. I know many of you have asked me how to connect with him in the future and when he’s doing the next event. The best way to find out about that is to sign up for his mailing list. When you do that, this is what you get. Could you tell us about your free eBook?

This eBook was written at the beginning of COVID because I was getting all these people who were losing their jobs and businesses. A lot of them did not have very good finances. When I started many years ago, I was a starving X university student. I was trying to get enough money to pay off my student loans. Originally, I was living my parent’s dream for me to become a lawyer, which was never my dream, but it was my parents’ dream. After I got my first degree, I had all these student loans. I know what it’s like to be starting in real estate.

Maybe you don’t have a lot of resources, so the book was written from the perspective of what I wish I knew many years ago. I used to do transactional real estate like a lot of people do, trying to save a down payment, qualify for a mortgage, and buy a house. I learned down the road that there are so many other ways you can buy a rental state with very little or no money. These are the top seven strategies that are working now. They were written at the beginning of COVID, so it’s stuff you can do while you’re at home in front of your computer. Those are seven strategies you can do without leaving your home, even if you have little or no money.

It’s an easy read on purpose because I know people won’t read it if it’s 2,000 pages. It’s twenty pages of big letters, but it talks about the ten strategies you can do and can do them now. They’re still all working. The market has shifted a little bit. There are some of them you couldn’t do at the beginning of COVID, like the tax deed I was saying. Get prepared for these auctions. Once they open up again, there’s going to be a lot of inventory and backlog. I talked about that and a whole bunch of other strategies that can get started on, even if you have very little resources. It’s free. You have nothing to lose by checking it out.

To get that, go to Blissfulinvestor.com/MikeWolf. Go check that out. I’ve read it, and it’s really good. You’ll enjoy that. Unfortunately, we don’t have time for the three rapid-fire questions, but we have time for EXTRA. We talked very slightly in this show about building a team. I know that Mike is correct that if you have a mentor who’s willing to share their team, that’s the quickest way to build a team. All of us are not necessarily going to be able to do that or want to do that yet, so we need some tips on how to start that path towards building our own team.

We’re going to be talking about that in EXTRA. If you have EXTRA, if you’re already subscribed, please stay tuned. If you’re not, we’d like you to go to RealEstateInvestingForWomenExtra.com. You get the first seven days for free. For those of you that are leaving Mike and me, thank you so much for joining us for this great conversation. I look forward to seeing you next time. Until then, remember, goals without action are just dreams. Get out there, take action, and create the life your heart deeply desires. I’ll see you in the next episode.

 

Important Links

• Mike Wolf
• RealEstateInvestingForWomenExtra.com

 

To listen to the EXTRA portion of this show go to RealEstateInvestingForWomenExtra.com

Learn how to create a consistent income stream by only working 5 hours a month the Blissful Investor Way.

Grab my FREE guide at http://www.BlissfulInvestor.com

 

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Invest In Your Future To Eliminate Financial Stress With Jen Lee – Real Estate Women

 

Many experience financial stress caused by debt or credit and want to eliminate them. However, people are afraid to ask for help or bring up their debt status for fear that people might think they are horrible people for having bad finances. Today, Jen Lee, the owner of Jen Lee Law Inc., expresses her thoughts on dealing with our debt situation. Jen is a debt and credit strategy attorney, a speaker, and a published author. She discusses the depth of future problems if we do not seek legitimate help with our financial problems. Let’s join them in this fascinating conversation to learn the actions we need to take and what we should consider in dealing with debt.

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Watch the episode here

 

Listen to the podcast here

 

Invest In Your Future To Eliminate Financial Stress With Jen Lee – Real Estate Women

Real Estate Investing For Women

I am so excited to introduce you ladies to Jen Lee. Jen is a debt and credit attorney and Owner of Jen Lee Law, Inc., a law firm with offices in San Francisco, San Ramon, and Tracy, California. She’s in my neighborhood. She is a leading expert on debt, credit, and financial stress, having been featured in ConsumerAffairs, US News, World Report, and other national publications. Jen is a Creator of several innovative programs to deal with financial stress and rebuilding after a financial disaster. Jen is the coauthor of Preventing Credit Card Fraud: A Complete Guide for Everyone from Merchants to Consumers, published by Rowman & Littlefield in March 2017. Jen, welcome to this show.

Thank you for having me. This is great. I’m happy to be here.

I’m so excited about this conversation. Jen’s backdrop is her little elephant Bernadebt sitting there with her. It’s making me smile. We are going to learn more about Bernadebt. Tell me a little bit about yourself. How did you get into this industry? Why are you passionate about it?

I grew up in a fairly financially unstable environment. I dropped out of college because college was boring. I went to work. I worked in financial services for a while and then went back to law school. While I was in law school, I thought I would do estate planning and help people plan for retirement because that was my background. I took a class in law school on Estate Planning. I thought it was the most boring thing in the world. I was like, “I can’t do this for the rest of my life.”

When I graduated from law school in 2009, we were in the middle of a big recession at the time. If you remember, back then, real estate prices were lowered. We didn’t know what was going to go on. I got into doing bankruptcy work at that time and helping people with foreclosures. I found inadvertently through that path that people need a lot of help with debt, credit, and planning for the future. It’s not always your basic retirement plan that people need. That’s how I got to where I am, helping people out with debt and credit.

It’s true. Retirement is only one event in our life. It’s a big event but there are a lot of things that you have to go through before you get there. You need to plan it and everything around living your life. That’s awesome. Could you introduce your little elephant? Tell me the story about that. Why did you introduce her?

Bernadebt is the elephant in the room. She’s the elephant in the Zoom these days with all of the Zooming that’s going on. She was born in 2017 because I kept having people say, “I don’t know when you want debt or credit problems, so I don’t know how I could ever send someone your way.” What happened was I did some statistics and looked at the numbers.

Seventy percent of Americans have a debt or credit problem of some sort. This was before COVID. She’s pre-COVID. No one talks about it. Everyone thinks they are alone. They don’t know how to deal with these debt and credit issues because they think that everyone is going to stigmatize them and think, “You are a horrible person because you have a debt or credit problem.”

Bernadebt was born to make that topic a little bit cuddlier. She made it easier for people to talk to me. They’re like, “You see a lot of this. I’m not coming to you with a new problem.” I was like, “You are not. Your neighbor and their neighbor also have the same problems.” That’s how she came about. Everyone thought that they were alone. She stands for the idea that we are not alone. A lot of us have debt and credit problems, especially with student loans.

The best way to be financially well is to never have financial problems, but that's not realistic. What people need to do when they have a problem is look for legitimate help. Share on X

She’s cute and cuddly. A lot of us have made mistakes. We have these credit problems. We have debt. We’ve made big mistakes. How do you set yourself up for success in spite of that?

There are a lot of talks out there about financial wellness and all these programs to help people stay financially well. The problem with some of the financial wellness that’s out there is it doesn’t help you recover from things. It helps you prevent it in the future. The best way to be financially well is to never have financial problems but that’s not realistic. What people need to do is, when they have a problem, look for legitimate help. Find out who you should talk to about a financial problem that you have and know that they are all fixable.

Every financial problem out there is fixable. Something can be done. It may not be stress-free and completely pain-free but things are fixable. You will feel a lot better getting it resolved than you would if you keep letting it stew out there and you are always worried about it. Find out what you can do and face it head-on instead of letting it sit there.

I find that avoidance is significantly more stressful than dealing with the situation. Avoidance can go on forever. It can go until you die. If you deal with it, it may be a couple of years of pain or maybe more. Bankruptcy can sometimes be seven years of pain but it is 7 years of an entire 90-year life. It’s finite but this avoidance thing can be infinite. Wouldn’t you say?

It can. The avoidance part of it is you don’t realize how much it’s affecting your relationships and your health. I have a lot of clients who come in. We solve their problem either with bankruptcy or through other means. They call me back 30 or 45 days later and say, “I had no idea that I hadn’t slept in 30 days before I saw you. Now, I’ve slept every night since we’ve resolved this issue.” You don’t realize what it’s doing to the people around you and your health when it’s happening to you but then when you look back, you’re like, “I can’t believe I lived with that for so long.”

Stress wears you out. You get tired. You don’t perform as well. Things tend to go wrong in other parts of your life. You can’t even get to your best. Your best is not its best. That’s true. Talk to me a little bit about the scams that people fall for out there.

We are so embarrassed by having bad finances. A lot of times, it’s because we weren’t taught it when we were young or families didn’t talk about it because it was a taboo subject. What happens is people tend to fall for the late-night television commercials that say you have the right to settle your debt for pennies on the dollar and some of the tax default scams out there too.

I see a lot of people who churn to the internet to try to DIY their problems, and they end up hiring companies that probably aren’t acting in their best interests. All that does is prolong the pain. They then have to come and see me, and we have to fix all of that as well, whereas if they had stepped in from the very beginning and said, “What’s the legitimate solution to this?” they wouldn’t have to go through that.

The big scams I see a lot are debt settlements. Most debt settlement programs don’t tell you all of your options. They sell to you. A sales pitch on what they are doing. I also see a lot of the online tax ones where they offer to settle your tax debt for pennies on the dollar. People pay a lot of money to those companies, and then they don’t get the results that they were expecting.

Talk to me a little bit about where they would see results. What is it that you do that’s different? Let’s talk about what you do.

My goal is to educate. I want people to know what all of their options are and the pros and cons of each one so that they can make good decisions rather than the decision someone is trying to sell them when they’re desperate. A lot of my discussions are almost like therapy. We are going through and figuring out, “What are the pros and cons of this? What’s my long-term effect going to be?”

People don’t realize that you can recover from bankruptcy in a year, your credit score recovers in a year. Everyone has this misconception that it’s this 7 or 10-year process and you can’t get a mortgage. I have clients who are investing in real estate while they are in bankruptcy because they are able to get mortgage lending while they are in a reorganization plan. My goal is to educate people to make good decisions. I’m hoping they make the decisions I recommend because my superpower is seeing the big picture. If they don’t, at least they know and are educated on those options.

I was under the understanding that it takes seven years. Could you talk a little bit more about that?

Most people who go into bankruptcy think their credit score is going to be destroyed by bankruptcy. What you don’t realize is once you get to the point where bankruptcy is a great option, your credit score is already destroyed. You have already been late on payments. You may have a house that’s in foreclosure. Things have already gone on that got you to that point.

Filing bankruptcy increases most people’s credit scores. If I have a client in the 500s filing for bankruptcy, it will immediately improve their credit score, and then they can start rebuilding right away. The credit score is how risky you are to lend money. You are way riskier if you have all this debt hanging over your head than if you were to clean it all up and be in some type of rehabilitation time in your life of financials. I have clients closed on a house in the San Francisco Bay Area. They are in a Chapter 13 bankruptcy reorganizing some taxes but were able to still buy a house while they were in bankruptcy.

Do they get a loan for that?

Yes. FHA lends while you are in Chapter 13 bankruptcy.

That’s interesting. I was going to say because most lenders that I know would not lend on that.

People don't realize that you can recover from bankruptcy in a year. Your credit score recovers in a year. Share on X

Most conventional lenders would lend four years after bankruptcy.

We used to have subprime but we don’t have any of those options anymore. That’s great news. It happened in my neighborhood in the South Bay. That’s impressive to me.

It’s exciting for me to see my clients are so happy. Once all these things start getting resolved, you start seeing the stress melt away from them. It goes back to the effects that financial stress is having.

Much of my message is about having a choice, and it’s exactly for that reason. It’s not necessarily because you are in debt but that’s part of the umbrella. I want people to live in choice and freedom, not in need, desperation or stress. Being blissful means, you are not stressed. You have moments of stress. We all have moments of stress but you don’t live in that place. It’s not running your entire life and being.

Having those choices is what frees people up to be able to do more things with their money and the wealth that they can generate. Once you know your options and you are making strategic choices and not emotional choices, things start snowballing in a good direction versus a bad direction.

One of the things that I talk about when I define bliss is that bliss is this deep sense of joy and contentment and the feeling that you can handle anything that comes your way. It’s about emotional mastery or emotional resilience. It’s being able to make those decisions outside of the stress and emotional reactions instead to get yourself to a place where you can make rational decisions. Get the education that you need. Have conversations with professionals that are not based on fear but based on problem-solving.

That’s exactly what I want for all my clients. I know it’s funny to talk about bankruptcy and bliss but honestly, I want my clients to feel that sense of, “I’m making good decisions. This is a strategic reason why I’m doing these things.” We speak the same language.

I love that we speak the language of choice, like for you to educate people so that they’ve got choices. They can go with what you say or not but at least they are educated. They can make rational choices. That’s amazing. Thank you for that. Talk to me about retirement. The question that you sent me is, “When should someone start saving for retirement?” For me, it is as soon as possible but what’s your response to that?

As early as possible. I know some self-employed people have their children on payroll, so they can do Roth IRAs. The idea of compound interest is you don’t realize how much is sitting there in retirement. I see the bad side of things because my clients are often financially stressed but what I see is people constantly cashing out retirement, paying down debt, and then building up some retirement and cashing it out again. I would like people to think of retirement accounts as something you start when you are six years old, and it just sits there.

 

Whether you have self-directed investments or real estate in your IRA or your mutual funds in the market, let it sit there and don’t touch it. I have a lot of clients that are in their 50s, 60s, and 70s that are not able to retire. They think they have $100,000 in their retirement account, and that’s going to be enough to retire on. That’s not enough to live in the Bay Area even. It’s scary to see the retirement accounts of different generations that we have going on in the country.

It’s so interesting to me because I’ve had a lot of people on the show say, “You can take money out of your retirement account for that.” That’s not the purpose of a retirement account. If we want to self-direct it and put it into an asset that’s going to appreciate or give us cashflow, you do a self-directed IRA like a true one. That’s okay. There are so many people that are like, “You can take money out of your IRA and pay for that. Do this or pay down debt.” I’m like, “That’s exactly what you shouldn’t be doing.” The retirement account is there for you to force you to save for later because you are going to need it.

If you are so desperate as a money earner when you are young, you are still able to earn money. If you are so desperate that you have to pull money out of your future, what are you going to be like then? You’ve stolen all those years of progress from yourself towards that future. It’s about creating better financial skills, not about robbing your future so that you can have something a little bit more comfortable. I believe in that. I’ve never said that on this show because so many people contradict me on that. It’s like, “Why would you spend your retirement? You need to plan for it.” You need to plan for that. There will be a day when you cannot work anymore.

I’m happy to know that. I have so many people come to me, and they have been told by a financial advisor to take money out of their retirement to pay the debt because they didn’t think they had other options. That’s where I come in with the options. What people don’t understand is retirement accounts have special protection legally from creditors.

If you cash out retirement funds, creditors can then get to those funds if they get a judgment against you. If it’s sitting in your retirement account, you can have a million-dollar in retirement accounts and still file for bankruptcy and keep your million dollars because it’s protected in their retirement account. It has a special holier than anything, almost protection over it by leaving it in that account. I like to educate on those options too.

That was amazing. I didn’t know that. I know that most of us have to be forced to save. It’s one of those things. Have you read the book, The Richest Man in Babylon? He was like, “Pay yourself 10% first.” Who does that? If you have a retirement plan that you have funded out of your paycheck, it’s automated, and you don’t think about it, then you are doing it. You are like, “I don’t have to think about it.”

You don’t have to budget for it. You don’t have to think about it every single month like, “Can I afford the 10% this month?” It’s not a decision. It’s planning for your life. People say that it’s held captive and that you can’t use it when you need it. You will need it and use it when you need it more than ever before. It’s a good idea.

I often hear from people, “I can’t afford to put any money into retirement. My budget is so tight.” I would challenge people to look closer at their budgets to figure out because it’s not even the full amount you are putting in there. You are saving taxes as well by putting them into a retirement account. I challenge people when they tell me that they can’t put any money into retirement because almost every budget has a little bit of room in them.

From the very beginning, from when we were dead broke, my husband and I always invested in his 401(k). I have a Roth IRA. We always put money in there and maxed it out. He has been at companies over time that matched, so we got a bunch of free money. I don’t want to admit that very often on the show because it’s not a popular thing to say anymore.

Having choices frees people up to do more things with their money and the wealth they can generate. Once you know your options and you are making strategic and not emotional choices, things start snowballing in a good direction versus a bad one. Share on X

I do have a self-directed IRA also. I’ve got all of these things. It’s part of the financial plan. It’s part of planning for my future. I won’t get it now but I’m going to get it when I’m 65 or 72, or whenever I decide to pull it out. I will need it then too. It has grown during that time. I didn’t rob myself for the fun of life. I’m allowing myself to have fun, freedom, and less stress later.

It will always grow. People look at the markets as shaky. If it’s not in a self-directed, if it’s in more of a standard portfolio, sometimes people freak out about market dips. You have to let it ride.

Don’t keep looking at it. That was amazing. For EXTRA, we are going to be talking about the mistakes that you see women making in finances. I love the topic but what specifically are you going to be focusing on?

We are going to be focusing on generational issues with women because we are often the caregivers. We are often trying to take care of our parents and our kids. We are going to talk about how that money issues come up in those situations.

It’s so much like the sandwich generation. You’ve got both sides that you are dealing with. We still have to protect our own futures. I’m excited about talking about that. Before we go there, could you tell people how they can get in touch with you?

My website is JenLeeLaw.com. You could contact me on LinkedIn too. I do a lot of posting on LinkedIn and sharing educational information. Those are usually the two best ways to get in contact with me.

Thank you for that. Are you ready for three Rapid-fire questions?

I am ready.

Tell us a super tip on getting started investing in real estate.

 

My super tip is to sit down and write out your budget. Figure out how much you have to put towards investing. Find the professionals you need to do that. That’s what I would start with.

What’s the strategy for being successful as a real estate investor?

Use the right professionals around you so that you are getting the best deals and you know what all the details are. Don’t leave it up to someone else to manage your finances. Know what is all in there yourself.

Have professionals but also keep track of them. Keep your eyeballs on them.

Use their advice but make sure that you know what’s going on and understand it because a lot of people fall into that, “Why did I trust this person to do it? I didn’t know what they were doing.”

What is one daily practice you do that contributes to your personal success?

I sit down in the morning for 30 minutes and plan out my day like, “What’s going to. What needs to happen, and what can happen if I have time?” We all get stuck in this jump into the day, and it flies away from us. That 30 minutes of planning in the morning have helped me to center myself.

This has been amazing. I’m super excited to chat in EXTRA about the mistakes that we make as women in our finances. If you are subscribed to EXTRA, stay tuned. There’s more. If not, go to RealEstateInvestingForWomenEXTRA.com so that you can check it out. Thank you so much for all that you’ve offered in this portion of this show.

Thank you for having me. I enjoyed it.

Thank you for introducing us to Bernadebt. Ladies, if you are leaving us now, thank you for joining Jen and me for this portion of the show. I look forward to seeing you next time. Until then, remember that goals without action are just dreams, so get out there, take action, and create the life your heart deeply desires. I will see you soon.

 

Important Links

• Jen Lee Law, Inc.
• Preventing Credit Card Fraud: A Complete Guide for Everyone from Merchants to Consumers
• The Richest Man in Babylon
• LinkedIn – Jen Lee
• RealEstateInvestingForWomenEXTRA.com

 

To listen to the EXTRA portion of this show go to RealEstateInvestingForWomenExtra.com

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