Unlocking Opportunities in Probate Real Estate with Sharon Vornholt - REIA 458

Welcome to Real Estate Investing Abundance, the show for busy, fulfilled professionals like you to learn how to develop financial independence built on solid passive real estate investments. Now, here is your host, Dr. Allen Lomax.

Hello, enlightened investors, and welcome back to Real Estate Investing Abundance. I'm your host, Dr. Allen. And it is a delight as always to have you with us. I know you are going to be impressed today with our guest, and we're taking a look at profiting from probate during the silver tsunami. For a quarter of a century, today's guest has specialized in probate, navigating with dynamic finesse the real estate investing market. She shines most brilliantly in her mastery of marketing and branding. I'm pleased to have with us today a veteran of real estate investing abundance. Please welcome me in joining Sharon Vornholdt. So Sharon, just take us into the show and share with us a little bit about your background and what took you into real estate investing.

Well, it was not a direct path. Growing up, my dad was a general contractor, so I followed him around on job sites. Being the oldest and the most well-behaved, I was the one that generally got to go with him. So years later, I worked for some years in the medical field, and then I opened a home inspection company in 1991, which I did for 17 years. Along the way, though, about 7 or 8 years into that company, you know, I had gotten to know a lot of realtors. So one of them came in and said, do you want to go to a REIA meeting? And I said something like, what's a REIA meeting? So I went to that meeting, and that was my really first introduction to the fact that you could be in real estate and not be a realtor. So I went— it's still to this day, it's been 25 years, and, you know, I still attend those meetings. And that's where I really got my start. So I kept— after about 10 years of doing both businesses, I did real estate investing part-time and had the other business, which is very demanding business. I decided to go all in on real estate investing. So it was— that was in 2008. And that was, as you know, the best of times and the worst of times. So, but that's where I really dove in. I chose real estate investing. And I never looked back. And it was about that same time I'd been doing— I always worked off-market deals because I just wasn't an aggressive personality and I didn't like getting in there and scrapping around with a few thousand realtors and other investors for deals. So I just made my niche off-market deals. And when I discovered probates, I began to focus 90% of my time on probates right from the get-go because there was literally no competition long around 2008.

Well, interesting. I mean, one, one thing that interests me is that a realtor invited you to a REIA meeting. There's not many realtors in REIA, so that's interesting how you got your start there. Well, just tell us to start off with here, what exactly is probate?

Probate is a legal process that takes place in the absence of doing estate planning and having everything in trust, which people should do. Should do, but very few do do. You're— if you have a property, it's almost certainly going to go through a legal process called probate where you have to go to court and open up the probate. And that is to protect the assets in the estate and to be sure that if there's a will, the person that is supposed to get different things gets those things. And so that the money is protected. So the probate is opened and then the court will decide what I call who's the decision maker. Now, as I said, if there's a will, that person would have named them in the will. Allen would have said, I named this person to administer my estate. Now, in the absence of a will— so that, well, with the will is called testate, without a will is called intestate— and in that case, the judge will determine who is the logical person. There's a hierarchy, so it would be a spouse, then children, then, you know, on down the line. But someone has to be in charge, and what real estate investors need to know is this person who is interchangeably called the personal representative, they are the person, the only person that can sign a real estate contract. So when you're talking to someone about a probate property, you need to determine who am I talking to? And you may very often be talking to an heir or a family member. Maybe they're geographically in the right area, or maybe they're just better suited for the, to show, you know, to show the property. But then that's fine. But when it comes time to write the contract, you need to know who is the person that can sign that contract. So it's very important to find this out in your initial phone call. Who is, I call them the decision maker. So in my area, probate, a probate deal is just like any other deal. You just write a normal contract. In many areas, well, not many areas, some areas like California, they have a lot of different rules. So if you're in California, I tell everybody, look up the probate rules in your state. Just Google probate process in my state. And what you will find is by and large, it's just like any other deal. Now I do recommend that you put a certain verbiage in your contract. Here we just use a one-page investor contract. And I got that from my local real estate attorney. But in that contract, we will put in there, remember, this is a court process, so things have to be done in a certain order. And we don't need an approval per se to sell the property, but you need them to tell you, yes, we've done, you've done all the things, all the things have been done by the family or by the probate attorney so that you are now cleared to close. So we put verbiage in there. Once again, this came from my real estate attorney who's also an investor. And we put in verbiage like property will close no sooner than this many days and no longer than maybe 30 days upon court slash attorney approval. What this does is it leaves your contract open. Now, I got into a situation the only time I've ever had this happen. The con— you know, we had the normal timelines in there, whatever they were, no sooner than this many days and no longer than this many days. And then the The family was trying to do the probate themselves, and they had not done things correctly. So they had to go back and start over. Well, what I found was I had a contract that was at the end of the contract terms, and I had to keep going back and hoping that someone hadn't offered them $100 more or $1,000 more for the property. So I went back to my attorney. And we, uh, I said, how can we protect this contract? What, what is some verbiage that we could put in there? That would make this stay open so that your, your closing time started when you were able to actually close the property. So that's how that came about. But other than that, for most people, they'll find that this is just like making an offer on any other property.

Well, that is, that is interesting. So it does vary from state to state, does it? Does it vary from county to county within states?

It does. There are over 3,300 counties in the US, and most of the counties will just, uh, follow their— whatever their state— they will follow their state laws. Now, it used to be even a year or 2 ago, there was no central place for getting leads, and more and more people are coming online literally every week now. Where you used to have to go to the courthouse if you were in Florida, New Jersey, Lots of places you had to actually go to the courthouse. Here in Louisville, Kentucky, they were in the newspaper once a month. They were published in the newspaper. And I thought that was really old school till I figured out I didn't have to go to the courthouse. So, but now if you Google in your area probate plus your city and county, oftentimes it'll just pop up where you can get them. But there are also some really affordable lead sources now that can pull these leads in areas where they were never ever available.

So are you, are you investing outside of your area?

I do not. I do not. But that is an option for people. Here's the thing, and I guess I'm just, I just like to make things easier. And for me, easier is in my area. Now, if you're doing multifamily, or there are many cases where you might invest outside of your area. If you live in Kansas, Kansas is a nondisclosure state, so you can't pull a list of anything in Kansas. And I have a friend friend that lives there and he invests in St. Louis only because it's just so cumbersome to get the lead, any type of leads where he lives, unless you are a realtor working strictly on the MLS. But I always tell people, master the process, master whatever your niches are, you know, master that in your own backyard because you cannot begin to know how to set up systems in a different city. Or a different state if you haven't mastered that in your own area. And you do have to have, you know, you have to have systems and people in place to work in another area.

Well, we are talking with Sharon Vornholt today. You can find Sharon at SharonVornholt.com, and she is with Innovative Property Solutions. So Sharon, how is it that through probate you are able to have an endless stream of opportunities to invest in month after month and year after year?

Well, that, that is because the cycle of life. People pass away every single month in every state, every city of the United, the United States, all over the world. So people think that we are, some people think, you know, you're taking advantage of them or you're, or it's weird or strange to work in probates when it, that couldn't be further from the truth. These people need our help. And they are so grateful when you can help them with this, especially if they have a distressed property that they can't list on the MLS. So I encourage people to change your mindset around this because this is the only niche on the planet where it's not affected by market cycles. If you're, if you're working pre-foreclosures, that's certainly affected by market cycles. Most of the ones that you'll look at, they are But probates are completely unaffected by that. There will always be people that need to sell their property month after month, year after year. And I think you touched upon it before. We are in this once-in-a-lifetime event called the Silver Tsunami. And that is that people that were born between 1946 and 1964 are the aging baby boomers. And over the next 2 decades, they're poised to drop about 2 million properties extra on the market every single year for 20 years.

Wow.

You know, some will downsize and move, some will pass away. But there's massive opportunity to help these people in their next steps. And this is true for real estate agents as well. You, if you understand this whole situation that we're in now, And you always come at it from being of service to these people. You can help a lot of people and you can build a good business by adding probates to your business.

Yeah, that makes a lot of sense to me because like you said, most people should have trusts and then you don't have to deal with the probate process. But also, like you mentioned, very, very few people are doing that. And so I can see how there's going to be a lot of opportunity as the silver tsunami, uh, even picks up, uh, speed in the next, uh, uh, 5 to 10 years.

Mm-hmm.

So not only are you an expert in probate, but you have developed an outstanding marketing and branding plan. So how is it that you are effectively And consistently marketing to the people who need your services?

You have to start with a marketing plan. And I believe that that is the key to success. And 2 things, and this is really old school now. I have a Google Calendar. I have an agenda book with a calendar and also a big flip-over online wall calendar, the kind that you get at Home or Office Depot, 3 foot by 4 foot or something. That is your accountability partner when it comes to marketing. But you start with a marketing plan, and for anybody that wants a free template of that, you can get that over on the Louisville Gals Real Estate Blog. It's completely free. But it tells you in there, you know, you should always have 3 to 5 ways to get deals. You do not want to put all your eggs in one basket. If, you know, if direct, you know, it's a Buyer's market, you'll market a little bit differently than you will in a seller's market. But for me, direct mail has always been the backbone of my marketing because I've always worked off-market deals. They're not on the MLS, you know, they're not, they're not on the foreclosure sites. These are homeowners that for whatever reason have decided to sell the property. And they— so you go direct to this seller. And what I especially love about doing it this way is that you get to talk to the seller. If you're working on the MLS, then you're talking through an agent. Not that there's anything wrong with agents. I've worked with agents for many years. But whenever you can get in front of a seller, and you know this with your business, you can find out what the root of the problem— what, what do they want? Sure, they want to sell the house, but maybe they have a job transfer. Maybe they're getting divorced. Maybe there's been a death. Maybe, you know, you can find out what do they need and what else do they need, because there's always something else they need. And with probates, it's often that they need help. They need somebody to clean out the house once they've gotten everything out that they want, then they need you to do that. But for— so when you're marketing to these people, you need a marketing plan. So direct mail marketing. Would be my, my number one way to get leads. Your website, your lead generation website, that should be on your marketing plan. You should put time and a little bit of money into, do into your website. Networking is one of the most underrated but the best forms of marketing on the planet. Get out and meet people because it's not even really who you know, but it's who knows you. Find a way to stand out. That all ties back into your branding. You know, everybody should be building a brand. Now, some people will cold call, some people door knock. There are probably, I don't even know how many ways to get deals. Some people have, they put out bandit signs, but you should have 3 to 5 ways that you consistently have on your marketing calendar. And then you put a date on your wall calendar and say, my direct mail is going out the first Monday of every month or whenever that is. And your REIA meetings, if you don't go to your real estate investor meetings in your areas, you're missing the boat. Now, in my area, you mentioned a realtor. You thought it was odd that a realtor told me about the REIA meeting. That she told me that she never was an investor, but she worked with investors. So there are many agents in my REIA group. We have several hundred people that show up once a month. We have attorneys, Real estate attorneys, all sorts of attorneys, plumbers, HVAC people. If you are a tradesperson that wants a source of business, show up at your real estate meeting. Join in my group if you belong, and it's about $100 a year to belong to the group. Then you can, you know, and I'll say this, you, you know, decide if you're going to— you can also in my group, we have a buffet dinner. So that kind of gets people in the door. But If you are a member of the group, then you can put out a flyer and, or go up and they have a time when you can go up in front of the room and say, I'm Allen and this is what I do and this is how I can help you in your business. You have a time to really give a little pitch for your services. But that's how people get to know you. And when they think of who do I know that can buy this house that I don't want?

Mm-hmm.

Then they'll think of you. You know, it's, it's a give and take thing. And what I found is that the more, more you give, the more that comes back to you.

Enlightened Investors, if you haven't done so already, be sure and click that like button and also click that share so others can take advantage of the content. And finally, be sure to subscribe so you don't miss a single one of our upcoming episodes. Well, that is true in, I guess, almost anything. Sharon, what are some tips that you might have? You've done your marketing and you've had some success in reaching out to those. Then you have to have a conversation. What are some tips for starting that conversation and making it a comfortable conversation for yourself and for the people you are working with?

I think in most scenarios it's just about figuring out where they are. But with probates, people often feel strange talking to people that are in probate because they know someone has passed away. And I would say this to you. First of all, the person you're talking to is almost never going to mention what happened to their, their person. They're just not going to do that. They're— they have waited and Enough time so that they're ready to sell the house. And when they open the probate, they're raising their hand saying, I'm ready to sell the house. So, you know, when you go to, to the property, you've talked to them on the phone, or they have filled out an online form on your website, and you, you get there one way or another, you get the appointment and you get to the home. I tell people to look for visual clues. And what I mean by that is You will know, uh, when, when you get a call, I go back and review the lead and I'll know, for instance, that someone's dad passed away. When I get to the house, I'll look around and if I see golf clubs in the corner, just because there's always stuff sitting everywhere, I'll say, oh, was your dad the golfer? And they'll either say yes or no. Either way, you've just started the conversation. If they say no, they might say, no, my mom is actually the golfer, or my Those are my brother's clubs. Maybe you look around and you see a lot of cookbooks in the kitchen. You might say, oh, was your mom the cook? If you know it was the mom that passed away, and they'll start to tell you about, yes, my mom was a cook. We had all of our holidays here in the house. So they'll, they will start the conversation very naturally. And then you can just move on to something. I always say, tell me about the property. And I just let them tell me about the property. And when they're through talking, then you'll know when the opening is to say, would you like to show me around? If you think about this, just like any conversation you would have with meeting a new friend, your goal is to find out about them, find out about their situation. Everybody is comfortable in the conversation so that when you have seen the property and you're learning about what they're Hoping to get for the property, you've already developed this rapport. You know, all these things that you do are part of your brand. You show up as the easy person to deal with. That's part of your brand. You've got your brand colors and your physical attributes, which, which is what people think of as your brand. But your brand is actually how you make people feel. It's how they feel about you after they talk to you. Some people say it's what they say about you when you walk out of the room. Gosh, that Allen, he is such a nice guy and he was so helpful to me. I mean, you want them to, you want to make them feel good. But that's actually from a branding perspective. That's how you stand out from the crowd. You, you make yourself memorable and you do things that are memorable. And you look at your business, um, as a whole. What, what is everybody else doing? Well, what can I do a little bit differently? What's the little bit of extra that I can put in that? And that all goes back to the seller conversations. If they've met with a couple of the investors that came in and said, show me the house. Okay, I'll call you back. Then, you know, when you leave that conversation at the end, say, do you have any other questions or is there anything else you need help with? Whether or not you get the deal, if they say, they may say something like, we've got all these back taxes, which have never come up. You can say, I can take care of those for you, probably. Let me look at that, and we can factor that into the offer and get those paid at closing. They might say, my sister wants these 3 antique pieces of furniture here, and neither one of us has the money to hire someone to come pick them up and take them. You can then say, I can take care of that for you, make that happen. We'll put it into the Contract, and when we close, I'll hire someone to come and do that for you. Did you pay for that? No, it came out of your offer if it's $200, $300. But find out, always just keep digging a little bit deeper and, and look for stumbling blocks to why they might not be ready to sell today. It's almost something that— always something that's a problem you can solve for them. So you, you get the property. You may not even be the, the highest offer, but if you can make their life easier and so that they can move on with their life, then you've just probably gotten the, gotten the property.

Well, those are, are certainly wonderful suggestions and things I, you know, I think we forget about oftentimes when we're in the process of, of making offers. And working with other people, and yet they are always so fundamental and so critical to closing the deal, but more importantly, to really creating relationships that even if you don't get that particular contract, you have a relationship that may very well refer someone else to you.

Go ahead. Yes, and always, I'll add one thing to that. Always, always send a thank you note, whether you got the deal or you didn't get the deal. Send a thank you note, and it's either— and get some nice— go on Google and spend $25 and get some nice white, really nice looking blank cards that just say thank you on the front and handwrite a note. And either you'll either be saying, I look forward to working with you, or we weren't able to come to an agreement at this time, but I would love to be your plan B if If your Plan A doesn't work out. And how many times, Alan, has— does Plan A not work out? The deal doesn't close. Something happens. So, and always put a business card in that thank you note, because if they really didn't like your offer, they almost certainly threw your business card right in the trash. So be sure to include a business card. And if you want to go one step further, this is a branding tip for you to really make you stand out. Send them a video. Say you can use Zoom. You can— there's a little thing that I love called Bonjoro, B-O-N-J-O-R-O. There's— you can start for free. You can literally walk outside, whip up your phone, and thank them for showing you the property and say, I look forward to working with you. Or the same thing that you just are going to say in your thank you card. Please think of me if your Plan A doesn't work out. I'd love to be your Plan B. But thank them for taking the time to show you the property. Guess how many people are doing that? Nobody but you. So you have solidified your rapport. You're going to be the person they're going to think about if, if their deal falls through. And it works. It 100% works to take this extra step to be different.

Well, Sharon, it has been wonderful having you. Excellent conversation with Tons and tons of valuable advice. So just closing us out, Sharon, just tell us your business, the name of it, and the best place for our viewers and listeners to get in touch with you.

Well, the business is Innovative Property Solutions, but where you'll find all the information— I have probably about 1,000 pieces of free content on the blog and the podcast. So you can go to the Louisville Gals Real Estate Blog, or you can go straight to the podcast, although there is a link to the podcast off of there. Let's Talk Real Estate Investing podcast. You can email me at sharon@sharonvornholdt.com and check out my probate course, probateinvestingsimplified.com.

Well, thank you, Sharon. It's been wonderful. And enlightened investors, thank you for being with us. You make our show. Please take a moment to like, share, and subscribe. And also, if you have a moment, go over to your favorite podcast app. And we would be most appreciative if you would leave us a rating and a review. Until next time, live abundantly in all areas of life, and we'll see you in the next episode.

Thanks, Alan.

Thank you, Sharon. Enlightened investors, wait, wait, don't go just yet. I just want to remind you about our recently launched webinar that you will not want to miss. If you're at all curious and would like to learn more about how real estate investing can diversify your investment portfolio, portfolio, alleviate the anxiety associated with Wall Street swings, leverage your 401s and IRAs to substantially increase the return on your investment, and do all of this with turnkey, hands-off, passive real estate investments, then you'll want to immediately go to stevetalker.com/webinar. In the webinar, we'll also address the common dubious investment schemes, that you want to avoid. To access the webinar, go to stevetalker.com/webinar. I look forward to seeing you in the webinar.

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