How To Analyze A Real Estate Deal And Fix-And-Flip 59K Red Flags

Really good.

Good.

How you doing?

Amazing. Excellent. Amazing. I see that Brandon Booth figured out how to use his phone. Now you realize you're on mute, Brandon, and your wife's not there to unmute you.

I got it, Toby.

I got—

I'm learning.

He's a quick study, ladies and gentlemen. He's a quick study. Here we go. Damn, I think we have a transformation of, of mental attitude here.

Technological mental attitude.

That's right, mythological. I like that word. For him, that's probably more fitting than anything else.

The donkey that learned to pull a trailer.

That's right, that's right.

Brandon, you got it.

What's different about this one? Uh, I've been able to log into this one. This one hasn't been a problem for me.

It's the other one.

Interesting.

It's the same link.

The other one sends me to some crazy stuff though, like it wants me to download— I don't know, we'll figure it out next week. But the other one does some weird stuff for me, like this This one goes right into the meeting. I just click join, it goes right in. The other one I have to register and then it goes into like— I can't even remember what the name of that thing is, but it tries to make me download an app and all kinds of crazy stuff.

What, uh, what kind of phone you got?

An Android. I'm not sure. Oh, there's your problem, buddy.

There's your problem. Come on, bro, he still has a flip phone from 1990.

Now we're going into politics.

Hey, Apple's the only way to go, bro.

Yeah, if you want all your stuff hacked.

Oh my gosh, you and your buddy Curran. Curran won't download ChatGPT because he thinks somebody's going to steal his shit. And I said, what shit do you have to steal, bro?

It's so— so there's a funny story behind that one. So we are— we— I go to his house quite often. Hell, we're best friends. So, uh, We go— I go over there and play chess, and we were talking about ChatGPT, and he's like, he's like, do you got it? I was like, yeah, but I was only allowed to ask 3 questions a day until I learned that Brittany, uh, paid for the thing so I could, I could ask him any question. I just logged in with hers. He's like, man, I just didn't want to pay for it the whole time. Shelly's already paid for hers. I could just use her login information. So he's got it now.

Yeah, after our talk last night, hour and a half talk last night, I think he, uh understands that he really doesn't have anything that the government needs or wants, so he doesn't have to worry about them hacking his shit.

Did you talk him into this? I've been trying to talk him into it.

Oh, I think we're there.

That's good, that's good. I've been trying real hard to talk to him.

Yeah, yeah. All right, uh, waiting for Renee.

I'll text her.

Who else waiting on? Randall? Hey, this is everybody.

Once Renee's here, everybody's here.

While we're waiting, let's, uh, let's talk about the deal you submitted last night, um, $453 all of drive. And I'm gonna share my screen real quick, buddy. So everybody see my screen here? Yes. Okay, so two things. One is I want to— I'm going to share this first. So, uh, Tate ran this through the AI, and here's what it came up with. It said that the, uh, ARV should be around $272,000. Maximum allowable offer, $114,000. Tate was looking at offering $120,000. Had a couple of flags, nothing major. But then I jumped on it to look at the property. There's Renee. I jumped on it real quick this morning. I didn't have time last night. I apologize, but I jumped on this morning. So, Tate, here's what I— here's, here's coaching number one. Okay. For— and this is for everybody. So here's a property that I'm going to look at the photos first and foremost. Real cute outside, nice metal roof, uh, looks like a nice porch in the front, pretty good sidewalks, pretty clean grass, is real clean backyard, big size backyard, good fence. And I get into interior, really nice hardwood floor, paint, uh, kind of cheap countertops, but nothing, you know, those are those Home Depot style, looks like. I can't really tell, but I go through the whole thing. So I'll go through the whole house, and on the surface, the house is really clean. House is really, really, really, really clean. Okay, so then that's a flag number one for me. Then I look at, well, if it's worth $270,000, give or take, and they have it listed at $130,000 and they've dropped it $35,000. So they had it at $165,000 and it's been on the market for 110 days. I'm missing something. I'm missing something. So this house is, is clean. I mean, you could buy it and rent it today. And, and there's no rehab needed. You could upgrade it, but why? But the biggest concern I have is why aren't they able to sell it? And then I go and say, okay, how long have they had it listed? So here's my price history. It's been listed since July at $189,000, all the way down to $130,000 today. They've dropped it $59,000 in 60 days and they still can't get it. They still can't get a buyer on it. So, um, this is where we have to figure out what's going on. So then the next thing I want to do is I will look at the neighborhood and see the neighborhood just at first glance is $150,000 to $200,000 neighborhood. I got a 181, a 168, a 141, a 194, 173, 127, 134, 170. Now these are all estimates, do not get me wrong. These are just Zillow estimates of the neighborhood, but they're pretty accurate. They'll tell you what the average price valuation of neighborhood, and I don't see any houses— $207,000, $231,000, $204,000, $170,000— this is a $200,000 neighborhood all day long, $150,000 to $200,000 neighborhood. So, um, That's what I see in the first 7 minutes I looked at the property tape. Now you tell me what you saw and why you felt like this was a deal to go after.

I think it's like a unique property in the fact that it's like huge. Um, I, and to your point, I'm just wondering why it hasn't moved because of the layout. And then maybe if it got like some sort of renovation to make somebody bite on a $200,000 neighborhood. But I'm just kind of willing to explore that. And then I, as you just provided your feedback, I wanted that to kind of, hey, am I looking at this right? You know, like, what are you guys seeing that I'm missing? So I just wanted to get that feedback. And then me and the agent can go walk it and kind of see like why did it, uh, drop, you know, significantly in the last couple of months, uh, and no one's picked it up.

And still no one's grabbed it instantly. Instantly. That's, that's the, you know, we know that, that we as real estate investors, seasoned real estate investors, know that the market is thin, that the market is tight, and when you have a viable deal, it is gobbled up in seconds. When a property sits out there for a period of time, and I'm saying 45 days or longer, then there's a problem. It's usually overpriced, or it just is a really, really bad property that needs a lot of work, and people— and, and they just— by the time they put all the work into it, it's just not worth it. This property does not tell me anything now. You may have to go walk it. There may be foundation issues. There may be severe foundation issues, and it's a slab. And the minute you go into— so one of the things that we talked about with Brandon on his property in Anna, um, I'll do foundation work on a pier and beam house all day long, all day long, because you're not going to bust pipes, you're not going to break sewer lines. But on a monolithic slab, like concrete slab, you have a high probability of busting pipes. When you start moving that and it's shifting, depending upon the, the, the pinch where the sewer lines are, the water lines are, you have a high probability of separating the sewer lines or pinching the water lines, and that causes problems. Now, not every time, but you have, depending upon how that piping is laid out and you start lifting and putting a pinch on stuff, that's what happens. And when you have 6 inches of concrete above it, you don't know it until it's too late. On a Peer and Beam house, you just crawl underneath there, make sure everything's still in place, or patch it and go on. So my first thought is something's wrong that we're not seeing on the surface, and this is where a potential drive-by needs to happen, or a, a visit first and foremost. and then a $90,000 offer may be a good offer, uh, on it. They're desperate. They've already dropped it $59,000. I doubt they're going to drop it another, uh, $40,000, but you can get them to talking. It might be one that— and I know you want to do multifamily, but it would be one that might be potentially good for a rental property because it's already stabilized. Okay, just food for thought. First rattle out of the bag.

Yep, thank you for the feedback. That's what I was looking for.

Now on the other one, 1105 Florida Avenue, that looks like that property is listed as a rental only, not for sale.

Must have missed that.

That's 1105 Florida Avenue.

Gotcha.

Um, hold on, let me go back to— so yeah, you were looking at offering around 120. I'm going back to Olive Drive, the first one. I had the wrong one pulled up when I gave you that. So offer 120. I think, I think if you got this around the 115 to 120 mark, it's got meat on the bones. Um, but I want you— before we do anything, I want you to walk the property to see what we're missing.

Okay.

At 30,000 feet. Okay. Because if the neighborhood's even at 200— if the neighborhood's even a $200,000 neighborhood and the property is a 2,800 square foot neighbor, uh, house, which is what I think it was.

Yeah, it's fairly large.

Yeah, 2,800, that's $46 a foot right now. Even in Louisiana, that's low, low, low. So we've got to be missing something, or you got a, you got a golden nugget that nobody has dusted off yet. I don't think that because there's too many investors out there scrambling for every deal they can find. But, um, we just need to get more educated because it just, it's like that too good to be true, uh, fear factor.

Okay, okay, yep. And I've requested comps from the agent, so hopefully I'll get those today.

Okay, and then 107 Heritage, let me pull that one up real quick, um, and then we're gonna jump on Renee's next now that she's on there. All right, so 107 Heritage Circle, Slidell. Uh, we've got, uh, listed at $149,900. We've got an ARV of $200,000. 11 photos. Let me look at them. Um, so I don't know what's going— so I'm gonna share my screen. I'm sorry. All right, so I don't know what's going on here. Is that the— I don't know what that is.

No, that's the front door. So there's a—

this is the living room. What is this? Oh, that's the front door there, correct? Stepping down. Okay, going down the hallway. Gotcha. Okay, then I guess that's just a coat closet, or is that going to the garage?

It should be going to the garage.

Okay, and then let's open these up a little bit. So, uh, new construction or what? Tell me about this house.

He—

so the, the, the video that he posted, he's in the process of doing upgrades and put it on the market. So as you can see, it needs flooring in the, the kitchen. Looks like he's updated the cabinets, appliances. So it probably needs flooring. The bedrooms looks like he's already done like the majority of paint and upgrades to like doors, hardware, things of that nature. So that's a lot of that's been completed.

I'm—

I think the only thing that's really kind of needs at this point is to finish it off. So you got some painting and flooring to do, and I love the fact that it's brick and a metal roof.

So, so is that common that you guys have metal roofs in Louisiana? Is that because of the, all the hurricanes and the hailstorms?

Not common, but you definitely starting to see a lot more with the hailstorms and whatnot. Absolutely.

Okay, so what do— so on the rehab, you estimated I don't see that you put a rehab amount in there, but, uh, rehab $45,000. There we go. Okay. All right. Yeah, no, no, I couldn't find it. I'm— it's early this morning. All right, so $45,000. Um, I know that— so that bathroom needs to be updated. Countertop, I don't know what's— I think that may be tile back there, but of course got the curtain closed, don't know. If they tiled that or not. All right, so let's look at the neighborhood. Um, so $200,000 neighborhood, $250,000 neighborhood. It's saying a $205,000. So I like this one. I like that valuation really good. $225,000, $192,000, $246,000, $180,000, $199,000, $200 to $228. So I agree with that assessment. Your margins are thin at the $135. Let me, uh, let me do something here real quick, see if my other analyst will work.

Yeah, I'm just kind of curious as how motivated he is to let it go, uh, even though he's done some, some, some renovations to it at this point.

He may be fed up and tired and exhausted, which is a positive for us, right? Uh, let's see here if this thing will work today. All right, Nick. LotSide is being a horse's butt. Um, I don't know what's going on with LotSide. I don't know. Let me change browsers. Let me change browsers. Could be it. Yeah. This was Heritage, right?

Yes.

Yeah, um, so we're about a $200,000 value. So let's just say, um, we can get this one for Um, I'm gonna say $130,000 maybe. We figured, uh, you said $45,000? Yeah, $45,000 on the rehab. I'm gonna say 6 months just for shits and grinds. Yeah, you'll lose your ass. Um, at $130 purchase, $45 rehab, holding it for 6 months, we lose $7,000 once all said and done, carrying costs and all that. So to buy this thing right, we need to be about $120,000. $120,000 breaks us even. Okay. So pretty thin now. Oh, well, that's— so let me bump that to $200,000 ARV. I was at a $190,000. So at a $200,000 ARV, which is conservative, we'll make a little bit of money, but that's buying it at $120,000, $45,000 in rehab. Those numbers are really, really, really thin. I think you have enough deals on the pipe right now. Uh, that, that would be one that I would not— I mean, you can make an offer, you'll never get in trouble for making an offer, um, if the guy bites. But I wouldn't pay a dime over $118,000. Okay. And then from there, it's gonna— we gotta get in, get it done, get it on the market at $210,000, $250,000, you know, $210,000, $215,000, and, and not get anything less than $200,000. Because you got carrying costs and selling costs. You've got $20 grand in it, so that eats it up fast. So we just— that's— it's a really thin deal, uh, with all the deals in your pipeline, um, should be fine. Um, so I'm gonna share my screen one more time. Here is the current pipeline, and then Renee, are you ready to go over some deals in just a second?

Yeah, I'm available.

Okay. All right, so right now we have, uh, Latay, Ankit, Brandon, Renee, Sandra, and here's all the deals that have been submitted by each person. Um, Brandon is is killing it. And we've got a couple of deals that we're working on. Letate, you've got several, um, but we keep a running record of everything. So I'm going to go through real quick. Letate, I want you to tell me where you're at with each property. Okay. So 1609 Whitewood, where are you?

Um, I spoke to the wholesaler yesterday. I think we're going to end up letting that one go, uh, per yesterday's conversation with you. He's not willing to kind of let us get in there, do an inspection with the GC. So I'm kind of good with just letting that go because after talking to you with the scope of work as far as the rehab, I don't think that if we do everything, we'll be above the ARV. So I'm comfortable with that and I'll continue to beat the bushes to get other deals in the pipeline.

Okay.

3318 Canes, uh, just submitted that one last night. I don't think you guys are taking a look at that, uh, just kind of waiting for feedback on that one to see, uh, if like you guys are on board with the, the offer. Um, and then I requested, uh, comps from the agent, uh, on that one as well.

Okay, so I'm— I pulled that one up. You're right, you sent it in last night. Um, uh, we've got, um, they've got it listed at $224,900. Yeah, this is the one that Nick brought into me last night. Um, only way you're gonna be able to make— now this one it says pursue with confidence, um, at a $150,000 offer price. Um, you've got $70,000 in rehab, puts you at $220,000. Uh, with an ARV of $300,000. So, uh, you're gonna have to get real aggressive on the offer price. You are going to offer— you can go up to— yeah, you could go up to $160,000 max, but I would start around that $150,000 mark and see if they'll talk to you. As long as we stay below $160,000 and $70,000 on rehab, You're, uh, you're a pursue with high confidence.

Okay.

Okay. I'll forward this one to you here in a minute. Okay. Uh, 13734 Lourdes Street.

That one's, uh, a dead deal apparently. Um, it was another offer on the table. Um, so that one's, that one's done.

Okay. 413 Norton.

Norton. We, uh, had a GC in there yesterday, got another GC going out there, uh, today. So I'll be able to provide you with the two quotes to kind of see if we can hit that $40,000 rehab costs. And per our conversation, I let the GC yesterday know that. And then the agent that I'm working with, she kind of knows some people and she understands that the guy that's taking a look at it today will probably be able to meet that $40,000 renovation budget. So, um, yeah, so hopefully by tomorrow or Thursday, I'll have some definitive costs for you on that one.

Okay, $1,820 Kings Row, you killed that one.

Um, that's, um, Rosemary, they came back at $2— they dropped it by $9 grand. Uh, there, there's a, another, uh, investor that's taking a shot at this, but, um, I, I wanted to— I want to counter back at $235 because I know the max is like $248 or something like that. Yeah, I don't know. I don't know if they're going to be able to play ball, but, um, we, we're, we're holding off on that right now. She's going to take a look. She's going out there today with another investor to kind of see like what's going on and where the seller's at. So her and I will talk later about that one.

Shalamar.

Uh, I just submitted that one to you, um, to take a look at. So just waiting for feedback on that one.

Okay. Uh, Woodland, we talked about.

Dorset, Dorset, no feedback from the bank, uh, on the bank, uh, uh, from that one.

Oh, that was the short sale. Okay. Yes.

Yep. So that's gonna take a little while.

Yeah. Uh, Allo Avenue.

Um, that one, uh, that was the multifamily, the, um, yeah, you, we can, that one's dead.

Okay.

And then that multifamily. So both of those.

Yep. All right. Perfect.

All right.

Mr. Booth, where'd you go? There you are. Are you gonna— are you on top of the roof?

Yes, sir, I am.

Don't fall off. All right, Wembley Downs, where we at?

Oh, shit, Toby, I gotta go to my emails and look at that stuff.

All right, then I'll come back to you.

Everything— yeah, everything that we have going right now has been offered, and we've made some really low offers on a bunch of stuff. But the only thing I really got going right now is that 9/11 West series.

So, okay. All right, all right. And, uh, Renee, Renee, Renee, Renee. Now Renee, um, Nick, how can we only have a couple deals in here on Renee? I mean, I can't— submitted much. Yeah, has she? Yeah. Well, that'll be— that's on my to-do list today to make it all— okay, get them all cleared up. Okay, um, let me go through here real quick, Renee, and find your deals. All right, so now let's talk about 2958, uh, Semmes Street. Am I saying that right? Okay. Yeah. So you offered, um, you offered $165,000. Is that right?

Um, that is one that my mom was talking to someone on that I submitted the deal for. So she actually has the majority of the information unless I go back to my email.

Um, it looks like you said that they accepted the offer. Is that correct?

At 165, they're the ones that wanted a proof of funds.

Yep. Yep. And I said that to you.

That one is within driving distance for us. It's 74 miles.

So, well, this one is within driving distance, but I'm really thinking we need to let this one go because It's way on the other side of Atlanta—

over there by Highway 29.

And it's not like it's a lot of miles. This is a complete gut inside, and I really feel like this one is too big of a task for us to take on for our first.

Yep. And this is where I think I went back to Renee and said, "Are you solid on the $45,000 rehab?" Because it says it's a complete gut out. The outside was solid, but it's complete gut out internally.

Right. And we were trying to get a GC over there, um, to look at it and give us an estimate.

I told, um, I told the guy that I was talking to that I thought it would be no less than a $60,000 rehab, but I was not able to find a contractor over there to go take a look at it to give us a quote on that. So with all those negatives put together, I really kind of think it's something I want to not pursue.

Okay. All right. We'll jump to the next one then. 523 North Oakley. We got a pursue with high confidence. On the offer at $135,000. Did we make that offer?

I, I did make that offer. However, after you and I spoke yesterday about distance and me being able to be there as boots on the ground, that is a 3-hour drive from me.

Okay. All right. So that— and that's a pretty good deal.

Um, yeah, it is.

If, if you could get the price because it's a $320,000 ARV. They're asking $162,000. I don't— there's no interior photos, so I assume it's a full gut. And you put in— now here's where I think the problem is. Now let me ask you this, Renee. Where did you come up with the $27,000 rehab on this property?

Um, let's see, I'm looking at my notes. Uh, I've got written down rehab $27,000 to $45,000, so I went with $35,000 right in the middle. That was after—

where did you come up with that?

I used your AI and it—

I, I had pictures of the property Okay, because I don't have any pictures of the inside. I only have the Street View picture.

Um, there, there should have been pictures uploaded with that.

I'll make a note. Yeah, they are, there are. Um, I got a few. Yeah, I was going off of what was online.

So, so the inside of this house looks fantastic. You've got hardwood floors, you've got an open floor concept, you've got the bathroom. Um, bathroom 1 is very well designed. Bathroom 2's got some old tile, but it looks nice.

Um, I think I would, I would think the bathrooms need to be completely redone because they got the little 4-inch tile. Yellow '70s tile in the bathroom.

Right. But all the comps for that property were anywhere from $312,000 to $355,000.

Yeah. No, it's a good $320,000 ARV. So, but you're saying it's 3 hours there and then 3 hours back?

Yes, it's in Columbus, Georgia.

Okay.

So unless I had somebody that could be on scene there, which I have family that lives there. Yeah, but I can't—

you like them?

I love them.

Well, there you go. Uh, okay, that's— if, if you could get that one at $135,000, you know, here's the other deal, just spitballing. If you could get that at $135,000, you might be able to wholesale it at $150,000, $160,000 and make $10,000, $15,000.

Right.

So I don't know. It's your call.

It's already being wholesaled.

Oh, it's already being wholesaled.

Yes.

Oh, so we don't want to— then they're struggling as it is. Okay.

Yeah.

Tell you what, it's got terrible marketing. Terrible marketing. I will tell you that much.

But it's got a great ARV on it.

I think it's got a lot of legs. I really do. Let me see what this— yeah, there's just, there's just no, no photos online. How did you walk the property? How did you get the interior photos?

They sent it to me and I was only able to upload 6 of the photos to you because that's all your deal thing allows. And I had tons of photos.

Yeah, they just— no photos online. It's amazing. Okay, um, I don't know. Let me, let me ponder upon that one just a little bit, Renee, because I think it's got some legs at the $135,000 price. Um, I think you're probably closer back to that $50,000 rehab just to do it right and to make sure you cross T's and dot I's. But even if you're in it, let's just say you bought it for $150,000, you put $50,000 in it. So you're in it for $200,000 plus carrying costs, you're in it for $230,000 and sold it for $320,000. That's a $90,000 spread, right? I, I, you know, I can't, I can't tell you what to do, but this would be something that if, if you could master organize it, you could make some money on it, right? So it's probably one of the best deals I've seen you present thus far.

Yeah, I definitely liked that one. Um, that, that Shepherd's Lane that I submitted, that was a great one, but somebody ended up offering $314.99 on it. And outbid me.

What did we offer?

Um, $300.

Okay, so that's not bad. That means we're in the right ballpark. If, if they took it for $314, they might have taken it at $305 or $310, and we were right there moving into that squeeze. Somebody just came in a little bit higher quicker. Uh, all right, uh, 2958, uh, Semmes Street. We already talked about that one, didn't we? Yeah, okay, uh, because you sent them 2 and 3 times. 314, yeah, uh, somebody put an offer 314, 9. Yep, okay.

And then the other ones that I have—

hold on, so on 523 North Oakley, I think we're mixing these up because on the, on the deal sheet of 523 North Oakley, your response was someone put in an offer at $314,900.

Yeah, I was wrong.

That was okay. I'm like, they're only asking $162,000. Why would somebody take offer of $314,000?

Okay.

Yeah. Okay. That was a cross-up and that's Oakley. Okay. Uh, Colebrook. Was in Dallas. We not going to let you do that one. Shepherd's Lane, okay, good deal.

Um, Verbena Street was in Fort Worth.

Yeah, right, right. And then Baywood— go ahead, I'm sorry.

That Colebrook was a good deal, but because I don't have anybody in Dallas, it wasn't gonna—

yeah, and, and the only way that's going to work is if I manage it, and I That's— there's— I can't do that, unfortunately.

Right.

Um, and then Baywood was a reject right across the board, right? Okay. All right, is there any that we're missing with you, Renee? That's all I got in the system on my side.

Um, I don't think so because everything else I had was at a distance from me, so I am scrapping the plate and restarting from scratch. And looking in those zip codes that we discussed.

Perfect. Perfect.

Hey, Renee, I could— we could still try to pursue that one in Columbus, and I could go over and stay with Janice and Paul.

From retired, she can be good boots on the ground for you.

Yeah, yeah, for— yeah, I could go to Columbus, and Paul can probably recommend some contractors and things like that.

I would— here's what I would do if I was in y'all's shoes. I would be negotiating the contract, and if you get it, you remember we go 90 miles an hour until we get it under contract, and then we slow way down. We put in a 10-day option period, we put up $100 for that option period, and then over the next 10 days we figure it out. And we have 9 days to decide whether we're going to do this deal or not. We either pull the trigger or we walk away, but we have nothing to lose and get really, really educated. So I would continue pursuing that, um, like you're doing. Get them to bite, get it locked down, and then figure out, is there a plan here that can be executed? Okay, $90,000, that's a lot of money to walk away from.

Yeah, figure out the actual rehab on that one.

Figure out the actual rehab. Figure out who you can trust that you can put in play that's not going to disrupt family, uh, reunions, right?

Well, I will call the, the guy back, um, because I told him last night that I was going to have to pass on it due to distance, but I can always call him back.

Okay. All right. Uh, make sure that if we move forward on this, whoever— and if Sandra's there for like the beginning, get things rolling, and then just needs to go back every weekend or every other weekend just kind of hang and, and FaceTime for me, then that works. But just make sure that whoever we put boots on the ground understands their livelihood is at stake because if they screw this up, they're not invited to family reunions or Christmases or birthday parties anymore, right? I don't know who they are, but that's, that's the leverage I would be using if it was, uh, in my family.

So, well, I think, I think Paul knows just about everybody in Columbus.

That's great. That is great.

So I think he would be a good source for referrals, recommendations.

Okay, so that's my advice on that.

Um, but we should be at $135, correct?

$135, I think. Um, I think we could go up to $150. Yeah, $150 is our max. Do not offer $150. If you buy this for $150, I'm gonna be upset. But you can go up to $150. With a $50,000 max rehab, you're in it for $200,000. And then we've got carrying costs of $25,000 to $30,000 over 6 months. And so you're going to be— and we sell it for $310,000. That gives you a good $70,000, $80,000 profit.

Yeah.

Okay.

Sounds good. Yeah, Renee, call that guy back.

All right, looks like Brandon's throwing shingles again on me. Um, I know we will talk to you about his deals until he gets his computer, so we'll go over that. Anybody have any questions on anything? Um, go ahead.

Yeah, um, so I just heard that you provide proof of funds.

Yes sir, yes sir. Now, like, I— now, so let me— so something we really need to clarify, and I'm glad Brandon's finally said his heiny down, um, and he's already been through this with me, so it's no big deal. But here's— and Randy and I are going to work on a, uh, next step sheet that says you've been onboarded, you're out making your calls, you're out submitting offers, here's the next steps. When you get a property your first step is to have it represented by a realtor, number one. But number two, I need to see the contract before it's ever submitted. Okay, so before you submit a, a contract, a promulgated real estate contract, it— your realtor— because here's the deal now, like with Sandra, Renee, Brandon, all your contracts are going to go under Global Integrity Investments LLC. So we are the buyer. You're a partner on those. Let's take— you and I talked about it. I can be a partner on yours and we can submit them under your LLC because you've got history and all that. So we need to make sure that the realtor understands who the buyer is, and it's me and you all buying this property. So I need to see the contract, and in that contract we want a $100 option fee and a 10-day option period with a $3,000 to $5,000 earnest money, and then we want a 30-day closing. Now, we would also tell them that we're looking at paying cash for these, meaning there's no bank approvals needed, none of that stuff. I am the bank, I'm providing funds. And so those are the things that, that need to be understood. You send me the contract, I review it, and then most of the time I'll say, yeah, we're good to go. And then they'll send it to me DocuSign and we'll sign it and then they submit it. What you got, Renee?

So let me understand what you're meaning by the $100 option hold and then $3,000 to $5,000 earnest money. I understand what earnest money is, but why are we doing a $100 option hold?

An option fee. So the option period is 10 days for you to be able to investigate and validate all the numbers. And inside that 10 days, if we find out we don't like the property anymore and the numbers don't work, we can cancel the contract and get 100% of our earnest money back. Without the option fee, you either close on the property or you forfeit the earnest money. Okay, so this allows us— this is why I tell you guys, submit, submit, submit, submit, submit. You need to be making 3 to 5 offers a day because we got nothing to lose and everything to gain. And the minute they say, I accept that offer, then you then go to contract, and in that contract says, I now want 10 days of due diligence and I'm willing to pay you $100 for me to do that due diligence. And if I like the property, then that option period will expire and we now move toward closing and they get to keep the earnest money. If for any reason after the 10 days we decide to walk, we lose that earnest money. We've, we've had the seller take that property off the market. No other buyers can contract it. And so if we then decide not to buy it, they get our earnest money. So we've got skin in the game to lose if we don't perform. And they've taken good faith to take it off the market and not accept any other contracts while we have it under contract. So there's that give and take situation. That option period is our ability to only lose $100 versus lose $3,000 to $5,000. Or $200,000 to $300,000, meaning it's a bad deal and now we're stuck with a property we don't like. So it's a small investment for a great reward.

Hey, can, uh, can you use me as an example in that, Toby? Because mine just went— like, she texted me the other day and said something about him trying to keep that earnest money. So I was kind of curious about that.

Sure. So Uh, we are in a legal argument on the Anna property. Um, so we contracted on Friday the 26th, and they said in the contract we had 3 days to get the option money and earnest money to title. So you got Saturday, Sunday, Monday by calendar days, but Sunday is a non-banking day, so legally it doesn't count. So Tuesday would be your third day. We got wired instructions from the title company on Tuesday. We wired option money and earnest money on Tuesday. We then canceled the contract 7 days later because we just— there's just going to be $100,000 worth of work and I don't want to do it. And so we canceled the contract and the seller's agent is a pompous individual who said, nope, we're not giving you earnest money back because you didn't turn in option fee money in a timely manner. And legally we did, but he's making a stink that we didn't. So now it's a— it's— now it's in with the title company's attorney to— or basically the title company attorney said, we'll let you guys go to court over it, we'll just hold it, you guys fight it out.

So basically, so basically they, uh, like, I don't know, they're, they're just being buttholes right now.

That's correct.

Nothing, nobody did anything wrong. It's just them trying to get over on somebody.

That's correct. That is absolutely 100%. And it happens all the time.

Well, if Sunday is a non-banking day, which it is, that real estate agent should know that.

You're correct. And title companies don't want to get in the middle of these pissing matches. So, uh, but there'll come a point in time where they'll have to, because I'm going to give them another 24 hours, and then I'm going to send over a legal demand letter from an attorney putting the title company on notice that they must execute according to the law. Um, so the— and what I need to make sure is that because it, it's, it's open to interpretation. And this is what happens with, with promulgated contracts. You're open to interpretation. It doesn't say 3 business days. It doesn't say 3 banking days. It says 3 days. But the common knowledge, the common theme is that a holiday or Sundays are non-banking days. So those days don't count, and they're respected by the industry. That's right.

I just studied that in my real estate course.

And what did the real estate course tell you?

That they don't consider a Sunday because it's a non-banking day.

Correct. And this is the correct law. Been doing this for 30 years. And but you have an agent who is squabbling over 12 hours. You know, we had to have it in by according to him by Monday at 5 PM. We got it in Tuesday by 11. We're 12-hour difference.

Is her name Karen?

Oh yeah, his name is Karen. That is his name.

Okay.

Yeah, so I got up at 4 o'clock this morning and gave him bad reviews on every portal I could find. Um, and he has no reviews. He has one review on everything, and it's me, and it's a one-star review across this across the board. So, because it's unprofessional, it's unethical. We did nothing wrong. We exercise according to the law, and he's being a butt because, oh, you were supposed to have it here by Monday night. Not really, not technically. We got it there Tuesday morning, and we got it the minute Title sent us wiring instructions. Wasn't like they sent us wiring instructions on Friday and we didn't send it till Tuesday. We had asked for it. They sent it over Tuesday morning. We wired the funds. So, um, these things are argumentative and stupid, but we run into them a lot. So part of the— part of the doing business, it just really is. All right, uh, any other questions on anything?

Yeah, I got two more for you. Uh, properties that are going to auction, do we pursue those? Because sometimes you have like low bids, right? If you can get it at a decent price, you probably got a deal there. So what is your take on going after those?

Some auctions we love, some auctions we don't, because here's the deal. Let's say you're going to a foreclosure auction or a sheriff's sale auction. You have to have cash on hand at the time of auction, whether it be just enough to secure it or to pay it off. A lot of times they give you 24 hours. So here's my fear and anxiety on auctions. Most of the time, those properties are occupied prior to the auction, number one. So you can't get in, you can't walk, and you can't see all the damage. Number two, when you buy that at auction, you've got a tenant, a homeowner in that house that you've got to evict out and then hope that during that eviction process, which is court proceeding and a sheriff removal, they don't do damage to the house. Um, so, and then, and then you got to start the process. If it happens to be a property that is vacant and through a traditional auction where we can walk the property, I'm all for them.

Okay.

But if it's a blind auction, I, because I don't know the area and I don't know you well enough, I don't know that I would greenlight that yet. Okay, I quit doing auctions here in Texas. They're just, they're just too tough. Gotcha. Even though, even though the eviction and the removal rate is the easiest nationwide, what happens is, is, is the homeowner is in denial. Every Tom, Dick, and Harry has come to him, said, hey, I'll stop the foreclosure if, if, you know, if you'll take money for keys, dollar for keys. And most homeowners, nope, nope, nope, they're not going to happen. And then it happens, and now they're mad at the world because now their home— not just their house, but their home— is being taken away from them. And so then they get into this destructive— we've had concrete poured down toilets, uh, we've had, um, various things happen, you know, of course, rip out all the, all the electrical wiring take the condenser, the air compressor condensers, just damage, all kinds of stuff put up in the attic, dead fish, all this. I mean, they get vindictive because they're losing their home. And so you now got to go in and hope that you find all the rats in the walls and get it out before you close everything up. And then you go to show the house and it smells like a dead cow died in there. Gotcha.

And my last question for you, um, you made it sound like family deals or network, right? So in order to spread the net, like, I have a brother that does like, uh, he, he basically like repairs houses. Um, so I'm just wondering if you have like a good person, boots on the ground, to manage, you know, the, the rehab in a different state, area, whatever. Is that feasible?

Yes, absolutely. If you've got a partner— and this is the only way I would do it, Tate— is if you've got a family member that's in another area that would be good boots on the ground, he or she, they need to become a partner so they have a vested interest in the success, not just an employee. An employee doesn't care whether you win or lose. Realtors don't care whether you win or lose. Wholesalers don't care whether you win or lose. All they care about are their commissions. Contractors don't care whether you win or lose. They care about getting paid. You bring somebody in as your eyes and ears, boots on the ground. They need to be a partner, have skin in the game, so that they ensure success and profitability. Okay, okay. Sondra, any questions?

No, sir.

Renee?

Uh, I just messaged Brian about the house in Columbus and asked him if they are going to accept my offer of the $135,000 and what were the repairs that were needed because I didn't feel like the $35K was enough, that I'm thinking more around $50K, and he is going to contact the seller, and then we're going to speak as soon as he gets an answer.

Okay. Hey Taylor, is Chandler there or is he at the station today?

He's here.

Um, did you get any more information on that deal you sent me, Chan?

Uh, no, I sent you the packet that they sent me over. It's really just pictures and—

right, so I think I'd asked you about the scope of scope of work? Did they have any kind of estimate on the scope of work and you're going to find out?

They, they didn't have a scope of, uh, an estimate. They said that all majors were new— brand new roof, brand new HVAC. Um, there's two other things. Pretty much everything is just cosmetic.

Let me pull up the email they sent. Yeah, the HVAC looked good. It looks like new— we need new flooring. You need to get new countertops, bathrooms. And this one is in Flower Mound. Okay, Flower Mound.

Yeah, every—

the—

there's been 4 houses sold in the last little bit, 4 or 5, and they all had less than 10 days on market. Okay, so they're selling quick over there.

Now, is this the same guy that did Dundee?

Nope, I have no idea who this is. Oh, okay, popped up on my stuff.

Okay, uh, now what about the foundation? So on one of those pictures, they show some foundation settling, but I didn't— I see the damage on the outside, but I don't see any on the inside.

Yeah, I don't. Which picture do you see the damage on the exterior?

Uh, it'll be, um, I think it's second to the last or the last. Let me look.

Okay.

Second to the last picture. Okay, it's not numbered, it's 9145. Okay, but they, they filled it with some caulking, and it may just be that corner crack. A lot of times that'll happen.

Oh yeah, yeah, that's what it looked— yeah, because you can kind of see a little bit of that foundation.

Yeah, chipped away.

Okay, they didn't list anything about foundation. Um, that would Based off what I see, that would be the only worry is how the foundation is. Yeah, but it's a wholesaler, so you're probably— there's probably going to be very little room for negotiation.

Okay, unfortunately I'll work on this one a little more today.

Um, I'm trying to see where it said— okay, this property is well maintained, most major items are already updated. He put somewhere what had all been updated. I'm trying to find it. But I'm looking at about conservatively probably $230 to $240 a square foot ARV. We've had 2 houses sold within the last 90 days on in that neighborhood for 2— like one was $259 and one was $265 a square foot.

So let's see here. And you're saying— what did you say the ARV was?

Uh, let me do the math. So I'm looking at about a very low end. You're looking at about $440. Yeah, but you've had two houses on that street in the last 90 days sell for two on an average of $260 a square foot. Which it puts you at $490,000.

Okay, so you think so, $60,000?

I mean, you literally— there were, there were two houses that sold for right at $230 a square foot, and then two of us that sold for right at $260 a square foot.

Yeah, yeah, I think conservatively $420,000, $430,000, real easy. Yeah, it could be. And then $50,000 to $60,000 in rehab. Um, carrying costs. Carrying costs kill us. But now I have a realtor that I can use that doesn't need a commission, so that'll help. All right, well, that's, that's cool.

You found somebody that doesn't want a commission.

I didn't say he doesn't want one. I said he doesn't get one. There's a big difference on what he wants versus what he gets.

A poor soul. I'd never do that.

I'm sure you would. We'll talk offline though, buddy. Okay. All right, uh, all right, Mr. Booth, you got anything? Look like he's still throwing bricks. All right, um, you got anything, Brandon? You're on mute. You're good. All right, all right, guys, um, we need lots of activity. Rick, what you got, buddy?

Did you see my message in the chat?

I did not. I apologize, my friend. I told you about Thursday. Okay, perfect. Perfect. Um, and I think they get here about 11:30, so that'll work out perfect. We'll do a FaceTime. Now that's my— that's 11:30, uh, Central Standard, so that'll be perfect for you. Okay, just let me know. Yep, yep, you're top of my list. Okay. Um, also, if you guys want to buy any properties in Ontario, Canada, Rick's got like 4 listings. I won't help you on those. I won't support you on those. I will not partner with you on those because that is across the border. You're on your own. Now, Rick can jump in and be your partner all he wants, but I ain't doing it. Okay, all right guys, uh, get back after your classwork. None of y'all doing your homework. None of you doing your lessons. None of you making me happy. Keep submitting the deals. Activity, activity, activity. It ensures success. I guarantee that. Okay guys, have a great one.

You too.

Bye.