How To Estimate Rehab Costs For House Flipping Under $16k

Morning, Rick. Morning, Latay. How's it going?

Good morning.

Morning, guys.

Good morning.

You guys, are you guys married, have kids?

My chance.

Rick Tate, I know you have kids. Renee, what about you?

Yeah, I'm married, I got kids.

Married and got kids. How old are your kids?

20, 15, and 12.

Nice, very nice. Who are you, Rick? Uh, I actually tried twice and got 3. There you go, there you go. So I got 2 girls and a son, and they're exactly 2 years apart. That's awesome. That's awesome. Hey Renee, do you know if Sandra's hopping on today?

She will not be here. She's where she doesn't have internet.

Got it. I'm gonna call Brandon, Nick, but you can go ahead and check.

Yeah, I was like, okay, that all who are missing? Alright, what's going on, guys? We're going to do this one a little bit differently. Toby's still up in the mountains right now, so we have a few things on the docket for today. I think the best thing that we can do just starting out right now is to kind of give some room for feedback. If some of the tools are difficult to use or if there's any errors that we need to correct, something that needs to be explained a little bit more. I know we've kind of changed up a few things over the last couple of weeks, so I wanted to kind of open up the floor right now to see if there's anything that we need to fix and update. I know that we've had a little bit of issues past couple days with the AI analysis, and that's because of a little bit of Amazon Web Services. I don't know if people have seen some of the articles on there, but they had a a lot of shutdown with their cloud use. And so a lot of companies, third-party companies, were affected and kind of trickled down to some of the, the tools that we end up using. But it seems to be back up and going right now. So that was just a little bit slowed down. Um, but I know that we've kind of changed around how we utilize the tools and utilizing the rehab estimator, and there's just constant tweaks that we're doing in there. So I wanted to see if there were any issues that people were having that that we could fix? It's the first thing.

Not necessarily issue, and I'm glad you explained that. The Notion, so like the thing that kind of tracks our deals now, I know that you guys got to go in and kind of do the AI slash your own kind of analysis on it before it shows up, I think, in our thing now. Is that accurate?

Yes. Yes.

Okay. All right, so because I was like, hey, I've submitted like, you know, 2 or 3 since the 14th of October and they haven't showed up on my end, but I know that you guys are working it, so.

Okay, well, yeah, that's good to know because I was looking at your, your deal, say, rotating. I was like, that's— I didn't— I don't see anything past the 14th. And so maybe, maybe that's why. So I'll go in and double— I thought I put— made sure I went through everybody's deals.

So if you know, you know how You know how it says initial on there? I think, I think you guys have to put initial on there for us to see it in our own kind of little database thing, right? But otherwise it's just kind of out there and I can't see it. So just, just some feedback for you.

Anybody, anybody else, anything else? You guys using the, the website that has all 3 tabs and all 3 deals easily, or any issues with that?

No, but that's extremely helpful because it lets me know what you guys are looking at as far as profit margins are concerned.

Yeah, and we'll probably make, um, some tweaks to make that better and a lot more accurate, you know, as it, as it gets to you. It's definitely super accurate right now, but we're always updating those things.

One more thing for you, and I know that all this is kind of like a work in progress, uh, the rehab estimator. So I get the fact that, like, let's just say if you're rehabbing a kitchen or a bathroom, right, there's a certain dollar amount associated with it. But the thing that's kind of hard to kind of articulate using the rehab estimator is if a if a property needs like additional drywall, things that's kind of outside the norm, right? Like, I don't know if there's a best way to capture that other than maybe— I know it has the 10% that catches it kind of, but I guess what I'm trying to say is that it doesn't— there could be some more tweaks to kind of capture like the—

A little more customization?

Yeah, a little bit more to kind of get after some of the stuff that doesn't necessarily fit nicely into it.

Nick, do you think you could do like a miscellaneous where they fill in their— what they're thinking and then the dollar amount theirself?

Yeah.

Yep.

That's exactly what I was thinking was just adding a section for extra areas that you can add there, put the price and what it is. I could probably add that in there pretty easily.

Nick, the other thing that I thought of is when you're doing flooring or carpeting, associates it to the full square footage of the house.

Does. Yeah.

Well, if you only need half of the house or 300 square feet flooring, there should be a dropdown tab where we can put in square footage that needs the flooring in the rehab estimator.

Yeah.

Yeah, you'd be double dipping if you put carpet and wood floor, it would hit you for the full square footage on both.

Right, right, exactly.

So you— yeah, I can, I can add a section in there actually for that. I have an idea that's good, making it easy for you guys to use but still accurate. So those might take a day or two, but those are some stuff I can add in there relatively easily. So that's good. That's pretty good. I've— we've seen a decent amount of those PDFs come through for, for the rehab estimates, and we're trying to make sure that whenever there's emails that pass through about your guys' deals or if you guys have a rehab estimate, it should go straight into your Notion database. It is dependent upon where the deal is in the stage and different things like that. But you will notice if you go into Notion on your specific deals that you have sent emails to Rachelle or Randy or myself on, we've been capturing those to put them in there so you can kind of see that history all in one sense. So that's one small thing that's in there too. And you guys do have a certain degree of customization inside of Notion. So if you want to add extra space for you to put notes yourself, There's a lot of good areas in there of adding comments or something that you don't want to forget, or any links that are associated with it. It's a great place to add documents. So there's one place that's— I could— let me pull it up here and I'll show you one thing too that would be helpful. So if you go into a deal and just go into a specific deal area here, I have a place in all of your guys' right at the top for documents. And you can— all you can do is just upload a document just like that. You just click this area, add a file, you choose a file to upload, and you can hold whatever documents you may want in here. Maybe you've gotten estimates from contractors, Or if you created a contract that you wanted to send, or any place that you want to keep and hold information and still keep it organized, you can easily put it right here and that holds all of it. So that makes it really easy for you guys too. Okay. Any other feedback?

What do we do once we get a contract? Accepted from the seller.

That would— ideally, you guys have been connecting with Toby about that, and as long as everything's good, you know, his, his main stick is that once you get under contract, you know, now the process really slows down. You really dig into the details of it. Um, and so that's, that's definitely something that, that you and Toby should talk about. Have you— do you have a contract that might be going under pretty soon?

I have, I have two that I submitted last night.

Awesome. That's awesome. Well, yeah, I think Toby would be the best person to talk about that. And, you know, he, he is communicable to a certain degree on certain parts of the day. So whenever it's something like that that really needs to have, you know, something happen soon, you should definitely talk with him and get those next steps. But we're really going to be accumulating a lot of information if you don't have— you have a GC that went out there and had a lot of quotes done so you can get more accurate rehab and just certain things that you can do inside of that process after you go under contract.

Yeah, Renee, you'll want to make sure you're getting your option period on both contracts so that during that option period we have time to do the due diligence that's needed to make sure that the project is going to work as well. So you want to make sure that you do have that option period in your contracts.

Right.

Good. Good. All right then. The last thing that I was going to say that I thought would be good to talk about was, you know, with you, Rachelle, I thought you may go over just a few good notes that you have as you've been seeing a lot of deals come through and picking good sales comps to create accurate ARV estimates since you've done it a bajillion times. Some, some good tips and tricks that we can kind of give people to help them do these things faster, more accurate, things to look out for that you've seen recently, that kind of thing.

Yeah. So I know a lot of you are getting CMAs, which is great because then it kind of shows you what comps your realtor is using and then you kind of have an idea of what to look at. The biggest key factor is we're looking for likeliness of property. So, you know, the age of the properties need to be, you know, 5 to 10 year span at the most. They need to have properties that are of the same kind. So if you've got a 2,000 square foot home and the garage was converted to get 2,000 square feet, then it's not equivalent to a 2,000 square foot home that still has its garage. You've changed while you change the footprint of that home, it's still not an equivalent home. We're missing, um, a large key factor to it, which would be the two-car garage. And you also really want to watch, um, changing your— like the addition. When you're in an addition, generally the prices of homes in that addition all go for the same amounts based on, you know, they vary due to what people have done inside the homes and their square footage, but that addition has a price point generally in it. When you start going to other additions, like you're in a regular addition and you try to comp a property that's in an addition that has a golf course, you've changed additions and you've changed the value of that property just for changing the addition. The exact same home might go for a different price in each location. And we really try to stay within, you know, a mile to 2 miles max. And we also don't cross highways, um, because again, you're changing the location. And the best way for me to kind of, um, even dive into that a little further is like in Dallas, when you stay within a zip code— I don't know how familiar any of you are with Dallas, Texas, but you will literally have a million-dollar home sitting, and when you go to the street beside it, it will be a $50,000 home. So, and that happens a lot in Dallas areas. So when you do like a zip code search, you can get properties that don't really represent your property. Um, and the biggest scare thing is that we choose an ARV that's not obtainable, and nobody makes any money. And especially for the beginning of your deals, that's the worst thing that can happen. It's very discouraging to get into a property and try to sell it and/or try to refinance it because you decide you want to keep it as a rental, and everybody's saying it's not worth that, it was never worth that, you know. Um, because ARVs are subject— they are based on the vision that you have, based on the scope of work that you have, and the appraiser's, um, do that based on the properties that they see. It's kind of tricky to do, but we always want to stay a little on the side of caution. You never want to ARV your property for the highest price in that, in that area. It makes it a little harder to do. You want to always look at it at what the best case of it is, but you shouldn't be the highest priced property in that the neighborhood. Um, especially when you're not doing to your property what some of those extremely high-priced properties are. They're customized, they, you know, have, um, the huge vaulted ceilings and all of the extra jazz to them. And we're going in and carpeting and repainting and maybe just doing a little update. So do try to be real, um, visual on what the actual comparison is for for that property. And which can— we just want to always— I mean, I know it can get discouraging when you think you have a $200,000 ARV and we're like, oh, we think it's a $150,000. It's— and we're all— I'm always happy to kind of show you how I got there. If you send me the comps that you have, I can tell you, you know, and maybe your comps will help us make a better decision too at some point. Um, between the AI and myself, um, we can only do so much, and there is, uh, room for human error or missing something. So your input always helps us see where you're at, and then we can give you input back to tell you how we got where we're at.

Yeah, yeah, that's great. And the AI analysis too is like one of the first steps, right? So it's, it's very accurate, but it's not, it's not perfect. We're constantly dialing it in to make it even better, which is why, you know, Rochelle is looking at these deals, really affirming what the analysis is saying. And so what she says definitely goes, you know, past what our AI analysis does. That's why, you know, you kind of start with Toby AI, gives you a great idea and estimate, and you just continue further down the line and, you know, filter out or filter in deals essentially into, yeah. That area. But one question I was going to ask you too, Rochelle, also was whenever you take into account those comps, I mean, if there's a deal that is for sale that's in that neighborhood, I mean, do you take a lot of importance in that number against, you know, sales? Maybe a little further.

We don't really— we only use sold when we do our analysis. And a lot of people will use the for sale sometimes, like on your appraisals, you'll get some of those. The problem is you don't know that it's going to sell for that. Some people, you know, you can look at some of these properties. I wish I could remember off the top of my head. There's been a list where they listed at $269,000, everybody listed, and then you see the actual sales price and they were $5,000 or $10,000 lower for that sales price. So we do look at kind of what the neighborhood is selling for now versus what it was buying for 6 months ago. To see if there's been any change just in the market itself. And because we fluctuated between a buyer and a seller market so much, um, this last year more than anything. So there is always the opportunity that 6 months ago it might have been down a little bit, but now the rates are coming down, so people are going to be able to list a little higher and they're not being jude down on their property price in order to get sold. So I do look to see, you know, kind of what the base price is going for in this sale. But when I comp you, I try to use sales comps and I really try to use comps that are 90 days or less if possible. Some of the neighborhoods, you just can't do that.

Yeah, makes sense. Um, can you also talk about what we were talking about yesterday afternoon about, you know, how there's— you can have a budget but you put in that rehab into more major items, you can really kind of make, make a better efficient rehab for that property.

So there's parts of rehab that are necessities and then there's parts of rehab that add value. I'm redoing the electric in a home. That's a necessity that has to be done because that has to be a working home. That's not a value add to rewire a home. Be— unless, I mean, because the home is supposed to work. I mean, that is part of it. You get those value adds from your updates to your kitchen, your cosmetic. Um, while, you know, an HVAC is great, unless you install one that maybe you're in a place where HVACs really aren't that common and you've installed one, you might get, um, additional credit for that. But here in Texas An AC isn't— if you don't have an AC, you have a whole nother problem. Those are normal. So repairing an AC or putting in a new AC doesn't give you a bunch of value because a home should come with a working AC unit. So, but updating your kitchens are huge. Your kitchens are great price points. You get the biggest return on your kitchens. And so nice kitchens tend to add the most type of value. Nice bathrooms add good value. Um, your flooring and your painting add value, and probably the flooring more than the painting. And just because, you know, when people come in, if they don't have carpet that's stained, they're even more pumped. So you get— you have a more— it's more eye-pleasing, so it gets more value, I guess, is how I want to put it. So while you might have a $100,000 rehab and you're only getting, you know, almost a dollar match for that on the increase in your value because big portions of that brought the home up to where it should be to be sold. It's frustrating, I get, but you might have a $40,000— Renee had one, I think it was like a $33,000 rehab, but it was giving her a great return because that home was in great shape. But she was fixing up the kitchen and the bathrooms and that's where it was lacking. It had like the laminate countertops. Didn't have a backsplash and things like that. People love nice kitchens. And so that brought more value to it than if she told me she was fixing the wiring on the property. I would not have given her, you know, then the home's visual isn't really changing. You're just getting it to be a home that's completely operational the way it should be. Does that make sense?

Yeah, yeah, yeah. Explain that pretty well. What do you think about that, Rick? What's your input? Wow.

Way to go, Rochelle. When I'm looking for a home as a flipper, I'm very, very specific on the home that I'm looking for or looking at. When I do a flip, I really don't want structural issues because that can just compound and your costs can go way, way up. So when I'm looking at a home, my perfect home is no, no structural, only cosmetic. And see if this sounds familiar, um, I only do or want to do brand new kitchen, brand new bathroom, brand new vinyl plank flooring, kind of a professional, really good paint job. I'm out. That there can be done, set up properly, or I do them in 30 days.

Um, yes, those are the best. Those are the ones that we love.

I saw that, Nick. Uh, my guy, or no matter where, I, I call my guy Eric, and, uh, Eric can go in there. He's very good, very fast. Uh, quality of work is 8 or 9 out of 10, so you come out with a pretty good product, but only cosmetic stuff. The reason too that I only want to do cosmetic stuff is I'm generally not involved in permits. You get into, you know, if it's necessary, you get into HVAC or replacing the wiring or something like that, you're into permits, and then you're into the government. The government costs money and takes time, stuff like that. So when I'm looking for a property, I only look for stuff that is is going to be cosmetic. Those 4 things, I can do it in a month. And y'all know, y'all know, nobody smiled up here. It's a joke. Um, you all know, uh, that I'm in Canada and we buy our stuff generally at Lowe's or Rona only because of their systems are very good and very fast and everything. Um, so my wife did me a favor and she knows exactly what we buy at, for example, Home Depot. And up here, uh, it'll cost $20,000-$25,000 for the material. So we did one, uh, in Texas. We picked a Home Depot, put in the zip code for Texas, and new kitchen cabinet, brand new kitchen, brand new bathroom. Paint and flooring came out to about $16,000 in the States, way less. So take your 16, round that up to 20, add on your labor, and you pretty much— at least rule of thumb, I pretty much have a very good idea of my total rental costs. Am I going on too long, Nick?

No, no, not at all. Any questions on that stuff, guys? I mean, that was some good information there too. Any specific things you guys want to know about that?

I do like that you stay out of the structural because the problem with that is while surface-wise you can only see so far behind a wall, when there's structural stuff that needs changed, once you're in, there might be things that nobody budgeted for and/or expected. That take place. So I do like that you try to stay quick and easy on yours to keep moving your properties quickly.

I've been doing it for a while, but that's absolutely correct. Even when I buy a place, no structural issues, only cosmetic, go in, you're still going to find something that you didn't expect. Um, one of the last ones that we did, there was, uh, actually two bathrooms, two-story. It was, um, one, a bathroom upstairs, smaller one, one downstairs. When we got to the one upstairs, there was a cast iron, um, kind of sewer thing going all the way down to the basement from the upstairs, and there was about a 2-foot chunk that was completely rotted out. Now, we didn't know that until we got into renovating the bathroom. So that, you know, Eric, uh, no problem at all. Put the— got another piece and, uh, put the two, uh, rubber, uh, I guess donut things on there and clamp them down and fixed it. It took him maybe half a day to do it. But you're absolutely right, even if you try for golden, you still might find you know, a little something, you know, I wasn't expecting that. Well, no, we should be expecting that. Expect that, you know, no matter what house you're going into, you're going to find something you didn't expect or you didn't think of. But build that expectation into your budget. You know, throw an extra $1,000 or $2,000 in there for something, you know, that might happen. Find a piece of drywall, you know, so now you got to change a whole 4x8 piece of drywall. It's not— that's not going to cost a lot of money in material, but it is going to take some labor and, you know, extra time, stuff. So expect the unexpected.

Yeah, classic. Um, let's say, how are your current deals going? Um, any, any movement since last week?

Um, I'll try to give a rundown. So on 528 Royal We had essentially 4— I'm sorry, 5 scheduled. 2 showed up yesterday. So I'm expecting to get obviously the estimates back here shortly so we can make a decision one way or the other. And Rochelle, I am working to get the insurance quote back on that. The guy called me yesterday basically saying that he had to go back out to some other entity, but hopefully I will have something today for you.

Okay.

In regards to Dorsett, we are waiting to hear back from the bank on that one. I think they're going to accept the $130,000. And then talking to the agent yesterday, I think the, the, the actual auction is supposed to go Thursday, and she's been having problems communicating with the person at the bank all the way in California. So that was kind of up in the air if I'm going to be able to land that one or not, depending on who answers the phone and try to make this deal come together. You would think that, you know, they have a solid offer on the table and they would take it, but, um, for some reason they seem like they're just going to go through the auction process. I'm not sure. So that one's still up in the air.

And you haven't heard about the, the roof and the HVAC. Do you know much more about that? Does it need a new roof?

It needs a new roof, absolutely. Um, HVAC, um, And I am— I totally like my agent. She's aggressive when it comes to helping out with things like that. So she had a guy go out there, take a look at the AC. Apparently only needs the fan motor, which will be about $500. I would try to go that route before actually replacing it, just obviously to save some costs. But yeah, and then she's actually had a quote for the roof that came in about $15,000. And then I'm— I should have I should have a quote back from my contractor today. I gotta follow up with him because they walked the house, uh, I think last weekend, and, uh, I just need to get that back to kind of solidify the numbers at this point for Dorsett.

Very nice.

And then, uh, for Gaither, the one in Mississippi, the mobile home, um, I just saw an email come through as far as the, um, appraisal is concerned, so I'll get hot and heavy on that today to get that coordinated. And the one for Beverly today at 5 o'clock, the contractor, we're going to go back out there with his guy to see if we can solidify the numbers. But that's what's going on. And then I guess as, as I have all that going on, I guess the question I was kind of thinking in my mind, I know we're supposed to continue to submit deals and have them look, look that, right? Like, that's the whole process, right?

Like It is, but I think Michelle and Toby could speak more on this too. To a certain degree, if you start stacking up too many deals on top of your plate, I'm sure Toby will tell you to really do these deals well and then start to move forward through those and then continue that process better. So I'm not as fluent with all the deals that you currently have right now, But if it doesn't feel like, I guess, too much of a workload on there, I would continue working through these deals as the numbers of getting to a deal to the finish line dwindle. I guess you just have to keep putting in those offers on projects.

Yeah, I would confirm with Toby on how comfortable he is with each of you, maybe differently, on how comfortable he is how many properties you're allowed to take down or can take down at one time, especially when you have big rehabs. And what we don't want to do is get any of you stretched so thin that you can't manage and/or keep up with your property or your plate so full that we start missing things and things start to get away from us. And that's the one thing we don't want to have happen. So I would confirm with Toby what he's comfortable with you all, but I would always continue to search for new properties. Like me and you talked yesterday, you know, while you're in the appraisal stage and especially on ones that, you know, we're all kind of waiting to see what numbers are solidified at, and you never know for sure that that— until property closes, a property is not closed. It's not making you money until it closes. So once you've closed, you know, you've got a project under belt and then you have possibly— you can work on your whatever numbers, but And so looking for other properties still, I would continue to do that. I would assume Toby wants you to always continue your search for properties. Sometimes a gold mine falls into your lap. And while you're doing that, you know, it's always easier to find a job or a boyfriend when you have a job. So now that you have properties, all of a sudden more properties seem to become available.

The only other thought process I had behind that is my brother's in Florida, like the Port St. Lucie, West Palm Beach area. They do a lot of work down there, and one actually works underneath the GC. So I was going to start looking there just to kind of expand the footprint, um, and then I'm not necessarily the one that's managing that, but like one or two maybe out of that. But yeah, so I'll continue to obviously try to find some deals, but obviously slow down as well. So, but that's it.

Yeah, and remember too, guys, inside of the platform, you know, with this membership, you have the ability to schedule a call with Toby, a coaching call with Toby, so you can kind of go over more of this strategy and more of these specific questions that you can bring to that meeting. So you get 2 of those a month. And so I don't think you guys have used too many of those scheduled meetings. So I definitely encourage you guys to schedule one. You know, with a lot of those specific questions like that kind of strategy and planning out towards things that change. But that's everything I had on the table. I was going to leave anything else open. Renee, Brandon, if you guys had something or currently working on deals that you have questions about.

Rick's got his hand up.

Oh, okay.

Rig, do you have a question?

Um, yeah, uh, and is it latate?

Is that how you pronounce it? Yes, yes.

Um, that brings up a good point. This whole thing is alluded to my question. I, I had a, a call from, um, from a girl in Michigan. She's probably like in maybe 45 minutes or an hour away from me. And I don't know really how she found me, but she needed some advice. So I coached her up a little bit and I didn't charge her anything, just doing kind of a favor. She was looking at a house. She was going to flip it. It didn't work out. And that was like 6 months ago. So she contacted me by Messenger or something and said, hey, just wondered how you doing? Would you partner up with me for some flips. And that kind of sparked a little bit. And I thought— and I typed back to her and I said, I'm involved in a group that can provide financing if we find or you find a half-decent property. So you don't know the way my mind works, but that went up and up and up. And I thought— and this might be an idea for everybody here, too. But I wanted to run it by you guys to make sure everything's okay. Me being here, if I had a person in Nashville and I had a person in Dallas and I had another person in San Jose, California, whatever, I'm thinking if they either need to learn about flipping or want to get into flipping, or maybe they've got some experience and they're having trouble with the financing, whatever their issue, I could go 50/50 with them. So it would kind of be our project, but I have the experience, so away we go. Uh, yeah, split the, the profit with them 50/50. But I think the advantages might be their boots on the ground. You know, if it's in Nashville, I'm not there. Uh, we get a really— I would get a really good, um, a realtor in that area, plus, you know, Billy, uh, who wants to do a flip, and he would be my boots on the ground. Got the realtor to do the CMAs, uh, you know, stuff like that, make sure the numbers are working. And I could actually do quite a few more. I'm not doing really very much right now. I've got other stuff on the go, but I could do a lot more if I had boots on the ground in various different places. Rochelle, Nick, Brandy, what do you think of that concept?

Um, yeah, I mean, it's, it's always— I think it's always good to have, you know, a, you know, potentially a long-term plan in mind. You obviously can't do everything at once, you know. It would, it would depend on, you know, people's situation, you know. I guess I would I myself would think that I would like to do the first few deals maybe within a certain distance from me so that I can see them. I have control. I can go through things and go with it. And having that long-distance trust, I mean, you'd have to have somebody like, I think, I thought, let's say maybe you said your brother or something like that. There's trust there. But other than something like that, I think that is something that you can work towards, right? Scaling. Would happen later on. Wouldn't you agree?

Yeah. And I think with Rick's experience, that kind of project works great for him because he knows what he's doing well enough from afar that he knows how to manage a property. I do think I agree with you, Nick, that when it's your first dozen or so, you really want to be able to view them, see them, touch them, and take care of, make sure they're moving properly. And I do like the idea of having somebody that is very familiar with that area. So they're aware of what the actual sales look like in that area, and they're aware of what, you know, the cost per se is in that area. You know, if you live in one section, it can vary drastically. So I always think if you have people that are smarter than you in an area, then utilize that. So if you've got somebody that knows the Texas market and you don't, then utilize that, that person knows the Texas market and they can help you. But yeah, I agree with you, Nick, for these first deals, I would definitely try to keep a backyard idea so that you can see it. That way you learn too what's happening. You'll be able to walk them, see how the rehabs work. I've been doing this for a long time and I still wouldn't be able to tell, walk a property and give you a scope of work. That's not my forte. But if I watched it enough and was on site to see something like that, I guarantee I'd pick it up. And that's the benefit of it. You might be great at comping your properties, but you're not great at your scope of work. Being able to go to your properties and see it, that's how you're going to learn and how you're going to get better at that specifically.

What's your question, Renee? So you got your hand up.

Um, yeah, I had a question from the realtor last night about a closing attorney to use because the owner of this house lives in Arizona and her son is living in the house. So she doesn't have a closing attorney? I thought Toby told me that you guys have like a global—

yeah, we have an attorney that handles all of our closings. They draw all of our legal docs, they look through all of our title work. Um, I want to make sure I understand what you're asking. Are you looking for a closing attorney like is in a title office Or I'm trying to make sure I understand, like, if it's a— some states are attorney states, some states aren't. And so while you'll have a title, you'll also have attorneys in certain states. And in that case, most of the time the sellers would have their own attorney or need to get with an attorney. I'm not quite sure why, um, the son living in the house would cause an extra need for an attorney. And generally when you sell, you're moving out, there's usually not attorneys. So I would probably need more information to help you and guide you on that. But yes, we have an attorney that will, um, be in your benefit. I don't know, um, if they would represent a seller. I think at some point it becomes a conflict, so I would have to check with our attorney.

Right. Okay. And who do we pay the escrow to? How does that work?

You mean your, uh, earnest money deposits and things? Or what do you mean when you say escrow?

You're breaking up. Sorry. The escrow money.

Right. Are you talking about the earnest money? Is that what you mean by the escrow, which you put on the initial? Yeah. So it depends. No, no, no, you're good. Sometimes the contracts will be specific if the seller has it going to the real estate agent to be held or to the title company. Most of the time they go to title because that's where it's going to get the credit on the HUDs and things like that. They control the closing and they control that fund. So, um, ideally as a buyer, I would always want my earnest money to go to the title company. I would not want it to go anywhere but. So I would always advise that to be what you, um, advise that you would— where you want to put your earnest money.

Okay, that way if anything happens—

yeah, go ahead.

The contract that we submitted last night, the realtor told me that they normally hold the earnest money.

Okay, I mean, I don't know that that's necessarily a problem. And the reason I would always prefer or say that we would prefer a title company is if anything happens, title will follow the contract and the rules and give the money to the correct party her the contract, um, versus having anybody else hold it and there ever become an issue of getting funds back or making sure funds were handled correctly. Um, I don't— I would have to look at your contract. I don't know that it's completely 100% unusual that a realtor owns it or holds it, but generally it always— even the realtors take them to title. Um, so that's generally because the title has to give credit for that on the HUD, um, once you get to closing because you've already put a deposit into that purchase price.

And do I send the contract to you once she sends it to me?

Yes, once you have, um, a contract, you'll want to send it to Toby, to the— our whole team so that we can make sure it's reviewed, um, do whatever's needing to be done on it and make sure that all the points that need to be on there are on there for you. Okay.

All right.

A sample contract that you could maybe send out with all the points that you require so that when we're doing up a contract, we're kind of aware of what should be in there.

Sure. I mean, I could probably send you more of an email breakdown because contracts do vary so much. And, you know, mainly it's your contingencies. You want to make sure that you always have your contingency. You want to make sure that, you know, pay attention to the almost additional verbiage that, you know, who's paying for closing costs. Pay attention to how your closing cost is getting paid, that you as the buyer— there are times that sometimes the buyer pays all the closing costs because that's how they arrange the contract in an agreement. So Pay attention to those things. And if you get a contract before you sign it and you want us to look over it, that would be ideal too, because then we can kind of tell you what we think works and what could be a problem or isn't a problem for you. That— I mean, those are generally your main things, um, that you're going to watch for is your contingency period, who's paying, uh, for closing, and then pay attention to the date of the closing. And you want to set a realistic date. You need to make sure we have time to really review, get everything back in, and, and can vet your property correctly. You have time to get a GC out there because nothing's worse than you've created a scope of work and you think that's great, and then you close, and then you— your GC goes out there and they're like, no, it's not going to work for that. And because there's no undoing that bill, once you funded with that amount, that's the amount you have to do that property, um, and you've got to either bring more money or figure out how to make that work without losing any of your value or changing that scope of work.

Point.

So we always want to make sure we have room for that. And then also, like LaTate pointed out, some of those, um, contingencies will be 10 days, but some will say 10 business days. Pay attention to that too. It doesn't always go Monday through Friday and then Monday through Friday. There are some that are a 10-day window. That means you have 10 days period, not 10 business days. So if you can get a business day contingency, that's even better. Um, but again, just kind of see what you can work with, uh, within your guide with that purchase.

Perfect.

Well, that's all we have, guys. Again, myself, Randy, and Michelle are available whenever you guys have any questions. We'll continue to look through it. Let's say I'll run— make sure all your deals are ran through and you have them in there by the end of the day. All right. And if there's any other issues, you guys let me know.

Let's say, can you send like an email of the ones that you're missing so we can and make sure that on my side that I've seen them too, um, and we got them reviewed for you.

Will do.

Thank you.

Thank you, sir. All right, y'all have a good rest of your day. Thank you.

Thanks, guys.

Thank you.