Chat Transcript – August 1, 2011

Posted on August 2, 2011

BozoB Hello?
BozoB Hey Mach
mach78 Good evening
mach78 How are you doing
mach78 ?
BozoB I’m great
BozoB how are you?
mach78 Doing pretty good myself
BozoB good to hear 🙂
mach78 Last time I was an hour late
BozoB been there
BozoB lol
mach78 Got the time zones a bit mixed up
BozoB where are you from?
mach78 Brazil. You?
BozoB I’m from hawaii
mach78 Awesome
mach78 When did you get into the “Weekend Millionaire”family
BozoB I first heard of it in 04 i believe
BozoB or 05
mach78 Really??
BozoB Aloha Mike!
mach78 Hello Mike
Mike_Summey Hi everyone!
BozoB yeah, it is really expensive here and had a lot going on. haven’t been able to start yet 🙁
Mike_Summey Just logged in. I need to step away for about 1 min. Be right back.
mach78 I see
BozoB no problem
mach78 Ok, Mike
BozoB what is the investing like for you Mach?
mach78 I just finished listening to it about 2 weeks ago and I am REALLY excited
BozoB great stuff huh?
mach78 Haven’t started yet myself
mach78 It’s amazing
BozoB Mike and Roger are great guys
BozoB always helpful
mach78 I am here, tonight, to talk to them and see if it can be applied here
mach78 I bet they are
BozoB Hello laura!
mach78 Good evening Laura
Laura Hello!
BozoB Hello ksk
mach78 Hello ksk
mach78 And the community is growing
BozoB 🙂
mach78 Have you any other of their products, Bozo?
BozoB it’s been years since i been able to join a chat
Mike_Summey sorry about that. I had to go yell at my dogs for chasing a coyote in the back yard.
BozoB Hello greg
mach78 Hi Greg
BozoB Mike, good dogs. LOL
Greg Hi Bozo & Mach
Mike_Summey Hi Laura, ksk, Greg & whoever else came in while I was gone.
Greg Hi Mike!
Laura Hi Mike.
mach78 That’s just us for the moment
BozoB Hello Joshua
Mike_Summey Hi Joshua
mach78 Heelo joshua
mach78 typo
BozoB lol
BozoB uguese?
Joshua Hey everybody!
BozoB Hi Charlie
mach78 What, Bozo?
Mike_Summey I have coyotes, foxes, deer, bear and turkeys in my woods and they come out in the yard occasionally and the dogs get after them.
mach78 Hello Charlie
Mike_Summey Hi Charlie
mach78 and Tray
Mike_Summey Hi Trav
BozoB I was asking if heelo was portuguese
BozoB lol
Trav Hey Mike
CHARLIE Hey everybody
mach78 Not really. hahahaha
Laura My dogs would love to chase all those animals Mike.
mach78 More like Alo
BozoB bom dia?
mach78 That is good morning
mach78 Hello John
BozoB Hello John
Mike_Summey Charlie, did you get a call from Kristina earlier about her house?
John IL Hello
Mike_Summey Hi John & gp
gp evenin all
Mike_Summey What’s on everyone’s mind tonight?
CHARLIE Mike no i did not call me later a give me her number
mach78 Good evening gp
BozoB investing, of course
mach78 That is for sure
Laura How to find REO’s that are not listed with a realtor?
Joshua Mike, how’s the house purchasing going? Still buying several a month?
Mike_Summey Just so we’re all on the same page, if you have to sell a house to make a profit, you’re not an investor, you’re a speculator and sooner or later you will get burned.
CHARLIE Laura a good agent can find you alot of reo to look at. The banks only list there reo with agents
Laura thanks Charlie
Mike_Summey Joshua, we’re approaching 50 in the last 24 months.
BozoB wow
BozoB it truly is a snowball isn’t it?
mach78 Awsome
mach78 Awesome
John IL Anyone have any experience rehabbing an older house with (potentially) lead paint of asbestos?
Trav Mike when looking at REOs how do you check the plumbing, some of the units have the facets tape off?
John IL I found a great prospect, but it needs work, and I’m afraid of the asbestos deal.
Joshua Mike, nice work, I’m at 2 houses YTD, they take some time to get rehabbed and then leased
CHARLIE John il you can buy a test kit at lowes that will let you know if the paint has lead in it
Mike_Summey I have 6 contracts on my desk right now that were supposed to close last Friday, but the seller didn’t get them ready in time. It now looks lik they will not close until the week of Aug 15.
Mike_Summey John, I rarely look at older properties. There are too many newer ones on the market to worry with old ones.
BozoB Mike, now that you are financially free, do you still invest as if you were just starting?
John IL Mike, I knew you were going to say that! ; )
CHARLIE Mike did you get the other proposal today i sent
Mike_Summey Trav, you just have to look the best you can. sometimes you will miss something, but if it’s anything major, you can usually see it…missing water heaters, etc.
Trav OK thanks
John IL I’m a sucker for the original old properties, with their architectural details. Even if they are tore up.
Mike_Summey John, stick with houses built after 1978 & you won’t have to worry with lead paint or asbestos.
John IL I’ve found a property or two, but no takers on the offers.
Mike_Summey Bozo, I’m still doing things the same way I did 30-40 years ago. The Weekend Millionaire method of investing works all the time, not just when the market is hot.
Joshua Mike, have all of them been REO or have some of yours in the past 24 mos been “other” type of distressed sales?
mach78 Mike, I am from Brazil and I was wondering if the same principles might work here (I just finished listening to the program). Furthermore, I was wondering if the Offer Generator can be configured for different economical backgrounds
gp Would you advise selling one property (with a lot of equity) in order to get the capital to buy with cash?
Mike_Summey John, this is a business, not an art project. You have to get the emotion out of it or you will not be successful.
John IL Mike, while I have your attention, iI can’g get the OG to work on my new WIndows 7 system, so I tried my mac. No Luck there either.
Mike_Summey Hi jan-erik
Jan-Erik Good evening
mach78 John’s last question is important for me either
Mike_Summey mach78, the Weekend Millionaire principles work anywhere. The Offer Generator does as well; the only difference is you will have to do the conversions from USD to your currency. The OG computes in USD.
Greg @John: have you tried using a Windows emulator on your Mac (non Windows 7)?
Joshua John IL, Mike and I have discussed this in the past, but newer homes are great for long term rental if you can find them in non-HOA neighborhoods. Where I’m investing it’s very tough to find any newer than 1978 homes that don’t have an HOA. I would take an older home any day over a newer home with an HOA
Mike_Summey gp, why not get a loan on the property, pull out the cash and use it to buy the next one for cash, then do it all over again.
mach78 Thanks, Mike
John IL Greg, don’t know what a Windows emulator is…
gp If we refi we will get half what we will get if we sell. I’m torn between these two choices
Laura Joshua – what is HOA?
BozoB Home Owners Association
Greg @John: I’ve used Parallels … I’m sure there are others … maybe free too …
Laura Thanks
Mike_Summey John, we have had some problems loading the program on Windows 7. We tell you that on the website. It’s not with the program, it’s with the way Windows 7 loads programs. You shouldn’t have a problem with the Mac, just be sure to follow the Mac loading instructions in the cover.
mach78 Can’t I buy the Offer Generator to download from the site?
Greg @John: Windows emulator lets you run Windows programs on a Mac (Intel based) …
Mike_Summey mach78, sorry, it is only available on disc.
mach78 @ John: Boot camp is an idea
John IL Hmmm. I’ll try the mac again. I’ve had it for a while, and used it on an old compaq that’s now in the graveyard. So I tried it on the Mac, folllowed the instructions, no luck. I’ll try again…
BozoB good luck John
BozoB technology is another form of leverage
John IL Mike, do you buy ANY house that meets the OG criteria? Or do you look at other factors.?
BozoB can make it easier or more difficult LOL
Mike_Summey gp, that is a call only you can make. I’ve never sold a property so I don’t know much about selling.
Joshua Mike, have another property under contract but still waiting on the bank to decide if they’re going to fix the electrical so they can turn on utilities so I can have an inspection done…this thing is dragging out much longer than I want…
John IL Greg, where do I get the windows emulator, and is it free?
BozoB John, Google can be your best friend
BozoB 🙂
Mike_Summey John, I inspect several properties in a day and then make offers on all of them using the OG. So far, I’ve bought everything that has had an offer accepted. Charlie may want to chime in on this as I’ve bought several using him as my buyers broker.
Greg @John: type, “parallels” in Google … you’ll find them and others … 🙂
John IL In my experience, Sometime realtors don’t like to present low offers. Thanks Greg.
BozoB hello goofball
Greg @John: Shirley!
goofball hello there everyone!
BozoB Hello Mike
BozoB late again I see
BozoB lol
CHARLIE John the og works no matter what the home is listed for make the offer based on the og it works, have seen it over 20 times in 2 years
mach78 Anyone here can tell me the difference between de OG and the Carleton Sheets Real Estate Toolkit?
Greg @Charlie: good OG testimonial … I need to go check it out …
Trav Mike, when you put offers in on REOs do you put them in near the end of the banks quarters?
CHARLIE John a real estate agent has to summit all offers no mater what if one is not let his broker in charge no that he is not
mach78 @ Charlie: Same here
Mike_Summey John, go to and download the program. You need this to install the program on a Mac and it no longer comes with the operating system. You’ll find instructions with the OG in our online store.
BozoB Mach, there is a big difference
mach78 @ Bozo: can you tell me?
John IL Thanks Mike. I’ll try that.
BozoB Both are great, but the OG is prectically idiot proof. I like to say Noobie-Proof
mach78 @ Bozo: I guess I fit both categories
BozoB But, imo, Carleton Sheets toolkit has some very powerful tools
Greg @Bozo: idiot-proof … I need that …
goofball Mike, starting out as an investor should I go towards getting pre qualified with commerical loan (5 or more plexes) or stay with conventional loans (4plexes) and under?
Greg 🙂
Mike_Summey mach78, the two programs are completely different. The Toolkit contains, a property analyzer, property manager and real estate forms. The OG prompts you to supply the data needed to create purchase offers that will cash flow if accepted.
Mike_Summey Hi goofball
goofball Hey Mike, does that question make sense or should I reframe it?
gp What’s the max LTV you are able to borrow with the 5/15 balloon strategy you utilize? i think we should refi as you suggest, it will just limit our price range.
CHARLIE Trav mike & i have made offer beginning of quarter end of quarter does not matter, follow the property till it sels. We have made offers on property in april and offers on same property in sept. And closed them
mach78 @ Mike: And does carleton Sheets work anywhere, as well, say, in Brazil, or would I have to make some adjustments?
Trav Thanks Charlie
Mike_Summey goofball, I recommend starting with single family homes.
John IL Charlie, I guess the hardest part about the OG is determining what the potential rent would be.
BozoB Mach, I think they both work in USD. the forms on CS Toolkit will need to be looked over by an attorney
Mike_Summey gp, I don’t look at LTV, I look at the payment amount the NOI will support using 15yr amortization.
goofball even if available investment funds are to where the one can afford going bigger?
CHARLIE John that is where a local property manger can fill in these blanks
Mike_Summey mach78, I don’t think much of what is in Carleton’s program would work in Brazil.
mach78 @ Bozo: As for it being in USD, is not a problem, since I can make input the numbers and assume they are in Real (our currency)
John IL Aha. I don’t have one. I had one, didn’t trust him. Got rid of him. Haven’t been able to bring myself to get another.
BozoB right
BozoB good point
John IL I think they’re sort of hard to find. Honest ones anyway…
Mike_Summey John, I use my property managers to get that information. They know the markets better than I do so I rely on them to tell me what they can get for a property if it is ready to rent.
BozoB remember what Mike said in his material
BozoB property managers do what you inspect, not what you expect
mach78 @Bozo: What is that?
CHARLIE John you have to interview the property managers like you would a real estate agent and see there track record
mach78 @Bozo: Ohh. It makes sense
John IL Has a property manager ever lead you to a purchase?
John IL led
Mike_Summey Hi Richard
richard-dallas hello
Mike_Summey Bozo, I think I’ve heard that somewhere before. Ha!
CHARLIE John i have bought a property that property manger told me about
mach78 😀
Mike_Summey John, I’m closing on 5 properties this month, which will make 14 that were brought to my attention by my property manager.
Joshua Mike, of your 50 purchases in past 2 yrs were all of them REO or were some “other” distressed sellers? Seems only deals I can find currently are REOs
Mike_Summey Joshua, some have been REOs, some distressed sellers, others just sellers who needed to sell.
John IL Mike, Charlie, In your experience, Big or small property mgr. Or does it matter?
BozoB what does his weight have to do with anything? 😛
Mike_Summey John, experience & longevity in the business means more to me than size.
BozoB I see, intimidation factor
John IL Bozo, don’t quit your day job…
CHARLIE John i think the one you feel the best with after the interviews
BozoB lolol
mach78 Mike, it has been a pleasure. Thanks for all the answers. Bozo, Thank you for your time as well ans your tips. Everyone else, it was a great “listening” to all of you. I have a hospital shift to go to.
BozoB Aloha Mach
mach78 Aloha Bozo
John IL My first guy was collecting late fees, and pocketing them without my knowing..
Laura bye mach
Mike_Summey mach78, thanks for joining us from Brazil.
BozoB John, sorry to hear that
mach78 I will be back next chat, the is for sure
John IL And he was ignoring my tenants phone calls…
Mike_Summey mach78, Bozo is from Hawaii I believe.
BozoB yessir
Joshua Mike, the ones your PM brought you were they distressed investors? Every deal my PM brings me is nowhere close to OG prices
gp Mike, are there any OG tutorials?
mach78 So I have heards
mach78 Herad
mach78 Heard
Mike_Summey John, that was not a property manager, that was a crook.
gp i second that
mach78 Good evening guys.
John IL Think it’s a coincidence that he’s running for political office???????
Trav Mike, how long do you wait to put an offer in again on the same REO?
Joshua PM collecting late fees and not passing onto owners is very common
BozoB John, sounds to be right up his alley
John IL Joshua, hence, why I haven’t looked up another PM
BozoB just because one was doshonest, don’t attribute that to the whole profession
Mike_Summey Joshua, the asking price of the houses I buy is rarely close to what the OG calculates the properties to be worth as an investment. I jsut go ahead and make the offers and let the sellers decide if they want to accept it or not. I think Charlie can tell you that sometimes I’ve bought properties at close to half the asking price.
BozoB wow, Mike, I never even considered that possible
BozoB that’s what has kept me from investing here. the usual $500k pricetags
BozoB I guess the large numbers just scare me
CHARLIE You have to make offers to buy properties the more offers made the more acceptance you will get
Mike_Summey Trav, I usually wait one quarter or if the original offer was made at the beginning of a quarter I may make another one about 2 weeks prior to the end of the quarter. Banks are much more flexible during the last two weeks of March, June, September & December.
Joshua Mike, I hear ya, me too, it’s just that PM are usually representing owners who are older and want to get out of the business. Those aren’t the guys that are willing to accept a low ball offer–at least they haven’t when I’ve made them
BozoB Josh, would you mind if I asked how many offers have been declined?
Trav Ya thanks, I was wondering if they became more flexible under time pressure
Joshua Bozo, on average I get one accepted for every 75 to 100 I submit
John IL Mike do you think putting it on paper increases your chances of offer acceptance? I’ve made a few verbal offers…
BozoB are there enough such properties in your area to make you wealthy? at those numbers?
Joshua John IL, written is always most powerful. Verbal means nothing to banks
Mike_Summey Joshua, you might be surprised to learn how many properties are managed for heirs, divorcees, people who have lost jobs, banks, etc. Don’t assume anything. Make the offer and let the sellers decide.
CHARLIE John always put it in writing
John IL Joshua, I’m talking about the sellers.
BozoB John, there was something I read by Roger about the power of the written word
Mike_Summey John, a verbal offer is as useless as teats of a boar hog! Pardon my French.
BozoB I think it was in Power Persuasion
richard-dallas Agree on offer strategies. After having similar experiences, have elected to managed all my properties personally for the past several years, and even with the demands this places upon my time, figure the control justifies the time & energy expended. Does anyone else face the dynamics we do in DFW, $60-80k valuations, lack of qualified deals for cash-flow driven investors?
Joshua Jonh IL, when I say banks = REOs (sellers)
John IL I haven’t cracked the REO thing yet. I have one bank sending me their REO list. Can’g find others…
John IL I think I’ll be making written offers from now on! Point taken!
Mike_Summey Richard, I’ve used professional management since I bought my first house. I did this because I wanted to be an investor, not take on a second job. My time is much more valuable negotiating new deals than fixing stopped up commodes in the middle of the night.
CHARLIE John you need to find a local agent that deals in reo, most agents can tell you who has the most reo listing
Mike_Summey John, find an agent who will represent you. The agent should be able to find plenty. That’s what Charlie does for me.
Joshua John IL, if it’s of any help, all the REOs I find are listed with agents on MLS. I rarely deal directly with banks
John IL Then you use OG, and treat the REO guy like any other seller?
BozoB Is it safe to say that if your credit is less than stellar, REO’s are out of reach until you can improve your score?
Mike_Summey John, keep this in mind: Banks are not in the business to own property. An REO is a liability to a bank.
Mike_Summey Hi Penny
Penny Hi Mike.
Joshua Mike, do your lease agreements with your tenants say your name exactly (or your LLC) instead of your mgmt co name?
Penny Hello Charlie, everyone.
Joshua John IL, you got it
Mike_Summey Bozo, nothing takes the place of good credit, but that’s something you build over time. Just accept the fact that if your credit is not good, it will be more difficult to buy than someone with stellar credit.
CHARLIE Joshua the lease is with the property manger and the property manager has a agreement with me
Mike_Summey Joshua, all leases are in my management company’s name. The tenants don’t know who I am.
John IL Mike, do you have a standard contract that you use with the PM?
BozoB thanks Mike.
John IL My crooked PM had a contract that I wasn’t comfortable with. My homeowners agent didn’t like it either…
richard-dallas Mike: What do % of gross rentals do you estimate do you estimate you pay for such services?
Mike_Summey John, yes I do, but it is my contract and it reflects the volume of business I do with the property manager. Most management companies have an agreement and it is usually okay to use; however, you should read it carefully and negotiate out any provisions you don’t like.
Joshua Mike, Charlie, thanks for the feedback. That’s interesting. I have two PM and both put my name in the “landlord” line but they are on the “agent” line acting on my behalf and execute the agreement. It may be a Texas form thing. I doubt they would change it for me.
BozoB Josh, you don’t know until you ask 🙂
gp Is there a PM standard commission you use, 10%
gp ?
Mike_Summey Richard, most property manager will want 10-12% of the rent, but that figure is negotible. The more properties you have the lower % you can negotiate.
CHARLIE Joshua you dont want tenants knowing who you are, they might call you at 2 am to fix a toilet
BozoB Mike, can you renegotiate after you start to get more properties? renegotiate on the ones alredy under contract?
Joshua Charlie, believe me, they don’t have any of my contact info! All they see is a name on a lease they rarely look at.
Joshua BozoB, not that you want my opinion, but of course, I do that all the time
Mike_Summey Bozo, yes you can. Usually the agreements are for 12 months and are renegotible annually.
BozoB thanks guys. And Josh, I welcome any and all opinions 🙂
CHARLIE Josha if they have your name with all the search engines you will be surprized what a tenat can find if they want to
BozoB thank you for sharing yours
BozoB Charlie, it sounds like a horror story
Joshua Charlie, good point, haven’t got a call yet after 9 yrs, but could happen you’re right
Mike_Summey I’d like to see some of you back here next week with a success story to tell. All this talk is of no use if you don’t put it to work.
BozoB challenge issued 😛
BozoB But, I will have to postpone. I am actually moving from Hawaii. To make investing easier and for the opportunities all around
Trav Thanks Mike, everyone have a goodnight
Mike_Summey Everyone, one reason I use a professional manager is to provide a layer of protection between me and the tenants. I require them to carry errors and omissions insurance to protect both them and me in the event they do something that creates a liability claim.
BozoB Aloha Trav
Joshua Mike, I’m looking at acquiring 14 units of a 64 unit apt complex. The other 50 are owned by a bank looking to unload them. They are asking too much currently. Been on market 2 yrs (the 50 units). My play is hoping to get bank to grow impatient and sell the other 50 very low since no one really wants to buy a portion of a complex. Thoughts?
John IL Mike, I’ll be asking you more about the errors and ommissions thing next time. Is that in your book?
Mike_Summey Bozo, I’ve visited your state and you are right; prices there are astronomical compared to the mainland.
BozoB yeah.
Mike_Summey John, Google errors and omissions insurance. You should be able to get more information than you want.
John IL Will Do. Thanks.
Mike_Summey Well everyone, the time has flown by tonight. I’m going to sign off and I hope to see you here on September 12th. We will skip the first Monday in September as it is Labor dAy.
BozoB Thanks to everyone for all the great and informative conversation
Mike_Summey Goodnight all!
Joshua Mike, I’m looking at acquiring 14 units of a 64 unit apt complex. The other 50 are owned by a bank looking to unload them. They are asking too much currently. Been on market 2 yrs (the 50 units). My play is hoping to get bank to grow impatient and sell the other 50 very low since no one really wants to buy a portion of a complex. Thoughts?
John IL Thanks everyone. Mike, thanks for holding these chats.
BozoB 9/12. I’ll be here
Laura thanks Mike and everyone
BozoB anyone gonna stay on longer?
Mike_Summey Joshua, get the 50 first. You don’t want to own 14 and then have the other 50 purchased by someone who runs the complex in the ground.
Mike_Summey Goodnight
John IL I always learn something useful. Goodnight.
Laura good night
Joshua Thanks for everythng Mike!
Greg Goodnight all.

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