Are you ready for part two of how to build your real estate power team?
It's coming your way right now.
Okay. we are back. We're teaching you how to build your very own personal power
team and in our last video, we talked about how important it is to be rooted
to freedom for money, time, peace of mind, that can all come by doing real estate
successfully and so the five additional F's that you're going to need to build
your power team, we talked in the last video about finding the right kind of
realtors that can find these good deals and today, we're talking about the second
and third F which is fixed and fund. We need someone to fix these homes and we
need to make sure we're funding them the right way.
- Okay, now again, we're talking about building a power team so this is you getting
outside of putting on the tool belt yourself and swinging the hammer, you
want to find individuals who are competent and know what they're doing in
an investor's world. Now this is different, we oftentimes talk about
putting on the investor goggles and especially when it comes to fixing up
the property, you want to make sure that you're not wearing your consumer goggles.
This isn't a home that you're going to move into, this isn't your dream home, you're
not fixing it up and making it to the nines and putting in the granite and the
gold fixtures and the, you know, the golden port, golden porcelain,
golden porcelain tub or whatever. You're not putting all the fancy
things in it, you're just putting in and fixing it up to a certain level so that
it is appropriate to go ahead and run out. - This is the opposite of the approach
of hiring an interior decorator who's going to look at the house and say, oh my
gosh, there's so much potential. I don't want that person setting foot in my
property because this is all about getting functional and tactical and so
we're looking, like Steven said, for a competent repair person but does
competent repair person actually go so far even as a licensed contractor that's
bonded? Friends, that stuff already gets really pricey and the reality is, you can
either pay $60 an hour for someone to swing a hammer and a nail or you can pay
someone $15 an hour and so in the game, understand that your margin for winning
and success in real estate comes down to getting good work done at a really good
fair price, not at that really high level $100 a foot mentality. - Yeah and I will
say, this is a place where you really want to get real. Don't go to Google
and just do a search. I'm sorry but Google does not tell you who the very
best, highest rated, most honest handy men are but
what you're looking for, that's what you want to find. So the question here I
think that probably is on everyone's mind when it comes to fixing a home is,
Kris, how do you identify those type of people? How do you find them and then how
do you kind of get them in your employ? - So this is really good. There's a
couple important things that I look for when I do this and the first one that I
look for is competence and then I look for price. Let's talk about
competence. Competence is getting the work done in a proper time frame, meaning
quality over time. Though that is what competency means and then the number two
is price so you could literally hit social media or the classifieds and just
go out and get a minimum of three bits so when you go in and you assess and you
know what work needs to be done, get three different eyeballs on it. Yes, it
does take extra time to get them and to meet with each one of them individually
or as a group and to spend time but what you're really doing is building a team
so as you find the person that you're going to work with long term, that means way
less time but still getting the job done. In the beginning, we've got to build the
team and that takes a little bit so what I want you to do is, I want you to look
for people that probably broadcast himself as handy men that have the
ability to do everything from roofing and flooring and cosmetic and things
like that, some plumbing and some electrical, that's generally what you're
going to look for in a home. There's someone that usually possesses all of those
abilities and have them come out and get three different bids.
The purpose of the three bids is to give them all the same projects and you just
have a chance to actually have them compete in price against each other and
what's going to happen is, you're probably going to have a front-runner that's going
to do it for less than the other two. When you find that person or you may
need to get more bids until you find that person, then you got to test their
competency which is, can you do the work at the quality I'm looking for in the
timeframe? Both of those are really really really important and I just want
to throw in a little bonus here.. When you pay these people, pay them half up front
and do not pay the other half until the job is completed and I'll sometimes go
one step further because handymen are notorious for mismanaging their time.
One week turns into four weeks astonishingly fast
so what I'll generally do is, if I agree that the project is $4,000
and I pay them $2,000 upfront to cover their materials then
they're very motivated to make the half of the money but what I let them
know is, I'll actually have them tell me how long it'll take it if they say two
weeks and if that fits my budget is reasonable, I'll say, great. What will
happen is, two weeks from now, on this day, I'll write you $2,000 check.
If you you'll get three days of leniency but three days after that, I will be
giving you an eighteen hundred dollar check or a fifteen hundred dollar check
which means that you actually get penalized for time because guess who
else is being penalized for time.. You. And I like to pass that right on to them,
it's actually create. Now this is a little bit of an aggressive stance but
of works for me. - I want to take that a little bit of a different angle because
I think the concept is amazing, what you're talking about here and giving
people some opportunities in learning how to really build that power team
appropriately. Most of this, when we're talking about handyman and and building
the fix-it side of this of this equation, you want to properly incentivize them,
right? That's what we're talking about, giving them a proper incentive to fix
the home in a timely manner and to do it in a certain way. Communication here is
key. If you're not appropriately communicating with them, everything that
you do want and everything that you don't want within the time frames that
you want it then you're doing them a disservice and yourself a disservice.
One of the things that I was going to mention here that you can do and
add in is, you can give them a bonus. You know, you can work this into your budget
so this doesn't have to be negotiated after the fact or it doesn't
have to eat into your profits necessarily but you can you can say, look,
I'm looking to get this job done, for example, for $3,500 but if you get it done
in the two week time frame, I'll give you an additional $500 so that
just takes a little bit of different angle, it's kind of the same process, same
concept but if you will do that, they're going to be way more likely to go to work
for you, to work harder faster, to make it better and give you
their best and this is what you're really looking for. - And you're going to really find
out a lot about you and you're going to find out a lot about them. When it comes
to finding a handyman and really doing the whole fix-it part of the fix-it F in
the whole system, is it starts with assessing then it goes to interviewing
the right person and then it goes to management. Now the management means
they're the ones doing the work but you've got to look over their shoulder
and make sure that you're checking up on the progress, make sure they look they
know that you care about the project and that it's going accordingly. Down the
road, when you have a trusted handyman, I call it people today and there is
one conversation or even my manager has it and right now, everything's being done,
no questions asked and they know exactly what to do. So really, this
is a rapport building period of time and let them know, I'm going to be doing a lot
more projects, there's future projects on the line, this is really important for
these people so I'm really looking for a good trusted relationship and trust for
me comes down to honesty, it comes down to quality and it comes down to
timeframe. So Steven is absolutely right, you can incentivize them with the carrot
at the end but I also like to let them know what might happen if we go over
that time frame and if you're ever going to enforce a deadline, make sure they
help create the deadline, that's another one of the big secrets when it comes to
fixing. - Alright, the second part of this video today is about funding and funding
obviously is one of those really important parts of the process. If you
want to do real estate, you need the appropriate funding. If you want to even
fix the home in the right way, you need the appropriate funding so this is a
great great segue. - And I just want to pause for a second because there's three
ways you could have funded this deal. You could have taken Steven in my Lease
Option course where we were training you or we have trained you and you're now
part of our community and we're teaching how to find deals with no money and no
credit and it's already funded. You might have taken our partner profits course
and in that one we showed you how to line up on partner who put their money
up and and now that's how you funded the deal. Let's assume for this video that
we're using traditional funding which means we need to work with a loan
officer, whether it's for a partner's sake or for your own, generally with
investment real estate, somebody needs to put down a 20% down payment that can be
funded from a 401k an IRA, from equity and another property which on an
average-size deal, you might be needing $30,000 or $40,000 or $50,000
to do a real estate transaction and you need to have the proper funding
team which in the world of real estate means you got to have a really gifted
loan officer. Now let's talk about loan officers cause again, loan officers quite a
lot like realtors are a dime a dozen, they're all over the place and there are
so many different mortgage lenders and mortgage brokerages and banks that are
vying for your business, one of the biggest things I think, this is the
hugest, I think the biggest takeaway that you can have here in the world of
funding is make sure that you find a lender or you find a mortgage or loan
officer who does the majority of their work with
investors. Now if you're going around and you're trying to get a loan, most places
do have primary residence financing, they're loading on people's
first home or their primary residence. That loan world is a lot different than
investment financing, it really just is. - And for those of you that don't actually
even know what we mean when we say loan officer, right now if you bank a
chase or whatever you go to bank or if it's a local credit union, that's you
interfacing directly with a bank. A loan officer is an individual who interfaces
with many banks and what they do is they understand that all banks have different
lending programs, they're all a little bit different, they're all a little
unique, they all offer slightly different rates and not all loan officers are
created equal. Some have done so much investment portfolio lending, they work
with so many banks and they do so many deals that they they get these
incredible volume rates. What that means is, they do every month, they're known for
doing pushing so many new loans through successfully and that they're
successfully marketing and finding investors and people that need loans and
they actually get them all done that they start getting preferential
treatment with the bank which means that those loan officers will have their
banks give you the investor even better rates and even better deals so
really the question is, how do you find a good loan officer? Part of it is knowing
what you want. You're going to want to pull out your pen and paper and you're going to
want to take some notes on what you need when finding the right loan officer for
your power team. - Awesome. So most people when they get in started in real estate,
they're super rate conscious - Rate is everything - and most loan officers are
super rate conscious. - But Steven, let me ask you, how much do you care about the rate?
- I don't care. Well, that's not true, we care a little bit
but I only care in terms of, is it going to help me to get my next deal? This is
the difference between finding a loan officer whose rate conscious as
opposed to one that is more portfolio minded and I want to talk about what
that means here for just a second, alright. The rate on the home, what
we're talking about is the percentage rate, right. How much you're actually
paying to borrow that money and that percentage rate is what we pay
out in interest in the home so in any mortgage payment, you're paying a
portion of it to the principal or actually paying down the loan on the
home and the other portion is being paid towards the interest or that's what the
bank or the lender is making. Now so many people are rate conscious because that
rate consciousness is what's going to allow you to either pay more or pay less
out over the life of that loan. The problem with being so rate conscious is
sometimes it gets you into this rut of you might bypass your next deal in order
to get a lower rate now but that might stop your investment possibilities.
If I'm going to get home number three or four or five or whatever and I
did home number one or two a certain way, that may completely close the doors for
more opportunity and so I'm looking for a loan officer that's going to open
those doors for me. - So when Steven talks about a loan
officer instead of being rate conscious that's portfolio minded, what that means
is, imagine that a loan officer is working with ten banks and it's like one
big jigsaw puzzle and we've got to figure out which banks to use in which
order for which properties that are being bought and you're looking for an
experienced loan officer that can help you maximize your credit because once
you've used it all up then we need to go maximize somebody else's credit and
we're always looking for maximizing credit and doing it the most intelligent
way so here are the three things that you're looking for when it comes to
finding a loan officer.. Number one, they need to specialize in investment lending
instead of primary residence. Write that down,
investment lending expertise. Number two, portfolio minded means that they work
with it probably at least five to ten banks on a regular basis and you'll find
that most loan officers do not work for a number of different banks because
they're not doing enough volume which leads us to number three. We're looking
for a loan officer that pushes lots of volume, they should be able to brag and
say things like, "Oh yeah, last year I lend it and helped put together tens of
millions or hundreds of millions of dollars worth of mortgages together on
properties that we've done." Okay, that kind of volume, working with that many
different banks specialize in investment is a winner for you, that's who you're
looking for on your team to be your loan officer, to help you figure out how to
secure the long term with banks as you're going from deal to
deal to deal. So let's summarize real quick. In our first video, we talked about
the power of freedom and we talked about how you find the realtor that's going to
help you find the deals, now we're talking about fixing and funding and
today, we've talked about what you need to do as far as vetting and finding the
right kind of handyman to help do the work on the business we also talked
about what you need to look for when finding the right loan officer that's
going to help you fund the deal and that takes us through finding, fixing and
funding. In our next video, we're going to hit two very key elements, we're going to
talk about how you fill the home with the right property manager and then how
you follow up on the home so that you get it to continue building and
maximizing your portfolio with time and again, friends, this whole series is all
about how you build a portfolio and how you build a power team and I want to
just say something.. Steven was the first person that I brought on to my personal
power team when I got started. Steven has served in a variety of capacities and
now he helps me run our entire massive real estate empire. We've got you, our
Limitless Wealth YouTube nation on the line watching our videos and reaching
out to us and now what we're doing is, we're building your real estate power
portfolios and if you want to know how to tap into more than just watching
these videos, if you want to know how to pop tap into our power team then go
ahead and click the link up here and click the option where you get a chance
to talk with Steven, myself or a member of our team who can lay out all the
details, show you our deals where we're investing how, we'll introduce you to our
power team and we'll show you how you can leverage our power, our entire power
team to build your portfolio. This is exactly how I built my original real
estate power team that has now led to a system of nearly a billion dollars worth
of real estate. So excited tomorrow to bring you the next and final concluding
segment on how you build your very own real estate power team.
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