On today’s episode Paige Panzarello joins Holly. Paige has been in the real estate business for over 20 years working various different aspects of the business. Paige has worked as a landlord, as well as working in land development and owning a construction company. While there are several types of notes available to buy Paige works in non-performing notes.
Non-performing notes allow for Paige to help people who might not otherwise be able to keep their homes, keep them, while also making a profit for Paige.
A recent success story for Paige is one out of Memphis, Tennessee. A borrower had not been able to pay for her mortgage because she was paying for her husband’s medical expenses. The husband recently passed away and the borrower was on the verge of losing the home that she has lived in for over 30 years. Paige was able to help this woman out by buying this note and allowing for the woman to keep her home with repayment and a mortgage adjustment.
Paige speaks about FHA 1023, which are specifically designed for banks, like Paige, to work with borrower. They will come in and refinance after 12 months at 97.5% of current market value, which means the borrower, gets to stay in their home and Panzarello gets cash flow. In the end borrower ends up with a manageable mortgage payment and is able to keep their home. When buying notes Paige reminds us that in every 10 notes, one-third of people will perform as expected and be able to keep their home while a profit is being made.
Non-performing notes have 23 exit strategies but Paige only utilizes about 4 of them. Paige has preset criteria to determine which notes she wants to get involved in. Paige and her team work out, on paper, every stage of the plan to make sure that they are making money, if they are not making money on paper than the deal is not worth it to them. If you cannot make a profit on paper then the chances of you making profit by buying the note are slim.
Paige reminds us that there is plenty of opportunity in note buying, $1.38 billion dollars of bad debt opportunity. To get involved in note buying you need to take the right steps and do your due diligence to make certain you are buying the right notes.
While you can go online and signup for a website and buy a note this is not the best way to purchase a note. Paige insists that you do not want to buy a note this way unless you know what you are doing because there are a lot of steps that go into note buying. Unless you know what you are doing you need to hook up with a mentor and develop a relationship with them so that you can benefit from the education and keep yourself out of trouble financially. You need to do your due diligence before you decide to purchase a note to make sure the comp value is where it needs to be and there are no delinquent taxes, etc. Never buy a note without having someone go to the property and have him or her take pictures of the property. You need to make sure that the debt that you just bought is physically there and still standing.
Paige likes to say that there are no bad notes but there are bad buying of notes, bad buying will occur if you do not do your due diligence. If you buy badly your profit margin shrink or disappears.
Paige finds her deals through relationships. Real estate is a team sport, you cannot do it all yourself. If you do not have good relationships with people on your team you are not going to get very far. Paige funds her deals with her cash, as well as her partner and joint venture partners. Notes are cash and carry unlike conventional loans for homes that you are buying to flip.
Paige has become successful by utilizing her strengths and skills. Paige has been in the business for a long time and has experienced the ups and downs of the real estate market. Paige feels that her most important characteristics are perseverance and dedication. She also feels that having a strong team is crucial to her success. A strong support system can be a very beneficial asset.
If you are interested in learning more about note buying you can check out Paige’s website at www.CashFlowChick.com On her website you can schedule a free 30-minute consultation to discuss note buying. Paige handles all of the emails that come through this website so if you are interested in reaching out to her this is the place to do it.
Paige and Holly also mention a cannot miss event happening on October 23, 2016 in the Los Angeles area hosted by Women’s Real Estate Network (WREN) – Ignite Your Fire From Within. To learn more about this event visit www.WRENinspires.com
On this episode of House Flip Masters Holly is joined by guest Raj Bhaskar. Raj is the co-founder of mobile profit and taxes app, Hurdlr, designed for self-employed entrepreneurs.
Raj had his first taste of real estate when he created his first software platform for real estate management; this software was used by housing agencies all over the country helping them to manage their public housing and affordable housing properties. Raj built this company up for 10 years and when it sold in 2010 to real estate software company Yardi.
With his own real estate experience and knowledge from the platforms that he has created Raj believes that real estate should be a part of everyone’s investment portfolio in some way of another whether it is actual property or an indirect real estate venture.
Raj got interested in real estate software when he and his wife bought their first home together and decided to rent the condo that Raj owned. When they decided to rent out this property Raj was asked to get together all his expenses concerning that property – this was the first time he had to do this – and he wasn’t prepared to do it. When gathering the information that he needed Raj started thinking that gathering the required documents was basically a business.
During this time Raj was already building an app for entrepreneurs to help manage all of their business finances – when he was gathering paperwork for this condo he realized that his personal task was a great use case for the app – he then started adding functions to the app that allowed for real estate investors to track their finances along the way so that when tax time came they could just send information to their CPA with a tap of a button.
Raj reminds us that in real estate investing it is vitally important to track your numbers and to invest smart; invest to make a return on your investment. By knowing your numbers you will make good money and have a good business. The best way that Raj suggests to know your numbers is to start off by opening a separate bank account or credit card and use that only for your rental property expenses. With a separate account every time you receive a statement everything will all be related to that specific business you opened the account for. Raj also advises that you do not mix your personal expenses with your real estate investing expenses.
Holly agrees that it is a good idea to separate your flips from your rental properties from a tax perspective; she also says that it will make your life easier to track expenses and to have that separate bank account or credit card opened.
Raj’s app, Hurdlr, allows users to sync bank accounts and credit cards to the app and every time a purchase is made you will be notified and at that point you can tag the expense as personal or business allowing you to keep everything organized. The app will also give real time income tax estimates.
If you would like more information about the app or to download it you can visit www.Hurdlr.com or download the app in the iTunes app store or Google Play Store. You can also reach out to Raj via the website or with the chat function side of the app, you can chat directly with him or a member of his team if you have questions or concerns.
In this episode of House Flip Masters Holly McKhann talks with real estate investor and philanthropist Rod Khlief. Throughout his career Rod has personally owned 2,000 single-family homes and several apartment communities. He has built several multi-million dollar businesses and is dedicated to giving back to the community with his Tiny Hands Foundation, which has helped over 40,000 unprivileged children.
Rod emigrated from Holland at age 6 and moved to Denver where he bought several buy and hold deals as well as flipped houses. Rod saw that he was making money in flipping houses but wanted to increase his cash flow so he bought homes in Denver, Memphis, and Florida. With the amount of properties that he had purchased in 2006 Rod’s net worth increased by 17 million dollars overnight, but it was the crash of 2008 that caused Rod to learn a 50 million dollar lesson, or seminar as Rod calls them. Rod likes to view failures as seminars because there is something to be learned out of something that doesn’t go as planned.
As a way to generate cash flow Rod started with flipping single-family homes but tells us that if you want to increase cash flow you need to take the money from flipping and invest it in a cash flowing asset so that you do not have work anymore. Because with house flipping every January 1st you have to go back to work and with cash flowing assets that is not the case, your money works for you.
Rod advises listeners that if you want to be successful you need to do the things that other people do not want to do. Rod makes most of his money doing the things others do not want to do. He started this tactic in Denver by knocking on the doors of people that had homes going into foreclosure and talked to those people personally about helping them with their situation. When doing something like this Rod emphasizes that you must come from a place of love and caring and not from a place of money because people will sense that and not be open to your help. You need to look for a win-win situation and if you do this you will make a ton of money just by helping people out of bad situations.
When you are getting lists and mailing them Rod advises that you do what others don’t want to do and take the extra step to get the phone numbers of homes that you see have potential and actually pick up the phone and call on those homes. Do no be afraid of rejection because it will get in the way of your success. There is a ton of money to be made in flipping houses if you are willing to do what other people are not willing to do.
Rod reminds us that to be successful in multi-family homes you need to have knowledge and not necessarily money, you can be successful in multi-family homes without money as long as you educate yourself listen to podcasts, create relationships, evaluate properties, and learn in your backyard and that is where you will get your intuition about properties.
If you want to get into multi family houses you need to study. Start with a duplex and work up from there or whatever you feel comfortable with, study and evaluate deals so that you know what you are getting into, learn terminology and develop relationships
If you’re thinking about getting into this or any other business Rod urges listeners to write down your goals, write down your why and what you want to achieve. When writing down your goals you also need to look at the other side of the goals and write down what will happen if you do not reach your goal because people will do more to avoid pain and have a greater chance of reaching their goals. Rod advises using pictures of the things that you want – make a visual representation of the things you want to help drive you to your goals – visualize to manifest. Rod reminds us that you are going to get knocked down and off track but the visuals will get you back on track.
With goals and success you also need to keep in mind the area of fulfillment. Rod had everything that he wanted but he wasn’t fulfilled so he took a page from Tony Robbins and his Basket Brigade and started the Tiny Hands Foundation. With business success and fulfillment from helping others Rod can appreciate and be happy about how far he has come in his life and career because success is empty without fulfillment
If you are interested in learning more about cash flowing assets you can listen to Rod’s podcast on iTunes, The Lifetime Cash Flow, or on his website www.lifetimecashflowpodcast.com
Listeners can also learn more about how to build a multi-family home portfolio by getting a free copy of Rod’s upcoming book, Lifetime Cash Flow, by texting Rod to 414111 – you will be put on a list for when the book is finished, no strings attached.
You can also reach out to Rod by going directly to his website at www.RodKhleif.com
On this episode real estate investor Gerald Lemoine joins Holly. Before Gerald got into real estate investing he had 30 years in general construction. When he met his wife he knew that she would not want him to continue to do construction and travel to different countries and different states for work. He started to research his options and came across real estate.
Gerald started his real estate career with house flipping before he moved to note investing. He felt that his biggest mistake with house flipping was that he rushed into a deal that he bought. He jumped into the project head first started painting and ripping out flooring but shortly after starting the rehab he got a call that the sale had been rescinded. While this lesson was painful it was a learning experience that he took with him into the houses he would flip after.
Gerald got into the note business after attending a seminar where a presenter was offering a workshop on note investing for one thousand dollars. Gerald paid the money to attend the workshop and has since integrated what he has learned into his current note business.
Gerald’s first note that he bought was in Ontario, California. This property was already in foreclosure when he purchased it. Gerald took the property to auction and was not able to sell it so he decided to flip the property. During the rehab Gerald put a ‘For Sale by Owner’ sign up and got several inquires on it before he has even finishing the rehab. A couple approached Gerald about the property and wanted to purchase, the buyer gave him a deposit and signed a contract and the home was in escrow before the rehab was even finished. From the time Gerald bought the note to the day the home sold it only took him sixty days.
After flipping houses Gerald got into note buying. Gerald has purchases 500 notes since 2008. Today he manages about 250 notes that generate about $1 million dollars of income. His team of 4 buys notes and sells them, they also hold onto some of the notes that they buy. Gerald suggests when buying notes to spread your money out, don’t buy one note for $100,000 buy 10 notes for $10,000 each because you don’t know what could happen with the notes that you buy. Some notes end up in court, or some notes are bad notes where you could potentially lose some money.
For those of us not familiar with note investing Gerald lays out what notes are all about. Gerald gets his potential notes on a spreadsheet that tells you about the borrower, the home, the mortgage, and the second mortgage if applicable, as well as the fair market value. Gerald and his partners will buy just about any note if they see that it has potential profit.
Gerald compares house flipping and note investing. He looks at note investing long term and wants to compile a portfolio of notes that he can live off of the return of them. He wants to hold notes and get them performing so that he can create a stream of cash flow. Sometimes borrowers do not cooperate with Gerald’s plans and then he has to send the property to foreclosure.
When investing in notes you need to be mindful of the risks with this type of investment. Gerald reminds listeners to be careful of condition of the property. He has someone go out and look at the property to make sure that he is buying what the note says that he is buying. Be mindful of the condition of property and the value of property.
To get educated on note investing Gerald suggests you attend note training, but make sure that you are not spending a lot of money on training; do not spend thousands of dollars on note training. Some websites that Gerald suggests are:
If you are interested in getting in touch with Gerald you can reach him by phone, email, or Facebook.
Gerald and his team also offer monthly meet-ups for $15 at his office in Garden Grove, California. To get more information about those meet-ups visit: