Recently I had a conversation with a potential investor who was a surgeon. I had reached out to him through LinkedIn. He reached back and responded with his phone number, so I called him.
I was like, “You know, I’m Brady. We connected through LinkedIn and I invest in distressed debt backed by real estate.” And he said, “Okay, well, you know, I’ve got an appointment coming up, so I’ve got a little bit of time to talk now.” I was like, “Great. If you need to go, just let me know.”
And so, I explained to him what we’re trying to do. The banks or various entities to get rid of debt that they no longer want because it no longer meets their portfolio requirements. We have the opportunity to buy them at a discount and work to rehab the borrower. We rehab the paper, not the property and make some profit.
And you know, his first question was, “Is this multi-level marketing?” I had to assure him, no, multi-level marketing is much easier than this. They already give you a business and you just execute the business. This, Mortgage Medic USA, has to be created from scratch. Buying notes has to be a process you have to create from scratch. So, I was like, no, what you’re actually doing is you’re entering in a joint venture agreement between your LLC and my LLC. Together, we’re going to take down and procure an asset and we’re going to rehabilitate it.
The next question was, “Well, will this take a lot of time? I don’t have a lot of time.” I can appreciate that. He’s a surgeon. He gets paid to be in the hospital fixing people for a living, so I can appreciate that. I told him that’s my role in this joint venture. I’m the one who’s connecting with the vendors. Connecting the dots on the deal. Keeping up with the timelines. Making sure we’re in compliance with CFPB and Dodd Frank and RESPA and all of the steps and phases of the procure, find, fund and flip process. He was satisfied with that answer.
And you know, he asked me how long I’ve been doing it. I told him about a year and I went into a little bit more in depth because I knew this was a highly intelligent person and so I had no problems going into you know, some of the foreclosure processes and variants of the laws and rules in each state. If I’m unsure of a specific deal, I’ll show it to my other peers in the note industry and get insight from them. I told him I’m not in this alone either. I’ve got lots of fellow note investors that would happily throw a second eye onto something to make sure I wasn’t missing anything.
He liked that concept. His call dropped and I thought, okay maybe he will call me back. Maybe he’s got to go to his next appointment. And he did, he called me back and we again, had a really great conversation and I thoroughly enjoyed sharing this industry with this gentleman. Then, I believe my call dropped. We dropped calls again. And I thought I’d taken up way too much of his time, so I texted him. I said, “I really had a great conversation with you. Call when you have time.” He texted me back and he’s like, “Please call me.” It was just the highlight of my day talking to someone who was interested in this process and wants to be a part of it.
I shared with him a story about a deal in Mississippi. It was a manufactured home, but I told him some of the research I’d done on this family. They’re paying almost a $1,000.00 a month in BK 13 and I told him, I looked at all their bills and I looked at the bankruptcy and it was mostly school debt. I found them on Facebook and this is a couple with two young boys and they vacation and they fish. And you know, they must have just had something bad happen, but they are steadily paying on their mobile home each and every month often times paying more than the minimum required. So, even though it was a mobile home and it was a rural area, I thought that this asset would be a really great asset to invest in because it’s already performing.
And so, then he was asking me about, well, how long are our terms? How long are we into this deal? I said, well, we could do this 18 to 24 months. The idea is typically we would, you would fund the deal and we would work it out for 18 to 24 months, maybe even 12 or shorter, depends on the state and at the end of the deal, you’ll get your half out and I take my half. I do all the work and the labor. And I said, “Hey, it might get to a point where you might want to stay in this agreement. You might not want to exit. We might, if we foreclose you might …” And I asked him, “I said, you, I mean, because we’re in this together, you might decide you would like to let it go to foreclosure and get the capital out.” We might think together it’s a better idea to rehab the property and sell it as a turn key rental to an investor or do seller financing.
I said I’m open to what you want to do. I’m kind of here to work for you. And I think he really liked that idea that he’s really in control because it is his money, but yet he doesn’t have to stay on top and keep track of everything. He has someone guiding the ship for him. I don’t know necessarily know all note investors handle conversations with potential investors, but I would much rather have someone who was not always looking to foreclose off the get go because my goal isn’t necessarily to kill people’s emotional equity. Although that might just go with the territory. Half the time you will. Half the time you won’t. I’d prefer it less, but facts are facts and stats are stats.
Anyway, I just wanted to share with you on this episode of Notes on Deck my conversation with a potential investor and the value that I have to bring to the table, to them, to convince them that there’s someone that they can trust.
He did mention that he’d like to, he wanted me to meet his wife and I said, “That’s awesome. I would love to meet your wife and I’d love for you to meet my wife.” And I told him, “Matter of fact, I don’t hide where I live. You can go on my website and you can find my address. My address is easy to find. It’s on Google. I don’t hide it.” I told him, “Hey, stop by. It’s fine.” because I don’t have anything to hide. So I hope you also feel like you have open, kind of an open door policy with your investors and potential investors and aren’t trying to hide necessarily behind anything. Other than using an LLC to separate you from your business because you are not your business and your business is not you. I am simply a manager for Mortgage Medic USA. Thank you and have a good evening.