10 down, 4 to go!

Bob, Scott and I started the day off having breakfast in the hotel. It’s a way for us to debrief and prepare the days activities.

Students, students, students! We have 7 students with us! Jamy Vanderwoude, Jackee and Ron Benson, Ilene Durbin and Brent Tyler, Nancy Moore and Majorie Durkee. They are all excited to get going, yet not exactly thrilled with yesterday’s activity of NOD and NOT cold calling.

We had a discussion reminding students how important these seemingly low level marketing tasks are. The biggest thing to remember is that we don’t need to be the ones performing these tasks! What’s the highest and best use of your time, and can some activities be outsourced? Yes, they can! First, you need to be able to understand the task to train someone else!

We changed up our strategy and began targeting MLS pre-foreclosure listings. We came up with a group of listings and had students begin calling the listing agent to see if there were any Subject To opportunities. A SubTo is where we reinstate the debt, take over the payments and maybe even give the homeowner and real estate agent a little money, depending on the numbers in the deal. SubTo’s are a great way to get around the conventional lending limitations placed on investors. We also began researching NOD low default amount and high equity properties.

Nancy researched possible opportunities using an online system at krunching.com. It’s a California based system that allows you to search and evaluate investment properties. Between Nancy and the MLS, we had a large number of prospects to look at.

We took our buying criteria and had the student begin help narrow down our prospects into properties we were interested in. By the end of the day we had made an additional 20 short sale or REO offers.

Our real estate agents updated us on offers made earlier in the week. A few offers had been flat out rejected. No problem, this is a volume game. We’re in a multiple offer situation on others. Two others have been tentatively accepted pending a repair addendum. Guess we better check these two out! Or better yet, get someone else to check them out for us!

The real estate broker and lawyer we met on Day 1 referred me to Sonya, one of his agents, regarding a 24 unit apartment building in National City, just south of San Diego. Sonya sent me the property specifics and we gave the students the opportunity to evaluate the deal with us.

The 24 unit property specifics were problematic. The 5.13% cap rate was too low, and several math mistakes made the entire package suspect. Operating costs appeared to be overstated based on our understanding of the building. Income appeared to be understated based on the owners daughter using one of the larger units as the managers office. Vacancy appeared to be understated.

The owner financing and terms made deal attractive. We decided the building was worth a visit tomorrow. Check out our 24 unit apartment building discussion online.

We broke for the day, feeling great about our accomplishments. Bob, Scott and I watched Jeff Dunham videos to relax. Scott took me shoe shopping in Mission Valley at Nordstrom’s Rack. I managed to break not one, but two pairs of shoes so far this trip. Scott wound up getting a pair of Roland-esque boots. We ended the day grocery shopping to restock the Sheraton suites kitchen, as our students have quite an appetite!