Transcription
Welcome to the Estate Professionals Mastermind podcast, built for real estate professionals that want to work less, earn more, and make an impact in their community. For information on how you can become part of the Estate Professionals community, visit probatemastery.com.
Still waiting on a few people to join, but I want to welcome everyone here. We've got a special guest today. Um, I will introduce Paul here in just a couple of minutes, but for those of you that are new, uh, this is the Estate Professionals Mastermind, um, podcast, coaching call. Uh, we're here to kind of discuss everything. If you're watching after the fact, you guys are going to enjoy today. If you're here live, you all are going to have a chance to ask your questions. We're going to be discussing a pretty niche topic um as it's going to relate to our businesses in the probate space today.
Um, I do want to remind everyone here, those of you that have been here many times already know this, but um, if you want to, uh, raise your hand and ask questions or interact with the topic today, you're going to go to the bottom of your Zoom window, just kind of hover around with your mouse, open that control panel up, click the react button, and click raise hand. Uh, you raise your hand, and you're going to have a chance to um, ask questions. If you guys want to chat a question in, that's totally fine. Um, I know as a host and as our our co-host today, Paul is probably going to agree with uh we love seeing your faces. We love hearing your um live interaction. So, if you all have a chance to throw your camera on and ask your questions in per in person, um that's great. If you need to chat a question in, Lou will be monitoring those and he'll be coming to us with any questions that you guys have chatted in.
Um, if you're new, we're here to discuss um the the real estate business as it pertains to the estate and the probate niche. Today, we're going to throw a little bit of a wrinkle in. And to do that, I want to introduce our guest today, which who's Paul Ritter. Paul and I never connected until what, maybe a week ago. Um, I was looking at a few different um a different things to raise funds using credit and I was put in touch with Paul.
Um, Paul, if you would unmute yourself. Um, we we had a conversation. This guy is a credit expert and a uh lease option expert. So, Paul, give us a little bit of background uh as a of of you and your world.
Well, thank you, Bruce. You hear me? Okay. Uh, it's a little silent. That could just be my speaker, though. You sounded good to me. Yeah. Okay. It must be It must be me. Okay. All right. So, little bit about my background. I've been doing credit repair since last century. Um, I started my credit repair business in 1997. Last I understand, you know, what to say to whom to say, how to say, and when to say it to get bad things off the credit report. So that's kind of where things started right there and I kind of figured, okay, so how am I going to get leads into my credit repair business? So um I I started talking with a couple real estate investor trainers and what I came up with was uh we we developed the screening company. So the screening company married itself to the credit repair company and became essentially the lead source. So I carved out a niche in the industry of lease options or rent owners. Uh, they refer to it, the clients refer to it that I am kind of like the exit strategy. I'm the person I've done this for thousands of people all across the country that help people to get to a place to be mortgage ready.
Whenever you buy a property, let's say you buy it, you fix it up and instead of wholesaling or to just uh uh or just renting it, you can sell it on lease option. Uh, why would you do such a thing? Well, you make more money with doing something like that. And many of the trainers will tell you that you can make money now. Uh, you make money in the middle because you can get paid a little bit over, you know, the rent. Uh, and then you make money when you sell the property. So, um, I'm think of it the person who can help you to successfully bring that that strategy to a close. A lot of people say, "Well, I'm not going to get my hands dirty with all that stuff because, you know, uh, there's a lot to that whole thing and what happens if they don't uh execute the lease option and they trash my property." So, there's a whole bunch of pieces to it, but whenever they people implement and use our lease option strategy, the the credit repair on the back end and the screening on the front end to make certain that they can qualify for the mortgage, then they end up um, you know, most of the time being able to do this. Over 80% of the time uh they're whenever people come through me, they end up uh buying the property. And then there's one more qualification I'll throw out there, too. I'm also a licensed mortgage originator and I can originate in all 50 states. So, um, that's kind of the the gamut of my background. So, I essentially what I did is I took a couple different concepts and companies, married them together to make a strategy that's unique to this industry.
Amazing. So, um, Paul, admittedly, we probably have a few, um, experts or a few people that have dabbled with lease options and rent to owns on this call, but but admittedly, the majority of our community probably hasn't done a lot with a lease option. Um, it could be it could possibly be because they're a little bit afraid of the unknown of a lease option. It could be pure ignorance. Uh, in in a lot of cases, you don't know what you don't know. And I'm going to admit, I've never done a lease option. Mostly because I don't know what I don't know. Um, I've found other ways to monetize uh, deals, but it's it's really intriguing to me to get paid three times. So, how's the typical uh, lease option deal uh, uh, run from start to finish? So, from the time that you first meet a seller through the time that you you get paid, um, from the time that I meet a seller. Oh, okay. Um, so I come in, I'm kind of a after the fact guy. I'm not the one actually doing these lease options. I work with the real estate investors who already have these properties and they come to me. I give them links that they can use, links that have their name in it so that they can send it to the tenant buyer. It's a nice clean link where the tenant buyer can have a nice clean form to apply for their property. So, I'm coming in at that stage.
Totally fair. Yeah. Yeah. So, um, I'm not here really to train on how to sell a lease option in terms of like the paperwork and all that stuff, although I have all that stuff and I've seen every bit of paperwork that you could think of and I've worked with every one of the real estate investor trainers out there and they most of them have me in their in their tools and resources. Um, so I I understand it um very very well. But um if you want to implement a strategy like that, I'm not here to train you to do such a thing. I will give you the reasons why you probably do want to do it. And then um I would I would say Bruce, if you want to refer them to anyone, you know, any of those other trainers that do such a thing or if you want to take that on yourself, you know, I I'd be happy to work with you. Um, and also there's one other niche that I do address and that is for realtors. Um, if you're a realtor and you want to refer business to me because you want to get people in a position to be mortgage ready, in other words, uh, the credit repair, you know, you know, I want to buy that house, but I don't have my credit stinks, you know. So, I'm that guy that you can refer that business to me and you'll have your own link where you can then even track their results along the way. And also, if you have a mortgage guy already, that's fine. If you're not satisfied with your mortgage people as a realtor, yes, I would I would be happy to look at your business as well. Uh, you know, take on new business on that.
Um, and I'm going to go back to the original question in a minute and clarify a little bit of that. But, uh, but with regard to credit repair, um, most of the real estate people here, um, and this is this is speculation, just knowing most lenders, we may have lenders that we like, but many times those lenders aren't repair credit repair specialists. So to have someone like you being a credit repair specialist, even if even if we have a lender that normally we send business to, if you've got someone that's a little bit iffy, especially on your own deal, um I I I think having someone like Paul that has been doing this since last millennium, not century, since since last millennium is probably a good thing.
Now, may may I may I add one little tidbit to that? Um, and that is it's really good to have a credit repair person that's also a mortgage person for the reason of let's just say you send me somebody who's got a 580 credit score and we really want to do um um you know a Fanny May or Freddy Mack product so I need a 640 or better. Okay. So when you send it to a mortgage broker who then sends it to a credit repair person to fix them up now you have two entities there. And if the credit repair person fixes them up and doesn't give it back to the mortgage broker, then you you know you you could lose your client right there. Since I'm the same guy and I'm going to put a flag in that person's file whenever a certain threshold is accomplished or such a score, um then I'm going to be able to move them right over into the mortgage. So there's not a dropping of there there's one less thing to go wrong um when you have it all under one roof. I'm sorry. Go ahead.
No, perfect. I couldn't agree more. So, um, let's kind of go back to the uh, the the question that I'd asked and I set the question up um improperly and probably created a lot of a lot of confusion even with our people thinking that you were going to structure the deal. Um, most of you guys um I would hope know how to uh present options to a seller. Um, and and and in in our case, it's normally someone in probate. So, you present options and um if you're a realtor, you need to get comfortable or get at least put yourself in a position to be able to present an option where you buy the property or you own or finance the property or you can list the property. So, when I go into an appointment, um I'm talking to a family and I kind of walk them through um a decision-making tree and it ultimately comes down to do you want my cash offer? Do you want to owner finance to me? Do you want a list? And uh in many cases, the um the the choices come down to do you want $500,000 with a listing? Do you want $450 with a with a cash offer? Do you want 550 with an owner finance or do you want 525 with an owner finance? And that's the scenario that I'll put in front of sellers very very frequently. What I have not ever done on the back end is the lease option. So let's say that I bring you a contract where I've either bought the house 5450 or I've owner financed the house at 500. One of the two. walk me through what you may uh suggest that I do with with a lease option.
When you're selling on lease option, you're selling on terms. That's the most critical thing about it. When you sell it now, you're selling you say instead of saying, "Well, you're going to pay 500,000 to Mr. Customer for this property or whatever the 525, you're gonna make a little profit, whatever it is." Um, so when you're selling on terms, you're saying, "Well, the payment on this is going to be x amount, $3,500 per month, whatever that amount is." Um, so that's that's the attraction to the people because, "Oh, gee, I'm already renting for $3,000 a month. This is a much nicer house. I can own this house." You know, it starts to really look attractive to the tenant buyer. So, you're selling on terms, not so much the purchase of price of the house. you're selling the terms of this. And now the terms, um, a lot of times people get the weebie-jebies or they get scared of doing the terms because they think, well, gee, my credit stinks. And what happens when it comes time two years from now to be able to get a mortgage? Well, guess what? I got a plan for that. This house has a plan for you to be able to get yourself in a position to be mortgage ready. And let me show you what that plan looks like. and and and you as the seller, you guys don't need to show them. That's where you just basically bring me in, say, you know, I got a guy for the application's 50 bucks for them to come along and I'm going to do a full debt to income ratio analysis much like an underwriter would do. I'm going to I'm also could be their loan officer. So, I'm going to show them how they can qualify for the house, what they would need to pay down or pay off in order to qualify from a debt to income ratio standpoint, you know, and I can even walk them down the underwriting guidelines of the type of program that they're looking at, you know, whether they're FHA, VA, USDA, Fanny May, Freddy Mack, whatever it is, you know, we can play in that sandbox. So, having all those tools under one roof to make you look more professional. I'm pumped as part of your team. I'm an extension of you. Um, so as a as a as you present to your potential buyer, you look much more professional complete with the professional application and everything. So it becomes a lot more doable for you to take on selling on lease option. And again, I think the gist of your question is why would I do it? Um, well, the the answer to that is is is tango diero. You way more money, much more money you're going to make. you're going to make because the you're normally they're marking these things up at least 10%. If not more and because you're you're selling on future value, okay? And um you say, "Well, house is worth 500 now. I'm going to sell it for 560 580 uh two years from now." So, if you sign up now, then we're going to figure out, you know, what the payment's got to be in order for you to um make some money in the middle. Make some money on the backside. you might make 70 80,000 on the back side uh of this transaction as well. So uh you can make money, you know, coming and going with those type of transactions. And I I would argue that you're also selling uh convenience to a a a buyer right now who isn't credit ready. Uh, they don't want to move twice, but they'd like to get in a house now. They're in a small apartment. they're in something maybe they don't like, they want um they they want to own without having to have a transition house. So, not only are they buying on future value, but they're paying a little bit more because of the convenience of being able to go through something without having to have have a transition house, right? Because and they and right now they can't afford to buy a toaster on credit because they can't get they can't get approved. Mhm. So, um, you know, you come along and you say, "Okay, well, listen, I understand you have these dings on your credit report, but, uh, we have a plan to get you to where you need to be." So, that's quite attractive to them.
Yep. Absolutely. So, Kristen and Lou, if if you were going to ask Kristen's question, you can take your hand down. Um, Kristen chat sent a chat in that says, hold on, someone else just chatted in and messed messed up my view. Okay. Even though the seller may receive more money from a an owner finance, how much time does it typically take for them to to actually realize those funds?
These these contracts are t I'd say 90% of the contracts that I do or two-year lease options. I'm not sure that that answers your question. Two years. Yeah. Yeah. To me, that's a that Yeah, that that answers it. So, um, are there risks? I mean, obviously there's a few risks, but how do you how do you mitigate those? Mitigate. Yeah. The way to mitigate those risks is of non-refundable option deposit. And those non-refundable option deposits typically most people won't take less than 3% down. Um the standard is is anywhere from 5 to 10. And typically what they'll do is they'll take five now and then they'll say five more% over the course of two years. So, $100,000 transaction. I went $5,000 down. Over the course of two years, you're going to need to give you, you know, overpay the rent by uh $200 a month, and that's whatever $4,800. And there, that's my second $5,000. Now, I've got a 10% down when they go to buy the house.
So, are you frequently applying that overpayment toward the principal or can it just be profit? Make out two checks. One's for rent, another one is for um the non-refundable option deposit. Got it. So, it's going to be for down payment. Okay. Okay. You you got to specify that though because people people say, "Does 100% of my uh my rent money go toward the purchase price of the house or toward my down payment?" And I don't know what they see on the internet, but, you know, I tell if it doesn't on your deal, it'll be the first deal I've ever had that happen on because and you really don't want that, Mr. Tenant buyer, because if you do such a thing, then you're essentially living rentree and underwriter wouldn't like that. So, you're not going to get approved for the loan. So, I kind of diffuse it on that side. But, yeah, good question. Yeah. Yeah. Um, no. That's a that's an interesting point because if if what what owner what um uh property owner in their right mind would let 100% of the rent go toward the uh toward the purchase price? Um, even if you think that you would, uh, I never thought of it actually hurting the tenant on the on the back end. Yeah. Never. It never happens. It's never never happened in any of the transactions. thousands of transactions I've done. Yep. I've had a couple of um couple of clients of mine that had um engaged in in uh lease options. Um, they weren't deals that I was I would be involved in. What What else, if anything, can you think of that we might need to know about lease options? um from a well I can give you like a lot of like you know why they would have failed you know and what to look out for type of um tidbits like if their down payment is money that they got all of a sudden oh it's a tax refund or it was an inheritance or it was a slip and fall accident that I got paid money on whatever it was if it's a one-time hit you know that's a kind of a difficult thing although you you know you still can source the funds it it's just it it it will set you up more often than not as I see for failure uh when you have a one-time hit for the payment. Now, they show the ability to save, you know, that money and even if it's only half the money they save, they show the ability to save, then that's something that then typically those people are going to be um okay. Obviously, married couples are much better than people that are just dating or or so on. So, uh, there's a lot of things um there's a lot of things to look out for and I guess um yeah, I'd welcome any questions in that arena. You know, why would transactions fail? I mean um you know, deaths, losing jobs, uh the economy, you know, people losing losing things. So, but um like I said, about 80 to 85% of my transactions go through. I think the industry is around um 50%. From what I understand, I mean, I've looked at some different data says a lot of different things, but but I think that's pretty standard. Some sometimes some of these real estate investor trainers teach you to um allow them to fail. Oh, what do I care if they fail? You know, then I can kick them out and put somebody else in and take their non-refundable option deposit. uh when I sense that that is the um method of operation of the real estate investor I'm I'm working with, I tend to try to not do business with them anymore. Should I say that gently? Because I'm not in the I'm I don't like to because remember whenever you refer somebody to me then I'm I'm joined at the hip with them for a year or two years doing their credit report repair, doing their mortgage and doing all those other things. I I can't look in the mirror and know that this guy's just this real estate investor, this person's just taking their money and setting them up for failure, you know? I I want to make certain that they're going to have a fair opportunity to be able to cash cash you out and put their name on the title to that property. So, um like I said, you you'll find trainers out there that will teach you it's okay if they fail. Let them fail because then you can make more profit. Um, if that's the way you're doing your business, I'm probably not your guy to work with. Uh, and you're probably not good for this. Not you, Paul. If that's your the type of business, you're probably not good in the probate or the estate administration space either because we have to be we have to lead with empathy. We have to lead with value. And if if uh uh if you don't lead with value, if you lead with money, regardless of the consequences to the people you're dealing with, um you shouldn't be in the probate and the estate niche or in the uh lease option niche either.
So Paul, I'm not sure if you're seeing any of the questions that are coming in or not, or if you want me to I'm not I'm not seeing the questions. Go ahead.
Um, so on a lease option, if the tenant has a life-changing event such as a job change or they need to move, I'm assuming out of the area, uh, do they lose all the funds that they do they typically lose all the funds that they've, uh, used toward the down payment? That's strictly your decision as the um, the person who controls the property. I'm not going to say that you're the seller or the owner. You control the property because there's many different ways you can control it, but it's your decision. I've seen a lot of creative things happen whenever something like that happens that the guy's been real good to me and he's painted the walls and he's he's leaving the property in good shape that they'll pay them $2,000 or $5,000 as a move out fee because remember the guy gave me $20,000 upfront as a non-refundable option deposit. So that's part ways at least with having some level of, you know, I'm not crippling this guy, sending him out to um to the wolves and taking all his money. So I've seen a lot of compassion that things done. Um, if certain events like that occur that are unforeseen uh and then all of a sudden, you know, the person needs to vacate the property, you know, yeah, throw them a bone. Throw them an extra couple hundred,000 maybe to move out. Make just on the way out. makes sure all the rugs are done and you know there's no holes in the walls and everything else. So yeah, you can you can that's the beauty of having your own business. You can call your own shots. Um, but my on the front side you that's why you get a non-refundable option deposit that has you know that is of substantial value. You're looking for at least 5% if not 10% somewhere in that range.
Okay. Does that answer the question? Absolutely. So, um, question from me. Um, how often do you see, let's say, a realtor come in and do this where they don't own the property and aren't structuring the lease option, um, for themselves, but they're actually helping structure it for a client of theirs. Do you ever see that?
Yes. Yes, I do. Yeah. Okay. Um, yeah. Realtors who are wanting to learn this business, you know, will start out by, you know, doing something like that. Sure. Um, and I would imagine if they can position themselves as the new owner, that would be quite beneficial to them. Now, all of a sudden, you're you're beginning to move into the world of a sophisticated investor. Um, but I I I would also say that if you're worried about personal risk as a as a realtor, and I know there's a lot of you guys on here that are investors and you you're kind of exclusively investors and you're used to structuring things like this. Uh, but for those of you that are realtors only and maybe a little bit worried about risk, um, Paul just gave the answer that you could structure something like this for your seller client or with your seller client.
Um, I've run into many, many, many times and never even thought about this as an option, um, properties that I managed as a property manager for someone else where, um, I had highinccome individuals that, um, were newish into their um, their new incomes. So maybe they'd had their higher income for the last year, last year and a half, but their credit hadn't caught up from um, from previous times. And I would imagine that that's kind of your ideal um buyer client. Uh, somebody
My ideal buyer client is somebody who has once upon a time been somebody of substance, had money, had good job, had this, had that, and then crashed and burned. Something happened in their life, divorce, whatever. something happened and now they're on the upside and they're heading back up into the world of I recovered from whatever it was that drugged me down through the through the ashes and now I'm ready to go again. That would be my ideal client, somebody who's on the upswing after crashing and burning.
Yep. Uh, folks, I'm seeing a lot of questions come in on chat. Admittedly, when we're in conversation and I'm looking at a camera or somebody else's screen, I may not always see your questions in time. If anyone wants to ask questions um live, uh, we'd welcome your hands up just like Muel just did. So, go for it, man. Uh, Mikuel, what do you have?
Sure. So, this does apply to creative finance strategies and also for listings as well. I've been practicing my conversations with sellers when I get an appointment to try to convert them, but it still sounds like a script. And I had it wasn't a creative finance discussion. It was more of a listing with the easy real estate offer. Mhm. But even still, it sounded very scripted and it didn't flow as a conversation as we got to the end. So, how do you guys practice so that when you do have that appointment, you have an easier chance of converting?
Okay. So, you're you're um uh worried that you feel or sound scripted at the appointment level. Um, so, this is after the initial conversation that set the appointment up and now you're you're at the listing appointment, you're at the investor's appointment, and you're you're trying to uh keep from sounding scripted. Yeah, that's a bad habit I have. Okay. Uh, well, first off is I think it's important to um practice individual lines. Individual lines. And um Paul, forgive me for a few minutes. I'm going to put my uh coach's hat on and we'll we'll go over this. Um, I believe that the majority of us are scripted. And some people are scripted into saying uh like this, like you know, you know what I'm saying? You know what I'm saying? We all hear those verbal ticks. Um, every single person on earth is operating on scripts. Okay? Most of the time they're unintentional scripts. Um, you give me someone who has a script from start to finish of an appointment and I'll give you give you a person that's probably not very flexible and is most likely very uh readable as being just a script guy or a script gal. Um, and I think you're trying to fight against being the the script person that just it's it's tr it's obvious to them that you're just operating on scripts. So, the way that I normally try to do that is I try to break down or identify the most common scenarios that I'm going to run into in uh my appointments that or the most common um talking points that I'm going to have in my appointments. And then I start by scripting out how to address that specific talking point, that specific talking point in a couple of lines, in just a just a few lines. Okay. Okay. So, I'm going to write it out and then I'm going to go to uh my computer. I'm going to pull up the app Audacity. Now, there's tons of apps like this. Audacity is just the one most of us have on our on our system. And I'm going to read that script. I'm just going to read it and I'm going to record it and I'm going to listen to how I sound. And I'm going to first get it to where I can deliver that script pretty quickly with no emotion, no ad libing, no hand gestures, nothing like that. And once I can deliver it and it sounds decent, sounds like something I might want to say, then I start adding emotion in. And I start adding the hand gestures in and fluctuating. And I'll do that a few times, recording myself each time and listening back to how I sound. Okay? And then where it gets really fun is when I don't look at my script. I know the idea that those two or three or four lines are trying to convey and I want to just record myself and roll out the idea that I'm trying to convey with those few lines until I get to the point where like five times in a row without using the exact words I can deliver that idea. I can deliver the idea. And if I can deliver the idea inside of 15, 20, 30 seconds repetitively without reading the words, I know I have it. Now, you will always sound scripted if you don't finish those short bites with a question. You will always sound scripted. Um, even if you can deliver it really well and really smoothly, you have to close everything with a question. So, an example of this might be, you know, seller Mikuel, a lot of uh a lot of folks that are trying to sell a house um are looking to kind of maximize the value of their property, but I do find that some people are just kind of emotionally done with the property and they just want to let it go. They're looking for kind of a cash offer. Um, where do you think you are now? The fact that I've turned the conversation over to them with a question will break up any scripts that I have. So, I might have 10 different scripts all all in a line, and they'll never know if I break each one with a good open-ended question and get them communicating. And if you can go in with like 10 different short bite-sized scripts and just know that you're not there to force any one of them into the conversation, but they're they're they're ready in your quiver if the conversation flows that way after the seller starts talking. Um, so I would take the concept that you're trying to deliver and practice it and get it down to where you can deliver that concept without reading it inside of 30 seconds and always finish with a question and see where it goes from from that point.
Okay. And it sounds like you definitely don't bring a 20 to 30 slide PowerPoint to your listing presentations. Never personally. Never personally. All right. All right. Cool. All right, Muel, thank you so much.
Hey guys, I'm butdding in here with a quick ask. Um, if you're getting value out of this coaching today, uh, I want to invite you to check out my Probatemastery trainings over at www.probatemastery.com. Probate Mastery is for you if you're an agent or an investor that wants to work with motivated sellers that have inherited real estate that they don't need and in many cases can't afford. Uh, these sellers are more appreciative, uh, willing to trust your expertise and less likely to nickel and dime you over commission or price. Uh, why is that? Uh, they're often in the middle of a complex probate or an estate administration process. And this means that real estate is very often a burden on them and they they simply need the help. Inside of Probate Mastery, uh, I teach you exactly where to source your leads, how to establish value, and offer your service in a way that quickly makes you, as the professional, your market's expert in the probate space. If you want to know a little bit more, go over to www.probatemastery.com. Hope to see you you guys inside of the community. Thanks, Shannaz, did I get your name pronounced right? Yes. Yes. Yes. Perfect.
Um, I just had a question. So, I mean, we've seen that there are a lot of first-time home buyers who are coming off of renting and this might be a really good option for them if they're going to buy a home compared to, you know, I am in a market where there's a lot of town homes, condos, and the single family homes. How beneficial or how how much does the data data show that people with single family homes are like sellers are accepting this kind of option from their buyers?
Um, is that one for me? Yeah, that one will be for you. I'm I'm wrapping my head around the question. You might have a you might have it. Yes. Okay. Um, are are sellers are sellers amicable to the idea of selling their house on lease option? Um, typically not at first. At first, they oh, don't even talk to me. I want I want cash only on cash. They don't even understand that there's there's a way to get more money later on down the road. Um, sometimes they need to be beat up or softened by the by the market before they before they start looking at this type of an option. And it's usually the real estate investor who gets in there and says, "Well, you know what? If you're just that's fine, Mr. Seller, uh, my offer stands. If you want to talk with me six from months from now, save my business card. Here's my number." And that maybe he follows up with them on some sort of like workflow type system. Um, so that's kind of how that works. I would say typically there is a resistance from any sellers standpoint, most sellers, unless you've done something like this. I bought my last two houses on lease options. So, you know, I'm not afraid of it because I I think it's a great tool to be able to get, you know, from a seller standpoint more money from a buyer standpoint, possession of the house right away while I fix up whatever is ailing me or preventing me from buying now, whether it be credit or I can't prove my income yet. Um, can I did I answer your question? We Okay, we okay there? Yes. Thank you so much. Appreciate it. You're welcome.
Um, I was going to put something in the the the uh notes, the chat notes. Is that okay? Someone so people can register with me for as a realtor or as a real estate investor. I'll just drop them in the in the chat notes and then uh people can go to that and and um register as a as whenever they wish. Yeah. And we've had quite a few people asking for contact information. So, I assume that that's what uh all this is going to lead back to to being able to connect to you. Yeah. I'll put my phone number in there, too. But go ahead. Go ahead. I can answer questions and and do this at the same time.
Perfect. Now, um, before we go to any other questions, um, I want to address something that Shinage just asked, and I think it's the importance of not presenting the recipe when you're talking to sellers until they express interest in the overall dish that they're about to get. Okay? So, so often you investors are going to love this. You realtors, this is going to be a bit of a a a a brain twister for you. Okay. So often on the phone conversation, we as realtors are trying to present the idea of listing a house to someone when we're just on a on a phone call. Um, this also applies to our appointments as well uh in in a lot of cases. Now, in times when someone says, "Hey, I want to list this house," okay, it's easy to talk to them about a listing uh plan, a listing strategy. It's easy to talk to them about commissions, things like that. Um, but so often we end up in the weeds talking to people about the process that we're going to use to get this big result that they want. And they don't want the process. As a matter of fact, most sellers uh would happily cut a family member, realtor out of a deal if it meant that they made more money. Okay. Why wouldn't they? I I if I my sister, my father-in-law cut us out of a deal. I'm 21 years in real estate. My wife is like 13 or 14 years in real estate. My father-in-law sold by owner. It felt like he was going to make more money. I don't think he did, but it felt to him like he was going to make more money. And I get it. I I understand. People don't want the process of listing. What do they want? They want to sell and they want to get at least market value. Okay, in most cases, they want to sell and they want to get at least market value and they want convenience. Now, um maybe listing the property and going through the listing process and paying a commission and uh doing all those things, maybe that's the recipe that it's going to take to get them to that result, but they don't really want to talk about the recipe. They don't want to talk about the process. So, if you're prospecting and if you're on appointments, you need to find out what result people want before talking about process. So, get them committed to the result. So, Shanaz, this applies perfectly to your question because um I think that you were leaning into this thinking that you were going to be talking about the process with a seller who is going to probably be resistant to the process. But if you can get them committed to the result, now the process opens up. So, in your appointments, the conversation probably goes something more like this. um seller. Um, as you um as you decide how you're going to sell, um, let me ask you or let me kind of present a couple of different ways that a lot of things that a lot of sellers are looking for and I'll let you tell me where you are. Okay. Um, are you looking for kind of quick cash, easy transaction, maybe a little bit less than market value, but convenience? Are you looking for full market value and you understand that you might need to go on the market for a little bit? Or uh, are you maybe considering alternative strategies that might get you more than market value? I want more than market value. Well, can I tell you a little bit of a plan for how we might do that? Now, the seller instead of coming in being resistant, no, I don't want to talk about lease option. Now, they've said, "Yes, I want a plan to see how I might be able to get more than market value." Now, it doesn't mean that they're going to take a lease option, but at least you're going into that part of the conversation with a receptiveness and an openness, and they say, "Yes, I want to discuss this plan." Okay, that's how I would do it. So, get them committed to the result a little bit more than market value before you talk about the process. And of course, the process in this case is either you doing a lease option, you doing an owner finance, you doing a sub two, or being able to go out and shop for a lease option with buyers. And I think that was really helpful because I wanted to understand in which scenario would I actually think about presenting this offer? And that that was very helpful. Thank you.
So, with those three options, let me ask you guys, uh, what seller in their right mind, the way that I gave it to you, what seller in their right mind would ever say, "No, I don't want to look at how to make more than market value." Can you think of any seller that would say, "No, I'm not interested in more than market value." I can't. I I think it's brilliant, Bruce. It's You've presented it very very well. It's brilliant. And one other thing it does is the guy who comes in after you, if you didn't present all three options and he comes in with the option that you didn't present, guess what? He could get the business. You diffused that before he even went to the table. So, yeah, you're looked at as the as the expert in the industry. You're given options and then you're basically coming up with plans. I love it. Yep.
Now, if they say, "I want market value." Now you talk about going on the market with a listing. If they say, "Hey, you know what? I'm just sick of dealing with this property. I want to I want to wash my hands." Now you come in with a cash option. Okay? And I never try to dictate, and this kind of applies to Muel's question a little bit ago with scripts. I never try to dictate my uh dictate the conversation through an entire script process. I want to have little bites that I can present. And sometimes my lease option will never come up. It'll never come up. Sometimes a cash option will never come up. Sometimes a traditional listing will never come up. I let them tell me what they're what result they're interested in. So I present the option of three results. Which one are you more interested in? Well, obviously I'd love to know how to get more than market value. So, why wouldn't we be able to openly present a lease option at that point? Okay. Especially if their price is too high. Uh, what's that, David? Especially if they're they're, you know, they're setting the price their anchor too high because some other investor came in prior to you and they put the house at 20, 30, 30. You know, yesterday I went on an appointment and the guy said he had a $100,000 offer. This is a just an old house in my neighborhood. And then as the rapport was built, I learned that he actually is an $80,000 offer, which he was going to sign the contract and then put it out to the network, which he's going to wholesale. So all this conversation is about building rapport and trust so they can so you could tell where they're anchored at as well. Mhm. Yep. Absolutely. And you wouldn't have known that if you didn't build rapport. You you would have been stuck on thinking he he had a $100,000 offer.
Um, Kristen, you had have your hand up. Yeah. Paul, um, with the lease option, if I am trying to sell my house and I do this lease option, how does that affect me when I want to go buy another house? So maybe our market is slow. I've got five military installations near where I work and I'm trying to get my niche in and I know I could probably do a lot of lease options because there's a lot of military people that don't want to be in base housing. Great, cool, fine. But if I have to move because I'm military and now I need a house in my next duty station, how does me leasing this house help me out with that? Or doesn't it? Maybe I'm not the right client for that. Are you Kristen are you asking are you saying when you lease option a house you're taking ownership and
Possession of the house and you're going to live in it? Is that what you're asking me? Or are you saying that you're going to ex exhaust your funds because you're you're paying for the house? What I don't Well, if if it was my house and I'm going to do a lease option with somebody to lease buy my house. Buy my house with a lease option. I'm still carrying a mortgage on my house. Okay. But I need to buy a house where I move on to next. So if I don't sell my house, I'm still carrying a mortgage on it, but I have a lease. Do you know how that would affect my ability to buy my next house?
Well, yeah. There's a couple things you can do. You can actually have the seller come in and do a wrap um in which now they're responsible for um they record on and and they do a wrap. So that as far as the underwriting is concerned, you're not hit with that debt on a on a wrap because of the the title and possession of the house actually goes to the next person. Um or you can if you're if you're renting it and you have a rental contract with somebody um e even if it's just if it's rental or it's it's lease option, you're lease optioning it to somebody else. That's another way you could be absolved of the debt, too. Okay, that helps. Thank you. It depends upon how you're how you structure your paperwork on the way out the door. Okay. Probably be wise to have a conversation with Paul as you're structuring that paperwork to make sure you're not Yeah, absolutely. Thank you, Paul. Yeah. Y good. All right. Uh what other questions do we have? Uh, admittedly I haven't seen every chat that's coming in. Paul, thanks for dropping so much into the um into the chat. Um, we will uh Is Queenie here? Queeny, are we going to get the um get the contact details for Paul put on YouTube? And the answer is yes. I just want to make sure that we are going to get all all Paul's links and contact information. Paul, assuming you want those going on YouTube after the fact.
Oh, sure. Yeah. Yeah. Yeah. There's three different links there. One is if you want me to do a free evaluation of your own credit report or anybody that you know who needs evaluation of their credit report. Another the second link is if I'm a real estate investor and I want to reg they want to register with me. So you have your own link that you can send out to your tenant buyers. And the third is I'm a realtor and I want to refer business to you and be able to track how people go through the credit enhancement service. So if you you might want to do all three of them if you if you use all three of those. You may want to use all three of those different uh services. Phenomenal. So they're not all the same service. They're all different things. Yep.
I want to take a moment to just remind those of you that are um investors on the call. Um I I generally believe it's a very good idea to partner with or get a license. Um, I think that it it it's only a positive thing for your business to be able to um to offer listing solutions to people that need that result in their life, in their in their uh transition. Um, if you're a realtor and and it's most of you realtors that I run into that have the most resistance here. If you're um if you are a realtor and you are not investing, I encourage you to get into get yourself in a position to be able to invest. And um Paul, I I know this isn't necessarily lease option topic. Um do you have any any kind of solutions or any um anything that you help with that may u may take a realtor that's just making a 1099 and wants to get themselves in a position to invest. It's kind of how we we started our discussion by talking a little bit about credit stacking last week. Um, I didn't know if you had any any thoughts on on that for realtors that want to say, "Hey, I I want to put myself in a position to maybe own and do lease options on properties that I'm buying or put myself in a position to be an investor as well."
I would say probably of all I'd probably deal with close to 2,000 real estate investors all across the country. Mhm. Um I would say out of out of the the number that I'm working with, I'd say probably about 30% of them are realtors. Yep. Um so I'm I'm with you. Uh getting a realtor license is definitely a great play. It really introduces you to many of the nomenclature of the industry. So now whenever you go to start learning other things about being a real estate investor, you understand what title is and you understand what all this, you know, how properties move and everything else. So it gives you a really nice foundation. Plus, it it can be an income stream as well, uh, for you to be a realtor. So, I I'm I'm an advocate. I'm a fan of anyone who is also a realtor. Um, yeah, I I'm with you.
So, I'm a a realtor and I want to I'm already a realtor and I want to position myself to invest. Is there is there something that you can do to help from a credit standpoint or a finance standpoint uh for the realtor that wants to start investing and offering um uh invest in uh an option to sellers where they become the buyer? Does that does my question make sense? the sellers. I mean, you're looking for training as a realtor to move yourself into the real estate investment community. Um, there's a I mean, there's a whole host of different real estate investor trainers and and acres and um you know, all these all these clubs that meet, you know, so those are really nice places to uh to meet other people, like-minded thinking people. Um, you know, I'm kind of I'm kind of an offshoot to that industry. I'm not the main track. You know, I I am a service to that industry. I help I help people um primarily with the with the credit piece of it. That's that's the number one issue. And by the way, I didn't mention this, but the distinction that I have in the credit repair space, uh, as as as far as the real estate investment industry and also even as a realtor is I will give you an end date before you even start with my credit repair. I will let you know how long you're going to be in the service before you start. Everyone else, Lexington Law and all those others out there, they'll say, "Hey, join up, sign up with us, and we'll tell you when you're done." Uh, we don't know when you're going to be done, but we'll tell you whenever you're done. We'll let you know that. and they want you to be a lifer. So, they dispute one thing at a time on the credit report and that basically puts you in a position where you're going to be in this thing for two years or more. You know, my maximum program is one year. So, you know, we try to get you done over with quick and then now you're able to to accomplish your goal or whatever that mortgage goal is or buying a house, a car, whatever it is. So that's a unique niche that we have that and we can only do that because we dispute all the negative things every time we do battle with the credit bureaus. Yep. Yeah. And then from the screening perspective, the the unique niche I have there because like TransUnion, Smart Moves, and all the other screening companies, they won't calculate how much if you could afford the property or not. I do an affordability analysis with people. So those are my two unique niches within each of the frameworks of each of those companies that make this the ultimate lease option exit strategy. Yep. So but back to your original question. I mean I would be looking at you know those real estate investor trainings and the RIA groups and the acre groups and all those other guys.
Awesome. Cool. Hey Lou, what do you have? Yeah. So I was just looking at the chat uh questions from earlier. One from Glattis. Um, do executives need special permissions or court orders before signing lease option agreements? M um, so executives do need to be uh, theoretically should be the only signer. Um, not that other family members won't. Um, it really comes down to whether the house is uh, needing to be cashed out or not. So, are all the debts and heirs that need to be paid and the taxes that need to be paid um are they able to be paid if the house isn't gone? Okay. Uh if the answer is no, they can't be paid unless the house is completely cashed out, then you probably aren't going to do a lease option on it. Now there there might be couple of exceptions and ways to get around that but probably not a lease option um in that case. Um but there's nothing that says that you as the realtor or an investor can't buy the house and do a lease option of your own to a a tenant a tenant future purchaser. Um so I would probably structure it there. Now, uh what we know in a lot of cases with um 67% nationwide, 67% of real estate that's being inherited through the estate process is free and clear or through a probate process is free and clear. If the house is free and clear, um they probably don't have boatloads of debt. So, I would imagine that the majority of uh the majority of of families are going to be in a position where they can can do a lease option, but you you need to understand the other debts that they're dealing with before they're the court's really going to allow that to happen. So, just make sure that the the debts can be covered out of the the estate's bank account or any liquid assets. Um, and if it can't, then you're probably not going to do a lease option unless you buy it and lease option yourself.
All right. Uh, coming up to the end. I just see somebody popped a question in. Uh, hey Sam. Um, you've chatted in several times. I I don't know. Your question is kind of long. Um, and I don't want to mess it up. Do you want to Is it a question or is it more of a statement? I don't know if you're in a place to No, it was just a statement and I'm not Yeah. No, I was just for some of the people who were making comments. No, what I was just saying is I'll just short and sweet just I think that I've done a lot of in I'm more focused on the investment side of things. I know Paul, he's amazing. I'm in the I'm in his market. I just think that lease options is a very specific investment strategy and I don't see that it's heavily going to play into the probate niche just because these sellers need cashed out. That's usually what we're offering them and that's what my statement was kind of alluding to is just that I know I have shiny object syndrome and for some of the people just like this isn't a tool that you can just throw in your tool bag and say hey now I'm offering lease options this is complex and it's an amazing amazing thing to offer the right people for sure and it makes sense to know it absolutely but I was just just you know it's just not a flick of the wrist thing and it's a very very specific seller that is going to fit in the you know the pegs It's going to fit in the hole for them. I was walking up and I'm like, "Hey, TZ or Okay. Um, so I don't know if um uh it's going to fit very many sellers. There are some of you that in here that have the ability to become the investor that it might fit you and your personal investment strategy if you can pick a property up and cash a seller out that's in probate." But I would agree. Um, we need to equip ourselves with as many tools as we possibly can and um, and know that we're not trying to force anyone into that one particular tool, but you have the tool to be able to use when it fits. And um it's one of the reasons why uh traditional wholesalers, and there's plenty of you on this call and plenty of you guys that are going to be listening after this, it's one of the reasons why I say, "Hey, I love you wholesalers, but I want you to equip yourselves with more tools, more tools than just a, hey, let me come in and offer you 60 cents on the dollar and make my 5 or 10 or 15% uh margin on assignment." um get more tools in. A lease option might be one. Getting access to cash might be one. Doing a um DSCR loan to hold a property might be one. Getting a real estate license or partnering with a real estate agent could be another one. I want we want you guys to have tools and be able to ultimately give the seller choices. And remember uh I mentioned this earlier the choices that you start off with by giving are result choices not process choices. If a seller says I want this result then a lease option it may be one of two different things that you could present. Which one of these pathways to that result do you want to work with? Um, if a seller says, um, no, I really want fair market value, then which one of these pathways to that result do we want to work with? And that's normally listing. Um, if they say, hey, I'm just ready to wash my hands. That's that's where you have the most p most pathways to a result. U, but learn how to um present your your plan to sellers in a way where you're presenting the idea of a result. Do you want this result, this result, or this result? and then have a couple of ways that you can accomplish any of those three results.
All right. Um it is 3:00. Um Paul, thank you so much. Any closing words? Anything that you'd like to add before we jump off? Yeah. Yeah. One more thing just to touch a little icing on that last comment. Um you know, as you tear apart my services like the credit repair, if I'm a realtor, I still need to have somebody in the credit repair and in the mortgage space. So may you're right. Maybe every people aren't going to use all of my services, but uh there are pieces of it that make sense um within the framework of we what you guys are doing here with the probate. But I want to thank you uh for having me, Bruce, and I want to thank your audience for being attentive all the way to this point. And I appreciate um the feedback. And um yeah, I put my phone numbers in the show notes. So, if there's anything you want to talk with me about personally, you're welcome to call. And again, thank you for uh for having me.
Phenomenal, Paul. Thanks so much for being here, guys. Uh thank everyone. This will be on YouTube and on your the podcast platform of your choice within about a day. Um so, YouTube is Probate Mastery. Uh podcast uh the name of the podcast is the Estate Professionals Mastermind. So, if you're going to a podcast app, look for the Estate Professionals Mastermind. you guys can listen again or if you ever miss one of these um you can go on those within about a day and listen to them. Um like always, welcome you guys back next week 2:00 Eastern time on Tuesday and we'll see you then. Thanks Paul. Thanks everybody. Thanks guys. Bye. [Music]