Real Estate Investment 202 Few Deals Complete (LA 767)

Real Estate Investment 202 Few Deals Complete (LA 767)

Transcript:

Steven Butala:                   Steve and Jill here.

Jill DeWit:                            Hi.

Steven Butala:                   Welcome to the Land Academy Show. Entertaining land investment talk. I’m Steven Jack Butala.

Jill DeWit:                            I’m Jill DeWit, broadcasting from gorgeous southern California.

Steven Butala:                   Today Jill and I talk about real estate investment 202. You’ve got a few deals done, and you like it.

Jill DeWit:                            You’re a sophomore now. You made it through your freshman year.

Steven Butala:                   This week, yesterday was 101. Today’s 202. Guess what tomorrow is?

Jill DeWit:                            I don’t know.

Steven Butala:                   What is tomorrow, junior for you?

Jill DeWit:                            That’s a junior.

Steven Butala:                   For-

Jill DeWit:                            I did junior, senior and masters. That’s how I see it.

Steven Butala:                   There’s no PhD here?

Jill DeWit:                            No.

Steven Butala:                   You just stop at masters because you don’t think-

Jill DeWit:                            We didn’t keep going.

Steven Butala:                   Because education’s no longer important to you, because you really actually want to do stuff? In the real world?

Jill DeWit:                            I think that at your master, you know what? I’m glad we’re having this discussion.

Steven Butala:                   Me too.

Jill DeWit:                            I don’t think you need a PhD in this. I think you can get by with a masters. Sometimes, you don’t need to go that far unless you want to be a perpetual student.

Steven Butala:                   I’m gonna quote Danny Elfman.

Jill DeWit:                            Ready.

Steven Butala:                   He’s from the school of hard knocks, and that’s-

Jill DeWit:                            And he’s from Orange County. Had to point that out.

Steven Butala:                   Once you get the basic information down, you’ve got a few big deals under your belts, which is the 202 here-

Jill DeWit:                            Yeah.

Steven Butala:                   At that point, the needle’s either in your arm-

Jill DeWit:                            Yeah.

Steven Butala:                   And you’ve got the bug and you’ve got to take it to the end-

Jill DeWit:                            Right.

Steven Butala:                   Or you’re just gonna kind of say, “You know what? This is not for me.”

Jill DeWit:                            What was the, was there a quote? Does he have a certain saying about that?

Steven Butala:                   No.

Jill DeWit:                            Oh.

Steven Butala:                   Either get the needle in your arm or take it out.

Jill DeWit:                            That’s Danny Elfman saying that?

Steven Butala:                   No.

Jill DeWit:                            Oh.

Steven Butala:                   Danny Elfman said, I read an interview years ago in Rolling Stone, and they were all asking him, “What is it with this multi-level success?” He had a successful band, successful independent career, and then he became one of the greatest-

Jill DeWit:                            The movies, composer-

Steven Butala:                   Movie score artists, composers ever.

Jill DeWit:                            Yeah.

Steven Butala:                   They said, “Where’d you get your education? What’s your history?” He said, “I come from the school of hard knocks.”

Jill DeWit:                            Right.

Steven Butala:                   That’s it. I don’t think he, might not have finished high school.

Jill DeWit:                            I don’t know. I’m not sure.

Steven Butala:                   So, those people are the exception, like Bill Gates and stuff.

Jill DeWit:                            Yeah.

Steven Butala:                   But you gotta be careful with telling your kids that, because they might just said, “Oh, yeah, I’m from the school of hard knocks. The mean streets of Scottsdale,” that’s what I like to say.

Jill DeWit:                            Right. Now the rough areas in South Bay.

Steven Butala:                   These poor kids.

Jill DeWit:                            You go on the other side of PCH, it’s a whole different world over there.

Steven Butala:                   Before we get into it, let’s take a question posted by one of our members in the land investors online community. It’s free.

Jill DeWit:                            That’s funny. BD Jones asks-

Steven Butala:                   What a name. That’s good.

Jill DeWit:                            I like that. “Hi gang. I’m buying a property from a trust. I have a copy of a trust doc, so I know who’s authorized to sell. Do I need to record an affidavit of trust? The title company I talked to said an affidavit trust should be on record. Anyone with any experience? Not simply an opinion, LOL, buying from a trust and then selling it. Did you record anything stating who had the authority to sell from the trust? I know when I buy or sell through or from an LLC, I have to record an affidavit saying who’s the authority to sell for the LLC. Anyone have a copy of an affidavit trust they’ve passed on?”

You want to start with me?

Steven Butala:                   No, I’m gonna drink some coffee while you answer this.

Jill DeWit:                            Oh. Our experience has been this. I always want to have copies of the items on record for my homework and my due diligence should anyone come back and ask anything about it, but in all of our experience and dealing with the, and all of our recordings and all of our counties that we’ve worked with, it’s not needed. You know that you had the right person sign for it, and you know that you had the deed done correctly and done all your due diligence, but as far as recording those extra things is kind of a nice thing to have, not necessarily a need to have.

Steven Butala:                   Right.

Jill DeWit:                            Kind of like death certificates. There’s been times in the beginning that I remember before I learned, I was just recording extra things just for the sake of recording things, like oh, Mr. Smith, let me give you an example. Maybe it was a situation where it was joint tenants with rights of survivorship, and husband and wife, and maybe the wife passed on. So, I would just go above and beyond and I would record the original copy of the death certificate-

Steven Butala:                   Yeah.

Jill DeWit:                            Showing that, as I’m doing the deed with only the husband signing. It wasn’t necessary, and that was, the county’s like, yeah, whatever. We stamp everything you send to us. Literally you could probably send them a recipe to have recorded and they’ll record a recipe, put a date on it, and send it back to you, but it’s not a need to have.

Steven Butala:                   In this career, since we’re talking about education, it’s important in many parts of this career where overkill is appropriate.

Jill DeWit:                            True.

Steven Butala:                   Marketing, overkill is appropriate.

Jill DeWit:                            True.

Steven Butala:                   Like this show, for example.

Jill DeWit:                            True.

Steven Butala:                   This is a great example of our real estate career bleeding into something that’s total overkill and not necessary-

Jill DeWit:                            True.

Steven Butala:                   And we’re probably not even pulling it off.

Jill DeWit:                            Hey-

Steven Butala:                   When it comes to recording-

Jill DeWit:                            Speak for yourself.

Steven Butala:                   When it comes to recording deeds and getting the county what they want to get a deal recorded and so you can get it ready to resell it and prep it, at that time prep it so that when you resell it and get recorded that it’s easy, overkill’s not appropriate.

Jill DeWit:                            Right.

Steven Butala:                   Just give them what they need.

Jill DeWit:                            Right.

Steven Butala:                   They don’t want to look at all that stuff anyway.

Jill DeWit:                            That’s true.

Steven Butala:                   They want to record a deed and the necessarily affidavit, which is state specific, by the way.

Jill DeWit:                            Right.

Steven Butala:                   And that’s all. I’ve never recorded an affidavit of trust.

Jill DeWit:                            No.

Steven Butala:                   So, there may be-

Jill DeWit:                            That’s true.

Steven Butala:                   Jill has way more experience, by the way, than I do, and I’ve never actually recorded an affidavit of LLC, so-

Jill DeWit:                            Yeah, I didn’t-

Steven Butala:                   I’m not sure if law, we don’t do our stuff, our staff does our stuff now, so I’m not sure.

And I’ll tell you this. I have to have a talk with our producer, because she said one of the best producers we’ve ever had by leaps and bounds, but I asked her to, we don’t want to talk about deeds on this show, Jill and I.

Jill DeWit:                            We want to talk about the good stuff.

Steven Butala:                   How many deals have we done where we … I think it scares people from getting in this business.

Jill DeWit:                            Yeah.

Steven Butala:                   We don’t have to know how to record your own deeds and all this stuff. There’s a lot of people that really get into it, like title/escrow type personalities-

Jill DeWit:                            Right.

Steven Butala:                   Just core accountants that love to do paperwork. This is all about making a bunch of dough.

Jill DeWit:                            Right. This is-

Steven Butala:                   This is about creating massive wealth for yourself inside of 24 months, buying and selling real estate.

Jill DeWit:                            I think this question’s timely for our show today, 202, because you have to make that mental shift and trust yourself and-

Steven Butala:                   Here’s the question.

Jill DeWit:                            Do what you need to do. Oh, you’re, okay. I’m like, I know the question, thank you.

Steven Butala:                   No, I was talking to them.

Jill DeWit:                            You’re showing the question, thank you.

Steven Butala:                   Jill’s like, “Put the camera back on me.”

Jill DeWit:                            No, I’m not.

Steven Butala:                   “This show is about me.”

Jill DeWit:                            Here’s the question. I’m like, I thought you’re saying-

Steven Butala:                   Where’s the camera?

Jill DeWit:                            Jill.

Steven Butala:                   Why is the camera off of me?

Jill DeWit:                            Jill. Stick to the question. Here it is. Stick to the question. No.

Steven Butala:                   Can you imagine working with some really huge mega-

Jill DeWit:                            Celebrity?

Steven Butala:                   Movie star? Movie star female? It’s just like, why? Why is the camera on him?

Jill DeWit:                            Oh.

Steven Butala:                   This is about me.

Jill DeWit:                            That’s funny.

Steven Butala:                   You couldn’t be further from that.

Jill DeWit:                            Thank you very much.

Steven Butala:                   Today’s topic, real estate investment 202. Get a few deals completed, or maybe you’re at a point you’re a little ahead of the class, Jill’s doing the whole class analogy this whole week-

Jill DeWit:                            Yeah.

Steven Butala:                   You have a few deals done, a few more deals than the guy sitting next to you, and you want more. You can just taste it. This is the meat of the show.

So, what would you say? This is sophomore now, you say?

Jill DeWit:                            Yes.

Steven Butala:                   You’re sophomore?

Jill DeWit:                            Yes.

Steven Butala:                   What should you be thinking about?

Jill DeWit:                            Getting in, you know what? Sophomore is wrapping up all the basic knowledge, getting all your core classes, not your core classes, your fundamental classes out of the way because now your junior and senior year are all your degree classes.

Steven Butala:                   Yeah.

Jill DeWit:                            So, you now had your freshman year, and you’ve had a taste of it. You’ve done some deals, and you’re liking it. So, now as a sophomore, you’re ready to start ramping it up. Then by junior year, senior year you’re going crazy, man. So, is that how you, that’s how I see it.

Steven Butala:                   Yeah.

Jill DeWit:                            So, now, too, as a sophomore, you’re helping that, you know you’re a sophomore because you’re helping the freshman, and I see it all the time in our online community. I see people that, when they’re surprised at themselves that they’re like, I can actually help this person answer that question, because I did one last week, and I remember being that guy. I remember being the guy that does my first deal and I’m so freaked out. Does my posting look good? Now you’re a sophomore and you can weigh in on somebody else’s postings.

What I mean is a lot of our members, it’s a really great place, they will, when they have their first property, their first couple properties, they’re making their postings, they’re on their website, they want to make sure their pictures look good, their video looks good, their description looks good, they want it to sell, obviously.

So, they’ll send links and they’ll upload things onto our online community and ask the community-

Steven Butala:                   Yeah.

Jill DeWit:                            “Hey, you guys, you’re all way ahead of me. Will you please, if you have time, eyeball my posting? Tell me if I’m missing something. Does it look good? I want to get your input.”

I watch the sophomores in our program weigh in on that-

Steven Butala:                   Yeah.

Jill DeWit:                            And it’s funny because they’re a little bit, I know that they’re a little bit like, you know what? I actually know something about this, and they can say, “Look, I can tell you from experience, if you change your photos up a little bit or you add this in your description,” or even silly things like, “Hey, you forgot your email address or your phone number in there,” whoops, that’s a little freshman mistake. They’ll catch it for them. So, that’s where I think we are.

Steven Butala:                   At this point, after you’ve done a few deals, you should start to have thoughts like this. Boy, that last deal didn’t go how I wanted it to. It’s a good thing I got out of it. I’m not gonna let that happen again. Don’t let these deals control you. You control the deal.

Jill DeWit:                            Right.

Steven Butala:                   You should have an idea of a transaction in your head and when you go into the transaction, you make it happen for you, not the other way around.

Jill DeWit:                            Exactly.

Steven Butala:                   Don’t let the transaction control you, or the seller or the county or the title agent or anything. You also should have, always have, start to think about, at this point in your career, an exit strategy for every property.

Jill DeWit:                            That’s good.

Steven Butala:                   You never want to end up with for sale property.

Jill DeWit:                            Yeah.

Steven Butala:                   For sale. You want to end up with property that you know who’s gonna buy it before you buy it.

Jill DeWit:                            Yup.

Steven Butala:                   You know exactly when, you’re gonna start marketing the thing long before you actually close on the acquisition, and you also should be having big picture thoughts like, “Wow, this is it. If I do 20 of these deals this year, I’m gonna make $80,000.”

Jill DeWit:                            Yeah.

Steven Butala:                   “Wouldn’t it be better? Wouldn’t it be better for my personality type to do 20 deals this year, but I’d rather make $50,000 each, and make a million bucks, instead of $60,000 or $70,000.”

So, those are the kinds of things that sophomores-

Jill DeWit:                            You start seeing-

Steven Butala:                   Sophomores in anything start to have thoughts about.

Jill DeWit:                            Mm-hmm (affirmative). I-

Steven Butala:                   Feelings.

Jill DeWit:                            Love it.

Steven Butala:                   If you’re Jill.

Jill DeWit:                            Well, and also, too, you can start to take a step back and look at things differently. Like, all right, now I know from the experience on the last time, I accidentally picked a county that the recorder’s never there. You pick things like that.

Steven Butala:                   [crosstalk 00:11:38] is bad.

Jill DeWit:                            It’s hard to find stuff. It’s really, they’re not easy to work with, who knows whatever it is. Or maybe you picked a county like, everybody else is in this county. I want to go somewhere where nobody else is going now.

Steven Butala:                   Yeah.

Jill DeWit:                            I want to really branch out, because I know I can make more money over here, or something like that. So, now you can take a step back and start seeing those things. It’s like, you know what it is? I have a good analogy. Learning to ride a Vespa, which I am doing right now. Seriously. I am now, I have now-

Steven Butala:                   You’re a sophomore there.

Jill DeWit:                            I’m a sophomore. I am a sophomore. I have enough miles now, I have enough saddle time, enough miles under my belt that I can start really looking up even further. First it was I’m looking at potholes, you know what I mean?

Steven Butala:                   Really?

Jill DeWit:                            Yeah, yeah. First, well, actually first of all, I’m like, can I hold this thing up? You know what I mean? How fast can I go? Can I hold this thing up? Come on. Just the last time, just recently, we were at a red light, and you said, you looked around and said, “This is your time to hit it.” I said, “All right, I’m gonna do that.”

Steven Butala:                   You did it, too.

Jill DeWit:                            I gave it all it had, so by the way, that was awesome. So-

Steven Butala:                   300 CCs, too.

Jill DeWit:                            Thank you very much.

Steven Butala:                   Zero to 60 in 5.8 seconds. Truly amazing.

Jill DeWit:                            How fast this can go.

Steven Butala:                   It’s not a 50 CC Vespa.

Jill DeWit:                            Thank you.

Steven Butala:                   It’s a full blown motorcycle.

Jill DeWit:                            Thank you. That was my favorite thing, too, by the way. When we’re sitting at a light, I have to tell you off the record. Well, with everybody here watching-

Steven Butala:                   Yeah. This is more on the record than, it couldn’t be more on the record.

Jill DeWit:                            This is true. It couldn’t be. No, I have to tell you. Every single time we’re sitting at a red light and you point out guys on motorcycles that look like they’re legit and you tell me that they’re smaller than mine, engine-wise-

Steven Butala:                   Yeah.

Jill DeWit:                            That makes me feel so darn good. So, please always do that.

Steven Butala:                   Yeah. Some of them are smaller. Some of the CCs are bigger but they’re way heavier, and they’re made for different stuff, so.

Jill DeWit:                            Yeah.

Steven Butala:                   With a few exceptions, you can blow-

Jill DeWit:                            You’re faster than that guy?

Steven Butala:                   You’re faster.

Jill DeWit:                            Yeah. Okay, that makes me feel good. Remember, we did that the other day, too, one time. It was probably not the best thing to do, but there were three of us sitting at a signal and I had to make a point to keep up with or try to pass that guy. Not you, I won’t do it to you.

Steven Butala:                   All right. So, let’s continue with this-

Jill DeWit:                            Anyway.

Steven Butala:                   Vespa theme. You’re a sophomore.

Jill DeWit:                            Oh, yeah.

Steven Butala:                   Where do you want to take this?

Jill DeWit:                            So, what was my point? My point was now as a sophomore on my Vespa, I’m not just looking out for the potholes and looking out for the little things, right? I’m not over analyzing these deals or, oh my gosh, should I buy it? Now I can, you know what? I got the feel for this, I know how it handles, I can now really start looking further ahead on the horizon, where I’m going, where I’m gonna turn, what possible things might get in my way, that kind of a thing, and I think that’s the same for sophomore and 202 level investors. They’re gonna start going, oh, you know what? I now see what could happen if I price these this way or whatever in this county, something.

Steven Butala:                   Yeah.

Jill DeWit:                            That’s my … does that make sense, I hope?

Steven Butala:                   Yeah, I think that-

Jill DeWit:                            Okay.

Steven Butala:                   The first deal I did, all I could do is look forward. I did a large acreage deal. I talk about it in the ebook.

Jill DeWit:                            Like this.

Steven Butala:                   A large acreage deal in northern Arizona when I was in Ohio. Or Pennsylvania, it doesn’t matter. I can’t remember. I bought it, sold it, doubled my money, and that was it.

Jill DeWit:                            Mm-hmm (affirmative).

Steven Butala:                   All I kept thinking was, well, does this concept work with apartment buildings?

Jill DeWit:                            Right.

Steven Butala:                   Does it work with hospitals? Does it work with rural, urban land? Right now Jill and I are doing two very, very profitable urban land splits.

Jill DeWit:                            Mm-hmm (affirmative).

Steven Butala:                   We’re buying properties that are on a residential lot that are zoned for multi-family and the sellers have no idea, at all. They just want to get rid of the property.

Jill DeWit:                            They don’t care.

Steven Butala:                   They don’t care about-

Jill DeWit:                            One knows and just doesn’t care.

Steven Butala:                   These are acre properties in a really densely populated area, urban area, so acre doesn’t sound like a lot. Originally when we pulled the deals in, Jill’s like, “Well, it’s only under an acre,” and I’m like, “Well, look at the map.”

Jill DeWit:                            Yeah.

Steven Butala:                   There’s 92 properties on one acre in this area, so.

Jill DeWit:                            That’s true.

Steven Butala:                   Two of them. I don’t know how that happened.

Jill DeWit:                            I know.

Steven Butala:                   We didn’t even set that up. That was just, these are a good example of what can happen. They were mistakes.

Jill DeWit:                            Do you know what is so great, too? You’re right. This is one of those situations we tell our members. Get into it, get into a flow, and hang with it. We feel like we had our one home run, right? That’s how I feel with the first one.

Steven Butala:                   Yeah.

Jill DeWit:                            I’m like, holy cow. What did we just find? There’s a home run.

Steven Butala:                   Yeah.

Jill DeWit:                            Then two weeks later, here comes another one. I’m like, oh my gosh. What are we gonna do? It’s great, and I know there’s more around the corner.

Steven Butala:                   By the way, if you’re listening to this on iTunes, and you probably are, based on our analytics, we’re filming the show now on YouTube.

Jill DeWit:                            Yeah.

Steven Butala:                   So, if you want to see what Jill looks like today, go check it out. You’ve done it again. Spent another 20 minutes or so listening or watching the Land Academy Show. Join us next time, or tomorrow, where we discuss real estate investment 303, knowledge is your small business.

Jill DeWit:                            We answer your questions, should you have one. Post it on our online community, landinvestors.com. Go there. It’s free.

Steven Butala:                   You are not alone in your real estate ambition. I think we’re pulling this off.

Jill DeWit:                            I hope we are. They’ll let us know.

Steven Butala:                   We’re gonna find out. Yeah, we’ll find out.

Jill DeWit:                            Our numbers will tell us.

Steven Butala:                   Somebody will say, “Geez, stop that.”

Jill DeWit:                            Stop it. Yeah.

Steven Butala:                   We did this is a long time ago. We did it wrong, I did it wrong. I posted, instead of posting the MP3 file, the actual audio file where it’s supposed to go, we posted it through the normal channels in MP4 file and people were just calling us and emailing us saying, “I have you on auto download so I can listen to you on my commute, and I downloaded four gig file in MP4,” so we figured that all out.

Jill DeWit:                            Oh, good.

Steven Butala:                   It’ll be fine.

Jill DeWit:                            I’m really glad. Thank you for saving us there.

Steven Butala:                   You’re welcome.

Jill DeWit:                            Join us on iTunes, or wherever you are listening, and while you’re at it, and hey, or on YouTube. Please rate us there.

We are Steve and Jill.

Steven Butala:                   We are Steve and Jill. Information-

Jill DeWit:                            And inspiration-

Steven Butala:                   To buy undervalued property.

 

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