On today’s show, trusted investment counselor Oliver Fu joins host Marco Santarelli for an unscripted conversation about working with Norada Real Estate and the common questions, fears, and issues that come up. Whether you are working with NRE already, have worked with them in the past, or have experienced working with them, discover things that you can go back to and improve about your portfolio. Get your investment questions answered as you continue to build that portfolio. Listen to this episode to become a sharper, more seasoned, and smarter investor.
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Common Questions Answered With Investment Counselor, Oliver Fu
I was talking to some of my investment counselors like Oliver, Melissa and Steve. We got thinking, “It’s been a while since we’ve done an episode that talks about what we do and questions our clients and ask issues that they run into and some of the common questions.” I thought, “This is a great opportunity to get all of them on separately, ask these questions and have a good conversation about what are our investors experiencing? What should you know?” All of this is coming from the perspective of the investment counselor. With me is Oliver, one of our investment counselors here. We’re going to have an unscripted conversation about working with us, common questions, fears and issues that come up, things that you didn’t think about. Even if you are working with us already or have worked with us in the past or have experienced working with us, maybe these are things that in hindsight you can go back to and think about and maybe improve what you’re doing with your portfolio. As you continue to build that portfolio with us, you are going to be a sharper, more seasoned and smarter investor. With all that, Oliver, welcome to the show.
Thank you for that introduction, Marco. A lot of our investors are going to get a lot out of this episode because we’re going to go over a lot of the questions that hundreds, if not, thousands of you out there have.
I love having this conversation. We seem to get on the phone from time to time and we end up talking about one thing. That one thing mushrooms into all these different conversations, topics, questions, and ideas. It’s like a brainstorming session. It’s a lot of fun. We were joking about this, but we should click a record button and record our conversations because they would make fantastic episodes.
Almost every conversation that we’ve had, we’ve left it off by saying, “We absolutely should have recorded that.” That means that we’re having great conversations that hopefully a lot of people would find useful. Hopefully, this is going to help a lot of people out there and we’re going to have fun while doing it too.
That’s my hope. I’m sure this is going to turn out great. I like starting with the basics. Let’s point the spotlight on you. Let’s talk about the counselor’s role. Share with us how you would describe your role with your investor clients here at Norada.
The way that I like to explain my role to a new investor is that I more or less help advise the investor, the new client, or individual on what it is that they can potentially do with some capital that they may have saved up. The best way I can explain this is that I essentially hold your hand from step A to Z for the entire process of having that initial introductory call, to moving forward with all of the steps that are involved, post that from the lending, from looking at market specifics, reviewing and assessing properties together, going through the home inspections, seeing if there are any issues there and bringing all that through to closing. This is a question that I get asked quite often, “What’s your role once I close on a property? Do you just go away?”
I always explain I’m here not just to sell you one house and you’ll never hear from me again. My role is to help you, the investor, build a portfolio. You’re going to continually hear from me in some way, shape or form post-closing. I want to know how the property is doing. I want to make sure that your portfolio is on track to reach the goals that you’re wanting. Some of my investors, if they can only save a small chunk of money every year, that’s fine. We touch base every 4 to 6 months and we see how things are going. If you want to move more on the fast track, we adjust and we touch base a lot more often in order to show you the right properties that are out there and develop and create your portfolio the way that you want.
I find that sometimes, discussing my role can be a little challenging because there are many segues that can go into answering that. It depends on where the investors are at. For example, for someone that’s brand new versus someone that already has a well-developed portfolio, their lending criteria and their options are going to be a lot different than someone that still hasn’t used up their first initial conventional loans. When it comes to getting financing through LLCs, going through specific vendors, creating a bundle of properties to be able to purchase all at once and lump those all up into one loan, that’s a whole other strategy and criteria that we’re looking at doing instead of someone that’s just getting started and wants to dip their toe in the pond.
That’s a great specific question and I have two comments on that. The first is some investors that don’t work with us, they don’t have a good understanding of the services we provide. There’s this false belief that we throw investors over the fence to the teams, builders, providers and lenders that we work with in other markets. That is far from the truth because we always remain the primary point of contact for you, the investor, in working with you at each step of the way. We do obviously need to bring other people into the fold like lenders, home builders and property providers as we go down that road, as we have this journey. It’s not that we’re throwing you over the fence, it’s just that we do need to introduce you to property managers and lenders and other people in order for you to achieve your investment goals. We’re never throwing anybody over the fence. We want to remain your primary point of contact, but we have to give you over to other people to work with them as we work with you.
That’s exactly it. We’re always in the mix in some way, shape or form overseeing something. There’s also a lot that tends to happen in the background that maybe the investor may not necessarily know about at the forefront, especially if I’m dealing with our lenders directly or maybe with some other providers in terms of timeframes, timelines and making sure that certain things are done on the property. We always ensure that the investor knows what’s going on. Sometimes, in order to push that, to get things going sometimes a little faster and ensure that there’s proper communication, there’s a lot that goes on in the background that the investor may not necessarily know about. We’re always keeping tabs on what it is that we can do for the investor to make sure they’re well taken care of.
To add to that, the other point that I was going to make is from a 40,000-foot level, we call this initial conversation or even the first two conversations that a client will have with you as an investment counselor. We refer to that as a strategy session. The reason for that is we want to make sure that we understand where a client is at today and where they’re trying to go. Everybody starts off at a different point. Everybody starts off with no properties, but people start off with no properties and some capital then they start building their portfolio. It’s one or two properties over the course of let’s say a year, but they all have an idea of where they want to go. It could be a financial goal. It could be a number of properties. It could be an age of retirement. It’s different for everybody. For us to take a look at that and understand your personal situation and your goals, it allows us to help you reverse-engineer that.
If you’re here and you want to be up here down the road, let’s say that’s a passive income goal of $5,000 a month and it’s a combination of fifteen properties spread across three different markets, all that is stuff that we’re going to help you identify and get specific on. It’s a matter of us are listening to you, asking some intelligent questions, pulling that information out of your head and creating a roadmap. That’s what we all do here with that first or second conversation. We refer to it as a strategy session. We don’t charge for that. It’s something we gladly do because we want to help you. Everything else you said, all of it fills in all the gaps in and paints the picture and colors how that strategy session unfolds going forward. Do you have anything to add to that?
It brought up a couple of examples for some clients. One client, his name is Chris and he’s a friend of mine. He is using the process of closing on his second property and based on the total amount of the cashflow. He’s going to be bringing in from those two properties. He’s going to be able to cover his full car payment. He got himself his dream car, for the moment. He loves this thing. He shows me pictures and everything. Once we’ve done the numbers on this, he will now be able to have that entire amount that he’s bringing in cashflow on those properties. That amount will cover his car payment moving forward.
Granted that he’s still a young guy in his 30s, but his goal is going to be very different than some other clients that are looking more towards retirement. They’re looking more towards the stability of the cashflow that can come in. That’s generated on those properties. Whether your goal is to have your overall monthly passive income cover your dream car payment, to build that nest egg, to build that overall wealth, or maybe fund that vacation for you, everyone’s goals are going to be slightly different. We’ll help you. We’ll help you tailor to whatever it is that investors are looking for.
That all starts with that first step, that first call, that strategy session to help put it all out on the table and see how we can map this out with you. Let’s talk about some common questions here. There’s probably a long list of common questions that could take up several episodes, but one that I get from time to time myself as I’m out on the field dealing with providers and lenders and meeting new people at networking events, I get this question after I tell them what we do. They say, “This sounds too good to be true. What’s the catch?”
That’s something I get so often as well, Marco.
I don’t understand why that is. Maybe it’s because we provide what I’ve ultimately defined to be the knowledge, the resources and the properties. We provide all this stuff at no cost. That’s when I get the eyebrows going up and people asked me, “How do you guys make money?” They’ll say, “This sounds too good to be true. What’s the catch?” When someone asks you that, what do you say?
That’s probably one of the most common questions that I get asked, how do we get paid? How do we get compensated? There’s an easy answer to that one. Essentially, we get paid a flat fee from our providers once we close on a property. I think that you’ve done a couple of episodes on this one as well, Marco. It’s a short Ask Marco session. That’s the answer to that. Is this too good to be true? I won’t lie, there’s always going to be skeptics. It takes someone to take that initial step to move forward with something, to decide and see for themselves. Does this make sense? I’ve been investing for over several years. Was I a little skeptical? Absolutely, but after I did my first one, my second, third and as things progressed, it made sense. That’s what I find a lot of investors. That’s the progression. When they buy one property, they may hold onto it. I will tell them to hold onto it, but they will closely keep an eye on the following 1 to 5 months to see how the cash was coming in.
What are things looking like? Are there any issues that come up? I won’t say that there aren’t any issues that come up because sometimes things do happen. For the majority of the time, they see the cashflow that’s been deposited into their bank account automatically every month. When that happens, they have a lot more confidence in the process. That’s when they start looking at a 2nd and 3rd property. Eventually, that’s when they start telling their friends and family about us. That’s how we’ve been able to grow. That takes someone doing that initial step and making the decision to move forward. Even if it is not moving forward, just to get more information and speak to one of us to ensure that this is indeed the right step for you because it may not be for everyone.
That is true. It’s not for everybody. The reality is that this is a people business, not a property business. Things will happen, but the numbers don’t lie. If you have accurate numbers and you’re looking at actual numbers or realistic pro forma numbers, those are based on what you are able to pull out of the market and the market rents. You can compile this stuff pretty easily. We already have it. When you look at this stuff, you’ll know that you have a very good expectation of what is going to happen over the course of the coming months and the coming years. We’re dealing with people. It’s not just properties. Things will happen from time to time. You will have a turnover. Someone will move out after 1 to 4 years because they have a job transfer, a family transfer. They’re moving up, they’re moving down, whatever the case is. It’s important to be realistic about the whole thing. It may sound too good to be true, but the reality is that it is good. It is great.
Real estate is one of the best investment classes out there. It is the most tax-favored investment class. It’s the only thing short of starting a successful business where you can get the maximum amount of leverage on your capital. When you look at your overall returns from your cashflow plus what you’re going to gain in equity from the amortization of the loan and appreciation over time, you can’t beat real estate. When you understand how the numbers compound and aggregate or accumulate with each other, you look at what that can do across multiple properties over multiple years, there’s quite the wow factor in there. Look around. People who are financially independent, they typically and often have some portfolio of real estate. The proof is in the pudding. It’s in the reality that a lot of people hold wealth and create wealth using real estate. That’s indirectly a way that I address that question. If it sounds too good to be true, it’s because it is good and it is true. Look around, you can do your own research.
What was one of those famous books about the book called The Millionaire Next Door?
Thomas Stanley. You mentioned The Millionaire Next Door. I remember reading that book a long time ago when it first came out. I thought it was an incredible book. I am in love with the book. I thought, “This is the answer. There’s a lot of great stuff in there.” A big focus of that book is about being frugal. I see that as the flaw in the book. I don’t agree with that book for that reason. I don’t agree with him on some of the things he says in that book. What he’s basically saying is you have to be extremely frugal. Don’t splurge or treat yourself. Drive an F-150 truck as opposed to the car that you would like to drive.
If you have a very limited low income and that’s your only option, then that’s your only option. It’s to live frugally in order to save, to invest, whether that be in the stock market as he talks about or in real estate. If you have the ability to enjoy your life, I don’t mean go on cruises every six months and spend foolishly, but if you have the ability to save first and save on a plan where you can save enough to achieve your investment goals in real estate and whatever else you’re doing and enjoy life, skip the F-150 truck and go to whatever your car is of choice. You can do both. To me, it’s not either-or. You can do both if you have the capacity to do that. The message in that book is strong about being frugal and saving every penny and every dime to get there that you don’t enjoy life. Ultimately, you’re set when you’re retired, but you haven’t enjoyed life during your 20s to 50s in that journey or that process. To get off my soapbox, I want to say that’s the beef that I have with that book.
I would agree with you on that one, Marco. I remember years ago, there was this one particular stat that a lot of people use, which was the Starbucks factor or something along those lines where they compare. They said, “If you spend $5 every day on a Starbucks coffee or Frappuccino or whatever you get, multiply that by every day of the year. That’s $150 a month and multiply by twelve. You’re spending $1,300 a year on coffee.” If I like coffee, which I do, is spending $5 on something that I enjoy and it is worth it for me. I know that I work hard, so I absolutely do. Whether I do it every day, I usually do but that’s definitely something that I like to do. Being frugal can make sense in some ways but enjoying your time while you’re here is the most important thing. That’s a big segue as to why is that we do what we’re doing, to be able to generate that additional income, to be able to offset some of those expenses that we’ll have later on. Not just to create that income to whether to do anything that you want to. I mentioned at the start to get that car. By the way, Marco, F-150 is a great truck.
I’m not saying it isn’t. I’m just saying that it seems to be the vehicle of choice amongst the millionaires next door. It’s what Thomas Stanley paints. It’s the guy that you never thought would have a net worth of $1 million. It’s the guy that’s wearing jeans and basic shirts. He has no sign of any kind of wealth and he drives an F-150 truck. Through his research and surveys, that was the most common vehicle of the millionaire that is next door in the community that you would never think was a millionaire, but that happens to be the vehicle of choice at least back then. We’re talking about cash. How much cash do I need? I get asked this question from time to time. I don’t know how common it is. I’ll let you answer it and then I have my canned answer to that question.
That is a question I get asked all the time as well. The quick and easy answer to it is to have at least $20,000 to $30,000 on hand. That will cover your down payment. Nowadays, all you need is a 20% down payment on the properties. I always allocate around $5,000 for closing costs. To give a rough example here on that $100,000 property, you’ll expect to put down 20% so $20,000 and then allocate at least $5,000 for closing costs. Granted, that $5,000 I’m paying for closing costs, what that includes are all of the loan origination fees, the county, the recording fees, and all of those plus the appraisal fee, the insurance and any type of prorated taxes. Sometimes I’ll have my clients call me up and they’re all confused when they see the original loan estimate. They are like, “Why are the loan estimates so high?” It’s because they include those three big factors I mentioned at the end.
The appraisal fee is usually around $500 to $700. It depends on whether or not you’re buying a single-family or a multi-unit, but it is more than your residential purchase. Your insurances, you always have those on, plus any prorated taxes. It depends on the time of year that you’re purchasing and you’re closing on that property. If tax is due immediately, then you’ll obviously have to pay the taxes for the remaining of the year. Whereas if they are not due yet, you may only have a smaller payment. Then in the months preceding that, you’ll have a larger payment that you have to pay for taxes. That’s why it’s always good to ballpark roughly $5,000 or so for that amount. With that property in most of our markets, that’ll be a great B class property where you’ll be able to cashflow quite well. Around $20,000 or $30,000 is a very good starting point.
When you’re talking about closing costs, you’re being very general because you’re chunking in pretty much everything related to that transaction from beginning to end. I’m not saying you’re wrong, I’m saying that you’re being on the high end. To compare and contrast, this is typically how I answer the question of how much cash do I need. The first word out of my mouth is, “It depends.” I always like to give my typical example and I’m going to say that a lot of the properties that we sell through our network to our investor clients range from $80,000 to 180,000. That’s my canned response. It could be a little higher, a little lower, but that’s the range. Maybe $120,000 to $125,000 is the median price of what we sell.
I always take it down to the basic $100,000 property example. I like to work with easy math. My hypothetical example as well, if you take $100,000 three-bedroom home and it’s in a B-class neighborhood of any kind in one of the markets we’re in and you’re using 20% as a down payment. You’re looking at $20,000 of investible capital, that’s your equity going into the property. In addition to that, you want to budget between $2,000 and $3,000. This is my rounded number in closing costs. I may not be chunking in everything that you’re talking about but generally speaking, if you look at your prorations and fees that are on the settlement statement, it’s going to be somewhere in the $2,000 to $3,000 range. I’ve seen it less.
I’ll also say that you should have another $2,000 or $3,000, which is essentially 2 to 3 months’ worth of gross rent as reserves, at least for the first batch of properties, not necessarily for every single property. If you add that up, you’re looking at $24,000 to $26,000, probably around $25,000 $26,000 for that $100,000 property. You ask the question, how much cash do I need? If you’re looking at a $100,000 property, bank on about $25,000 or so for your down payment, closing costs and something for reserves. That’s a simple answer to that question that allows people to think the math in their head very quickly. They’re thinking, “I’ve got $100,000 to invest. For $25,000 per, that’s four properties.” It allows them to add up the number of properties that they can execute very quickly. That’s my answer to the question.
It helps see this in a different way and calculating things slightly differently. We arrived at the same number. I like to put a chunk in it so that way it’s seen it in two different tranches. It makes things easier. Especially when you’re getting started, sometimes there are many numbers that are coming at you and you want to be able to simplify everything as much as possible and have that goal in mind and that number in mind as to, “That’s $25,000 per property or so that include all these things. What’s my cashflow goal?” Work towards that goal having those general numbers in mind.
Oliver, let’s touch on a couple of expectations-related questions. Sometimes investors ask the question or they’re thinking about this. They don’t ask the question, but we’re talking about passive real estate investments. There’s a difference between a passive and an active type of real estate investment, but generally speaking, when you’re buying properties that are meant to be a buy and hold rental property in your portfolio, we’re referring to passive investments. People ask the question or they think about, “How passive is passive?” I don’t know exactly what they mean when they asked that initially. I have to dig down because some people are thinking, “How involved do I need to be month after month with this property,” even though they have a full-service property manager? Some people might be thinking, “How much time do I have to put into managing my portfolio from the sense of bookkeeping, accounting, tracking and talking to a property manager?” It’s an open question, but if I throw it out there to you, let’s say I’m your client and I’m asking, “It’s a passive investment, but how passive is passive? How much time should I be putting in or do I need to put in?”
The answer to that one is similar to your last answer, Marco, which is it depends. The reason I say that is for an investor that’s starting out, maybe they have one property. This was asked to me before by a client, “I’m buying my first property. Am I going to have to touch base with my property manager every week to see what’s going on with the property?” I said, “That will definitely be overkill. They’ll get to know you at the office very well, very fast. If there are no issues that are going on with the property, you’re getting your rents in every month and there are no repairs or maintenance items on your monthly statement, then there isn’t a huge reason for you to touch base with your management or your property manager.”
It’s good to touch base on maybe every 4 to 6 months to ensure that things are going smoothly if the tenant has any issues and concerns that have been brought up. Overall, if you only have one property and all you’re doing is taking a look at the monthly statement and reviewing that, it takes 30 seconds to do and look at. If you’re a lot more detailed than you take all those numbers and you insert them into a spreadsheet, that’ll take a few more minutes. In my opinion, granted that I’ve been doing this for a long time, it only takes me a couple of minutes to review all of my monthly statements every month. If I do have any questions, I just call up the property manager. I ask them whatever issue or line item that I want to know more about. Maybe I send them an email. I’ll ask them for photos about something that was recently replaced at the property.
Overall, it depends on how big your portfolio is and how micro specific you may want to be. There are some people that would love to know as much as they possibly can about a specific neighborhood or community or an area that they’re purchasing and are wanting to purchase them. They can spend hours and hours researching and looking at all sorts of different statistics. Once you have that property and you get your monthly statements, if there’s nothing that’s coming up on the property every month, it’s quite minimal in terms of the amount of time you need to spend on a monthly basis reviewing these statements. The thing that will take the most amount of time is whenever there’s a rent-ready, which means your tenant has left the property.
Hopefully, they have given their 30-day notice to the property manager. Once they move out from the home, the property management company will send their team there to assess everything and do what they call a rent-ready, which is like, “Here are all of the items that need to be done to the property in order to make the property rent ready for the next tenant.” They’ll have a discussion with you about that and how much that cost. We’ll give you photos and give you a line item expense as to what it will cost to do that. That’s the most time-consuming thing that you can expect. I had one of these on one of my properties. It took me ten minutes or so to take a look at everything, review some photos and approval.
That’s probably the most time-consuming thing that can happen. The other one, which is the very unfortunate case is if ever you have to deal with an eviction. Based on the state that you’re in, property managers can get a tenant out of a property within 30 to 45 days, but they tend to take care of all of that for you. They’re the ones that are going to court on your behalf. They’re the ones that are meeting with the sheriff if need be at the property. All you’ll get are the summaries as to what’s happening at the property and dealings on the workings there. That is probably the second most time-consuming thing, but it’s not as active because you’re not the one that has to physically go to court. You have someone doing all of those things on your behalf.
It’s important to point out to everybody that as descriptive as everything was that you said, most virtually all, most of everything you described is not being done by you, the investor. It is being done by or handled by your property manager. You’re just going to get an update, whether it be an email or a phone call to let you know what is going on. The second thing I’d like to point out is that if you do experience an eviction, it’s not that common. Often, someone is going to move out not because they’re moving on. They’re moving up, down, out of town, has a job transfer, moving to the other side of town, whatever the case may be. It’s a voluntary move. You can expect all tenants to stay somewhere between maybe 1 to 4 years, depending on the type of neighborhood you’re in.
Organic and natural move ins and move outs happen, but evictions don’t happen as often as a lot of people think, interestingly enough. When you experience an eviction, often it’s because you’re in a sketchy neighborhood, a middle C-class neighborhood. You’re dealing with a demographic of tenant that is not the same as someone like in an A-class community that will leave the property, broom-swept clean and move on to their next place. The point I’m trying to make is that a lot of this stuff is handled by your property manager. Your time is more about communication and being updated or asking questions if there are any questions to ask or be answered.
The investor is more or less the CEO. That’s what you can see them as. All of these other individuals, including your property manager, they’re just bringing you updates to take a look at and review that you have directly take action or anything along those lines. You have all these people doing all this work on your behalf and all you’re doing is assessing and reading the updates.
I’m going to add one more thing and we’ll probably go on to the last question I want to ask you. Regarding the time, whether it’s 1, 5, 10 or 50 properties, when you have a stabilized portfolio, this is a very general rule of thumb. I like to think of a stabilized portfolio involving about five minutes per property per month. When you ask the question, “What is that five minutes for?” It is when you’re tracking your income and expenses and you can automate all this so that it doesn’t take any of your time other than to review. In the beginning, your first few properties might take you a little bit more time each month because you were voluntarily wanting to spend more time to read the statements and understand what’s happening. You’re learning from the experience.
As time goes on and you have a bigger portfolio and it’s stabilized, you’re spending literally minutes per property to make sure that income and expenses are booked. You can automate this stuff to the point where you have the rents that are coming in from the property management company being automatically deposited into your bank account, your LLC’s bank account, wherever it’s going. That income comes in and it’s automatic. In my case, it’s PITI or Principal Interest Taxes Insurance. It’s all one lump sum that is being taken out by my lender. The gross rent comes in at the beginning of the month. The lender pulls out their PITI payment each month. Those two transactions are on my bank statement each month and it happens automatically. I track that. I’ve done different things in the past. I’ve used spreadsheets. I’ve used QuickBooks. You can use Stessa.com. They were one of our show’s sponsors in the past. We’re working with them to work on some other things together. They will help to automate and create a dashboard for all your properties so you can see all this happening as if you are looking at a dashboard on your laptop.
A lot of this stuff is automated. It doesn’t take a lot of time. Whether you have 1, 10 or even 30 properties, the time involvement is minimal outside of your property manager for things that may come up from time to time, month to month. It is a minimal time investment, but you would do that regardless of whether you’re looking at your stock portfolio or you got something else going on. There’s always going to be a little bit of engagement and involvement no matter what you invest in and what you’re doing. It’s not even a price to pay, but it’s a very small price to pay for the benefits of what you have in terms of investment.
I like to do this every now and then, but when I look at what my overall net cashflow for the month is compared to the amount of time that I spend on reviewing these statements, it ends up being pretty high. I know that may not necessarily be something that many people may think of as in terms of ROI on time. I definitely do. Some people may want to incorporate the down payment, the closing costs and everything else. This is what I spent on doing this every month, maybe twenty minutes a month max on all the properties that I own.
Oliver, I think most people can afford twenty minutes a month.
I absolutely do think that they can. What they ended up seeing 2 to 5 years down the line when they see the amount of time that they spent on the other properties and the amount of benefit that they’ve been able to get from a tax perspective, the equity, the cashflow, all of that, it becomes very significant.
The bottom line is we all need to do something for our financial well-being and our financial future. It’s something that you want to pass along to your family and your heirs. You’re going to have an investment of time and capital. You already understand the capital investment side of it, but the time is something that you need to do. Unless you’re completely lazy and you’ve checked out of everything altogether, then it doesn’t matter. It’s time well-spent. It’s time invested. I don’t look at it as an expense. I look at it as a necessity. I’m going to put the time in to understand the performance of my portfolio, make sure everything is moving along well. I’m going to see how I can improve that, how I can leverage that to do better next month and next year and as time goes on.
I enjoy it. It’s fun and I learned from it. If I’m learning something, I’m happy. I’m a perpetual learner. I will always want to be learning something. If I can learn from my experience in building my portfolio, great. More power to me. One last question. We don’t have to go long on this one, but it’s a more of a preparedness question. I thought about this before we were recording here. What should investors do before they contact you or their investment counselor? It’s a very general question. It could be about preparedness. It could be a mindset thing. What should investors do before they contact us?
I would definitely recommend reading at least a few of the blogs. Most of our readers have already. Some of them read quite a few of them. What should they do beforehand? I would absolutely say to save up some capital in order to be able to get started on the potential path of moving forward with the property and have that vision, mindset, and goal in mind. Have a good idea in terms of where you stand with your debt to income ratios and also your credit score. If you have a huge amount of debt, for example, chances are the lenders may not necessarily qualify you. It’ll always be good to pay down some of those outstanding credit cards if you do have those. Otherwise, it’s good to be in a good financial place. What that means is if you have $20,000 or $30,000, make sure that’s not every nickel and dime that you own and have in your bank account. You also want to make sure to be in a good stable financial place before moving forward. Those are probably the best things to do prior to contacting us.
Once you contact us, we’re going to have some suggestions and recommendations in terms of whether it be audio or video material or something to read or a mortgage broker, lender that we work with to have a conversation with to make sure that you can qualify or what your purchasing power is. There are things that are going to unfold naturally in that conversation.
I have some clients that are working on their credit score because of some issues that may have happened a few years ago. We keep in touch and every six months or a year, they tell me how things are going. We’re now at a point where we can start moving forward with something. Even if you’re not ready right now, feel free to contact us. We’re here to put you in touch with the right people so that way we can devise a plan for you. Even if you’re not ready right now, you can be very soon in the future.
A lot of people are going to have a lot of good takeaways from this. If you are already working with us, great. Stay in contact with your investment counselor. If you’re now thinking about taking the next step and you want to have a strategy session, get in touch with us. Go to the website, fill out the contact form and we’ll certainly connect you with our team. Other than that, Oliver, thanks for your time. This has been great.
It’s been great to be on the show. I look forward to the next one and also to meet any and all new clients here.
I know we’ve been very busy. 2018 was an incredible year. In 2019, we’ve experienced even more growth as you already know. As most people know, we’ve been honored to achieve a rank of 925 on the Inc. 5000. It’s an honor to be on the list. We’re looking to help more people. I know, Oliver is incredible at doing that. He’s incredibly smart investor and when you are talking to Oliver or anyone else on our team, for many people, it is a breath of fresh air because I’ve heard people say, “I’ve learned more in one hour on a phone call with an investment counselor than I did spending $40,000 on a particular bootcamp three-day real estate training.” That speaks volumes. I’m very proud to hear that stuff because it means that we have a great team. Oliver, thanks once again. For everybody else, if you haven’t subscribed to the show, please remember to subscribe. Help us spread the word. Visit us on iTunes or Google Play. Leave us a rating and a review if you can. Thanks and we’ll see you all on our next episode.
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