Millionaire in the Making – Vickie Haberbosch and Alex Mora

Alex and I started our real estate business prior to attending a Ron LeGrand summit. I attended the summit in July 2017 by accident. It turned out to be a great accident to have!!!

I signed up for coaching at that time because it was obvious we were buying properties the wrong way.

Our coaching with Barbara LeGrand, Ron’s sister, started in October 2017.

The first deal we put on the table with her turned out to be a bust, but a bust that was in our best interest. The closing attorney, at the last minute, came back and said that if we wanted to put the property in a land trust, we would have to pay her $5,000 to set up the trust and almost $2,000 in other closing costs and fees. Barbara advised us that these expenses were not only significantly inflated, they were not even necessary. We did tell the attorney that we had our own trust forms, but she did not want to use them. We passed on the attorney’s suggestion.

We live in a small, rural area, and there are very few “real estate” attorneys to choose from. We saved about $7,000 in legal expenses. A few hours before we were to close on this deal, using another attorney who charged us $250, the deal fell through. We were out a couple hundred dollars, not $7,000 like we would have been. And it turned out that this deal would have used up too much capital on the front end, something Barbara advised us of, so it worked in our favor. At the last minute, the spouse of the seller tried to squeeze us for some more cash; it was tempting because we had a good plan for this house, but we also remembered Barbara advising us that we were already on the top end of cash for the deal. This was a deal that went late into the evening before Thanksgiving, and Barbara was still responding to our emails as it was deteriorating, encouraging us that there are other deals and we did not have to force this one. It felt really good to have an experienced coach at our side when a deal was not going well. That house, to this day, still sits empty. If we had proceeded as we would have without Barbara’s involvement, we would have been financially hurt.

We were able to use that cash to get two more deals within the next few weeks.

The second deal we put on the table turned out to be a winner. We bought a small 2/1 in a quiet, rural town for $30,000, with $6,000 at closing, $24,000 financed by the seller at zero – yes, that’s right – zero percent interest with $850 in total closing costs, including prorated taxes. We put $8,000 in repairs to the house. We put the house on Facebook for $59,900 and currently have an application on it for $3,000 down with a two-year lease option at $600 per month. Our cash flow in the first five years, if we are not cashed out sooner, will be $200 per month. But the best part is we bought the house correctly for the first time and used less capital. The closing agent asked the seller if he had any more properties he would like to sell! What she did not know is we had previously asked the seller the same question!

A week later, we bought a small efficiency apartment for $500. We put $7,500 into moving it to our property, and we will collect $450 a month in rent. The apartment will pay for itself in a year and a half.

If we had followed through with the first deal, we would not have had the cash to use for the next deals, that have better financials.

We found that coaching with Barbara really helped us fine-tune the following:

1. Let the numbers speak for themselves. If it makes sense, proceed. If not, move on and move on quickly.
2. Always market.
3. The best quote of Ron LeGrand’s that we use over and over: “Is that the best you can do?”
4. Keep negotiating. Until one party says “no,” keep negotiating if there’s promise.
5. Use social media not only to sell your properties but also to buy them, even if the seller is also real estate investor. Don’t shy away from real estate investors. Let the numbers do the talking.
6. The concept of “Subject To” needs to be explained, and explained again, and reinforced, and explained as if you were explaining it to a second grader without being insulting, and then have the seller explain it to you! You may as well get the entire community around a campfire and sing a song or two, because this concept is difficult for most to comprehend. It’s actually an easy concept for us, but our handful of sellers simply did not get it the first and second time around.
7. Coaching not only helps you make good choices, but it also helps you avoid catastrophic mistakes.
8. Make sure you have all the parties involved, even if they are not legally on the documents. For an elderly lady, her kids are going to have their say, so you may as well get them involved on the front end and save yourself some aggravation. For a spouse, have the other spouse involved even if s/he has no legal interest in the property. When in doubt, if Santa wants to join in, let him. If you don’t, he will have plenty to say to the sellers or buyers when you are not around and cannot address the concern.