REI Talk Detroit | Weekly News and Interviews With Active Real Estate Investors in Metro Detroit, Michigan - REITD 005 - Mike Simmons - Landlord, Flipper, Podcaster and Coach

REITD 005 - Mike Simmons - Landlord, Flipper, Podcaster and Coach

06/04/14 • 52 min

REI Talk Detroit | Weekly News and Interviews With Active Real Estate Investors in Metro Detroit, Michigan

In this episode I interview Mike Simmons. Mike is a landlord, a flipper, a podcaster, and he coaches new investors on how to get started in real estate.

Mike's husband and father of three. He, along with his wife Nanette, started flipping houses here in metro Detroit back in 2008. He's been successfully flipping houses in Metro Detroit ever since. In November of 2013, Mike started a podcast call "Just Start Real Estate", with the goal of helping new real estate investors "Just Start" their real estate investing business. Mike also recently launched a coaching program which helps him work more closely with investors who want to either launch their real estate business, or take it to the next level!

REI News

One REI news item this week - and it’s a serious one.

It looks like the Fair Housing commissions across the country are stepping up their prosecution of of fair housing violations. If you are a landlord - I strongly encourage you to read the two articles that I saw on this, then do an internal review of your process and policies to make sure that you are 100% in compliance with fair housing laws. This is critical, because one of the guys that was prosecuted recently and fined $36k was investigated simply because he didn’t return a call from a renter prospect.

You can find both articles and my blog posts that go with them at dennisfassett.com

Again - if you own rental properties or you’d like to, these articles are a must for you. I’ll put a link in the show notes, which you can reach at REITalkDetroit.com/5

And I want to remind you that I’m still looking to put a group of folks together to do some decent volume of suburban turn key properties for a couple of hedge funds that called me.

So if you’d like to participate with funding deals, or if you can do some volume in the suburbs (not including cities like Pontiac or Inkster) then drop me a line at REITalkDetroit.com/contact and let’s talk.

And if you have a news item to contribute or an event coming up, drop me a line and I’ll get it on the show.

Current BusinessMike and I have been friends since we met something like 6-7 years ago when we were both members of Mark Ijlal’s mastermind. He’s an unassuming guy who has quietly focused on building his business over the last several years, starting with a disastrous rental and his first stressful flip.

Now several years later he’s still doing flips. But he’s also now doing his own podcast, and he’s teaching new investors how to get started on the right track with real estate investing. If what he’s doing is of interest, then drop him a line. His contact information is below.

How He Got Started in REI

Mike got started accidentally when he married Nanette and decided to rent out his under-water house. Despite the somewhat bad experience he had with it, he realized that his retirement plan was't looking so hot, and when he looked around for a way to invest, real estate really appealed to him. He attended a couple of seminars, then took the plunge and did his first flip. He hit a home run with it, and learned some valuable lessons as well, so at that point he was hooked. He continues to do flips, and he's in the process of getting into rental houses, because it's a great way to build passive income.

Biggest Mistake

Mike says that his biggest mistake was not checking out the contractor he hired to do his first flip. The guy hi hired stiffed the electrical contractor, who then demanded payment or else he was going to put a lien on the house. They worked it out, and now he always gets a release of lien from everyone who works on the house before he makes his final payment.

Biggest Success

He says that his biggest success was starting out on his first deal by documenting everything on his Facebook fan page. He posted videos and pictures during every step of the process, and by doing that he garnered a lot of interest from other investors and, most importantly, private lenders. Because he built a track record that was visible, several private lenders asked to do business with him. And he continues to do business with them now.

Money Talks

Mike is exclusively using private lenders to fund his deals. He's been doing the standard 50-50 split with them, but now that he has attracted additional lenders through his investing and his podcast, he's started to keep a higher percentage of the deals himself. He also explained how he structures the deals with his private lenders during our conversation.

Answer to Listener Question

The question that I asked Mike was “Since you coach a lot of new real estate investors, what's the question that you get most often from them?”

This was an interesting discussion, because he said that the majority of the questions he gets are pretty basic. But the one thing he emphasizes to new folks is FOCUS, in that if you want to do flips, fo...

In this episode I interview Mike Simmons. Mike is a landlord, a flipper, a podcaster, and he coaches new investors on how to get started in real estate.

REI News

One REI news item this week - and it’s a serious one.

You can find both articles and my blog posts that go with them at dennisfassett.com

Again - if you own rental properties or you’d like to, these articles are a must for you. I’ll put a link in the show notes, which you can reach at REITalkDetroit.com/5

And I want to remind you that I’m still looking to put a group of folks together to do some decent volume of suburban turn key properties for a couple of hedge funds that called me.

And if you have a news item to contribute or an event coming up, drop me a line and I’ll get it on the show.

How He Got Started in REI

Biggest Mistake

Biggest Success

Money Talks

Answer to Listener Question

The question that I asked Mike was “Since you coach a lot of new real estate investors, what's the question that you get most often from them?”

Previous Episode

REITD 004 - Trent Dalrymple - Former Hard Money Lender Turned Real Estate Investor

In this episode I interview Trent Dalrymple, former Hard Money Lender turned Real Estate Investor.

Trent’s story is inspiring. He was cursing along with a profitable lending business when the government jumped in and changed the rules. Overnight he had to switch gears and find another way to earn a living. And he did. We talk about what he experienced and what he did about it during our conversation.

REI News

No local REI News to report this week.

Just a reminder though that I’m still looking to put a group of folks together to do some decent volume of suburban turn key properties for a couple of hedge funds that called me.

So if you’d like to participate with funding deals, or if you can do some volume in the suburbs (not including cities like Pontiac or Inkster) then go to the contact page http://www.REITalkDetroit.com/contact and let’s talk.

And if you have a news item to contribute or an event coming up, drop me a line and I’ll get it on the show.

Current Business

Trent is now on the investing side of the business instead of the lending side.

Because good numbers are hard to come by with straight rehabs, he’s primarily focusing on doing straight new builds in Birmingham and Royal Oak. He has a pretty cool business model where he has licensed contractors bringing him deals and doing the work. He has one property on the market, two nearing completion, and he closed on the purchase of a new property a coupe of weeks ago. He’s busy.

It’s a unique and pretty simple business model as well - if you’re interested in how it works then this episode is for you.

Also - because the new build business is highly capital intensive, and because he’d like to do more of them, Trent is also looking for additional finding sources. If what he’s doing is of interest, then drop him a line. His contact information is below.

How He Got Started in REI

Trent started his career as a radio DJ. He was "spinning records" on the radio in Southern California in the 80’s! Once he got married he realized that he’d need to do something more substantial to support his family. He started on the retail agent side like many do, and got frustrated with it.

So he jumped over to the lending side. He did that for a while in California then he moved his family back to Michigan. When the lender he was working for went out of business during the crash, he and one of his former money partners decided to start their own Hard Money lending business. He did that until the Dodd-Frank legislation put him out of business as a lender.

Biggest Mistake

Trent says that his biggest mistake was not trusting his gut instincts with some of the folks that wanted to do hard money loans with him. He tells the story of how he made a loan even though his gut told him there would be issues. And sure enough the borrower was a problem from the start is is presently in foreclosure.

Biggest Success

He says that he particularly proud of two things. First, that his business is going so well now and that he enjoys it so much. The second is that he won a sales contest to sell a premium mobile home back in the 80’s which lead to a nice bonus check but also a lot of new business selling additional models of the premium home that he had sold.

Money Talks

He has numerous sources of capital, which you’d expect from someone who spent so much time with private lenders in the past. At present he’s using family money and partner money to fund his deals. Nothing really fancy - but Trent is yet another example of someone who has spent a lot of time cultivating respect and a solid reputation, which in turn makes it really easy to attract investment capital.

Answer to Listener Question

The question that I asked Trent was “How do you go about delegating and outsourcing work in your investing business?" And as a follow up, "How do you keep track of the work that you delegate?”

Trent is like most investors in that he knows that he need to keep up on what’s happening in his business. So he’s starting small by delegating some of the tracking and office work. Because he wants to grow his business and do more deals, he thinks that delegating might take the form of having someone visit in-flight projects and take extensive video and picture to document progress.

Links and Resources

Trent’s looking for three things:

Licensed contractors with deals
Additional sources of funding
Deals! Particularly in Birmingham and Royal Oak

If you’d like to talk to Trent about any of these, or if you have questions for him, you can reach him via email at [email protected].

He also has three new build projects that are completed or near it. They are:

...

Next Episode

REITD 006 - Allan Daniels - Third Generation Real Estate Investor

In this episode I talk to Allan Daniels. He’s a third generation real estate investor here in Metro Detroit. We talk about his family real estate business, his really cool perspective on making mistakes in your business, how he’s funding his deals, and his pretty black and white take on Dodd Frank. REI News Six news items to report today: First - crowdfunding is coming to real estate investing in michigan. Stay tuned for more information on this. It could absolutely change the way you do business. Second - my new friend Aaron Yates passed his builder’s license exam last week. So if you see him around, or run into him on social media tell him congrats! He’s going open a rehab business shortly as well. I did an interview with him that will air in the next week or so with all the details. But in the mean time you can find him on facebook at https://www.facebook.com/CkiProperties. Third - it looks like Detroit is now on the map. I received yet another request this week for bulk rentable properties. This time in the city of Detroit. So that makes two groups looking in the suburbs and one in the city. If you’d like to get together on one of these drop me a line at REITalkDetroit.com/contact. Fourth - Allan Daniels, my guest today, is scheduled to present two continuing education courses at the North Oakland County Board Of Realtors; one on June 25th at 10am and the other on July 30th, both at 10am. Here are the details: Hardcore Regulations: Uncovering Dodd-Frank 2-hour Michigan Real Estate Continuing Education (legal course M5750) Two Dates: June 25, 2014, 10am – 12 Noon July 30, 2014, 10am – 12 Noon Location: 4400 W. Walton Blvd., Waterford, MI 48329 To register call 248-674-4080, or email: [email protected] Fifth - I’ve kicked off my six week REI Quick Start coaching program. If you’re new to real estate investing or you’re frustrated by your lack of progress, then this might be for you. Part of the program involves walking you through - and giving you access to - my source of leads. The source I’ve used for over ten years now with GREAT success. Get more information at REITalkDetroit.com/coach. Sixth - the June Metro Detroit Real Estate Investors Meetup is tonight at Champps on Big Beaver in Troy. This is the meet up that’s being coordinated by Aaron Yates and Tom Auterman. You can find more information in the show notes at http://www.REITalkDetroit.com/6. And if you have a news item to contribute or an event coming up, drop me a line and I’ll get it on the show. Current Business While Dodd Frank has impacted the land contract portion of Allan’s business, the rest of the business is still going strong. They are doing conservative loans to professional landlords, they do occasional REOs, they are looking at commercial deals, and they are still making business loans. How He Got Started in REI Allan’s grandfather started the business several decades ago. His father then took the reins. Allan earned a degree from UM and had planned to get a day job, but when an offer he had been promised never actually materialized, he decided to go into business with his father. It ended up working out well, and Allan and his father are still in business together. Biggest Mistake I like Allan’s perspective on this - he characterizes mistakes or failures as “seminars”, which makes a lot of sense if you learn from them! He says that his biggest mistake, or seminar, was early on in his career when he got a little emotional about a deal and dug his heels in and wouldn’t budge on the terms he had negotiated. Lawyers got involved, and thousands of dollars were spent on both sides over what ended up being a difference of a couple of hundred dollars. He learned a good lesson that day that he has carried with him since. And the lesson is to not get emotionally involved in a deal. Biggest Success He says that he particularly proud of a deal where through financing a mortgage he helped a couple save their home from foreclosure. They were so happy and thankful that they brought a cake to the closing. And to top it off the note has performed extremely well over the years. Money Talks Allan’s real estate business exclusively uses family money. At present he’s not looking for additional sources of capital. Answer to Listener Question The question that I asked Allan was “They gurus are always saying that there are loopholes in Dodd-Frank that will let someone do land contract financing like they did before. Is there a loophole in the law that allows that?” The simple answer is - NO. There is no loophole. And trying to circumvent the law is a felony punishable by hard time in the gray bar hotel. Links and Resources Allan is looking for or is offering several things: 1. He;s looking for good deals to finance with professional landlords - 50% LTV, 1st Lien, etc 2....