Purchased a 63 unit for $4,200

[Stewart Beal]

The Power of Real Estate & My Favorite Story From My Career: In 2008 the foreclosure crises was beginning and I started purchasing foreclosures in Ypsilanti, MI, I made an offer on just about every one that hit the market and I was on a roll. Back then, people would list distressed deals on craigslist so I would check craigslist every day and make offers on those as well. Eventually toward the middle of 2009 the deals on craigslist in MI were gone but craigslist had a feature that said here are some deals near you and there was a 63 unit apartment complex for sale for $630,000 in Toledo, OH. The price really excited me and I contacted the owner immediately who happened to be Fred Warner from California, a relative of the Warner brothers. I offered him full price which he accepted, he told me that Huntington Bank was going to foreclose on him if he didn't sell. I told him I wanted to take over his existing loan and he said sure so I approached Huntington, I met with the bank and they said I could take over the existing loan if I put up a $250,000 cash repair reserve which at the time I did not have, we went back and forth for a month but they refused to remove that requirement to the deal. I told Fred Warner and Huntington, sorry no deal, and I turned my attention to other deals. 3 months later I was in Lansing, MI looking at a deal when my phone rang, it was a banker from Huntington Bank, they said that they foreclosed on the property, they owned it, but they forgot to pay the water bill, the water was shut off and all of the residents were in the bank lobby screaming and yelling, Huntington Headquarters is within walking distance to the property. The banker said, look, if you go pay the water bill, you can come to the bank and pick up the deed to the property, the property will be yours. I called the water department, they said they would turn on the water for $4,200 so I drove from Lansing to my office in Ypsilanti and picked up a check, drove to the water department paid the $4,200, and then drove to the bank and they signed over the deed. And that is how I bought a 63 unit apartment complex for $4,200. The complex appraised for $1,800,000 in 2020.