All Forum Posts by: Adam Scheetz

@William Coet Apologies for the delay. My background is incredibly varied. I started in construction at a young age, developed a love for building, then joined the military, started a remodeling business while in the military, am now a military officer. Over the last 2-3 years though, I have really taken a liking to the investing side of real estate. I've developed a knack and liking to identifying trends in certain micro markets that help narrow investors desires to what is realistically available to them. In realizing what aggravates me and others as investors, I used that to analyze and present a product that allows out of state/country buyers to feel more comfortable with their decisions.  Warm and Fuzzies. Through all that, I continue to enjoy the cold calls, talking to strangers, eliciting information from them and identifying their house issues, and working to a solution. Sometimes that's a wholesale deal, sometimes that me handing them over to someone else to help, and occasionally I personally take action on the deal. Really depends. Being that I am at a distance for almost every deal or transaction I involve myself in, I have to capitalize on what I'm good at. Call me an assistant, Birddog, consultant, negotiator, partner, sounding board, or just someone to do the things no one else wants to do. I try to leverage these things to strengthen those I work with or groups I partner with. 

@Will Barnard I really appreciate that. Believe me, I like money- or at least the freedom it provides- and I certainly don't want to undershoot the mark. I think about it like dating, I don't want to ask to much from a relationship early on. But once it's apparent that my presence is a strong value-add to the group, I won't hesitate to ask for more. I also make that clear early on so that after a few deals there's no surprise when I up my stake. I really am thinking long-term here. $1500 per deal isn't sustainable- I agree. But showing that I am not after money but rather the groups longevity and success is. I think it ultimately comes down to the facts that I am 1) at a distance. 2) Have a small group that really wants me to work with them. 3) And because of the distance, I have to exploit the things I can do best and most effectively. You all rock!!

Thank You Very Much!!

@Will Barnard @Joe P and everyone else. Good insight and knowledge. I've definitely advocated for the partnership and that's seems to be where we settled. And to answer one of the questions. It was 1-3% of the before tax profit. If I only find the deal and put the pieces together then likely the 1-2%. If I do the negotiations, analyze the deal, schedule contractors, etc, etc, then of course I'd push north of the 3%.

The relationship is still young (less than a year) and I'm letting the deals strengthen it. Later on once repeatable systems and people are in place will be the time for negotiating. I'm thinking long term growth versus quick profit.

Thanks again for your thoughts.

@Robert White so that was my recommendation. 1-3% depending on the level of involvement for the particular deal. The real struggle is the intangible items outside of the actual deal.

Personally, I like the idea of advocating for the higher percentage because of these intangibles I provide to strengthen the process and business.

Good Day Everybody,

Before I ask my question, I’m going to provide some context so hopefully what I ask makes sense.

I was asked to be a part of a team that flips single-family residential properties in the Atlanta market. We have myself, a local agent, a general contractor, and two private equity investors who put the money in.

I have officially labeled myself as the GSD engineer. GSD stands for Get Stuff Done. And honestly that is what I do- I get stuff done. I help the agent track down deals, I generate call list as well as Cold Call sellers, I find and vett subcontractors with the GC, I research and analyze particular markets as well as specific micro areas within those markets to see what strategy is best to employ, I collaborate on strategies and systems to implement to make processes easier, I also network and put people together. By the way I do all this remotely from a distance.

Okay, here comes the dilemma.

My partners that I work with appreciate my effort and believe my time is valuable, which I would agree. My problem, Albeit a good one, is that they want to ensure that I am compensated for the time that I spend doing all these tasks. I like making money just as much as the next person, but I am under the mindset that I want to be paid when the fruits of my labor or realized- as in a deal is completed or we go to closing. Something doesn’t sit right with me about being paid for work when the end product is not yet realized.

Am I crazy or should I let them pay me even when results may or may not be correlated with that pay? How would you value your time and the situation?

I look forward to your input?

@Darla Smith most normal jobs your boss will be hesitant to pay you for work you haven't done. Usually you WORK to get paid, not get PAID so you then do work. To each their own I suppose. Contractors I speak with are pretty accepting of getting paid based on the SOW laid out at the onset of the deal. Best of luck

@Brandon Eten I partner with Gary. Shoot me a DM

One of the recent BP Podcasts I listened to made mention of a huge selling point that the guest used a lot. He said that when sellers say they want 2%, 5%, Etc, in interest on their seller financing, he reminds them that income received from principal payments on a seller financing deal is taxed at a lower rate that interest payments received. These have to be seperated when filing taxes. The benefit to the seller of foregoing the interest payments and doing just principal are significant because they save money on the back end when they file.

Thoughts?

@Tony Marcelle is your lawyer well versed in real estate investing? Having a tenant buyer leave can actually be a great opportunity. Here's why;

1. You use your processes to find and qualify another buyer and secure ANOTHER non/refundable option fee. That's two paydays just because of the option fee. Also, that option fee can eaisly cover several months of rent you are "on the hook" for.

2. You've been paying down the principal owed to your seller, you can renegotiate, change the terms with the next tenant buyer, or sell your asset "The option". Either way the original seller is still taken care of.

3. Because your paying down the principal owed to your seller, any rental spread from the buyer and seller agreement is still yours to keep and the previous buyer forfeited that when they left the deal.

If you structure a cushion in your deal such as a 36 month lease with the seller and a 12-18 month lease with the buyer, there's plenty of room to be safe.

If your lawyer is a good real estate attorney he should have told you this and seen dollar signs flashing from the opportunity to be involved.

@Justin Foster it's July 2019. His group corrals large pools of budding entrepreneurs and inexperienced investors with deep pockets from Israel and floods target markets. The result is not true competition but rather agents busting their butt only to be repeatedly shorted my their "foreign investor" who don't follow through. They artificially drive good deals to a highest and best offer based on analysis that is shallow at best and straight up baseless at worst. Even when you try to network they want your help but don't pony up when a deal that matches their criteria comes to them. Inexperience is fine, encouraged, and even expected. But when 30 investors flood one minor market with no real game plan other than "Try this place", it throws a big freaking wrench in the mix.

Thank you so much to all the replies. As I expected, some people who were far more knowledgeable provided some great info!