All Forum Posts by: Johnny Kang

Hey @Frank Chin, I'm in the process of looking at buying a business. 

Which metric did you use, and in what multiples to determine how much you were willing to pay? 

I've started businesses before, but never sold/bought one.

@Keith Vincent

In NYC, all tax liens are sold to just 1 authorized party. (what monopoly?)

NYC Tax Lien Sale

@Brett K.

Not really a matter of how big/small the contact list is, as much as it is how frequently that data changes, or how many data sets someone is trying to piece together. 

Generally speaking, the more dynamic the data, you'll lean more towards a database. 

If it's more static, spreadsheet makes more sense. 

This is the reason why it's not a big topic, since most ppl are using information from a sole user's perspective without too many moving pieces; data providers being on the flip side.  

@Gary B.

Yeah, you can tell where the fire started. 

You have damage all throughout the kitchen; cabinets, floor, wall, behind the wall, ceiling, can't use the appliances, not to mention the smell of smoke that's permeated throughout. 

Fire damage is not only limited to things you can physically see; it's also things you can't see. Aside from that, what are you gonna do, replace 10 sq ft of the physically affected areas? You have to replace everything.  

I would find a Public Adjuster & a Restoration specialist (just Google a few). Although the PA will know the process, Restoration company will know things more in detail, since they're the ones doing the manual labor part, and often times can point out things missed by the PA or the insurance adjuster. 

@Gary B.

How extensive is the damage? Do you have pics you can share? 

I've been to many fire damaged properties, and aside from the physical damage caused by fire, you have the smell of smoke to deal with, and that may include the contents, cabinets, walls, floor, window frames, etc. 

Without seeing any pictures, my guess is, if the fire department said it's not habitable, there's enough restoration work that needs to be done and filing a claim with your insurance company alone is not enough. You need to get a Public Adjuster to represent you, advocating on your behalf. 

Also, find a fire damage restoration company, that also does the renovation themselves (the term they'll use is "rebuild" or "recon"). 

Restoration company will use Xactimate and submit the scope of work, line item by line item, including any work required to test and remediate asbestos/lead paint (most likely, they'll hire a 3rd party specialist to handle that), coordinate things with your Public Adjuster, and your PA will liaison between yourself and the insurance company's adjuster (the insurance adjuster has the insurance company's interest in mind, not yours, so don't think the amount they quoted you is what you'll be entitled to on the claim). 

Plus, during the restoration/renovation process, if unforeseen things are discovered, they'll submit a supplemental claim to account for any additional cost. (Believe me, you're not going to do all this on your own, nor would you want to.) 

Your PA can also allot for loss rent. 

So although initially this may seem like a set back, if you do it right, you'll end up with a brand new kitchen redone up to code, get your lost rent paid back from the insurance.  

@Robert E lunt

Sorry, I didn't get your tag notification till today.  

Ok so a few things:

- VAs are good when you want them to do mundane tasks (data entry), you can even have them do cold calls for you, but you need to give them a script with answers to objections built in. From my experience, it's harder to teach them to do valuation, or something that requires a bit more thinking process. You can give a general matrix of criteria you want them to use in filtering, but anything more granular, I would look them up myself. 

- Since all the tasks I assign to them are done on the computer [even the cold caller is using everything cloud based (auto-dialer, CRM)], I just make screen capture videos on various tasks, using Filmora (free version allows screen recording). Each task should be its own separate video (5-10 min. Sometimes longer). 

I have one set of videos for my admin VA (which has about 25 videos) and another set of videos for cold callers (about 20 videos, along with actual live recordings of me making calls, overcoming objections, setting appointments etc).

- Along with these videos, I have things in document format in Google Drive. It's not a transcript; just necessary supporting documents to the specific task I want them to do (i.e. cold calling script to accompany the video/audio on making calls).  

- Your craigslist ads will get flagged; A LOT. You just have to keep posting. I recommend creating a google form where you have candidates fill that out. This is your first line of candidate filtering. I would have questions on the form, and have them send me a video about their experience level, sample screen shot of their previous work. 

- I started my Admin VA from $3/hr (I think). Over time, I gave her additional hours, then later, a bit more pay, with bonus built in. Cold caller, I start them at $5/hr with bonus incentives.

Don't overwhelm yourself, thinking you have to do all this in 1 sitting. I only put together a few task topics at a time, as they became more skilled. Once you have a few moving parts in place, it runs without your involvement. I keep in touch with my VAs, maybe 3, 4 times a week on Google Hangouts for a few min. 

@Mark W Carpenter

I hear ya; been there.

Main issue isn't competition. It's the list itself. All the usual list everyone tries to target (Absentee, pre-foreclosure, tax delinquent, code violation, probate) only assumes motivation, so ppl are hoping they find an owner who are motivated to sell, spending hundreds/thousands of dollars every month. 

Everybody's busy trying to figure out the "best marketing method"; how the font should look, what color envelop to use, whether to do voicemail drops, cold call, or if it's online marketing, how to do a proper PPC campaign, optimize their site for SEO purposes, etc. At my peak, I spent $28,000/yr on yellow letter marketing. 

Even if you had zero competition in your market, out of the, let's say 1000 ppl you market to, only a small percentage of ppl are ready to do something with their property. 

Compare that to owners who just had fire. The incident just made them motivated to do something with their property. 

There are 5 exit strategies with fire damaged properties:

1) Fix & Flip

2) Develop

3) Assignment of contract

4) Restoration & Renovation Job

5) Refer out Restoration/Renovation Job

This was why I started getting into this niche, and figured out how to aggregate info on properties that were having fires, real time. 

I would skip trace, and call them. My ratios went from sending out about 2000~25000 letters/mth to get 1-2% response rate, to calling up fire damaged property owners, talking to 10 and getting 1-3 actual appointments. I was able to repeat these ratios, not cuz of how good I was on the phone, but because of the type of owners I was targeting. 

This is an actual list of properties in NYC that had fire. What percentage of those owners were motivated to do something? 99%. 

(Moderator Note: Image removed for addresses.)

It's like having a mechanic shop, where I was having 60, 70, 80 cars that just happen to have a flat tire as they were driving by my shop. Not a hard sell when the need is there, and it's an immediate need. 

I can go anywhere in the country call these ppl and get appointments within a day or two. (I compile this data in about 40 cities, getting ready to roll out nationwide coverage). I don't have to wait to perfect my direct mail campaign, optimize my site for SEO, etc.

@Ron S.

The law changed on 11/28/2016. https://www.irs.gov/irb/2016-48_IRB

Section: T.D. 9793

@JJ O. , @Jeremy VanDelinder

This might help; https://www.uphelp.org/pubs/getting-your-mortgage-...

Basically, whether you decide to fix it up, or sell, getting escrow funds released is not something you have to worry about, but if you decide to fix, proceeds goes from your insurance company to your mortgage company, and they'll issue checks to your licensed GC, so "profiting" from insurance proceeds is not something that can happen "on paper." (do ppl come up with creative ways to do it?; yes, but if you're going to rehab your property, you know what my answer would be). 

Whichever way you decide to go, you have to make sure you have a Public Adjuster on your side, so they can be your advocate in getting the most from your claim, as well as a good restoration company that also does the rehab, so they can point out all the things needed to bring the property back to a habitable condition & the cost (the need for these ppl also applies, even if you're going to sell, since you'll need to know what the proceeds will be). These 2 parties have to work in conjunction to aid you in reaching your desired result on your claim. 

@David Wright is correct. Posting it on CL, you'll get a decent amount of replies from investors.  

@JJ O.

This is a niche I was kinda "forced" to get into, after spending a decent amount of money on direct mail. 

If you're looking to sell, your best bet is to find either; 

1) Fire Damage Restoration companies, that also do rehabs (the lingo restoration companies use will be either "rebuilds," or "recons"). Companies that do both are hard to find (operationally they're set up differently, and margins differ as well), which is why most restoration companies usually don't do both. 

2) Find an investor who has experience in this space. 

Don't do an AOB (Assignment of Benefit).