Jason Hartman plays a Flash Back Friday episode originally aired on Creating Wealth Episode 514. He starts the show by reading a letter from a client that discussed a great experience during the Memphis Property Tour. Later he introduces one of the network’s clients’, Philip. He discusses his real estate journey and portfolio. Philip explains how when he started he was hard-money lending. He gives us insight into some mistakes he has made along the way and some key lessons he’s learned.
This show is produced by the Hartman media company. For more information and links to all our great podcasts visit Hartman media.com.
Welcome to this week’s edition of flashback Friday, your opportunity to get some good review by listening to episodes from the past that Jason is handpicked to help you today in the present, and propel you into the future. Enjoy.
Welcome to the creating wealth show with Jason Hartman. You’re about to learn a new slant on investing some exciting techniques and fresh new approaches to the world’s most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine self made multi millionaire who’s actually been there and done it. He’s a successful investor, lender, developer and entrepreneur who’s owned properties in 11 states had hundreds of tenants and been involved in thousands of real estate transactions. This program will help you follow in Jason’s footsteps on the road to your financial independence day. You really can do it. And now here’s your host, Jason Hartman with the complete solution for real estate investors.
Jason Hartman 1:15
We have got a great story a case study, in an interview with our client who’s been a client of ours for many years. His name is Philip Sullivan. And he’s just a great guy and you’re going to hear his story. Quite literally, I think this is fair to say it is a rags to riches story. He has done an incredible job investing, starting out really just kind of looking dreaming wanting to get into this game, and he’s just done a fantastic job at it. You’re going to hear his story firsthand here in just a few minutes. A couple things. First of all, I really really appreciate listener engagement. So I love that we love to get emails from you. We love to get reviews on it. tunes and Stitcher Radio, of course, you know, we just appreciate engagement. So thank you for that. However, I do have a request. But first before I make my request, I will make a confession to you. I cannot type very fast I use the the hunt and peck method of typing. It’s been a really a huge handicap in life. Gosh, should I even admit this? I will. in eighth grade, we had electives. And one of the electives you could you know, you could choose for electives or the way my school worked in Los Angeles, California. You could choose for electives, and that throughout the school year, and they’d be you know, what, eight weeks each or something like that. Typing was an elective, and I took typing class, and I dropped out being an
Jason Hartman 2:49
idiot, because I thought that well, typing is for secretaries and I’m not gonna be a secretary. But little did I know, typing would be a very much in Man skill as the computer revolution took over. So yes, I am showing my age. Of course, you know, we had computers at my school, but not many people use them. I didn’t really use them. Yeah typing, I dropped out of typing class like a fool like a moron. Ever since then it’s been a huge handicap. In fact, I will bet you If I knew how to type Well, I probably would have earned a couple million extra dollars by now. Little design, no email would dominate the world and boy, it’s a huge handicap. It really is not being able to type well, and I do use dictation and I like it pretty well. However, if you’re using dictation on your smartphone, I use it on my iPhone or on your computer. I use it on my Mac. I gotta tell you something. You could really ruin a relationship with that dictation stuff. If you don’t look carefully, and I don’t always look carefully when I dictate things because it comes pletely misconstrues words and meaning sometimes. So, hopefully that will evolve and get better and better. So my request for you is this, instead of sending me an email, please go to Jason Hartman calm, or if you’re listening to not the creating wealth show and one of the other shows, say, for example, the show’s ever rebroadcast on another one of my shows, you can go to Hartman media.com, where all of my shows are either one either website doesn’t matter. And use the little send voicemail feature, it is super easy to use, and send me a voicemail that I can play on the air. And you know, it’s just rather than email me reading an email and then these issues are pretty complex. A lot of these questions that that you asked, it’s much more lively and better for the show. If the listeners hear it with your own voice and your own inflection. The meaning has a multi dimensional aspect to it It when it is voice rather than the written word. Please send me your questions. I love your questions. I appreciate your questions. I appreciate your comments so much. And please use the voicemail feature many of you have. And I just want to remind you, please do it that way. Okay. Also, you can schedule an appointment with me at Jason Hartman comm slash Jason, as a caller to call into the show, really, if we are able to have a dialogue. That’s the best form if you have a complex question, because anytime you ask a question, I may need to ask you a question. And we may need to drill down on a point further than we can in a asynchronous non real time type of format, where it’s either a voicemail or an email, but again, voicemail is preferred. Please leave your voicemails there, or schedule an appointment, call into the show and we’ll talk real time and I can answer your questions there. So that would be great if you use that awesome little feature. Well, I am off to Europe here in a couple of days. I am going to a conference there. And I’m also going to have a little fun little vacation time. Of course, I’ve been to Europe many times on this trip. I’m going to England, I’ve been to England before, so I’m not going to be able to claim another country stamp in the passport. I’m going to Croatia. And there are a couple of years ago as you heard on the show, but I think this time, I will get to at least one new country that will be Ireland possibly have not been to Ireland. There are a couple of countries around Croatia that I can probably visit to. So you know, want to get another stamp in the passport and be able to say instead of I’ve only been to 74 countries. Yeah, I know only that’s kind of a ridiculous statement. Maybe I’ll be back in a couple of weeks and I’ll be able to tell you, I’ve been there 76 or 77 countries who knows we shall see we shall see So I will be broadcasting from my Europe trip and telling you about some of the insights. I always love to get some real estate insights from these markets, as I did a lot a couple of years ago when I was in Croatia, Spain, a couple other countries talked a lot about that in the show and in thought it was pretty relevant and fascinating versus what we’re facing today in the US good perspective on investing. And so look for that. upcoming episodes. We’ve got some fantastic upcoming episodes. Some more case studies, like today’s episode, some more interviews with clients, just some great stuff. And that leads me to I want to make an invitation, Gary, I’m not gonna mention your last name. But Gary, you’re listening. I would like to invite you to be on the show. I want to read a little share a little note that you sent me about the Memphis property tour and thank you so much for your kind words and sending this note I just thought it was really good. I wanted to share it with the listeners, but I’d love to have you on the show as well. And I’m not sure if you’ve been on before. Maybe you have I can’t I just can’t remember. You know, we’ve only got like 500 and some odd episodes behind us. So it’s hard to remember all of them, even as I am the one recording them. But this note you sent me a few days ago about the Memphis property tour. It said, Jason, I had a great time last weekend, I always get motivated to get back on track with investing when I attend your events, so easy to get distracted with the other demands of life, my favorites, getting to know the two providers in other words, our local market specialist, the ultimate reason for going and it was more than achieved. Graceland. I have to admit I thought it was going to be extremely cheesy. And I’m Graceland of course is Elvis’s home that he’s talking about. But I was blown away. It was a spiritual experience walking through that mansion, immersed in his Elvis Presley’s life with my iPad storyteller. I had no idea how dedicated he was to philanthropy, and to being together with friends and family, enjoying life. Truly inspirational and a complete shock for me. Really enjoyed sharing the bus with your mom and reliving Elvis’s era through her eyes. What a gem Your mom is. And by the way, it happens to be Mother’s Day. So thank you, Gary. That’s a great thing to say and Happy Mother’s Day to all those moms who are listening, eating barbeque, my favorite in a car museum. My favorite could not have been better spending time learning from Fernando. What inspirational and giving individual By the way, Gary, I got to say so true. Fernando has been a wonderful client and a wonderful addition to our team. We’re so happy to have them, hearing the investing stories of others.
Jason Hartman 9:45
It is really helpful in keeping all the bumps of rental property investing in perspective, when you are reminded that it is not just your world, where evictions, leaky roofs and property damage occur. Thanks again, you provide an incredibly valuable service. Gary, Gary, thank you so much for the kind words and the nice note, really appreciate it. You know, folks, I just cannot stress enough. I know we’ve got thousands of people listening, and millions and millions of downloads of the show, and people in 164 countries around the world listening to this show, whatever you can do, you know, we’ve had clients fly in from Asia, Europe, South America, just all many places around the world to our events. Please make it a priority to attend one of our live events. Come and meet me in person, meet our team in person. And most of all, meet our clients, meet our clients, hear from their stories, hear from them, directly hear about their experiences, their triumphs, their tragedies, you know, this is hardly perfect. We have ups we have downs, but overall, the trajectory is up, because income property is the most historically proven asset class in America, if not the entire world. I’m just gonna start saying it’s the most historically proven asset class in the entire world. Because I think it is I’m pretty sure it is. And if anyone disagrees with me, call into the show, and let’s talk about that topic, because I’d love to hear some opposing viewpoints on it. But anyway, without further ado, go to Jason hartman.com. Check out upcoming events, check out the properties, check out the home study courses. There’s some great stuff there become a member so you can get on our monthly members only calls with Jason Hartman University. There’s just a lot of great stuff at the website. So that’s Jason Hartman calm. And without further ado, let’s hear from our client. A great story from Phillip Sullivan. Here we go. Hey, it’s my pleasure to welcome one of our clients to the show, and that is Mr. Phillip Sullivan. Remember, you’re listening to flashback Friday. New episodes are published every Monday and Wednesday. I met him several years ago, he was a podcast listener and came to one of our events in Southern California. And he’s just got an awesome story. And I gotta tell you, listeners and Philip, this is way overdue. We should have had him on the show a long time ago. Many of you have met Philip at our events before he was at the last meet meet the Masters event that we had in January. And you know, he’s just a great guy, and he’s got a great story. So, Philip, welcome. How you doing?
Hey, Jason, how are you?
Jason Hartman 12:31
Good, good. It’s a it’s great to have you on the show. Like I said it. This is long overdue. We should have done this. Two, three years ago.
I think I was The Reluctant podcaster. So
Jason Hartman 12:40
You were a little reluctant. I had to twist your arm a little bit, but I just hit you up today and sent you a note and you said yes. So I thought let’s do this. This is awesome. Well, a, you got a really great story. And I just wanted you to maybe take the listeners through it and let’s talk about some of the tips and tricks that you know you’ve learned over time. Yours as an investor and stuff like that. So it all started with you found my podcast right? Tell us tell us how it evolved.
Yeah, I discovered your podcast. I think back in the winter of oh seven so right before the crash and and so I started listening I think in December in a series I heard it I was like, Man, it’s good. So I I just started going through all of them and I’ve actually heard all of your podcasts every single one of them. Yeah, I think so. Wow.
Jason Hartman 13:33
So you 2000 2007 and you found you just what did you do find the podcast on iTunes just searching real estate investing or
no? What’s your first event in I think 2008 I think and and yeah, I went there to your crazy wealth. Show there and didn’t didn’t invest for a little while. Because with my work, I fix Hail Damage car. So I tried travel all over the US. So it was kind of hard for me to, you know, think about investing in real estate while I was traveling. So then I started thinking about hard money lending. And so I started doing that with your Georgia provider. In 2012, the 2011 Yeah, this fall oil. Right.
Jason Hartman 14:20
And I think I remember your first deal, you know, you didn’t start out with an actual real estate deal. You started out by becoming a lender on real estate. And I think your first deal if I recall, and you know, correct me because I’m may not remember this correctly, but I think it was like a small $40,000 hard money loan. And you probably got, I assume something like 12% on that deal. What was that about? Right? Was that your first first deal with us?
Yeah, I think it was, it was 12%. And then I quickly, there was another provider. There Phoenix who is doing 12% plus a $500 upfront fee, throwing back to The Georgia provider and asked for $500 up front plus 2%. And they matched it. So I stuck with them and did a bunch and alongs with them actually became one of their primary, you know, money sources at one point. And yeah, so that’s how I got started in real estate.
Jason Hartman 15:20
Yeah, fantastic. Good. And so how many loans did you do? Because most people would come to us they start out by buying properties. You started out by doing loans. How many loans did you do before you did your first real estate deal where you actually purchased our income property? Probably. I don’t know. Maybe like 10 or 15. Like that, that helped you just build up more and more capital and you have your own company. So you were working your business at the same time and, and when did you acquire your first income property?
Buy my first property was, I think, the spring of 2012. So yeah, yeah. Bye. property in a kind of east of Atlanta. And and that like first property actually turned out to be one I had I was forced to sell because the HOA we had gone over the number of real property. Oh, yeah, the neighborhood. So I had I had to sell it actually, they sued me actually. You Boy, that’s amazing.
Jason Hartman 16:19
And by the way, let me just explain to the listeners what happened on that deal. So this is another one of the reasons I really despise condos. But this is not a condo we’re talking about but it’s just, it’s even they get more strict. It’s unusual that we see this in single family homes, but you see it more in the condo townhome thing, but basically, an HOA can believe it or not dictate, you know what the rental requirements are, how long or short properties can be rented. And you know, some of our clients are toying a little bit with like the Airbnb thing or, you know, doing renting their properties on short term rentals and some Hoa is just completely won’t allow that some cities even have problems with it, you know, they can restrict they can say we don’t want more than, you know, 10% renters in the community or 20% or whatever the number they pick is. So yeah, that’s, that’s amazing. So, you sold that one was the market going in your direction by the way it definitely was an appreciating market and I made I think I made about 20,000 on that property. So, okay, so it turned out nothing to complain about
early. It turned out good. And after my first one, I am I quickly gain confidence. And I saw how, you know, basically simple it is the purchase properties. And so I quickly just started buying more properties after that. And since I was funding the deals, you know, I saw everything up front so I would pretty much just, you know, pick once I wanted to keep it or or just
Jason Hartman 17:56
land on it and it’ll be gone and gone out. Okay, let me let me mention something about that. So we we’ve had this kind of odd scenario happens sometimes, you know, in every product, there’s a supply chain. Okay. You know, with real estate, there’s a supply chain too, right? So did you I’m wondering, and we have this happen a few times and probably happened a few times with you, too. But I don’t know yet. We’ll see how you answer the question. Did you actually lend on a property to our local market specialist, and you were the hard money lender, they rehab the property, then you bought the same property on which you made the loan for them to acquire and rehab it. Did you do that? How many times did you do that one? I yeah. I did it most the time it was Oh, really? That’s that that was the way you did it most of the time. Hmm. So you really knew the ins and outs of that deal. I mean, you saw the margins that the rehabber or the local market specialists was making on the deal and, you know, you were the lender, so you got paid, you know, maybe somewhere in the neighborhood of 12% to loan the money. And then you bought the property and turned it into an income property and kept it Right. Right. Okay. Do you want to expand on that idea a little bit? Or is there more to
it? Well, I just think that if you can, and I kind of like doing this, basically, I like to, you know, concentrate at this point on one market mostly. And, you know, if you can do the lending, it’s nice, because you get to know the area, you can see the process, what’s going on. And you get to see, you know, these properties up front, and you get to pick the property that you want. And I just think if it’s, you know, an advantage, and
I think it’s a good way to go if you can do it.
Jason Hartman 19:40
So you started in 2000. And you met us in two, well, you learned about the podcast 2007. You came to an event in 2008. You started saving money building capital, and then you started lending and you did quite a few loans on properties, and then you purchased your first property, and it was one on which you lent so and you did it that way a bunch of times. So how many properties do you have now?
Yeah, well, I got my first property 2012. And then so I ended up getting seven in Atlanta. And these are these are like that little bit higher end houses in the 140 to 150 range. And then I got my eyes closed my first triplex in Kansas City. And that’s one of those nice ones. And then I’m under contract on three other triplexes in Kansas City. And two for plexes. And Little Rock, no fantastic.
Jason Hartman 20:43
You’re You’re becoming you’re building an empire. Congratulations. Yeah. So you mentioned on and this is really kind of one of the one of the tips you know, and one of the things maybe listeners want to hear about and we honestly within our company, we Really wrestle with this? Okay, and you know, for a long time Philip and you probably have noticed this the changes in our inventory of properties over the years because I’m sure you’re, you know, going to the website and looking at the properties we have listed online. Like when you first came in contact with us, we would do in pretty much all kind of class A maybe a little bit of class B type nicer properties. And of course, you typically get a much better tenant in those properties. But you know, typically also your numbers aren’t quite as good at least on the on the face of it. Okay. Have you have you stuck with you said, Atlanta, Little Rock, we’re all speaking in the City, Kansas City. Okay. So in those three markets, have you stuck with the higher priced income properties and when we say higher price, by the way, folks, we’re talking 150,000 it’s not that expensive as real estate goes. But you know, we do these you know, low priced cash flow oriented markets. And that, that is Sort of class A for our type of world that we’re in? Have you stuck with that? Or if you’ve done some of the lower end, like Class C type properties? And if so, you know, what differences have you noticed?
Yeah, I’ve only stuck with no class a type, you know, higher end houses. Because I was really trying to maximize my leverage, you know, per mortgage for Fannie and, and that was my main reason that’s God’s trying to maximize the amount of leverage I get. I wouldn’t be averse to getting a lower price houses, but that’s what I was trying to do. And that’s why I really went to Kansas City because the each mortgage was so high, basically a 400,000 for a family mortgage. 30 year fixed for five and a quarter is just great. And you really got me into the idea of going into debt. Fixed, right?
Jason Hartman 22:50
Yeah. Right. Exactly. Exactly. Know that long term fixed rate debt is pretty darn appealing. It really is. So with your first property That you, you know, resold rather quickly, you made $20,000 on that one. And you had some loans, you were making some money on the loans, you’re working in your business. How did the other properties go? As you went along, and I’m kind of wondering why you stuck with the nicer side, the class a type properties?
Well, it was mostly for the leverage. And I was thinking that the nicer houses might see better appreciation, and you know, the houses in the 141 50 range, and this is prices in 2012 2013. So they’re a little low at that point, these houses are now worth around, you know, 171 75 now, so I was looking for that appreciation, and then the good leverage, and I ideally having good tenants and for the most part, I have had good tenants, but I’ve had two that just walked off, you know, in just this last semester. So it can happen, it can Within the house, I guess,
Jason Hartman 24:01
right, right. So how did that go? Did you recover from the security deposit? Or was it? Was it over the security deposit? And if so, did you pursue a judgment against the tenants and send the collection? Or what happened with those? Well, you know, we want to hear about the bad experiences, too. It’s not all rosy folks.
Yeah, they had a property management, place a judgment on them, and hadn’t collected any money yet. But um, yeah, I got their deposit. And you know, that helped to fair. So it was it wasn’t too bad.
Jason Hartman 24:33
So when things like that happen, you know, what did you think Did you Did it ever occur that maybe this real estate thing isn’t really the right thing to do? And you know, you’re just going to give up are you still are you or did you just kind of keep the faith and keep going and moving forward.
I really just wanted to keep moving forward because I knew there were just bumps in the road. But you know, one thing that is one lesson that taught me a little bit with with the particular houses rehab, is, I think it’s worth getting an inspection on each property. I didn’t get inspection on any of them. And I think it is worth getting inspection home. I definitely
Jason Hartman 25:10
agree with that. You should get inspections, Philip,
for sure. I think one thing to look for is the roof. You know, what stage is that roof? And you know, how old is it? You know, how much life can you expect out of it? I think that’s, that’s pretty big enough. And it’s a big expense. It’s going to come on. Oh, yeah, no question. No question.
Jason Hartman 25:31
It’s going to come up eventually. In fact, I just sold one of my properties. That was a North Carolina property because, you know, I knew I wasn’t too far away from hearing about a roof. And you know, and then and then the buyer that purchased it from me and I did a 1031 exchange and bought two properties in Memphis actually, by selling that one. But the buyer that purchased it from me Of course they hit me up after their inspection and said hey, you know this gonna need a roof and I said thing that I know, that’s why I’m selling. That’s one of the reasons and, you know, I’m not I’m not giving you any more money, okay, you gotta just take it like it is us, you know, you you saw that the roof was old when you bought it. So you know, that’s a that’s that is what it is and they still went through with a deal and bought it. And I usually say, you know, keep your properties 27 and a half years, kind of jokingly because that’s the depreciation schedule. And if any of you listening have properties older or not older than but that you’ve owned longer than 27.5 years, you really really, really, really, really should consider selling them because you’ve run your depreciation schedule, and it just makes sense to get another property and start that schedule. Again. The property doesn’t need to be new, it just needs to be new to you. And one of the great things is you can do a 1031 tax deferred exchange and exchange it and not pay the tax you just defer the tax and definitely so I think the roof is a very good point because roofs are not Cheap that is one that’s probably you know, probably the most expensive item. I mean, I don’t know. There can be other things occasionally too but those are sort of surprise things the roof is one you know about two other things. One was definitely get termite treatment on each house. And that this is something I didn’t think about no one really talked about it. And I did that for all the houses you mean a preventative preventative treatment, right? Or like, Yeah, tell us about that. I mean, how much did that cost? What kind of treatment did you get?
I got a five year bond. And I think it was $500 is normally more I got to deal with the recommended vendor who does it. Eat tree eat cow so I got a really good price. And, and then it has $125 renewal fee per year,
Jason Hartman 27:51
after after the five years or each year during the five years each year during the five years you know that also depends on what area you You’re in. So you know, some areas are much more prone to termite issues and I think Atlanta would be you’ve got a lot in Atlanta. What are the age of your properties? You know, you’ve got these properties Little Rock, Atlanta, Kansas City, what what age range? Are they usually
they will be Atlanta houses are all in 1987 to, to like, early 2000s. And, and then the Little Rock properties with the two four plexes or the 1970s I think. And then the Kansas City multi units are all new construction. And some of them are getting started yet sir.
Jason Hartman 28:38
Right, right. Just a reminder, you’re listening to flashback Friday. Our new episodes are published every Monday and every Wednesday
in which do you have a favorite out of the three markets that you’re in or, or maybe another market that you’re looking at? I’m not really the I like the appreciate Atlanta, you know, with the houses, that I’m gonna like the cash flow from Little Rock in Kansas City with multi units. So I think it’s just a nice portfolio all combined. Really?
Jason Hartman 29:10
Yeah, kind of diversify it and spread it around like that. Do you think you’ll move into another market? I mean, I think three is enough. But you know, I’d say to people, they could do up to five, or you gonna just keep kind of doubling down in those areas that you’re in?
Yeah, I think I’ll I’ll probably just double down there’s I mean, I might be tempted by some other market that something attractive comes along, but um, I would be okay with just staying in those three markets early.
Jason Hartman 29:36
How long have you owned in Little Rock? And the reason I asked you about Little Rock in particular, is because Arkansas is the most landlord friendly state in the country by by a longshot. And it’s really, really landlord friendly. So I’m kind of curious to see how your experience plays out there over the years. It’s probably too new to tell. But how long have you owned in there now? Have you been it’s been a year yet or More than a year now. I’m actually just under contract. I haven’t actually made the purchase yet. Okay, okay.
Yeah, yeah, I’ve got a lot of contracts right now.
Yeah. So what do you think about that market? I think I think it looks good. I mean, it looks stable to me
and I’m not really expecting appreciation much but do like it from a stability standpoint and with units that all have their full price so you know, I like the idea of having properties rented to people with lower incomes and more middle class incomes not not just concentrate on one income but have multiple income.
Jason Hartman 30:40
That’s it. So what we’re talking about there is you’re you’re not only Phillip segmenting, you know what I would say take the most historically proven asset class and diversify geographically because all real estate is local. And you’ve been to so many of my events and listened to every single podcast which by the way, you deserve award for that, you know, you’ve heard me say this stuff a million times, but you’re not just diversifying geographically because you know, all real estate is local. Right. But you’re also diversifying in terms of market segments by having those different income ranges in your portfolio. Right? There’s different types of tenant classes. Yeah. So it as the economy, you know, if it gets worse or better, here, you’re more covered that way. It’s more more say, I agree with you. And the other thing that people will notice if, if things do get really bad again, at any point, the thing that they’ll notice is they catch people on their way down. I mean, it’s not as positive of an environment but you know, you’re providing housing to people who are moving down the economic ladder, you know, in bad times, and in good times, you’re providing housing to people who are moving up the economic ladder. So you know that that’s why we like the properties that are below the median price in any given market. It. And by the way, I got a comment on your Atlanta stuff, because last year, I mean, it’s about 10% appreciation in that market. You’ve done phenomenally well. Yeah. Yeah. I don’t know, if you even know that. Do you keep track of the prices of your properties? Or, you know, I kind of tell investors not to worry about that too much, because it’s really a cash flow game. But Gosh, it’s nice when appreciation does happen, right?
Yeah. I don’t really but I did. Look, I did look a few months ago, really, for the first time. And that’s what I saw some of the houses were worth getting to 170 what I paid into 144 Mm hmm.
Jason Hartman 32:35
Yeah, that’s great. And are you leveraging your properties or you paying cash for them? I paid cash for them up front. But I did a cash out refinance on every single one of those. So Oh, you have you completed those cash out refinance? Yeah, okay. Good, good. And what what’s your thing with management? Do you always use the property manager or do you self manage or do you have a blend in your portfolio? Or you’re, you know, self managing and using professional managers.
Yeah, I use property management for all of them.
I’ve been, you know, I’ve been happy with it really. And I’m really kind of excited about the property management can see with your provider there, because I think it’s gonna be really good from what I’ve heard from other clients. Mm hmm. Good, good stuff.
Jason Hartman 33:23
As you know, I had some problems with the Kansas City property manager A while back. I think you know about that story. We’re working on that one. And I, I kind of try to wait till these things sort of play out completely before I talk about them on the show because I just, I don’t have enough to say really yet. But more to come on that one. Do you have any tips that you want to share is you know, in terms of how you manage your portfolio, how you keep track of it, how you deal with property managers, your philosophies on financing, just any part of it that maybe we haven’t discussed yet.
One day, I thought I was with an HOA
You know, we buy a property, you have to want to make sure you know who the HOA is, you know, a name or a name or a phone number. Because if you don’t, you’re definitely going to at some point by now,
Jason Hartman 34:13
yeah, I know what you’re about to say, I think Yeah, like I did. I did on a couple of properties, maybe even two or three, and got, like fees, collection fees and stuff. So let me explain that to the listeners. Let me just elaborate on what you’re talking about. And they interrupt me if I’m not talking about the same thing, but I think I am. And this has also happened to me. Okay. This is the reason we say everybody should go to the USPTO, the Post Office website, okay. And every I think it’s every year for $1 is all at cost where you can do it for free. If you just go to the post office and pick up the little paper form that it’s like a little postcard sort of thing that you you just put in a mailbox and they do it always forward the mail to yourself from every one of your properties, because it just invariably is going to happen probably with the homeowners association, the HOA, but it could also happen with the tax collector, or the insurance company or the lender, and you do not want this to happen is that they will send the statement to the property rather than to your address. Then they’ll say, Hey, you know, your association fee which you really only owe $300 in fees now, because you didn’t pay it and you didn’t even know it was due, right. You didn’t pay it, you know, you now owe a $650 because we’ve tacked on late fees and a legal fee and some of this kind of stuff. So really, really, really be careful of that. It’s it’s one of the little minefields that you’ve got to plan for. Do that forwarding address. Now, just understand to the forwarding address goes by name. So it won’t affect your tenant in the property at all, okay? But if you purchase the property in the name of an entity like say you set up an LLC, you should forward both your personal name. So in your case, you know, Philip Sullivan, or ABC LLC, right when you do that, because that will really, really help prevent this kind of problem. And one of the other things that some of our clients have been using very successfully is these virtual mailboxes. And there are several services that offer this where they, it’s really helpful to organize yourself and make it a lot easier. What they do is they receive your mail just like you know, a p o box would or the UPS Store would, but they open it and they scan it and they put it on to a web portal that is password protected. And you go in and you just look at your mail online. If there is a check in there, you can actually instruct them to deposit that check to, you know, whichever of any various accounts you might have. And they’ll actually deposit your checks. It’s pretty cool. Do you use something
like that? No, I know. That sounds that sounds nice.
Jason Hartman 37:17
Yeah, I can give you the names of some of them, you know, whose I’m using one. It’s really great. This is Fernando. He just loves it. And, you know, they deposit all his checks. He showed it to me. And the last time he was on it several months ago, when I happen to be near him on the computer. He said, Jason, you got to use this look, he’s just going through his mail. It’s just on the screen. You know, he didn’t want to open anything. You know, so it’s great, you know, and it’s sort of amazing. The whole postal system doesn’t work that way, frankly, because it should, but that’s a different discussion. Yeah. Let me give a couple names for the listeners on that. Okay. One’s called Virtual post mail. And that’s virtual post mail.com. Another one I did all I did is I searched it well while you were talking. Okay. ones called traveling mailbox comm traveling mailbox calm. And another one is called us global mail calm. And another one’s called post scan mail calm. There’s a whole bunch of them out there. So just you know, put it in a search engine. Notice how I did not say Google just my own personal thing, put it on being and in search it just search virtual mailbox, you’ll find a bunch of companies offering this service and it’s, it’s cheap, and it’s great and especially for someone like you who’s traveling a lot because your business takes you to all these different locations. So Oh, yes,
Yeah, that’d be very handy.
goodwill Philip, your
Jason Hartman 38:44
story is super inspiring. And I thank you so much for sharing it with our listeners. What’s next for you? What are you what are you planning? Where are you going to be buying your next properties you think?
Probably either a little rocker Kansas City, but most likely Kansas City. Maybe construction. multifamily.
Jason Hartman 39:02
Yeah, good, good stuff. And when you say multifamily, you’re talking about, you know, for plexes, triplexes. That kind of stuff. Right, right. Yeah. Well, again, thank you so much for sharing your very inspiring story. We appreciate your business and appreciate having you on the show to.
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Jason Hartman 40:36
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