Real Estate Tactics and Foreclosure Bid Services | Chris Eymann

All right, science flipping podcast listeners, as always, this episode is brought to you by Rocketly.ai if you’re looking for a seller, lead generating system that has automation in AI Bot and has sellers coming to you, then Rocketly.ai is your choice. Make sure you head over to the website, fill out an application and schedule a demo now to see the power of Rocketly.ai. What is up? The Science of Flipping podcast family, I am back with another incredible episode and an incredible guest, a really true, good friend of mine, long time real estate investor, comrade in the Phoenix market. We’ve done a lot together over the last my 16 years. Your 20 plus now, yeah. And so, Chris, I’m in is in the house. Everybody what’s up, bro? What’s going on? Excited to have you here. You are now a, I guess, a local Floridian for Fort Lauderdale,

Chris: Yeah. Technically, I have my I claim taxes in Florida, and there you go. Better in Arizona. People don’t know this. Arizona is the cheapest tax state that has a tax (that’s right). So, I think it’s like two and a half percent of your federal or 3% of your federal, to tell you the truth, the property taxes in Florida on the house is way more than my Arizona tax.

Justin: I say this to everybody, people like, Oh yeah, you live in Florida now you don’t have the income tax. And I’m like, bro, yeah, they gave me that credit so they can screw me on my property taxes. Exactly. I mean, I have a nice don’t get me wrong, but like, 15 grand a year for property taxes. I’m like this is wild. (I’m at 26 Yeah), yeah.

Justin: Well, you’re right there on the water, (yeah) yeah. I’m sure your insurance is lovely too (Yeah, it’s not pretty). So that was another thing, my insurance. And you know this, but insurance in Florida, I have four different insurance policies, flood, fire, homeowners and wind and hazard or whatever.

Chris: I just have the two. I have the homeowners, and then a separate policy for flood, just, you know, water, water rises, and, you know.

Justin: I have four, which is a pain in the butt when it comes to renew them, because I’m like, are we sure it got paid, that I don’t lose the policy whatever, but between property taxes of 15 grand and then basically almost 14 grand in insurance, yeah, like, this house just alone is 30 grand a year just to, like, let it sit here, (Yeah, without the mortgage paid). And we’ll get into it, but I’ll go under a little bit of a rain. This is why I don’t believe people should own their own home for the most part. If you don’t think the way you and I think if you don’t have our experience, and don’t understand what it can do for you, most people can’t. They’ll look at the mortgage and interest and say, Oh, I can afford it, yeah, but now they’re taxed out every month. They’re living paycheck to paycheck, and they’re not really accounting for the insurance and for property taxes. And so unless you can think like Chris and I, which if you’re not following Chris, you need to go start following Chris right now on Instagram. It’s chris_eymann right? Wealth of knowledge. Over 20 years in the business, a good friend. We’ve done a lot of business together. So good person to follow. But I don’t know, I’m not a huge advocate of people buying their own home.

Chris: Yeah, it’s just, I mean to me, it’s if you do, I think the thing’s right, and you get appreciation and stuff like that. I’m still an advocate.

Justin: Because you know, you know, same thing for me, like, when my wife, you know, when I lived in Scottsdale, I just always rented, rented, yeah, but my wife was like, I want to buy. Fine, we’ll buy something. But it’s also because I understand, like, I live in a very nice area of Miami, it’s already appreciated like crazy since I bought it two and a half years ago. I know I have equity. I know I can rip the equity out and I can take the HELOC or whatever I choose to do. I can buy rentals, I can buy flips, I can lend it, yeah, right, like you’re not, but I think that way.

Chris: Yeah, a lot of people obviously just take the HELOC and go buy a boat, yeah. And then that’s worthless.

Justin: Worthless, yeah. So not a big Dave Ramsey fan, but for those people, go seek yourself some. Dave Ramsey, yeah, don’t be buying a boat, you know. So you’re now new to Florida. You have a great home, which I still haven’t seen. Unfortunately, even though you’ve invited me 20 times on the water, what boat do you have there?

Chris: I have a 35 foot center console there. But, you know, it’s funny, you come to South Florida, you think a 35 foot center console is a nice boat, and then you got a bunch of got a bunch of friends nicer boats? And I’m like, so I my boats actually spends most of its time in the Bahamas at my house.

Justin: Yeah for sure. Yeah. Well, and you go back and forth for your house, just anyways, I get that. Well, let’s talk a little bit about real estate again. Your wealth of knowledge, you and I have done, I don’t know how many deals over the years, you are one of those people that shockingly everything I say and I really preach, you’re one of probably the only outlying examples that I can reference that you don’t do what I say to do. So what do I mean by that? I say, make sure you’re always adapting with the times. Changing, moving with the marketing, you know, and all that stuff. Now, I do know you and I have done our own ventures together, and we’ve done it kind of together, so you will try things, right, but your business is a tried and true, consistent don’t have to do a fucking thing different, and you’re gonna knock down somewhere between 15 and 30 deals a month, just breathing, essentially. Is that pretty accurate to say?

Chris: Yeah, a little more than that. We did 408 in 2023 and 442

and 2022.

Justin: So for all those listening to me, I would say, make sure you’re fluid. Make sure you’re changing and adapting. Make sure you have three or four marketing strategies going. Make sure if one marketing strategy turns off, you have another one or two to rely on. In case, like direct mail starts shitting the bed. You and I built a call floor together, and then we started looking the numbers and assumptions, you know. I mean, when things go wrong, you need something else to stand yourself up.

Chris: Yeah, no, I still do that. Like, I mean, obviously we’re heavy into texting. Texting kind of went away, and then, you know, we are high, high into PPC and PPL right now.

Justin: Over time. So just out of my own curiosity, knowing you, as long as I have over nowadays, how many come from the model, which is you’ve been the guy in Phoenix for 20 something years. Everyone knows you. Everyone knows you as deals. You have the buyers that have forever, how many out of the, let’s just say 30 a month that you’re doing, and I’m just using a general number, come from that model versus lead gen model?

Chris: It’s probably 20 relationships, 10 Legion, okay, yeah, so, yeah, if you were just starting out and you had your budget, and ironically, I had a student. He’s like, I’m gonna, I’m gonna go, I want to do 800 deals a year. And I’m like, Sorry, dude, you’re not gonna do 800. I’m like, if you want me to coach you into 800 deals, I’m gonna tell you right now, you’re not gonna do 800 deals because, like.

Justin: and where was he starting zero?

Chris: No. He’s doing one to two a month, right? He’s like, No. And I told he’s like, I did 400 deals last year. He’s like, Well, I want to do 800 I got the I got the money in the budget to do it. I’m like, Well, I’m gonna tell you you’re not gonna do 800 deals. And if you think I can coach you to 800 deals, I’m gonna tell you I can’t coach you to 800 deals, just because, like you said, I get call it 10 from lead gen, and I get 20 because I was just before all the social media and all the craziness that we have now, I was the guy at every happy hour. Yeah, I taught every lunch again. I like that, yeah. That was just… go, yeah.

Justin: And you, it’s funny, because you and I are very we’re old school in that sense, and in I mean, you’re really old, yeah, old school. But no, listen, I firmly believe people over anything else, right? I’ve been posting a lot about this recently, which is what you have exemplified for you know, two decades in Phoenix, everyone who is anyone in the real estate space in Phoenix knows who you are. Yeah. They maybe have not done business with you yet, but that’s the key word, yeah. Yet they will

Chris: Yeah.I mean, I host a local Ria, and there’s, there’s a RIA in Phoenix that is, monetizes their Ria. I don’t really monetize my Ria. I literally have eight events a year, which is just strictly a meetup. Yeah, it’s just a meetup. Yeah, it cost me money. I don’t charge anybody for it. I don’t let anybody get up on stage, pitch Anything. It’s just truly network.

Justin: How many people will show up to that? Give or take? (60 to 80 a month). 60-80 a month. I’ve been a part of many of those. And I will tell you, most people should go create their own meetup, and not a RIA. You have, like an official like, people know, the Phoenix RIA. Yeah. I’m saying people should go do what you’re doing and have five people show up. (Yeah) 10 people show up (yeah), because that could be a buyer, could be a private lender, could be someone who’s connected in the realtor space. What you’re doing, again, you are the one person that kind of exemplifies something that I would say people need to lean on multiple verticals, meaning you need to be in the relationship business, right? You need to have relationships that can get you deals done without marketing budget. You also need to have some level of direct to seller marketing now, sure, these days that could be ppl, that could be calling, that could be, you know? Your online presence. It can be multitude of different things, but there should be some level of both. What I just always have admired you is, if you took away your paid leads, you’re going to be rocking 15 to 20 deals a month for the rest of your life. I mean, as long as, as long as you keep the team together, yeah? And you live a beautiful I mean, it is Friday as we record this (yeah). And what’s on your schedule today? (Nothing). There you go, right? (Yeah). And that’s reality is you’re gonna go make in your pocket a lot of money because you don’t have this operational cost, which you’re doing it right? You are the example that, literally, when I’m thinking of people to don’t go get a big office, don’t have a bunch of employees, have the people, and I want to give it back to you, to go back about like you were the guy that went to every happy hour, every networking function, every lunch and learn every everything. If you had to go over 20 years and say, how much have you made from that? Just doing that, just doing that, not spending $1 in marketing, what would you guess?

Chris: That wouldn’t even know where to start. (20 million?) I mean, yeah, over right

Justin: And if so, if someone’s sitting here listening to this podcast saying, Just now, I can’t wait to get started. I have no money, but I’m hungry. What is your advice to them? (Meet every person you can). Podcast is over. (Yeah), kidding, but it’s free. It gives me shivers to think of the simplicity of what we do. But when you coach your students, when I coach my students, they don’t do it. Yeah, they won’t, and you’re not listen for all those who don’t know Chris, it’s not like Chris is this charismatic, outgoing. Loves to be in front of everyone. That’s not your personality either.

Chris: If I were to go, let’s just say I finished this podcast and I was gonna go to my Friday happy hour. I could go to the busiest bar in Miami, and I will slide into the corner, get one bar stool away from everybody, order a beer and sit there bum, yeah,

Justin: I thought you were gonna say, I will go to the bar cross street.

Chris: That was the next best. But people watching is a sport. I still love the sport.

Justin: Totally. I mean, we were just talking about the Phoenix Open, bro, yeah. If anything, I would go just to watch the craziness.

Chris: Yeah. So I’ll go in my corner and, you know, do a little people watching, and just, you know, yeah, look at the uncomfortableness on that date. That’s they just met a match, or no matches, old school.

Justin: So let’s, let’s dive into your expertise. You really made a name for yourself, kind of the foreclosure space right in Phoenix. And you and I were in the game when the meltdown of Phoenix and I was buying from I think that was originally how we met. If I really pinpoint you became someone referred me to you as a bid service. A bid service essentially, think at the time you were either 1500, grand or three grand, (1500) 1500 Yeah, for someone like me that just didn’t want to have to deal with it to be able to tell your company, hey, I want to bid up to 100 grand on 123 Main Street, and you guys just take care of it. That is $1,500 is the biggest value you could possibly get.

Chris: Yeah, no, if you, I mean, if you don’t understand foreclosures, you know the foreclosure bid service, and not every city has it, no, but the foreclosure bid service is, you know, the best deal on the planet.

Justin: Ever if you really so, if we just talk about dollar per lead and dollar per deal, right? Yeah $1,500 is not after the deal (for the deal you acquire), yeah, that you’re buying per the deal, right? So that’s how we met and talk about foreclosures, right? I think there’s a lot of people that don’t understand the inner workings of that. I get this question a lot, should I go after the pre foreclosure or foreclosure list? I typically am talking more to a newer person at that point. Okay, what is your advice to the newer person saying, Should I go after that list?

Chris: Well, so the pre-foreclosure list, obviously you have what you need the most motivation, right? Because you have a timeline, whatever that timeline, whatever state you’re in, and we’ll just use Arizona it’s 90 days. Now, obviously you’re gonna get some postponements. They might go into bankruptcy or whatever may cause it to postpone, but you still know that they have some motivation. So one of my best lead sources in Arizona for that relationship person is a company that did 62 deals last year and did over $4 million in revenue. So do that math, right. So that is so the pre-foreclosure business is a is a really good business, but if you got to understand the business, understand the Pre Foreclosure business, but you might as well understand foreclosures, because you’re going to have some that do trickle to the steps. Just so you guys know, if you go to buy foreclosures in most states, it’s the most expensive place to buy because it’s public knowledge. You don’t have to learn all. You don’t have to go to the science of flipping and learn all the marketing strategies, the conversion strategies, all that you go to the courthouse and bid right? And that’s why, that’s how that’s the reason I actually got in we talked about, you know, me not being very social and not wanting to sit at the dinner table. Yeah, it’s not what I wanted to do. Like I was a tech guy. Got laid off twice in the tech down turn in 1999 and then between two of the jobs and when just did the 90 hour class and got my real estate license, got a listing from a friends and family, sold a house in Scottsdale, got 12 grand. Drove somebody around for four weekends just and then I went on vacation all week five just to have them call me and like, Hey, I just drove by this house. I called the agent off the sign they let me. I was like, I just wait. Yeah. So then I was like, Okay, I want to get some listings, but I don’t want to be the person at the door saying, hey, you know, I’m the best listing agent in town, right? Yeah, that’s just not me, right? Yeah, yeah. So I’m like, I want to buy houses. And so the foreclosures is just a numbers game. So that’s where I started. And to your point, being able to pivot and move and adjust to all the different market times, you know, obviously. With everybody having equity and covid and all that stuff, I had to switch to and I probably did it right when we started our call center. I had to switch more to direct to seller, because there just wasn’t the volume hitting the foreclosure sales. And I still I’m kind of the systems guy, believe it or not. I was the operator in our business, and now I’m the systems guy in our business. I build our systems and but actually, being a coach like you have to know how to build systems, right? Because if you you could, you could be a coach. And I’m sure there’s coaches out there that just have the knowledge and can hop on a 30 minute call or an hour call and coach somebody. Right? Sure, do this, do this, do this. But I’m actually like, Okay, do that, but put in a system behind it. It’s like the whole agent outreach, yeah, you know, which is, you know, a big in the business.

Justin: Anyone can just call, (Yeah). But if you don’t know what to say and how to say it in a way. (Right) And so you need the operations behind it.

Chris: What did I used to do all the time to you on Monday morning or Tuesday morning, Hey, Justin, you got a deal? You remember that text (Every time) Yeah. So I mean, if you’re doing an agent outreach, and I used to manually go to Starbucks on Monday morning at nine o’clock, and I would always put bird dog in the last name. So, it’d be Justin bird dog, Steve bird dog. I just type in bird dog on my good old cell phone, and I just start texting, you got a deal. You got a deal all the way through 50 up.

Justin: And in your scenario, wasn’t you used the word bird dog for your own verbiage. But the reality is wholesaler, because you know you have the relationship, which is the buyer who’s really gonna fund because of your relationships down at the auction (Yeah) and you know you have that buyer that I don’t have, (Yeah) And you know it. And you say, Hey, I’m happy to make two grand, three grand, four grand, five grand. I know the guy. You don’t know the guy. Give me three to five grand.

Chris: Yeah. So, you’re out there doing your acquisitions. You send me a deal, you know I know where the the foreclosure guys that will spend the most money, you know that, and I send that text to somebody else, and I had a $3,000 Starbucks, but that’s what he did. But at the same time, people do it today, and there’s systems in place, I was manually texting 50 people on Monday morning. You know, as you do that, you could have a cool CRM, a cool drip pan campaign, and you can do workflows through those drip campaigns, right? Yep. So you talk to somebody today. Workflow number one on week one is, hey, I talked to you last week. Yeah, right. Workflow number two, Hey, it’s me again, right? So, workflow number one is, hey, it’s kind of your follow up. Yeah, reconnect, because you talked to the last week and you put in workflow number two, it’s not, you’re not going to say, repeat that same text, because you didn’t meet them last week. You made them two weeks ago (That’s right). So, you change that to work, to text number two. And so yes, you can have a coaching call, but if you actually take the time to build out the systems now you don’t have to go to Starbucks and send 50 texts at nine o’clock on Monday morning. Automated,

Justin: Automated, yeah. And that’s all for your CRM, yeah, that’s what you encouraged it, yeah. And that’s the cool part. When you and I started, and again, you’re 20 years in, I’m 16 years in, none of this Automation. I mean, it was literally, you didn’t even have an option to the reason why you started texting is because that was really, what are you gonna do? Automation? There’s no Bot.

Chris: Yeah, I’m not gonna sit there, because at least I can copy and paste, right?

Justin: Yeah, same message, “hey, do you have a deal?” (Yeah). And I was the asshole. We literally picked up a phone every day and called Yeah. So I was calling agents, yeah. So ironically, the big theater space is Agent outreach, right? I get it. I started that way. I started broke, calling agents 100 a day from realtor.com because there was no Zillow. There was none of that back in 2007 and if it was, it was so infantile, like it’s nothing that we’re aware of today. But that was the only thing I knew, is realtor.com and I would call every listing agent I could find in Phoenix, because I was living in San Francisco at the time. Yeah, that’s how I did it. Now, full circle, age and outreach is a massive point of topic for a lot of the influencers out there. It still works. My team still does it stay but more in the style we’re talking about. There’s automation behind it. (Yeah), right? Now, there’s not over automation in the sense of this. Why Chris, ultimately, probably did so well, and you continue to do well, is the personability of who you are and actually physically meeting with a lot of the people over those years, where, if, if you have automation set up on a realtor who you’ve never met, you’ve never done business like you lose kind of the secret sauce of like handshakes and coffees and, you know, cocktail hour or whatever we still do Asian outreach, (Yeah). Now let’s just talk about the power of what you’ve built over the last 20 years and the simplicity of it. Why I say that is to have the utmost respect for it. There are a lot of people, including myself, that run a very big business at high volume, but we have a lot of operational just like boulders always pushing up the hill right in the Phoenix market, specifically. And I know you’re in more than. Just Phoenix, you could pretty much wake up at 9am if you really wanted to, and you’re done working by two.

Chris: Yeah, two or three, as long as you’re willing to be attached to your, you know, self, your phone for those Yeah, for from 6am to call it 8pm.

Justin: Yeah. So if someone out there is listening, trying to figure out the vertical and how they want to approach this business, would you agree or disagree, go find the buyers first. Is the path of least resistance to get your first deal. And if you could do that now, I’m kind of talking more to the person that doesn’t want to take the risk for a flip, right? Because anyone who has a big checkbook and say, just find me wholesaler, get me a deal, boom, right? Or where make offers on privy, fine, yeah. But I think the path of least resistance, and I’ll say there’s multiple ways to do this, but to get your first deal the fastest, find a real buyer, which you can find on I don’t care what it is, from Privy to REI Lead Machine, Prop Stream, it doesn’t matter. You can find these buyers and find them a deal that’s actually a deal. Would you agree that that’s the path of least resistance at this point?

Chris: To me, I think the path of least resistance is to find someone like me. There’s someone like me in every market (Yeah), right? (That owns the market) Yeah, you know, obviously Jamil is in my market, so he would be another (Resource), yeah, another resource.

Justin: But everyone came from Phoenix. Name a name that didn’t come like, right? We’re all from Phoenix.

Chris: Yeah, so you find somebody like that that you can, JV, sell your deal, okay? Because that’s going to give you the most opportunity to get the deal across the board, because we have massive buyers list, right?

Justin: So, if I was a newbie and I found wholesaler, Fred, you would say, Fred, I think I have a buyer for you. Hold on, Chris. I think we have a deal.

Chris: Yeah, you could do your Asian outreach and find the big wholesaler $0 spent little bit of time, and you could get a deal across.

Justin: So in this example, how does that shape up? Right? So I know you are the actual co wholesaler, meaning you have the buyer to Fred’s deal (Yeah). But the newbie investor says, I found Fred. I think there’s a deal. Hey, MVP of Phoenix. I think we got something here, (Yeah). How does the economics of something? How would you treat the newbie wholesaler? How would that all shape up?

Chris: On the newbie wholesaler? I’m going to take 50% right? That’s probably industry standard. And you know, he’s going to get his deal from Fred, and you know me, I’ll do a deal for three grand. Yeah, he’s got it for six you know, he just, he just made three grand. He didn’t spend any money.

Justin: Yeah, well, do you think that newbie wholesaler has the wherewithal or understanding of what the value is? Or would you say, Hey, why don’t you send me the deal first? Or what the whole, you know, Fred, the wholesaler, send me what he wants for first? Let me see it, because I know you think it’s the deal, but I know what my buyers are gonna pay.

Chris: Yeah. But then also, that’s kind of a little bit of (Too much work, right?) A little bit of kind of my secret sauce is, I’m like, Hey, Fred, the new wholesaler, like, let me underwrite for you. That’s my little, my little fishing line, right? Sure, there are gurus that push out people everywhere, (yeah) especially in Phoenix, right? So, and then, and then, that’s probably their biggest struggle, and underwriting, and it’s probably the hardest thing to learn.

Justin: Yeah, no doubt in the biggest part of the underwriting is hard. Thing is the construction part. (Yeah) That is always everyone they can get pretty close to what the sale price is, right? Great, yeah. (How much is the rehab? Yeah) That’s it. And then, you know, is it going to be a rental style rehab, or is it going to be a fix and flip style rehab right? And so, knowing that and then this goes back to finding the guy in the market you’re going after. (Yeah) Because if you find that guy, then you can lean on the guy to say, Hey, I think there’s a deal here. Can you underwrite it for me? And then I’ll give it to you to find a buyer, and we’ll just split whatever we can take, is that fair? because that bears. How long does it take you to under write house? (I mean, I mean, probably longer, yeah, longer than you. Because I think you’re in like, a 30 second thing. But like, very quick.

Chris: If you have true access to MLS or, you know, or if you have something like Privy or something that can give you some comps quickly. I mean, it’s like, if, if he brings it to me and it’s 300 and it’s worth 330 I mean, you’re gonna know in how long? (30 seconds) yeah, if that, yeah, right. So, it’s like, so that’s, that’s kind of always been. My little hook is like, Hey, let us do a little underwriting for you, because the intro, nicety conversation is going to take me longer to actually tell you what to deal.

Justin: A 100% just give me the address. Yeah, the number is this, yeah, I try to give, I give my newer investors, kind of a couple baselines, and I want you to see if you kind of agree and it’s in ballpark, a couple quick, easy, I call it bubble math, right? So this is before you like you want to go analyze the deal. You go look at a property, look at the pictures, if you can get them right? (Yep). And you basically have three ways of analyzing the construction, you have a repair, you have a rehab and a redo, right? $30 square foot, $50 square foot, $70 square foot, (yep all fair numbers). Yeah, right. And now it’s dependent upon price point you go into, you know, Scottsdale somewhere, and you’re probably rounding up pretty heavily. But I say that to say most of the country you could. Probably say that when you’re dealing with a three bed, two bath, under 300,000 you’re on those numbers, essentially (Yeah). Another thing you can just quickly look at is say, hey, what’s the ARV? If you just want to, if you’re on Privy, or if you’re on something that you can quickly look at, a comp. Yeah, great. You target the ARV. You got to be around 60% of that is about bubble math to where your offer needs to be fair (Yeah). And I say, if you can be around these numbers, there might be something here, and if you’re not, then we need to do some diving, right? Meaning, either the owner, agent or wholesaler wants too much money. (Yeah) And, or you’re not analyzing correctly. But those bubble math numbers make it really simple to find a deal these days. And by the way, it’s never simple to find a deal. I mean, make sure that’s clear, but to say whether a deal is a deal or not.

Chris: That just gives you, you know, gets you through the door, like you said, if you have to dig a little deeper, like in certain parts of Phoenix, stuff sells at 80 cents on the dollar, and only a few people are gonna know that.

Justin: That’s a 100% right. And that’s why, to your point, go find someone who is the boss of that town that has been around for 20 years and work with them. But it goes back to finding the real buyer, like you’re I can find you your company, right? (Yeah). Now I just got a reverse engineer finding Chris, so I can get on the phone with Chris say, Hey, here’s me. Here’s what I got.

Chris: Even if you just went to a fix and flip Phoenix Facebook group and said, Who are the biggest wholesalers in town? Like, how long that gonna take you, right? And people are you get that, that message that’s gonna go comment, comment, come on.

Justin: And you might have two or three. So, talk to all of them. (Yeah) To your point, it may be you and Jamil. Okay, well, then everyone’s gonna say Chris and Jamil. (Yeah) Perfect (Yeah) right? So, let’s go back to the foreclosure, pre foreclosure, I don’t ever suggest any of my members go after foreclosure. To your point, like, first of all, it’s public knowledge. Second of all, it’s going to be the highest sales price, because all the people down at the auction (Yeah). And third of all, in this is where I’m going to ask the question, you technically aren’t going to be able to wholesale it because the bank already owns it.

Chris: On a foreclosure. The owner owns it until the auction date. (Until the auction date?) Yeah, so that’s why everybody’s like, well can I just go to the top, top to the bank? No, the bank doesn’t own the property until the foreclosure date. Only own it. The bank only owns it if the bidder isn’t like, no one bids on it. The bid’s too high and no one purchases it. That’s it. The opportunity that bank owns it, then it just turns to an REO. They call their local REO agent listed.

Justin: So can you do what I still do, what I used to do back in the day, which was put in an offer and open up escrow and essentially stops the foreclosure process?

Yeah, you generally need, like, a two or three day. Because the if you’re you have your different states, you have your mortgage state, like Florida, or you have your trustee state like Arizona, so you need time (for the computer to say) the lawyer or the escrow officer to submit it, have the bank go okay.

Justin: So, you still have the opportunity to go to the homeowner offer what you believe to be the right price. If the homeowner likes it, they can sign off. Now it doesn’t mean the bank’s gonna sign off on it. If it’s a short sale, essentially shorting the bank (Yeah). But essentially, you can at least stop foreclosure, and then (you get postponed, and then try to get it worked out) and then go from there. Okay, so, you know, I just think there’s more hair. I think there’s easy to path of least resistance. But I like that this is something they can go do. There’s not many foreclosures to your point, and then it’s a little hairy, and probably the person’s going to be underwater, so it turns into a short sale (Yeah) for someone trying to get their first check, would you suggest going down that route?

Chris: Yeah, the Pre Foreclosure business is a very lucrative business because you have motivation. They have a time frame, so you got the stuff that you really need to get a deal across the board and get a deal at a really good discount, right? So, to your point, the foreclosure sales, because everybody does this as a business, like everybody’s oh first I’m gonna hold the foreclosure list, right? If there’s equity, they’re gonna get hit. First of all, as soon as the notice hits, they’re gonna get hit, right? Like they’re gonna get hit 10 times by everybody, yeah. And then the guys that do it, right, the guys that my group that I talked about, that are very successful, that house, goes into the CRM, and they hit that house weekly, right? They get a text message weekly. They get a door knock weekly.

Justin: I was gonna say, and you diversify how you’re actually reaching out to the seller,

Chris: Yeah and it’s for the entire 90 days. So if that’s what divide by seven, got it 12 weeks or two weeks.

Justin: What would you advise is a good process? If someone says, I pull a pre foreclosure list that I named the list provider. (Yeah) What would you tell them? How? How should they market? How should they hit it? What’s your advice to them?

Chris: So, it’s just a combination. You can call them and text them, right? The good, you know, the big texting thing is gone, but if you go to, like, a little penny protect something like that (Sure), and you’re hitting a small list, (yeah) you can get.

Justin: It’s gonna be small, right? I mean, how many pre foreclosure in Phoenix, which is a massive market, and, you know, these numbers pretty good, yeah.

Chris: Like 1200 and so they’re on a nine. 90 day cycle. So it’s not like there’s, you know, you’re not talking about a big list, like, maybe 10 to 15 new a day. So if you had, like, a simple tech software that you do your clarification, like, hey, come to my event. Like, I usually, yeah. Like, you might get that number shut down. Yeah, you just go buy a new click, send. Is who I Yeah, yeah. But it’s like, whatever, a penny or two a piece? (Yeah) What was a mailer 50 cents, (Right and you’re doing 10 to 15 a day), yes, you know. So, you could call them. I could send, like an easy text to, um, I also like to do the door knocking process, (Yeah) and then.

Justin: I love it, because then, you know, and we have a mutual friend that has murdered that game for a long time in Phoenix, right? (Yeah) Sam is just crushed the door knocking space.

Chris: Yeah. So then now, you know if it’s vacant or occupied. So you know it’s, it’s vacant, they’ve already moved on. Now it’s, now it’s strictly a texting and cold calling game, right? And then now you’re doing your door knocking on all the occupied ones. (Yeah) They do move. You know that they’ve gone on (That’s right). It’s just, it’s a very simple system. But like, to your point, my customers, I’m talking about, I wasn’t even talking about Sam, right? And Sam crushes it, right? But it’s, it’s a once again. It’s a system. It’s not just something you do once.

Justin: It’s repetition. The success of Chris Hyman and Justin Colby, everybody, just to be clear, is this doing the same over and over and again at repetition to point of nauseam going to every lunch and learn every cocktail hour, every title company, every brokerage. And you would go, and you’re like, I do not care. I don’t want to go meet these people, or I don’t care. But you know, it’s just that one connection one.

Chris: Like you said, I’m not even the guy that’s going to go up to somebody and talk to me. I do have my height, which is? (People come to you, you’re the big fella. Everyone knows where the big fella is at, right?) So that’s helpful, yeah? Um, but it’s, it’s same thing. You go to that happy hour, that lunch and learn you’re gonna get the three to four business cards. How many people take the three to four business cards, put it on that kitchen counter? And do nothing.

Justin: Everybody a 100%-99.9% because you’re the point one.

Chris: Yeah, So, but if you take those four business cards, you know you’re still gonna throw them away, and the next morning great, meeting you right now that.

Justin: Oh, so you actually relate to someone. You’re nice and you have manners where everyone’s like, Yo, you got a deal yet, right? I mean, that’s the reality is, is that I just want to make sure people understand that there, there is power in the foreclosure list. But to me, and you might fight me on this pre foreclosure and foreclosure kind of interchangeable to some extent, right? So I’m just kind of using them as one. It isn’t big enough to make it your only vertical. I mean, could you get a deal? Sure, but if you’re getting 10 people a day in a specific city, (Yeah) Or that’s county wide, right? (Yeah) That’s Maricopa County. Oh, goodness, God. Like, I mean 10 a day, what are you doing all day? I mean, you need a right?

Chris: Well, it’s just, it’s just like everything else. As you begin, what are you doing all day? At 10 a day, you’re not doing a whole lot. Six months down the road, you have your follow up calls. You have actually, you’ve done some agent outreach, you’re comping some houses like.

Justin: So, I think you layer that on. This is where I go with the three marketing tragedies. That is one you layer on some agent outreach, and you layer on some finding buyers. Yeah, and the reason why you want to find buyers or whatever, so you can sell someone else’s deal, if it comes across your plate.

Chris: The finding buyers is actually, it’s a, call it a six week process, and it’s really simple, and it’s not hard.

Justin: What’s the first two or three steps that you tell someone for the buyers?

Chris: So, you find, like, if you were go to Phoenix, you find Chris and you find Jamil. You get on their list. If you have a little bit of a budget, auto send. Once again, we’re automating, we’re auto sending that email that comes in to our virtual assistant. They’re putting that house in a spreadsheet, right? (Yeah) At 30 days, they that VA then goes to 30 days. Did it transact? Did it what? Okay, transact. It transacted this price number one, we’re also going to have them keep track of the percentage for that zip code so we can get what our house is going to sell on average, 73% that zip code, 69% that zip code. And we’re going to get the LLC, go to the corporation commission, get the three ll members, or two members, whatever. Get the members, add them to the skip trace list on the next time you get a script traceless, send it off. Have them text. Can I add in my buyers list? And then you just got every Chris’s buyers.

Justin: I’m shocked that you just put this out there on this podcast, but good for you guys, by the way, if you are not yet following Chris, make sure to go to @chris_eymann on Instagram. This guy’s a wealth of knowledge, literally a wealth of knowledge he’s been doing this an incredible time. Now, you just had a pretty big sale (Yeah), personally, and I think this is pretty cool, I wanted to talk about this really quickly. I know the home, it’s a beautiful home. You spend years, you know, not years remodeling it, but it took a little while done. (Took a year) Yeah. Talk to me about why you sold. Why now, what was the per I know. Was making you a bunch of money during covid (Yeah). Talk to me about this sale that you just flipped.

Chris: So, you know, I’ve always, I’ve lived in the little section of fuse called Paradise Valley for 19 years. Brought a little tear to my eye to sell it (Yeah). Just because I’ve lived in like a three block radius for 19 years so, and, you know, having moved to Florida, you know, I didn’t necessarily need that house. So when I moved to here, I started to airb. So it was my primary residence, slash, moved to Airbnb, obviously, with covid hitting and Phoenix being one of the more open states, Airbnb’s went through the roof, like every guru. Guru sold a look at these numbers on Airbnbs, right? But, yeah. But obviously that changes as things go back to normal, right? So, yeah, it was that was great Airbnb. But with covid also brought a lot of people not just coming to short term rentals. They decided to change their address to Phoenix, just like they did change their address to Florida, Miami, all these. So I got a big increase in value, and I had a $500,000 mortgage at 2.75. Who wants to pay off 2.75? (Nobody) Nobody ever, unless you have $2 million in equity behind it, right? (And I said, I’ll take my money now). So obviously, you know, the Airbnb was all great. It was, I was gonna call it 22 to 25 gross a month, right? So you can’t complain about that. And you’re getting 20 to 25 and your payments 2600 you know.

Justin: You’re putting 1215, grand your pocket every month.

Chris: Yeah, my personal assistant was actually do the management so kind of help pay that personal assistant, right? Because you pay a management company 20% that’s five grand. You know, those numbers, you could pay a personal assistant and then you get all the, all the other benefits. So, yeah, so I lived in it, so the primary residence, and then it was an Airbnb, because I, you know, spend my time in Florida, and I actually only rent in Phoenix, believe it or not. I just have a rental.

Justin. I was just gonna say, when you go back, because you go one on, one off?

Chris: Yeah, one off. So I’m in Phoenix, I just have a rental and I I’m a block from Caroline. I can just walk out the front door (And your breakfast). Yeah, I do my, I do my three mile walk, and then I’m literally (Are you at the Optima?) I’m not just across the street, okay, yeah, so I’m, I do my three mile walk. I’m looking through the door of Starbucks at like 5:29.

Justin: you’re now the, you’re officially the old man. That’s like waiting for Starbucks to open. I love that.

Chris: Exactly. So yeah, so I get my Starbucks, and then I walk back to my car, and I’m at my boot camp at 6: AM and, yeah, that’s kind of, that’s my morning. But so I rent Phoenix, but I had to pay out the 2.75 because I had, I had $2 million in equity, right? So I did this kind of little. I did, did it real, and I didn’t think I didn’t drew who’s behind the scenes over there is telling me I need better hooks. Because I don’t, I don’t my hooks, I guess. So. Sorry, but I took the $2 million and able to do a combination tax strategy, which I reached out to my CPA. Is I took the 500 married credit (Yeah). Then took the balance and put it into a 1031 Sure. So, then I drop million five hundred in a 1031. I actually knew this was happening, so I shopped and got a another Scottsdale. I’m up by Isabella’s now (Yeah). So, I ended up grabbing another one acre property up there, probably worth one nine when it’s the best time to shop for expensive luxury properties, December, because wholesalers can’t sell anything (That’s right). So I got one of those. I bought it for 970 got paid cash for it, right? So then I just so paid cash for it, but then closed the line of credit behind it so that, like, the line of credit can just pay for the rehab (Yeah). It’s funny when you do the 1031 if you want to, if what, if you want to use rehab money out of the 1031 money, a 1031 is only a thousand dollars. But if you want budget at a rehab budget, they charge you an extra five to manage it. I’m like, Yeah, I won’t, I don’t want (Interesting), yeah. I just thought, I thought that was an expensive jump (yeah). But so, I just went and got a line of credit. So, like, (simultaneously), yeah, I got, I actually got it the next day, because I didn’t know if that was going to mess it up and put, you know, a 250 line on it. So, like, I can just write checks for the rehab. It’s not going to come out of my cash flow or anything. It’s just like, here’s a check, here’s a check, here’s a check, here’s a check, and then that is a 970 acquisition. Is going to, it’s probably a one, nine or $2 million house, you know? But I’m going to, I’m going to do the same thing. I’m going to own it for (a year?). No, just, I will be able to do the personal because I’m actually but what I’ll do is I’ll own it for a year, which will make it an option to 1031 again (Okay). so, I’m just kicking the tax can right? And then I’ll do it again, and I’ll take out. And I got this other little thing. I didn’t have any 401, K got if you get to 50 and you have no retirement, the government will allow you to get to just over three million dollars by the age of 62 so I can drop 300 grand (no kidding) tax free into a 401K every single year. And if you’re later in life, and you don’t have a retirement, there’s a number at 45 there’s an I don’t, I’m not, I’m not the CPA(Sure), but on my particular instance I was 50 when I started it, so at 300 grand, I can, I can drop 300 grand. So what I’m gonna do every year is I’m gonna keep doing this luxury remodel. I’ll pull out 300 grand. I’ll drop it in the 401K (Yeah), all 1031, again, (Boom). I’ll go buy another one.

Justin: You’re funding your retirement.

Chris: I’m funding $300,000 in retirement every year, tax free.

Justin: We got to end the episode right there. That is phenomenal. And again, he’s not an accountant, but, like, talk to your tax strategy about this. This is insane.

Chris: Yeah. And if you’re, there’s a number of, like I said, so it’s probably, I’m just, let’s just do the math. If it’s they want you to get the $3 million in your 40 that’s 20 years. It’s $3 million so it’s probably 150 you know, yeah, I’m, I’m not attacked.

Justin: This is about about how much money you actually are 1031 in (Yeah), the whole thing. I mean.

Chris: Yeah. I’m just trying to maximize. I can, if I do the 1031 obviously, every year, I can kick the can (Yeah) And then you can also pull out money based on once again, talk to your tax strategist. If you’re it’s like 560,000 so let’s just say you were a $300,000 $350,000 guy. Your capital gains are only 15% that’s the cheapest tax rate you’re ever gonna see (Yeah). So, you can actually withdraw, let’s just say you took out some money and threw it in the 401K. You could also take if you just don’t hit that 560 number, it’s a 50. Soon as you go over that, I think it goes to 22 but once again, I’m not. Talk to your CPA.

Justin: Yeah talk to your financial advisor, CPA, all that kind of stuff. I firmly believe in retire like it’s not the sexiest subject, but I have a friend and a business partner, Greg Herlene who owns a trust company. If you haven’t set these up, I tell you to go work with them, because he’s in real estate. He has five funds. He gets real estate. So he might be a good resource for you. But I say that to say it’s not a sexy subject, but if you know how to use these things, right? Oh, my God, are they powerful?

Chris: Oh yeah, for sure. Like, I’m literally just funding my 401K I’m, I’m doing my, you know. And that’s, you know, I always tell, like, my students, it’s like, November and December suck. Like, you know, it’s good, just slow deals. If you’re an acquirer, you should be buying, like, if you got the cash and you’re a fix and flipper, you should be buying all your stuff, yeah. And actually, my son, Jack was like, he was like, you know, on those relationships as he’s getting stuff coming across the board. He was specifically watching close of escrow date. Like, you get a close escrow date and some wholesaler passes you a deal, and it’s closes 1211, for instance. It’s an all right deal. Closes February 1. You know the spring market’s coming (Yeah). He’s like, that’s worth $15,000 more in February than it is in December.

Justin: A 100% Yeah, so you, but you bought it in February, right? Or

Chris: No I bought it in December, knowing it was gonna close till February 1, (oh it’s just the close date), yeah. Cuz so like, wholesalers discount and November and December, just because there’s not as many buyers, buyers are, you know, (A 100% they don’t understand they take vacation they drive me nuts). Yeah, they but they all don’t understand the cycle too. It’s like, you know, we both have belonged to CG, the mastermind. And I’m just like, to me, it’s, it’s a little interesting that these guys are doing 70, 100, 200 transactions a month. They’re all a little younger than me, and I’ll sit around the bar, and they’re just younger. They haven’t seen as many cycles (Sure). And they’re going like, how was your fourth quarter in 2023? You got, kind of got my butt kicked, and I’m sitting there going like, when you’ve had a 12 year run of appreciation, that keeps going up. It saves you (Yeah). In 2022 and 2023 we’ve seen a seasonality run spring summer. Kids go to school. Stuff slows down, transactions slow down. And I’m sitting there going, guys, these, this is just normal. You guys just, you’re back to normal. You just, this is just normal. We didn’t you had a financial crisis that brought property values to the bottom. They had to come back. So you had appreciation every year, every year, every year. So it saved that deal that you were trying to listen October and November, because as soon as January come and it kind of went up in value. It saved you. You didn’t lose any money in 2022, and 2023, this is the cycle. It’s a spring cycle. It’s a summer cycle. Fall is always slower. People go away for the holidays. They stop, they get out of it. So what you call it the redo? (Yeah) If you’re a redo guy, and it’s a six month, you buy, you buy a redo in October.

Justin: I was just gonna say, September, October. Start buying, right?

Chris: Because wholesalers can’t sell it. Yep, it’s a big remodel. Everybody’s scared of it. You’re gonna get a massive discount on that pile, (A100%) but if it’s a paint carpet, you can buy in November, December (Yeah). But if you buy in January and February, it’s gonna cost you more.

Justin: Yeah, well, a 100%

and that’s why I say. What I say is people don’t understand, for the last decade, they’ve had the wind behind them. It’s hard to fit when the wind’s pushing you. Yeah, right. But all the gurus, not all, respectfully, but like everyone made money in the last decade. Yeah, right. You were doing something massively wrong if you didn’t (Yeah) right? And so not to say that the world’s crumbling, but this is back to normalcy. And if you don’t have a real structure, a real operation, with systems and in foresight like this, meaning you don’t realize there’s seasonality to real estate, you’re gonna buy something in, you know, January, that you’re gonna have a redo when you should have bought it in September last year.

Chris: Yeah, someone just literally came to me with a really good deal, and it’s like, what do you think this deal is really good? It’s really good. It’s a million dollar in Scottsdale, and it’s a redo. (When’s that gonna list? Nine months?) Yeah, it’s gonna list right there. I’m like, You need to budget selling that next February.

Justin: That’s right. You need to hold it and realize you’re probably have two to three months of just holding it. (Just sit there, throw a Christmas party out of there). Brother, I appreciate you coming Dude, you’re a wealth of knowledge. Thank you very much for your getting on here, for all you watching this over at Justincolby.tv again, make sure to subscribe. But also make sure you follow my guy, chris_eymann. My man is incredible. If you’re in Phoenix, make sure to connect with him. He is the real deal. If you have deals in Phoenix, you can’t move Get with Chris Eymann, brother, it’s been a pleasure to have you on this episode.

Chris: Thanks. Appreciate it.

Justin: Alright.