I have decided to note publicly my journey to raising $500,000.00 in 50 days. Like most new years resolutions and best intentions, they never get done. I have been thinking about doing this for a few weeks now and this morning while i am sitting outside on my deck watching my cat attempt to catch a squirrel I have decided to take action. What is so funny is that because I am self employed I do take action every day. I think by putting my action to words that it will be more real.
I will give a quick recap of my business. I am president of this company. I started this in 2013 and have had a blast with it ever since. I have 5 sub contractors that currently are doing work for me and 1 other full time employee. We work in the cash flow industry. What I mean by that is that we purchase, hold and sell cash flows. Things like mortgage notes, deeds of trust, cell tower leases, billboard leases, lottery winnings, structured settlements, annuities and on and on. If you have something that is paying you a predictable cash flow. WE BUY IT. Most people have no clue that they can sell their cash flow for cash today. You can and we buy them. The largest are that we focus on is mortgage notes. We can get between a 8% to 18% return on what we purchase. We are currently buying more Defaulted notes. These are notes that the large banks and hedge funds are selling off because they need to clean up their books.
The defaulted notes are where the $500k that i raise will go to. There is such a large inventory of notes now. About $500 billion in bad loans are on the books and the beautiful thing is that we can buy them for pennies on the $$ and contact the borrower to get a workout and re establish a predictable cash flow again.
So on to the action that i took yesterday. It was a great day. It was the first rain here in West Florida for a long time. In the morning I revised some quotes that i had put together from the previous day. This is always exciting because no quotes, means no deals!. I had check my inbox and a man had gotten back to me about selling a mortgage note that he holds in FL. He signed the contract so i prepared a checklist of documents that i needed to get from him in order to approve the file.
My mid morning led me to calling a few note sellers back to check in if they wanted to accept my offer. Most said that they wanted to review my offer some more but one said that he would like to sell and that he would get me the documents that I needed in the coming days.
My lunch hour took me to Wells Fargo. I needed to issue a wire to my title attorney because we had received the document package back on a loan that we have been in the process of buying for the last 4 months. There were a number of issues with this purchase but I can see the end and no amount of rain would stop me from issuing that wire. I will go tomorrow to sign all of the documents and get the collateral file.
For lunch I went to a networking event at a local Chinese restaurant. It is full of traditional real estate investors. It must have been the weather because they were all complaining about what was not going well with their business. I guess that i would be grumpy to if I was a landlord and had to deal with all the issues of a tenant. I love owning the paper on assets. Once I purchase them, for the most part I never need to deal with them again and I just collect my check each month. That is what is so great with these defaulted notes that we buy. Home owners are so excited to start making payments again because they want to stay living in their house but because they don’t know if they will be getting foreclosed on they don’t pay taxes, or keep the house up. When we get them back on track they start fixing the house up again and paying the tax. It is great for everyone. So back to the REIA meeting, I did meet a few new investors that kinda understand what I do. I collected their information and will followup with them to turn them into a Joint Venture partner.
I made it back to my office around 2 and spent the next 2 hours developing my linked in data base. We need to continually look for new sources of NPN’s because the person with the freshest product will have the best deals. This searching for new sources of defaulted notes is a daily process but it what drives our business. There are many investors out there that will not put the time in to developing new sources for notes. Because of this laziness they don’t see the smoking deals that we do. I have always had the mindset to provide the absolute best in any task that I did. I come from a construction family and our motto is do the job right the first time. This motto has saved me a lot of heartache over the years.
Around 4 pm I decided to leave because of the rain i new that the drive home would be extra long. I will write tomorrow about how I continue to raise the $500k that i have set out to.
Cheers
Scott Schmitz
PS. We joint venture on many projects. The one in the sample deal is a great return each month to the investor that is in the deal with us. Who could ask for anything better than true Mail Box Money!
