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Why You Should Not Wait For The Perfect Deal

GDNI 77 | Note Investing Perfect Deals

 

What are your criteria for note investing? Dealing with the right property takes enough understanding of what makes a company worth it or not. Chris Seveney and Gail Anthony Greenberg share insights about waiting for the perfect deal and what a complete career killer it is if you want to be a note investor. Circling back to where people start their note investing journey, they share some flaws you may encounter along the way. Learn more from Chris and Gail as they present the realities of note investing.

Listen to the podcast here:

Why You Should Not Wait For The Perfect Deal

Gail, welcome back. I hope you are feeling better.

I missed open mic, but I think everyone who was watching owes me a debt of thanks because you took the opportunity to do a very detailed teach-athon on partials.

It was insightful for a lot of people and in two aspects. One is showing people some of the alternatives to the traditional how you buy notes and think outside the box. Also, how you can get returns that are close to a nonperforming asset with a partial and it’s possible. For people who are getting into the business and learning the risk factor on buying a performing note and even trying to sell off a partial is much lower than on a nonperforming note. It’s something that a lot of people should take a look at. It might not be your cup of tea, but I strongly suggest people at least take a look at it.

I think we should do a very slow, tremendous overview and you showed a lot of great examples that showed people enough to understand what an opportunity that is. We will do a slower roll on it and get very step-by-step.

I was thinking afterward of doing a work session, book a few hours, get people on a Zoom conference call, go every single aspect of it and break it down, and walk people through it. Usually, a live case study that we could do. Even go through the agreements and what it looks like. I think that would be very helpful. I want to mention, for the people that are reading the blog, it is on YouTube and it’s something that you’ll want to catch the video version as well.

Chris, what happened?

I’ve got these condos in Florida, both of them are under the agreement. With a condo, there’s an association and you can never underestimate an association. I own two in the same complex that I foreclosed on and I bought them both at the same time. They came up with a rule that the borrower needs to have a 700 credit score, but it’s not in writing. The president doesn’t have a 700 credit score. I had a cash buyer from overseas and overseas they don’t have FICO scores. If anyone’s ever taken any of Merrill Chandler’s classes, there are 4,000 different FICO scores, there’s the freebie, the mortgage, a car and everything else. People can get an Experian number. They make the rules up as we go. It was a cash buyer and they rejected this buyer, even though they also had six figures in their account because they didn’t have a credit score. They are afraid that they would stop paying the HOA fees and they would get screwed. That was number one.

The second buyer had their interview. They had the 700 credit score, but the board instead of interviewing them is telling them all the problems they think are wrong with the unit. They were almost wanting to walk, which we got them not to walk. They did approve the borrower, thankfully. He wanted to back out. I did send an email to an attorney to set up a call with them in case they don’t approve this buyer in the way they’re acting because it’s very borderline. My whole point of the story is it’s another wild card, our HOA’s. When you’re buying these condos or notes on condos, give a little discount for dealing with condos or trying to get an understanding for them because they can be painful.

I was very shocked by this experience you’ve had at how much control they have. For them to not approve borrowers that are highly qualified because of something they’re concerned might happen in the future and for them to do it more than once. I have been encouraging you to have a lawyer waiting in the wings because you have a good one who loves to get into stuff like this with people, act them down. If anyone ever deserves to be backed down, it’s these guys. Who even is the HOA? Is it a company or is it their own group that they elect?

Yes, they elect them. Most condo board presidents are people who never were in any position of authority and then they become a position of authority in this condo board. They think they are president of the United States. They are like, “I am in control, I rule. This is my domain. I am a king.” It’s ludicrous, some of the things they come up with.

If a house has mold in it, you can negotiate the price down a lot. As the flipper quote goes, “Mold is gold.” Click To Tweet

It is interesting because when they can interfere with commerce, that’s something.

Technically, they can’t stop the person from buying the unit. They cannot let them live in the building. Think about it this way, I can turn around quitclaim deed that to anybody and they can’t stop. They can’t go to a recorder and say, “No.” Will the person be allowed to live there? They do have the authority. I would guess that in nowadays times, even that’s getting sketchy. Look at landlords, you can’t even judge people by their credit score and that’s the way on the other side of the spectrum. Some of these communities, they’re going to be in for a rude awakening when these times or somebody is going to get ticked off and sue them. They’re going to get hosed because of some of the things they’re trying to come up with.

I was hoping you were that guy who was going to sue them. If they do anything else, you should quitclaim deed it to a halfway house for crack addicts and have fun with it.

I would love to but unfortunately, I don’t own it by myself.

Mine is not nearly as interesting. Maybe it’s more interesting in some respects. I keep getting from Amazon a link and suggestion that I buy a T-shirt that says, “I Speak Fluent Sarcasm,” on it. I can assure you, I have done nothing to suggest to them that I do speak fluent sarcasm or that I’ve any interest in a shirt like that. It made me wonder the internet of things and the way everything is connected. If Amazon is making a simple error like this, what’s it going to be like many years from now with all the self-driving cars, all the robotic factories and self-driving big trucks? Do you worry at all about a glitch in the machinery of all of this?

Yes, to say the least. There was an article about somebody on mass shooters turnpike which was driving a Tesla and they were sleeping and it had an autopilot and someone took a video of it. It’s such a control freak and thankfully by the time all that comes into the real world, I’ll be dead.

I’m trying to think if anything of interest just happened. My historical renovation down south has come to a brief halt because the crew that is supposed to be inside my house framing removed the wooden siding from another historical house that they’re renovating and the entire wall disintegrated. It turned out that the wooden siding was the only thing holding that side of that house. I found myself wondering, “Is that about to happen at my house?” You gave an amazing talk about partials and I would love to talk about the bigger question that partials are an answer to. This came out of a conversation you and I were having about. We’ve been having an amazing time. You and I are having our best months, buying tons of stuff and all around us are people who are constantly complaining that they can’t find deals.

What we want to talk about is waiting for the perfect deal and what a complete career killer it is if you want to be a note investor. This is an area where I do have to give you a shout out, Chris. When you and I first teamed up, I was still working off the old paradigm of what was a good deal. I was having a lot of trouble finding things and you came along. I had the impression that you were never constrained by all the same concerns that I was getting hung up with. Your attitude towards what is a good deal has always been, “Can I make money from it? Is there a good chance I will make money versus not make money from it?” Was that pretty much your philosophy?

Yes.

One of the first things I noticed about you was while everyone else is looking for not just home runs, but grand slams, you’ve always been okay with anything that looked like a solid base hit. When you first started note investing, did you have strict criteria and what were they?

No. Here’s the reason why, I look at the big picture and as you say, “Can I make money on this?” I’ve bought a property that was ugly looking. It looks like a manufactured home in an area that had a $30,000 UPB that was nonperforming and it was in an area with 2,500 people. The house doesn’t look good, it’s ugly, it’s in a rural area but why would you do that? There are a few reasons. One is I got it for a great price. The average sale price in that town was $95,000. The borrower was still living in the property. When I looked at those three scenarios and the price I was getting it at, the odds are that person is probably going to reinstate and you got to take away the fact and the same thing when people go to get JV partners, everyone flocks to the nicest looking house.

It’s like, “That’s the one I want to team up with.” That’s the last thing you should look at. I almost would want not even to show people the house and show them the numbers of what it’s worth. Here’s what the borrower is doing. Here’s how much you owe. Here’s how much we’re paying for it. That’s all you need to know in the grand scheme of things. You do want to make sure the house is standing, livable, the value is there and it’s not got a foundation issue. Whether it’s bright pink, yellow polka dots, I don’t care, as long as my appraisal is putting the fact that I’m probably going to have to paint this thing. My philosophy a little bit is what I can make money on? A lot of times, the best-looking houses are the ones that the borrower has been keeping up and the ones are going to fight you the most. You’re going to end up running up your legal bill and at the end of the day, you’re going to pull your hair out. It’s like, “It’s a great house but I have spent $12,000 in legal and ended up not making anything on the deal.”

It occurred to me for the first time that maybe the fact that you’re a numbers guy has been a real advantage because you haven’t gotten emotionally-involved as people do. There are a fair number of women who are in note investing and there is like, “Is it a pretty house or not a pretty house factor,” particularly with women. I was lucky that one of the first loans I ever bought was in Flint, Michigan. If you ask yourself, “Would I live there?” No, of course not.

GDNI 77 | Note Investing Perfect Deals
Note Investing Perfect Deals: A lot of times, the best-looking houses are the ones that the borrower has been keeping up and the ones they are going to fight you the most.

 

One of the challenges with that is just because I have that, it doesn’t mean everyone else has. If I get a note reperforming or I buy a performing note and I want to sell it later on, I’m probably going to have a little more challenge with it. On the flip side, people who have those, instead of buying the performing at 12% to 14%, I can buy it at 16%, 18% because it’s ugly or in a certain spot, then that’s different. One thing I will mention is most of the time I won’t go into the neighborhoods where bullets are flying.

I think that’s a line no one should cross.

That’s different. We did buy a note where somebody was actually killed on the property. We quickly sold that one. That’s a little different in that sense. That is one of the criteria that I usually shy away from. I had assets that are in shadier neighborhoods, but I have discounted heavily on them.

I would like to circle back to where most people start. There have been trainers with big training programs that people are aware of who pride themselves on how comprehensive their due diligence checklist is. These are the people who will tell you only be in a town that has a major ball team, at least this much population. If they don’t have that much population, then they’re within half-an-hour of a city with that much population. Other people make it even harder the path of progress and the emerging markets. The amount of data you would have to crunch to try and find something that checks all of these boxes. There was someone I know, this person is selling a very expensive training program who goes through the comps. He’s looking for houses with really close square footage within 50 square feet. Honestly, you could lose your mind. I picture people hunched over their computers trying to put all of this information together and then there are people like us who are sailing past, putting in the bids and getting the deals.

Here’s one thing that I want to mention, those trainers are true to some extent in the fact that if you buy a note in one of those locations, if you take it back, there’s a much better chance you will sell it very quickly. There’s no disputing that.

For maximum dollars probably.

What I’m saying is every seller who’s selling that thing knows what the price is and is going to sell that for top dollar. Your returns are going to be much less than on something that may have a little more hair to it because it has less risk. That comes to that point of some of these returns on NPN get squeezed so much. If you do a partial where you’re picking it up at 12% to 14% and then have somebody on the backend at 8%, you’re going to make the same or more money than you would have on an NPN.

With much less difficulty. You’ve never been a flipper and this one chance you had in Fort Wayne you did not take it. There’s a famous phrase among flippers, “Mold is gold.” If a house has mold in it, you can negotiate the price down a lot and there’s a note version too. If you find out something that’s less than optimal about a house, you can use that to justify a rather low bid on it. Usually the sellers, they’re very aware that there are issues or if they’re not, they don’t find it hard to believe when you point out to them that there is something bad about a house. They don’t want to deal with it, that’s why they’re selling the thing. It’s amazing sometimes what concessions you can get when you tell a seller about something. I bought a note near me and I visited the property. There was a big condemned sign on it. I took a photograph of it and I sent it to the seller. He knocked the price down by half. It can be very helpful to get these battled properties. You also talked about the opportunity cost of sitting and waiting rather than getting a 10% return, waiting all year and not buying anything. What was the better strategy?

You wait for a few months, you buy something now and put at 10%, in a year make 10%. If you buy it a few months from now where your money is sitting there doing nothing and buy a nonperformer, the equivalent that you’re going to make is 20% and if you have a partner it’s basically 40% is where you need to be. In a few months you have it double. Time is money and people let it sit there looking for the perfect deal or not even sure sometimes what they’re looking for. At the end of the day, there’s no such thing as a perfect deal. For anyone that’s out there that has a spouse, like finding the perfect spouse. I have found mine because my wife is perfect.

She decided she would start with something and she would make it into what she envisioned.

Everything has its flaws, nothing is perfect and the question is on notes, what is the flaw? What is the risk with that flaw? What is the downside to it? When I started out, I would try and stay away from ones that had collateral flaws because I didn’t want to deal with it or I didn’t understand it, completely legitimate thing. What I would tell people is start with stuff like that, but get to understand that very quickly because you are going to find that again. When you go to buy assets, there’s going to be some stuff that has a little more hair, you’re going to get a significant discount. If you know how to rectify it, you will eliminate that risk and still get a very good discount.

The great part is that all the people who are still looking for that perfect deal, if they have put those under contract and did the due diligence on them, they will toss them back. Once that’s happened, the seller recognizes that they’re probably not going to get what they want for them. They’re more plentiful. You find deals that other people won’t touch and it vastly expands what’s available to you to buy. The pricing should be good because we’ve seen tapes where things have been passed over a number of times. When you start digging down, you’ll find the reason that it’s happening and it can be something fixable. People who are willing to put some effort in on stuff will find there are a lot of deals available.

The first time that we realized that was when we were offered a good price on six assets that the seller had to dump by the end of that month or the end of that year. I forget exactly what it was, but they were phrased to get rid of them. I think they’d been rejected by several people and when we got them, five out of the six have been amazing, but there was a lot of work to be done to track down borrowers who had left behind vacant houses. Sometimes there were a couple of layers of borrowers where the first set hadn’t been correctly canceled out of their land contracts. We had to deal with both sets and we had to find them. It wasn’t easy, but it was well worth the time it took to do it.

Start examining your prejudices about things and understand when it's okay to go a little outside the lines. Click To Tweet

I’ve been the one that does it and once we got by with people from bathroom facilities in the house, no bathroom, we still are doing okay with that one that we’ve got it back on track. It’s interesting too because we have the toxic asset list on our group and so forth. That’s been out there for a while. I almost want to go back and look at it to see how toxic somebody can be.

I was going to say what I thought was fatally toxic a few months ago. The experiences we’ve had lately, I would take another look and see with new eyes on all of that. You can all go look to anyone who is signed up on Notes and Bolts for the toxic asset list. Give yourself a little test to see how toxic they are. I bought one off the toxic asset list. The jury is still out on whether that was a good idea or not, but it’s not. If I have a problem, it’s not going to be for a reason it was put on there.

We’re talking about people not waiting for the perfect asset. If you are less experienced in this industry and you’ve done a few note deals, all of a sudden you’re on your first deal where you’re taking a funding partner on it. I’ll first start out by saying, I always recommend you do your own deals before taking on a funding partner. Let’s say you’ve done five deals and you’re feeling a little bit confident and you understand the players, the game and stuff. Now, you’re taking on a funding partner’s money. The question now poses is some of these do have a little more risk into them and stuff. Would you look more for the perfect asset? Do you stick with some of my philosophy of don’t get the emotion and go by the numbers?

I’d say there’s a price at which anything is a good deal. It’s a matter of understanding what the price needs to be based on what the situation is. There are some things that are incurable and we should say that. We were doing due diligence on our pool. There are some that are still owned by the original issuer of the land contract and that company is out of business now. There is no way you will ever get the required paperwork and signatures that you need. Learn to recognize what is a fatal flaw and what is a problem that can be solved.

Not only are they out of business, but they were also running a Ponzi scheme. They got shut down and all their assets got put into receivership which got sold off and then that receivership was closed. Sometimes a company closes, but you can still find a person that may have been affiliated with that company, get something still signed. With these people, they still might be in the slammer. I’m not sure where they are but it’s well-known that you’re not getting documents from that entity.

There’s challenging and then there’s impossible. You want to go with the first one. The other piece of this rather than on top of not being so picky is having more than one way of making money from assets. I will direct people once again to the partials talk. If you’re not familiar with partials or you feel like you don’t understand them that well or you don’t understand how much potential there is to be profitable, I highly suggest that you read Chris’s partials. We have to get that one a special name so people can find it.

We have to come up with a very good name for it.

That’s the overview and I’m sure everyone will want the real chalk talk on that where we hit it and all the detail. We’ve been so busy with our pools, and I don’t know if I will get a chance. I am going to put together some little training module that would have some paperwork involved that would help people do partials. We will continue to try and get that done.

When we talk about pools, we’re not talking about swimming pools. We’re talking about pools of assets Gail and I have participated in and taken down. We found some assets. Some of these assets we are going to liquidate. They’ll be out and about for people. If you’re interested in assets, especially performing assets, we are going to be putting some of these out. If you’re interested, make sure to reach out to us so we can get you on the list when it goes out the door.

We should do the partials workshop soon and use our assets so that people understand exactly, people who are unsure of whether they can do the calculating and understand the potential. We’ll use our actual assets that are for sale. If you see one that you like, you can buy it for the price that we will show on the calculator. That would be a real confidence-builder for people who aren’t quite there yet. This is what I see with everybody, they want nonperforming notes. I haven’t seen a lot of nonperforming notes for sale. I’m not sure what strategy the sellers are pursuing, but they seem to be all one thing and then the other. It’s been mostly performers and I think people feel disappointed when they see those tapes come out.

It’s performing in their CFDs. I looked at a tape of nonperformers in Florida, which are reverse mortgages where the borrowers had passed away. I have for some odd reasons attachment to borrowers that are deceased.

They’re okay when you buy it and then they succumb shortly after.

I was talking about the Florida reverse mortgages on a nonperforming pool. The borrower wanted around $0.60 to $0.65, which wasn’t bad because most of the values were around $200,000, $300,000. The challenge of it was all their BPOs were ARV values. They weren’t BPO values, so when you do the math and they have a $220,000 asset, that was worth about $175,000. We probably needed $30,000 to $50,000 of work. If you do the numbers, they think it’s worth $220,000 and they want $150,000 for it. It’s worth $175,000. Me paying $150,000 makes no sense at all because by the time I foreclose, pay the fees and stuff, there is no money to be made. That’s what I’ve seen a lot lately on the nonperforming, a lot of inflated BPOs especially from certain BPO companies. It’s almost people were buying stuff. I’m curious what the real value of the property and are they getting value if they have to take it back. There’s only been one occasion where I’ve had a BPO that was worth more than what the BPO has shown.

GDNI 77 | Note Investing Perfect Deals
Note Investing Perfect Deals: Learn to recognize between a fatal flaw and a problem that can be solved.

 

A low BPO.

Typically, it’s much lower or less.

There was a company that we used to buy from that would sell for half the BPO price on either non or semi-performers. Is that the word, semi-performers or sub-performers?

I don’t use semi-performing. I either say it’s performing or nonperforming. I go by the note as if it’s pregnant. You’re either pregnant or you’re not. I look at a note the same way, it’s either performing or they’re not. There’s no in-between.

A nonperforming note that had eight payments in 2018, that’s a better nonperformer than the one that hasn’t been paid in a couple of years. They would sell any in those categories for half of the BPO value and their BPOs were low, that was an amazing and exciting seller to buy from. Unfortunately, it doesn’t seem to sell anymore. Do you know how to buy and profit from reverse mortgages for nonperforming?

I know not to get myself in trouble. On a reverse mortgage, the bank gives the people money, then eventually, they can get the house. I’m still not familiar with that process, but if it’s a nonperforming, you’re foreclosing and getting the property. Every one of these borrowers was deceased. What I knew of based on a conversation with an attorney is to make sure that if it is a reverse mortgage not only in the foreclosure suit, are the defendants and their states and everything notified. Also, the IRS and a bunch of other entities with the federal and state governments need to be put as defendants in the case.

We’ll probably not get into too much detail. I want to say that these are the things you should be asking yourself, “Do I want to invest possibly in other kinds of debt? Do I want to look at things? Do I want to buy distressed lease options?” This is, to me, part of not waiting for the perfect nonperforming note deal.

I disagree in a sense on that because most people out there who are trying to get their first deal have between $10,000 and $30,000. Would you agree with that?

Yes, that sounds right.

Why bother flexing around looking at student loan debt, car debt and unsecured debt? If you’re a first-person, don’t look at seconds. Don’t look at all the stuff. Look at a first, you’ve got a set income. Reach out to someone and say, “This is what I’m looking for. I have about this much money.” Have somebody send you something. If anybody read this blog now and said, “This is what I’m looking for. Do you have anything?” I guarantee you, I haven’t extended to you. That’s the whole thing, stop beating around the bush. Focus. What is it that you want? Go and get it.

I’m not suggesting that somebody who hasn’t mastered notes yet does branch out into other things because it’s true. It’s like Shiny Object Syndrome. You can’t be great at everything. I’m suggesting people keep a much more open mindset about what could be a deal and continuous learning about things and not just stay rigid about what could happen. I had someone contacted me. She has a total of $7,000 to buy something. She didn’t say it has to be a nonperformer. It has to be a first, but you and I happened to have a little collection of some very small UPB performing contracts for deed. I sent her a tape and highlighted those for her. I don’t know if she’s going to buy them, but it’s to your point that whatever someone is looking for, we probably can at this point find the fit.

Have your expectations set. More than likely you’re not going to get if you have $10,000, a $200,000 asset. You may, on a performing side, but on a nonperforming no. You have to set your expectations of what it is. When you’re looking at these, these are probably going to be $30,000 to $70,000 properties. You’re not going to have a luxury condo in San Francisco or the house in Malibu on this. If you’re in seconds, maybe you can get that on seconds. I think you can, but most of this stuff is going to be in the Rust Belt area in the Midwest and the Southeast.

I’ve never seen a house in Malibu on any tape I’ve ever looked at. Have you?

At the end of the day, your calculator should be used to look at the risks, not the numbers or the returns that you're getting. Click To Tweet

I don’t buy in California. I don’t even look in California.

My impression that the way that the note buying food chain works that the many large hedge funds that buy skim the cream off the lists, the tapes before they come to the bottom feeders like us, pretty much all the Malibu houses go the first couple of rounds.

Typically what they’ll do, they’ll keep the stuff in California and Texas. They’ll have a lot of products in Ohio that they’ll get and that’s the stuff that they turned around to the people like us because we’re suckers. By the way, I submitted the Ohio license request. People are like, “Why are you doing it? You hate Ohio.” I’m like, “I know but if I buy a pool and it’s got assets that are in Ohio, I need the license.”

That’s what you’ve done already.

That was submitted. Georgia was also submitted. Georgia is much easier a process because I’ve got all the information in there. I got Ohio and the thing that took the longest was waiting for my accountant to get my updated financial statements because they’re finishing my books, so I just get my latest ones.

Ohio demands a ridiculous amount of information from what I’m gathering.

That’s a whole other show in licensing in some of these states and stuff, but we’re not going to that. Gail, it’s about time to wrap up this episode.

I might leave you with a thought, Chris, my renovation down south. It’s very acceptable that they paint a house pink there. I do not want to hear any more disparaging. There’s your word for the day, remarks about pink houses and they don’t need repainting.

What is your Note and Bolts, Gail?

Paint your house pink. Be happy. I was about to paint my house gray and then I thought, “I live in the northeast. Gray is a color you have to use in an area like this.” I have my first opportunity to paint a house a sherbet color, it could be pink, it could be orange, and it could be bright yellow. I feel like I have to snap out of it. I have to snap out of this thinking that everything has to be drab and conservative like up in the north. I feel like that’s the theme of this whole episode. Snap out of it. Start examining your prejudices about things and understanding when it’s okay to go a little outside the lines.

Something popped in my head when you’re talking about that. I almost want to take an asset that I paid back at some point in time, like a CFD. I want to paint it the most interesting color you can imagine on the outside because I almost bet that someone will buy it just because it’s that color.

When you said that, you probably pictured a color. What was it?

A peppermint green, a neon-bright greenish color. Put pink polka dots or purple polka dots on the house. I bet you if you did that to the house, you probably have the news drive-by and give you coverage on it. It would be hilarious. We should’ve done that with this house in Indiana that we had, that we have an under agreement. It’s one of my goals. I want to do that with a house, one of these houses that I buy it with my own funds. I want to take it and do something crazy like that. I think it would be hilarious. Test case and let’s see what happens with it.

GDNI 77 | Note Investing Perfect Deals
Note Investing Perfect Deals: Keep a much more open mindset about what could be a deal and have continuous learning about things instead of being rigid.

 

I think there’s a reasonable chance the neighbors will burn it down, that can be the better escape. Maybe I have a house that I should paint purple with pink polka dots.

Let’s be honest. If you have a property and you insure it properly in this business and it goes up in flames, that should be an unfortunate incident from a fiscal standpoint, you should do pretty well.

It would be a success. It would be judged a success in time.

I’m not the one who has my houses burned down Gail, like you.

You kill people instead, so you’re far better individual than I am. What’s your Note and Bolt?

I think I talked about this on another episode about partials and focusing on the number. How to get to the number that you’re looking for, and as part of that number, evaluating the risks. I’ve talked about it on several episodes, but it’s one of those things where if you could make 10% on something and have minimal risk versus trying to get 12% to 15% on a high-risk, like a vacant property that you might buy and target. 15% to you versus getting 10% on another deal, I would take that 10% all day long. That goes back to the thing about me hitting the singles and doubles. I’ll look at these assets and get them at a price where I think it’s low-risk based on what I’m acquiring them for.

Some of them do have the upside but no, it’s part of this analysis and that’s one thing people miscalculate. When you build it, make sure you understand, it’s garbage in, garbage out. Whatever you put into it, if you throw random numbers in it, you’re going to get a random number out. At the end of the day, your calculator should be used to look at the risks, not the numbers or the returns that you’re getting. Use that to say, “If I want to get 12% on this deal, how much room do I have and foreclosure and costs versus how much do I have at 15% or 20%?” That’s what it should be used for. That’s what it’s used for a lot in the commercial world and other industries. You hit a target return, but it’s also a risk analysis to see how much coverage you have. That’s my Note and Bolt.

That is interesting from the world of commercial real estate. Thank you, Chris. That’s a fun little glimpse into how things are done in your daily life. Thank you for joining us once again. That will do it for us for this episode. Watch for our fun and exciting partials workshop coming up. I’ve not committed us to do a workshop.

Thanks, Gail.

Please continue to leave reviews for us on the various platforms where we appear. Sign up on our website if you haven’t already, and please join our Notes and Bolts Facebook group. You would not believe the fabulous giveaways that Chris sometimes comes up with. You can also access on there the toxic asset lists, now that we’re thinking about it, might not be so toxic after all.

I think some of them are. Regarding the workshop, Gail, I’m glad that you volunteered us to do that between the hours of 2:00 AM and 5:00 AM. People on the other side of the world will gladly get to participate in that. In the last couple of weeks, I’ve been tied up a little bit, but I will find space for everyone to try and accommodate their requests.

We are very tied up with our pools, but soon our whole job will be selling our pools, and then it will be a justifiable use of time to do the partials training that will help people understand how valuable these assets are.

Thank you for reading. Go out and do some good deeds.

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