The Art of Buying Short Sales with Bob Vieira of Universal Short Sales

Bob Vieira: [0:00] Short sales are different from REOs. That's actually a great question because a lot of people confuse the two. A bank will never reach out to you with a short sale. Okay? A short sale is the seller's behind, but it's before the bank actually forecloses on.

Speaker 2: [0:18] Welcome to the Collecting Keys Real Estate Investing Podcast with your host, Mike DeHaan and Dan Austin. From wins, losses, horror stories, and tactics for optimizing your business, Mike and Dan take a real uncensored deep dive into the ins and outs of running a full time real estate investment and wholesaling business.

Mike DeHaan: [0:40] What's going on, guys? In this episode of the collecting keys real estate investing podcast, we have Bob Vieira, and he dives into a whole sort of like sphere of things that you probably don't know a ton about, or if you do, you've been in real estate for a long time, and that is the world of short sailing and free foreclosure real estate. Mhmm. This is something that tons of people made insane amounts of money on in like 2010, after the market had tanked, everyone was underwater. But now, with how the market had gone up in 2021 and 2020, most people, they have equity. So short sales don't really make sense anymore. And with all the COVID regulations, there weren't a lot of pre foreclosures. And, you know, either way, he stuck to his niche, he's been carving out some deals. And one of the things that was very fascinating was he dove into all the different sort of areas and types of properties he is starting to see more short sales in pre foreclosures. Right? And I don't know what you think, Dan. In my opinion, I think that this might be one of the niches that is going to become extremely common over the next couple of years.

Dan Austin: [1:46] I do, I think this is great timing honestly, but I don't really care because I've been waiting to say, you know what else he dove into? What? His 14,000 gallons of water in his basement that flooded when he told his horror story.

Mike DeHaan: [1:57] Oh, that's right. I've just been waiting for that joke. Know.

Bob Vieira: [1:59] I know. Yeah, right. I know. Yeah. Yeah.

Mike DeHaan: [2:01] It's a great horror story at the end of the show that you definitely want to hear to probably one of the most extreme situations I've ever heard of. But yeah, anyway, Bob is a is a wealth of knowledge here. You're unfamiliar with short sales and the power that exists there. You should definitely listen to this show. He goes into, you know, how to put them together, what the process looks like, how to market to them, you know, what it has to do with the seller, everything in between. And the knowledge here is like, I I would say definitely one of the most well rounded experts that I've heard talk in this space in in a very long time.

Dan Austin: [2:31] Absolutely. He's an expert.

Mike DeHaan: [2:32] Anyways, guys, enjoy the show. Reach out to Bobby as well. Super nice guy. Very, very knowledgeable and more than happy to help you out. He also has a great program where he can work with you to do short sales, and he pays out like 20% of the profit on the deal, which is pretty awesome for something that you basically make a passive situation with them. So reach out to him over there, and you'll be often be able to price some great value. Besides that, guys, please share this with anyone that you know, that is interested in real estate or just wants to make some money. Even if they don't like real estate, they just want to be rich. Like this is great way to sort of start understanding the true value that can come in this industry. So you should share it with everyone that you know. Just go to collectingkeyspodcast.com/free to get your free guides are joining off market leads and even buying your own short sales. And besides that everybody, we appreciate you all and enjoy this show with Bobby Vera. Enjoy. Alright, we are here today with Bob Vieira from Universal short sales. And in the year 2023, you don't hear quite as much about short sales and pre foreclosures and all those sort of situations as you used to since most homeowners have way too much equity, thanks to the run up over the past couple of years.

Mike DeHaan: [3:44] But Bob, you have built a niche business for yourself still focusing on that. So super excited to have you on the show here about your background, everything you're doing with universal short sales. And what does that even mean for people who are maybe just getting indoctrinated into this business still?

Bob Vieira: [3:59] Yeah, guys, thanks for having me. Very, very excited So to be what a short sale is in a nutshell from a bird's eye view, it's when there's two things that are happening with the homeowner. Number one, they're behind on their mortgage payments with the bank. Okay? So there's mortgage delinquency. So they're forced to sell their property. It's the best option for them is to sell. Right. Now they can't sell the traditional way or or they can't sell to guys like you with a quick cash offer because they have negative equity. Good. Okay? So they're behind on their payments, and they're upside down on their mortgage. All that means in layman's terms is the as is value of the property is less than what they owe the bank on their mortgage. When this happens, they could apply for a short sale. If and when the short sale's approved, their bank essentially lets them sell the property for less than what they owe on the mortgage. So, you know, quick example just to paint a picture. Let's say somebody owes $300 on their mortgage. Okay? Their mortgage balance is 300. Property's worth, let's say, $2.50. In a short sale situation, the bank is gonna let them sell for the $2.50 that the property's worth, and then the deficiency, okay, so that $50,050 that they would typically have to show up to closing and pay, that gets forgiven. So they don't show up with anything. They're able to just get out from under the mortgage, move on, and it does not get recorded as a foreclosure. Perfect. Does that sound That

Dan Austin: [5:34] makes sense. Yeah.

Mike DeHaan: [5:35] That's that's great. Good. Example of everything there. So I guess first off, how did you get into short sales? Especially because I'm not sure how long you've been investing for, but like I said at the beginning, most people right now are not even gonna be in that situation. Like it'd have to be a pretty extreme circumstance for someone to be underwater on their property right now. So what's your background with real estate? How'd you get into the short sales sort of like focus with your business? You know, let's dive into all that.

Bob Vieira: [6:03] Yeah. So I jumped in the business straight out of college in 2015, and I actually didn't jump in on the investing side. I started off as a real estate agent. Okay, not even investing. And just like any agent, I was kinda like running around like a chicken with my head cut off, I had no clue what I was doing, I was just trying to get any type of business to survive, and then as luck would have it, I just stumbled upon a bunch of short sales.

Mike DeHaan: [6:30] This is

Bob Vieira: [6:31] in the Philadelphia, PA market. So I had no clue what the hell a short sale was, let alone how to actually do one, but I ended up getting so many that I just learned it through trial and error. Long story short, I became a local market expert, you could say, in short sales, and people just started sending me these deals. So what I realized after doing so many was, A, I have a system in place to actually complete these things, and they're very painful, so I was solving a big problem. And then b, I needed a niche. I didn't have a niche at the time. I was just a generalist. I was a real estate agent. I was doing a couple wholesale deals here and there. Wasn't known for anything. My business hadn't really taken off. So in 2019, I launched Universal Short Sales, my company now, where we do short sale deals nationwide, and we solved that problem just on a bigger scale, and I was able to niche it down. So that's actually how I got into the short sale space. Yeah. That's awesome. Interesting.

Mike DeHaan: [7:39] I love that. And, you know, finding the niche is such an underrated thing. You know, even if someone did wanna be a realtor, right, like, we look at some of the realtor groups here, the ones that are most successful, they always have like, sort of like a shtick. Like one of the biggest groups here is a good buddy ours, and we always kind of make fun of them. But his whole team is like, blonde, bubbly girls in their 20s. And they market exclusively to like, people that, you know, want like the traditional, like American dream sort of lifestyle. Right? And it's funny, because if you meet him, he's like, not like that at all. But he's like, hey, that's what sells houses.

Dan Austin: [8:11] This was

Mike DeHaan: [8:12] so that's what I'm gonna Yeah.

Bob Vieira: [8:14] That's his niche. That's his niche. I love him.

Mike DeHaan: [8:15] Yeah. Plus he gets to hang around with a bunch bunch of blonde chicks all day, so it works out pretty good. So

Dan Austin: [8:20] So, Bob, I got a question for you on this to not to pivot too quickly from bubbly blondes, but you said as you're an agent, and this was your first deal, so were you representing somebody in the transaction, or were you actually ended up being a buyer right out the gate? What did that look like?

Bob Vieira: [8:36] So at first I wasn't a buyer, I wasn't doing any investing, I was just on the listing agent side. And my first ever short sale was a triplex. It was a distressed property, it was these two investors, awesome guys, really, really smart guys, they made a bunch of money in the insurance space, jumped into real estate, and they just were struggling with the rehab side of things, and they were underwater on the property. And like I said, I had no clue what the last shorts I don't know. I was just telling them I knew what I was doing, but really, I was googling it on my phone after I didn't. Yeah. Right? But yeah. Yeah. Yeah. That's how I started on the listing agent side.

Dan Austin: [9:14] So did the sellers or I guess the the investors reach out to you, was it a bank that reached out to you? I'm just curious of how does somebody come across this to list it?

Bob Vieira: [9:24] Yeah. Short sales are different from REOs. That's actually a great question because a lot of people confuse the two. So a bank will never reach out to you with a short sale.

Mike DeHaan: [9:34] Okay?

Bob Vieira: [9:36] A short sale is the seller's behind, but it's before the bank actually forecloses on. So a lender will never reach out. You have to go out and get it through off market deals just like you do a typical distress. So it's a b to c transaction.

Mike DeHaan: [9:53] Interesting. So when I guess, like, how does one even start a short sale deal with somebody? I I mean, you said it's sort of driven by the seller. So I say you get this lead. You know, we're we're wholesalers. Right? So we do a lot of lead generation. And more often than not, the person doesn't even know how much of a hit they've got themselves into. Right. The situation. Yeah. Yeah. So is like a big part of your role when you're doing these deals, like education as much as negotiation with these people? Because I mean, you have to rely on them a lot to be able to have this conversation with the lender.

Bob Vieira: [10:32] That's another great question. So it's actually 100% education, 0% negotiation with the seller. Interesting. So what's way, way different between a short sale seller and your typical motivated seller is a short sale seller is not motivated by money. Because Mhmm. In a short sale, they're not making any profit. There's no profit. Now there's relocation assistance, stuff like that, but that's a whole different topic. When it comes to profit from the sale, remember, the bank is agreeing to take less money. Okay? So the bank is losing money, so the seller is not allowed to share in any of those proceeds. So you're not negotiating a price with the homeowner. Most of the time, the cool thing about short sales are you can get awesome deals because the homeowner can literally care less what they're selling for. They just want out from under the mortgage. Yep. That's their primary motivation. So there's no price negotiation back and forth. You're just literally educating them on what a short sale is, and then when they decide it's a good fit, you get the ball rolling. Yeah.

Dan Austin: [11:36] Makes sense. It seems like it's more of a defensive position for the seller where they're you said that they're not caring about any of the sale price because they're just really trying to stop any losses.

Bob Vieira: [11:46] A 100%. That's all it is. And if you ever, like, for anybody listening to this, if you think you have a good short sale lead, meaning they're behind on mortgage and they're underwater, The third qualifying factor is the most important one. Don't be a dummy like I used to be and get all excited and say, Oh yes, I have a good short sale lead. Nope, you have to have the conversation upfront with the homeowner, and double check that they are not motivated by money. If they are, the deal will never work. You'll waste so much time, energy, and resources like I used to do in the beginning. I think that's a

Mike DeHaan: [12:23] great role from the start of any sort of direct seller transaction, is being up front about what they need to get out of it. Yes. Yeah. And and that's somewhere that so many people we do this, talk about this a lot with our with our coaching and different sort of things. So many people, they go into the seller conversation about what they want, when really it's a people serving business, direct to seller real estate with distressed people. Right? Yep. I love that. It's all about what they want and how your you can provide that to them with the collateral essentially being the real estate that you're going to buy. Yep. And it takes a lot of trial and error, think, where people in general learn that themselves. So having that conversation with the bank, I guess, what does it look like on your point? So for that example, but let's say they owe 300 and they're able to sell it to you for $2.50. Is it like you go to them like, hey, I'd really like to buy it for $2.50. Can you go talk to the bank and like see if they'd accept that? Or like, is it they go to the bank and they get basically a bottom line that the bank will accept? What's kind of the order of operations of this whole thing?

Bob Vieira: [13:23] Yeah. So we have it broken down into a science. Okay? I have a full time staff that works on this. It's a step by step system. So a lot of people use the phrase short sale negotiation, but I hate to use the term negotiation because there's actually zero negotiation going on in a short sale.

Mike DeHaan: [13:42] Yeah.

Bob Vieira: [13:42] That's a big myth. If it were as easy for me, Mike, to just call up the bank and verbally negotiate a price, I probably wouldn't be in business because it'd be so easy, everyone would do it. Yeah. But the short sale process, we have it broken down into 12 steps. So you have to hit every step of the process, and the vast majority of it is document collection, submitting it into the lender, and following up. That's the major thing of it. And the bank remember too, the bank isn't in the real estate business. They're in the mortgage business. So most of the time, like, you know, let's say you have a mortgage out with Wells Fargo, they have no clue what your property is worth. They're not in that business. They hire a third party appraiser to tell them what the property's worth. So going back to that example, let's say I need the property for $2.50. The bank will accept $2.50 if that's what the appraisal comes back at. If the appraisal comes back at $2.75, they're gonna want $2.75. They're just strictly going off the appraisal. That's Interesting. They don't care what I say or what I try to

Mike DeHaan: [14:48] Wow.

Dan Austin: [14:48] Gotcha. Okay. So that that leads me to a lot of questions. Yeah. Say okay. So you're upside down in the house, the idea being is the house might be less than they owe on it. If they owe I'm trying to think of what kind of not be good for you as an investor.

Mike DeHaan: [15:04] So like, why is it the big shirt flags are I mean, we've dealt with this a lot, like flips and rattles, things like that. What happens when you have your appraiser that doesn't fully understand like the cost to do renovations and those sort of things?

Dan Austin: [15:16] Sure. Yep. And that's where I was getting at, kind of like, what if that was less than, what if the appraised value was too high for you as an investor to buy it, but it was still below the mortgage value?

Bob Vieira: [15:27] Yeah, that happens all the time. That's an unfortunate part of the business. Now there's different ways to deal with that. You could do price disputes. We do something called waiting out the appraisal. So, you know, going back to the example I gave, let's say we need it for $2.50, it comes back at $2.75.

Mike DeHaan: [15:44] Mhmm.

Bob Vieira: [15:44] If it's not worth it to do a price dispute, so every appraisal that a bank does goes on file, and it has an expiration date. So let's say the expiration date is four months. What we'll do, one of our strategies, is to wait out that $2.75 value, wait for the 4 months for it to expire. Now there's other components involved. I'm giving you a bird's eye view, but we'll wait for the four months for it to expire, and then we'll resubmit our offer, and then we'll get a new interior appraisal done.

Mike DeHaan: [16:14] Mhmm. Gotcha. So in that four months, are you at risk of the property going into foreclosure at that point because they're probably not paying your mortgage?

Bob Vieira: [16:23] Yeah. That was the other components I was referring to. Absolutely, that's a big one. So I mean, it's just all part of playing the game. Sometimes we have to get a lawyer involved for the seller to try to postpone it. You know, there's other strategies we could do, but yeah, that is absolutely a part of it.

Mike DeHaan: [16:38] Yeah. So, yeah, that that that's really interesting. So I guess with these sort of properties, I'm just thinking trying to think about how banks work and how the appraisal process typically works. You probably almost need them to be, like, retail ready ish in terms of, like, condition for this to normally make sense. So I can't imagine you're normally gonna be getting appraisals that come in at, you know, that allow for a $6,070,000 dollar rehab. So it's actually the opposite. Short sales are weird. So typically, when

Bob Vieira: [17:08] a bank sends an appraiser out, yeah, you want the highest appraisal price possible because you want the lowest to get the best deal, obviously, and you wanna get it approved. The best types of short sales to get the best discounted deals on are the properties that are the most physically distressed and that literally show the worst.

Mike DeHaan: [17:29] Yeah.

Bob Vieira: [17:29] So, let's say we have a property at 123 Main Street, and it literally needs a full gut rehab. A property like that, I'm gonna probably come in at 50¢ on the dollar and try to get it at a really good discount, Because the thing is, you could tell a better story to the appraiser. So it's our job as the buyer and as the short sale processing company, whatever our role is, to provide supporting documents to the appraiser. So we never let an appraiser go in blindfolded and just trust their judgment. We're giving them construction estimates, itemized, breaking down all the costs. We're giving them as is comps. And then a lot of times, what I like to do is I'll even spend the money and get a full inspection report, and give them an inspection report and break it down for them. And say, hey, look, I'm coming in at a buck 50, and this is why.

Dan Austin: [18:24] Yeah. I'm thinking about this from an investment standpoint, because I'm gonna give you my hypothetical example, I want you to tell me where the margins are built in. Hypothetical example, let's say it is a property that's distressed and needs a lot of renovations, and the appraisal comes in at one fifty, and you all agree like, yeah, this actually is probably only $1.50. We sold on the MLS right now, it'd only get $1.50. Of that, we're going to have $75,000 in renovation cost. You've showed that to them, you all agree. Yep. Okay. So really all in, it's 225,000. So now is the margin saying that once you do $75,000 of renovation, it's actually worth 300? Or is it still you're having to show the appraiser that it's worth $2.25 with $75,000 of renovations.

Bob Vieira: [19:08] Okay. So in that example, so I understand, what's the price you're gonna come in at in that example?

Mike DeHaan: [19:13] So he's basically asking like, how do you work in the margin piece on this? Because why are they not basically saying just current value minus repairs is where you should be at?

Bob Vieira: [19:23] Gotcha. So the way you work in the margin is by, again, telling the story to the appraiser. So like, you don't wanna break it down like that. You know, I would say you don't wanna come in and say, Hey, look, this is the ARV minus repair cost. It's probably going to confuse them, I'd say.

Mike DeHaan: [19:42] Yes, that's fair.

Dan Austin: [19:43] Right, yeah, yeah.

Bob Vieira: [19:44] Yeah, yeah, If you're talking to an investor, almost want to dumb it down a little bit and just say, Hey, listen, we're coming in at 150. This is all the work it needs. You want an itemized repair list, an inspection report, and you really wanna focus on the repairs. Because a lot of appraisers and BPO agents, they're just going based off comps. So let's say you need it at the 150, and you could only find comps for 200. You have to explain to the BPO agent or appraiser, Hey, you're only gonna find comps for 200, but this property needs 50 k of work, so we need you to deduct the 50. That's how we ended up at 100 Yeah.

Mike DeHaan: [20:23] And then the repairs to get there, but

Bob Vieira: [20:25] What I would say is, though, Dan, I'm actually glad you brought that up, because I have a lot of so, like, we're almost a 100% referral based at this point, so we work with tons and tons of JV partners who are wholesale.

Mike DeHaan: [20:35] Mhmm.

Bob Vieira: [20:36] And wholesalers, rightfully so, are always talking about

Mike DeHaan: [20:40] ARV. Mhmm.

Bob Vieira: [20:42] The biggest piece of advice when you're running numbers on a short sale, yeah, of course, you wanna know your ARV, but really you're focused on the as is value of the property, more so of ARV in the beginning. You wanna focus on what is it worth as is. Yeah. Right. Yeah. That makes perfect sense.

Mike DeHaan: [20:57] No. That's interesting. So you don't hear a lot about short sales nowadays just because the run up in equity has been so massive through twenty twenty, twenty twenty one. Yeah. But, I mean, I do I I imagine it's gonna start coming around, especially as we were getting towards the end of, you know, the the big run where you had these people that were getting these VA loans, right, where they were 0% down, or these FHA loans where they're three and a half percent down, and they're also paying $40,000 over asking price. Right? Like, some of those have started to turn over. Bingo. Is that kinda where you're seeing short sales right now,

Bob Vieira: [21:29] or is there another situation that's pretty common? We're actually seeing a ton already for several reasons. So first off, when you look at distressed situations like short sales, there's pockets of the country that have way more compared to others. And you just brought up we're already starting to see a ton. Last month alone, three of the contracts we got last month were from what you just described. People who purchased within the last three years, super recent, and they overpaid to such an extent. Now mind you, these aren't investors. A lot of these are retail buyers, obviously, know, And people that are living they got into crazy bidding wars, overpaid by forty, fifty, 60 plus k, and, you know, something happened where they lost their job. Whatever the case is, they have to sell, and they're way underwater.

Mike DeHaan: [22:19] So

Bob Vieira: [22:20] is, Mike, you're 1000% right that is happening in real time.

Dan Austin: [22:25] But

Bob Vieira: [22:26] another thing I want people to remember, we have a consumer society. America is a very heavy consumer society. Whenever people have equity in their homes, they get super excited, and I promise you, they will find ways to lose equity in their house. Oh, yeah. Don't know another way to say it. Just to give you an example, okay, these past three years are crazy with equity appreciation, low interest rates equity. Many people, think about this, and for anybody listening, how many people do you know personally or can you think of that always wanted that brand new car, or that brand new boat to take on the lake this summer, and all of a sudden, their property's appreciating, they're sitting there with like $100 in equity. They're like, Oh my God. So they take that equity, get a home equity line of credit or whatever, and they cash out that equity and use it to buy consumer goods. Not investments, consumer goods. So there's a record amount of people that have equity, but they lose it because they take it out and they use it for other things. So not to go on a rant about that, but I mean, a lot of that is happening right now. Even in hot markets, people lose it.

Dan Austin: [23:37] That's a great point.

Mike DeHaan: [23:38] Yeah. Absolutely. I mean, that's what my neighbor did across

Bob Vieira: [23:40] the street.

Speaker 2: [23:40] There you go.

Dan Austin: [23:41] Are you serious?

Mike DeHaan: [23:42] Yeah. He told me cash out refi ed his house, and then all of a sudden he showed up with this $150,000

Bob Vieira: [23:46] boat. There you go, there you go.

Dan Austin: [23:48] Oh yeah, you're right, so their people do that because they have no patience, and I do forget that probably seven out of 10 people I talk to like that are non investors the last ten years, or ten years and last couple years have been doing that, and they go and finance a thirty year loan against their boat, or their car, or their kitchen, or whatever, because they did exactly what you just said, that's fascinating.

Bob Vieira: [24:09] That's another good one Dan, the home renovations, tons of people.

Mike DeHaan: [24:12] I mean, it's so easy to get like a HELOC and stuff like that too, you know, which isn't like a full refinance, you can abuse that get yourself in trouble. I don't think people realize that those docs that you're signing, you're getting a home equity line of credit, they still say that they can take your house if you don't pay for that. Yeah. And people just are like, oh, you know, I'll figure it out. So I guess like what what pockets of the country are you seeing that more? Don't have say like specifically, but is it like a cultural thing? Is it a, local demographic? Are you talking about higher growth areas? Talking about more poor areas?

Bob Vieira: [24:45] Yeah, that's a good question. As far as demographic wise, good question. We don't really track that. I'd say, yeah, yeah, we see a lot in middle to low income areas for sure. But you know, there's one that we did recently in Washington State that was like a higher improv. So really, it varies. But as far as the pockets pockets geographically, lots in Upstate New York for whatever reason. New York in general, tons of short sales. New Jersey's a really big short sale market, lots of people underwater. Where I live right now, Florida, Florida is leading the country in gross active pre foreclosures. There is over can see 30,000 people right now, and this is just beginning. There's over 30,000 people in pre foreclosure right now in Florida. Keep this in mind, Florida's a perfect example. Let me talk about Florida quick. Florida's super hot. Almost every market is super hot in Florida with equity. But what happens when you get so deep into pre foreclosure is some people are nine, twelve plus months into pre foreclosure. Every month, you don't pay the bank. Penalties, interest, and fees, lawyer fees, everything, attack on your principal balance. It compounds over time, and guess what? Even though it's a hot market, you are underwater because you're losing equity at a record rate. So that's just another example that wherever there's pre closures, you will find short sales 100%.

Mike DeHaan: [26:19] Yeah, that is interesting. Guess where I always assume I'm gonna see stuff like that is areas where there's low financial education, and there's gonna be people that suddenly have access to more capital than they ever should have had in their entire life. We see this a lot in North Idaho, where there's properties that people bought in the market for like $150.05 years ago, and are now worth 500, and they'll do exactly what we talked about before. They'll go refinance and just buy a bunch of guns and like dumb stuff. Or they're kind of in like the keeping up with the Joneses neighborhoods. Right? So like Seattle Mhmm. San Francisco, where you have people that can't actually afford it, but their desire to live the lifestyle that they want there, or they wanna be doing what their friends are doing, that are more well off, those sort of things, and so they overextend. And so I wasn't surprised that have you that here said the Northeast, because that's kinda like what I would expect from those people that I traditionally view from that.

Dan Austin: [27:15] What are you saying?

Mike DeHaan: [27:16] I'm saying that they have just kinda like to keep it up with the Joneses, sort of

Dan Austin: [27:19] You're calling them idiots.

Mike DeHaan: [27:20] I'm not calling them idiots, I'm saying they really care about how they're viewed by the people around them, right?

Dan Austin: [27:26] Their home and their summer homes

Bob Vieira: [27:28] Yeah.

Dan Austin: [27:28] And stuff like that, things that are typical of culture.

Mike DeHaan: [27:32] Well, exactly, right? I mean, we see the same thing with Seattle people, same thing with people from LA. Yeah. A lot of the big cities that really matter. Superficial, superficial. The Yeah,

Bob Vieira: [27:41] Joneses, my neighbor has a nice car, I

Dan Austin: [27:44] have to get one. Yeah, 100%, we see so much. That and probably the boom bust markets like we see in Florida, right? Yeah. I would assume Arizona would be similar, Las Vegas would be similar.

Bob Vieira: [27:54] But the big thing is too, though, what I said about pre foreclosures, because in judicial foreclosure states, so what a judicial foreclosure state means is, in order for the bank to foreclose on someone, they have to actually take them to court. They have to sue them, take them through a long, drawn out court process. So what that does, in states like New York, Florida, New Jersey, it allows people to stay in pre foreclosure for months, sometimes years. So going back to what I said, the deeper into preforeclosure, the more the interest and fees compound, and that's really what I see the most putting people underwater.

Dan Austin: [28:36] Really it's that, that's the big factor. Yeah. Interesting. So I've heard that before, these nonjudicial states when it comes to or judicial states coming, like New York coming into foreclosure. Yeah. Like it's kind of a pain in the ass from a note holder standpoint because it could be years, But on the flip side, it sounds like, is that an advantage for somebody looking for short sales because you know you have this like band of clientele that are sitting there in pre foreclosure for twelve months racking up these fees?

Bob Vieira: [29:02] A 100%. And really, yeah. Yeah. So I mean, first off, there's a lot more people that are gonna end up in a short sale. Not that I want people to, but there's those more people that need our service in those states, a 100%. And then also it gives us more time. Judicial states, because the foreclosure process takes so much time, if a seller comes to me needing help, you know, needing a way out through a short sale, I have more time to help them in those states. Yeah. Yeah.

Dan Austin: [29:29] Got it.

Mike DeHaan: [29:29] That's cool. There's so many little little nuances. I I mean, especially with what you're doing because you're getting involved in the mortgage business so heavily. I'm sure there's so many little local laws and things like that that you have to figure out. So I guess with your business, universal short sales, you do it nationwide. Are there any states that you just won't touch? What does it take for someone to work with you? Who exactly are you looking to work with with your business?

Bob Vieira: [29:54] Yeah, we do them in all 50 states. Like we just touched on, there's just more short sale opportunities in some states, but yeah, we're doing them in so many states right now. I mean, so many, like a variety of states, so we'll do them anywhere. Most of our business is referrals. So if you're a wholesaler, especially if your primary exit strategy is wholesaling and assigning, those are our favorite partners because those are dead leads. Like a true short sale lead, if you're looking to assign property, that's a dead lead. There's nothing you could do with it because short sales are unassignable, right, because there's no equity. So instead of throwing that away, we have a program where you submit it to us, and we do everything from start to finish. Short sales literally take months. We do everything, and then you get 20% of our net profit everyone you send us for literally taking a dead lead and, you know, having us deal with it.

Mike DeHaan: [30:51] Awesome. Nice. So if I'm

Dan Austin: [30:53] a wholesaler and I come across a lead that's in pre foreclosure, you're saying the best option is to send it to you guys and work that lead if there's no equity in the property?

Bob Vieira: [31:03] Yep. Only if there's no equity. Like I tell everyone, we're just a tool in your tool belt.

Dan Austin: [31:08] You know,

Bob Vieira: [31:08] if there's equity, do your thing. Make your money. You know, we're just here if you need us, if there's no equity in it.

Dan Austin: [31:15] That's great. It's always nice to have that tool in your toolkit too, because you do, another type of lead we come across is just a straight up retail lead, wholesalers, you know, if you don't have a license, or you don't have a good referral network, you can't capitalize on listing a property for somebody. Mhmm. And there's a lot of money in your CRM for listings, and now this is just another piece when you come across a no equity pre foreclosure, you have another tool. Exactly.

Mike DeHaan: [31:36] I think they're gonna become more and more common here, as we continue to see what happens over the next little bit. Yeah. Agreed. Awesome, Bob. Well, really good stuff, man. I love how you broke everything down too. You're obviously a proficient expert because you nailed the taking the complex topic and explaining it so a

Dan Austin: [31:53] five year old can understand. Understand. So So Dan can understand it.

Bob Vieira: [31:57] Yeah. So Dan can I understand appreciate it?

Mike DeHaan: [31:59] Awesome. We're we're gonna dive into our end of show questions here. These are the questions that we ask every guest who comes on the show. I'm excited for the first one, because I'm sure you have a couple. But first question is, what is the craziest real estate investing story that you have? This can be a big win, a big loss, a crazy tenant, crazy transaction, whatever you have in there.

Bob Vieira: [32:21] We'll go with the loss. Right? The wins are boring. So Yeah. I did a deal once. We bought with myself and a partner, we bought an eight unit mixed use property to hold. It was so exciting on paper. Cash flow is amazing. Cash on cash return was great. We didn't own the property for two months even maybe until I get a call. This is two days before Christmas. I get a call from one of the tenants. What the hell could this be? So I answer it, and the second I pick up the phone, I could hear in the background, it sounds like she's standing next to a waterfall.

Mike DeHaan: [32:57] Oh, no. I'm like, who

Bob Vieira: [32:58] is this lady? She's like, Bob, Bob, you gotta get here. She's yelling over the water like it sounds so loud. She's like, You gotta get down here. I said, What's going on? She said, A pipe burst in the basement. And it turned out like I said, it was like she was standing next to a waterfall. So we get down to the property. We see what's going on. There is 14,000, I'm not exaggerating this, 14,000 gallons of water. Can tell me? Yeah. Wow. The entire basement was submerged. Everything was, like I said, we just bought this property. And to make matters worse, so we had to pump everything out. You can imagine how much that cost. And the insurance company does an insurance. So now now we're in a lawsuit with the insurance company. We have a basement that's completely submerged. We just bought the property. We're in a lawsuit. This was on paper one of the best deals I've ever done. It ended up being, one of the absolute worst. I call it my university, let's put it that way. Jeez. It was just

Dan Austin: [34:03] 14,000. It's funny you know how much water because you had to literally pay to pump it out.

Bob Vieira: [34:08] Oh yeah, I own that once That's crazy. Because that's why you have to pay the company to come and pump it out. So, you know, they had to measure it. 14 plows. Like, I couldn't wrap my head around.

Dan Austin: [34:19] Yeah. That's a lot. Like, we've complained about basins flooding or houses flooding. That's, like, legit, like, a holding tank. Yeah. Yeah. That's crazy.

Bob Vieira: [34:27] Wow. It's a nightmare. Damn. I remember looking like pictures. You couldn't walk in the basement. Like, the water was actually like it was a storm. I don't know what you guys call we call them storm doors, like the cellar door that you Yeah. Open up. Mhmm. Like, you you literally could not see the stairs.

Mike DeHaan: [34:42] Oh my goodness.

Bob Vieira: [34:44] That's crazy. I'm actually starting to sweat. Could we change subject? I'm starting to sweat thinking about that. Yeah.

Dan Austin: [34:48] Yeah. Bet.

Mike DeHaan: [34:49] What so did you end up selling that property

Bob Vieira: [34:50] then after that? Yeah. But it was your we were in a two year lawsuit with the insurance company. Yeah, because they didn't cover it. We ended up they ended up settling it, but like that sucks. Who wants to go through all?

Dan Austin: [35:00] Yeah. Yeah. Yeah, we sold. Yes.

Bob Vieira: [35:02] So well, yeah, that's not a good property there. Yeah.

Mike DeHaan: [35:05] Right. You're in in real estate long enough, you'll learn that insurance is incredibly expensive. And for some reason doesn't do anything.

Bob Vieira: [35:11] Well,

Mike DeHaan: [35:14] we had a situation not quite like that. But we had an oil furnace leak that completely destroyed a fully newly renovated house. And the insurance company basically refused to cover most of the cost with it, even though they knew it was there.

Dan Austin: [35:29] That was a dang near twelve month battle for us Yeah. That was a long one.

Bob Vieira: [35:33] How do you remediate that, an oil leak? What did you ask to do? Wow. Oh, god.

Dan Austin: [35:37] Well, that was one of the big problems. Apparently, nobody knows how to do it. Yeah. And then finally, we finally, we were able to get our, like, in house contractor in there. He's like, oh, yeah. We just freaking clean it up, and you paint it with this, and we're done. I was like, okay, let's do it. Yeah. And then that's all it took. It was literally very little work, Wow.

Bob Vieira: [35:53] Yeah. I would've thought the opposite. I would've figured there's like a specialist that has to come out and

Dan Austin: [35:57] Well, they did do like an environmental survey and all that, and like that passed and stuff, but like, again, I think the people that they wanted to use, the insurance company, which they weren't supposed to be referring, wanted to make it a bigger deal than it was. Yeah. And it really wasn't. And then we yeah. We just got in a big back and forth battle.

Mike DeHaan: [36:12] Yep. So gosh. Anyways, that's a good one, Bob. I that's probably the worst, like, flood story I've heard that isn't like a natural disaster where, like, a neighborhood gets taken

Bob Vieira: [36:23] You know? I'm happy to set that record on the podcast. Yeah. Okay.

Mike DeHaan: [36:27] I know.

Bob Vieira: [36:27] It's a

Mike DeHaan: [36:27] good one.

Bob Vieira: [36:28] Yeah. Bob, while he didn't bring much value, but his horror story was the best.

Dan Austin: [36:32] Yeah, exactly.

Bob Vieira: [36:33] Yeah, I was it. You brought a lot of

Mike DeHaan: [36:35] value so far. Alright, second question. What is the number one tip you would give to either a new investor looking to get started, or a small time investor looking to take their business to the next level?

Bob Vieira: [36:46] My number one would be to pick a niche, but we kinda already covered that. So what I'll say is you have to be able to weather the storm, and that's in any business. I think the problem with social media these days, I really think it stems from that, is it paints the picture of not just real estate, but just being an entrepreneur. It paints it in like a rosy light, which is absolutely insane, which I'm sure you guys will realize. Like, nobody posts their losses. Nobody posts their failures. It's all just like, you know, guys standing next to, like, Lamborghinis and that type of shit. So I think, like, they they, like, portray it like that, but, really, entrepreneurship and what I'm learning right now, because I'm still really young in the game. I don't know a lot, but what I know is consistency is the key, and you have to be able to just weather the storm. Like, it's just gonna be failure after failure, and the key is just to keep on going. And that's the reality. I think a lot of people, like, they don't realize that that's what it actually is. It's just like putting out fires and just plugging forward and dealing with just a bunch of BS. So Boy,

Dan Austin: [37:47] that is great advice.

Bob Vieira: [37:48] You have to be mentally prepared to do that.

Mike DeHaan: [37:52] Well, that So true. There you go. That's another way that I know you run a legit business, Bob, because all the heavy hitters that we have on here, they always hit the same thing. Exactly. That's what we've always said to you, and then it's when you get the person that comes on, it's like, you just gotta work harder than everyone else. I'm like, bro, you haven't worked a day in your life, you're saying. Yeah. Honestly.

Dan Austin: [38:07] Yeah, exactly.

Mike DeHaan: [38:08] I didn't think he

Bob Vieira: [38:09] worked hard at that I mean,

Mike DeHaan: [38:10] yeah, the guy at the grocery store, you know, stocking shelves at 3AM, he's working harder than Jeff Bezos, but Jeff Bezos is more patient. Yeah.

Bob Vieira: [38:18] Exactly. There ain't no other thing that Jeff Bezos could do, he could deal with stress. That's the one thing I'm Like, the real successful people that I personally know, the one trait that they all share is they could all deal with stress unbelievably, because that's what business is. Like, the more stress you could handle. Because like you said, you know, the guy's stocking shelves or whatever, which is like all due respect, but like, that's not stressful job. They're not taking on stress. So Yeah. Yeah. I mean, and that and that

Dan Austin: [38:45] So true.

Mike DeHaan: [38:45] And that's huge, and that can be trained as well, which I think a lot of people don't always realize. And it comes with conditioning. Get those. You know, I even like, I remember back when we first started, we would have little issues come up with properties, it would be like, oh god. It would be such a big deal. It'd keep me up at night. Yeah. And then like that oil spill situation we talked about. I remember when it happened because it was a Airbnb. It was at 09:30 at night. The guest shows up, and I just see the Airbnb message comes in. He goes, your whole house smells like propane. And I was like, well, I guess you're gonna deal with that tomorrow. Went to bed and slept like a baby. We woke up the next morning, and then we figured it out. Yeah.

Dan Austin: [39:18] You're just like, you know what? It is what it is.

Bob Vieira: [39:20] I didn't know that was an Airbnb. Yeah. Oh, that makes it worse, man.

Mike DeHaan: [39:23] Oh, dude. It was such a freak.

Bob Vieira: [39:25] Like, somebody's vacation. Rude. Yeah.

Dan Austin: [39:27] I know. I know. Right? Mike doesn't care about other people's vacations is what he's saying.

Mike DeHaan: [39:32] Yeah. I'm saying at all. We we put them up in a room and then

Bob Vieira: [39:34] we No. Just No. No. I'm saying like that's a you know, that just makes it worse. That's to deal with.

Dan Austin: [39:41] Yeah. Yeah. You just get I mean, you get paid for the problems you solve kind of things. Right? And so it's like at some point in time, you you figure out the small easy problems aren't that hard to solve and they they just figure it out later. We'll take care of that later. That's not that's not the immediate fire. What's more important is me sleeping right

Bob Vieira: [39:57] now. Exactly. Yeah. I love that and it's the truth. I love that.

Mike DeHaan: [40:01] Awesome. Alright, last question, Bob. Where can people find you, follow you, and reach out to you?

Bob Vieira: [40:07] Yeah. If you're an investor out there, join my Facebook group. It is, I don't if you guys are gonna put it, I think it's called Universal Short Sales Success for wholesalers or something. I think that's the way it ends. But, yeah, Google universal short sales, and then you'll see the Facebook group. I'm constantly doing pre foreclosure webinars, posting strategies, how to get these, mortgage linked with deals. I have guests on constantly. I just had a guy that's done over 80 wholesale deals just with REO properties alone. That was an awesome webinar. So definitely get in that group, apply to be in that group, and then PM me on Facebook. You know, I'm always happy to network, hop on a call. Yeah, just find my personal Facebook, Bobby Diera. Shoot me a message and yeah, we'll just set up a call. I'd love to chat with anybody and, you know, just network.

Mike DeHaan: [40:59] Yeah, Absolutely. Sweet. Awesome. Well, thanks, Bob. And you should definitely reach out to him at all those different areas, guys. Because it's funny. I connected with Bob. I don't even know how he initially connected years ago, and we've talked just a couple of times before then. But, you know, you've been persistent enough and produced enough good content that, you know, I followed you for years kind of passively. And you're the first person I I thought I would wanna do a short sale and pre foreclosure show. Well, pre you know, you're definitely consistent. You put out good stuff. I'll give you some credit there. So guys, if you have any interest in any of these topics, should definitely give Bob a follow. So anything else we need of you guys before we

Bob Vieira: [41:36] close this thing up? Yeah. I just wanna compliment you guys, and I appreciate what you said, and this is honest to God. This is an awesome you guys are natural. Like, I know this is a newer podcast. You guys are natural. Flows very well. It's conversational. It's not choppy. You guys are gonna kill. I know you're getting a bunch of views already, but you guys are gonna kill it. Awesome.

Mike DeHaan: [41:56] Yeah. I appreciate that. Yeah. Thanks, Bob. Appreciate that. You guys heard him. Go in and share this with your friends because we kick ass and you guys know it's true for us listening. We kick ass. Well, thanks so much listening, everybody. So here's your reach out to Bob. That is why he comes on these shows. He wants to engage with you. He wants to talk to you and help you out with your short sales. So don't be afraid to reach out to him at every way that he said we will also put all those links down in the show notes. On top of that, guys, please go and leave us a five star review. Go and post it on your social medias, do all those sort of things. And if you want to start finding some off market deals, and hopefully find some short sales of your own, go to collectingkeyspodcast.com/free, get your free five step guide and start generating off market leads, and you'll be working in no time. Thanks for listening everybody, and we'll talk to y'all next week.

Speaker 2: [42:44] Thanks for listening. Please leave us a review on iTunes or wherever you get your podcasts. And check us out at collectingkeyspodcast.com for tips and guides on starting your own real estate investment and wholesaling business.