BirdDogBucksBasicTrainingCall! Transcript!–eBook!!2014.pdfSwingSign Corporation | PO Box 701586 San Antonio, TX 78270-1586 | PO Box 3444 Carbondale, IL 62902-3444 © 2014 All Rights

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Bird Dog Bucks Basic Training Call Transcript – eBook

Recorded & Transcribed: Saturday February 15, 2014

Audio Link: https://s3.amazonaws.com/BirdDogBucks/Audio/BDB-BasicTrainingCallFeb15%2C2014.mp3

Lon Reed: Okay. Let me just introduce myself and Kristi, and Donna Garcia will be on the phone later. The

three of us have worked together for many years in real estate. We’ve actually been doing this since 2000 on

the real estate investing side, specializing in different… Kristi will talk about the specialties that we’ve done.

But there are varied types of folks on this call – everybody from investors to people that are wanting to get

involved in real estate investing. But everybody’s got something in common, and that is that everybody is

interested in learning how they can earn money through the Bird Dog program. This is the initial basic

training. Everybody goes through it. It’s not complicated at all. There’s nothing complicated about it actually

on the basic training side. But it will tell you what the opportunities are and then you can make the decision

about whether you want to be involved or not. But anyhow, let me introduce Kristi. Kristi and I have been

doing this, like I said, for over ten years. She is a true expert in real estate. There is no doubt about it. Kristi,

why don’t you take it over and just tell the folks how they can get involved with us through the Bird Dog

program?

Kristi DuVall: Okay. Great. I’d like to welcome everybody this morning. I want you to congratulate yourself

for being here because it shows that you are able to take action, especially on a Saturday morning. That’s

what we’re looking for. That’s what’s going to get you moving forward in the direction you need to go. We’re

excited to be here. Obviously, there’s people in the call from all over. If you guys will just make sure that you

have a pen and paper handy, take some notes, and we’ll go ahead and get started. First thing I’d like



everybody to do is… As Lon mentioned, we have people here that are very seasoned, but we also have a lot

of people who are just getting started. You’ve probably heard real estate investing is the place to be, it’s a

great way to make money, and all these other things. But I’d like you to set aside, if you will, for me for at

least the next hour all the preconceived notions you have about real estate, about investing, about all the

things that you need to know, ups and downs, good and bad, and all that kind of stuff. What I’m going to do

today is we’re going to talk about the Bird Dog program, but also I think as important, we’re going to open

your mind and teach you some things and have you look at this business in probably a different way than you

have in the past. Also, I believe that most people on this call either see themselves as an investor or you want

to become a “real estate investor.” I’m going to introduce you to a couple of new terms today as you go out

and you present yourself in the marketplace more as a facilitator, as a bird dog, as somebody who puts deals

together. When you tell somebody that you’re an investor – and we’ve done this over the years – people

think that you’re going come in, you’re going to buy real estate, and you’re going to be the one that’s

responsible for everything, and all that kind of stuff. But really, that’s not what you want. You want to help

put deals together, help people make money, but without all the responsibilities and all the risk that goes

into what is a typical real estate investor. Those are some of the things I want you to set aside today as we

move forward with this.

First of all, just really briefly about Lon and I because I’m sure you’re thinking “Why do I listen to these

people?” How can we help you? What kind of experience do we have? As Lon said, we’ve been doing real

estate for over ten years. Lon has been in the marketing business for probably close to 20 years. We have

completed multiple types of transactions. Lon and I learned a lot of things the hard way. We probably own

every real estate course book, CD, program out there. We got started the hard way. We always knew we

wanted to be in real estate. We actually started with a little bit of rehab. We had rentals. We made all the

mistakes. We’ve lost money, made money, learned what we don’t want to do anymore. Part of what we

want to do with people that worked with us is educate you, save you from a lot of mistakes, save you a lot of

money in learning things the hard way. There’s no point in going back and doing all that. Right now is a

critical time because there’s such a market shift going on – we’ll go through a little bit of that – that it’s really

important if you’re going to succeed in this business on a small scale, a large scale, whatever it is that you get

involved in your education and you learn from people that are actually doing this business, not just writing

books and tapes and all that kind of stuff. It’s important that you follow people that have had a variety of

experience. Like I said, Lon and I have done rehab. We’ve had some rentals and things like that.

I’m going to mention this because we’re going to come back around to it you’re going to see why it’s

important later in the call. Several years ago, we learned how to start buying properties with owner financing

and subject-‐to type financing. Then, the market changed and there were no more properties with equity and

things like that, so we actually learned how to do short sales out of necessity and out of wanting to help

other people. Anyway, if you know anything about short sales, you know that we were crazy. But anyway, the

market shifted back and we came back around to subject-‐to and owner financing, which is what has been big

over the last couple of years. As some of you may know – but probably most of you don’t – there has been a

major shift in the rules and regulations when it comes to financing, especially for residential real estate.

Actually, several new laws went into effect the first of this year, which again made us step back and take a



look at the business. There’s something that came into effect called the Dodd-‐Frank Act, which if you Google

it or look it up, it will actually make you dizzy looking at all the different rules and regulations that we’re all

dealing with now. But with any change like that, it also creates opportunity. A lot of people will get out of the

market because they find it difficult if they don’t understand how to do it. This is one thing that Lon and I

have become quite experienced on and actually worked side by side with attorneys over the last year or year

and a half to figure out the best ways through these issues and the best place to go with the market. As

we’ve really analyzed this, we feel like in our business and also in the people that we work with, it’s our duty

to show you options but also to give you the details and the ability to do things correctly, to do things that

are going to be most beneficial to everybody involved – that’s sellers, buyers, little people, everybody. As we

stepped back and analyzed, we really started taking a look at the commercial market. I know that scares a lot

of people, but we’re going to go through why that is really probably the place to be. We’ll talk more about

that in a few minutes.

I want to go back for a minute. Why bird dogging? Why doing what we’re going to talk about in this call?

“Bird dogging” – or being a scout is another way to look at it – is a great way to get started in real estate

without the risk. A lot of people look at real estate and they think they’d love to do it but we get so caught up

in all the details and all the learning and being scared of the risks, and all that type of stuff. Bird dogging or

being a scout is great way to start. You get to learn while you earn. You are never in the hot seat as far as

making major decisions. It gives you the ability to be in the middle when you’re collecting information from a

seller or from a broker to submit your deals. You’re collecting information. They’re not asking you a lot of

questions about what you’re going to with the property and… buy it – all those kinds of things – because we

are the ones who get involved in all that. You don’t have to have all the credibility. You don’t have to have all

the details that a lot of people would expect from an actual buyer. It’s a fun way to start. It’s simple. We’re

going to give you some ways to really get in, start looking for and finding properties. As we all work together

going forward, we learn there’s multiple ways to do that. The most critical thing is going to be taking action.

You’re taking some action by being here this morning. This is an action business. A lot of it can be done from

home, on the phone. Different things like that will get you through the insecurities or the issues about getting

on the phone, talking to brokers, talking to sellers – that type of thing. So just take a deep breath and know

that we’re going to help you through this. We’re going to teach you how to do it.

Lon: If I may, people are still getting on the call, I see. There’s a wide variety of folks on this call. I’m just

looking at some of… I know. People are still coming on, as you can hear. But there are seasoned investors.

We have at least two that I know of that are on the call right now that we’ve worked with in the past. There

are folks that I have personally talked to that are wanting to work from home. They have no idea how to get

started. We do have a wide variety of folks on this particular basic training call.

Kristi: Right. This call is going to be kind of an overview. It’s going to be in different opportunities that we can

all work together. But I believe that we can take somebody from where they are right now, whether you have

a lot of experience, whether you’ve closed multiple deals, or you’re just getting started, and help you with a

little bit of mind shift but also just help show you how we can work together, help to grow all of our business,



help a lot of people in the marketplace. We will have other opportunities to work together in more detailed

stuff, if you guys prefer, on an individual basis.

Right now, I want to take a minute and… Even though I’m sure most of you didn’t get on this call thinking

about commercial, I want to go through just a little bit right now. Open your mind to it. Now there are

opportunities in residential too. But I also want to broaden your horizons a little bit about some things. Is that

all right with everybody?

Lon: I think it’s good with everybody.

Kristi: Okay. (???) a unique place right now because with the changes that have just come about with Dodd-‐

Frank and the new regulations for financing and stuff – which I’ll go into some more of that in a little bit more

detail – it’s elaborate right now. You don’t really need to understand all the details. You just need to know

that it has completely changed the market as far as financing and that it has opened up opportunities for

people that know what they’re doing and that get started right now, because it has also scared off a lot of

investors, a lot of people who have just been focused on one thing and not paying attention to the details. It

has made some major changes.

If you guys will look at this as a real business, even though you can do it from home, you can do it whenever

you want, I would set aside time that’s specifically set out for your bird dogging or your real estate education

and your action. It’s very easy to get caught up in this business in all the details, all the research and

everything else. One of the things that Lon and I have done from the beginning is focus on solving problems

and simplifying the process. What we’re going over in this call, we could spend days going over, but we’re

going to do it in a simplified form. We’re going to give you specific simple things to go do and not worry

about all the other details. Let us worry about those for now. But treat it as a business, because a lot of

people, when they work from home and they’re only working a few hours a week on something, it’s easy to

put it aside. By the end of this call, I’m going to give you some action steps. If you’ll focus on those specific

actions and not get caught up in everything else, you’ll find that you can be very successful with this.

Lon: Kristi, everybody on this call is here for one reason.

Kristi: To make money.

Lon: To make money. That’s right. Relative to what we are teaching them in this basic training class, relative

to that, how are they going to make money? What’s the opportunity for them to make money with us and

other investors? That’s a good point that we should probably make – that what you learn here isn’t just for

us, even though that’s what we’re hoping will happen. We’ll build relationships and be able to work together.

It’s to our benefit as well, but the bottom line is there are many states represented on this call today. In those

states, there are investors similar to us that would love to work with people that know what they’re doing.

You’re going to get the benefit of training from us and hopefully we’re going to work together. But once

you’re educated, you’re going to be able to use this training with other investors too. Kristi, relative to what

they’re learning today, how are they going to make money?



Kristi: That’s a very good question because it’s obviously why we’re all doing this. That’s one of the reasons

too that I’m going to open up your mind to a little bit more to commercial as we go through because for the

exact same effort and action steps, you can be a bird dog and go out and find leads for residential, which is

fine. But the difference is when you’re doing it for commercial; you’re adding viewers under that paycheck.

There’s three different levels we’re going to talk about today. One is basic scouting out leads. We’re going to

give you an overview of what kind of details we need to analyze a lead, whether it’s commercial or

residential. It will be a basic lead sheet. You’ll get an acquisition criteria based on what we’re looking for, and

then you’ll get a property lead sheet that you’ll fill out with the information. If that’s what you want to do as

a bird dog – you want to fill out some information and submit that – then we’re looking at, on the

commercial side, between $500 and $1000 on a lead upon a closing. That’s just for filling out the information

and getting it to us on things that are closed.

Lon: That is just getting us the lead that goes to closing.

Kristi: Right. Getting us the details that cover the criteria we need and not having to negotiate, not having to

do a lot of the other stuff, and then it’s closed. On residential, it’s less than that, but also on the commercial.

But the medium way to work with this or the midrange is more detailed information – maybe engaging the

seller a little bit more, getting more of their story, a little bit of pre-‐negotiation stuff that will go through

detail what needs to be done. It’s working more going back and gathering more information that we might

need and working through the process, still having no financial risks, no major decisions to make, none of the

other details to be responsible for. It’s more of receiving a little bit of cash upfront for the lead upon closing,

and also possibly ongoing payments, staying in the deal a little bit more – that type of thing.

Lon: For the folks that are more seasoned, then they obviously are going to be involved in the deal more. Talk

about that particular opportunity as well with us.

Kristi: If somebody wants to obviously learn a little bit more details about staying in the process, we can

actually joint venture our deals. Say that there’s ten steps to getting a deal done. We ask that you do the first

five, and then we take care of the back end, bringing in the financing, bringing in the people to do the

marketing and, say on a small apartment building, bring in the people that will do the rehab, get the

departments filled – all that kind of stuff. We do the heavy lifting on the back side. We ask that you do more

of the on the ground work, talking to the people, gathering all the information that’s necessary – that type of

thing. There are definitely some opportunities for joint venturing. We do ask that you get educated, that we

go through some training to do that first so that we know that you’re not wasting your time and you’re

looking for the right opportunities.

Lon: Kristi, I had one participant that is actually on the call today who asked me two days ago “When can I get

started?” I’ll tell you what I suggested, and then why don’t you give them the expert opinion? But what I

suggested was you can start anytime you want, but if you don’t know what you’re doing, then I would

suggest that you hold off so that you don’t waste energy and time.

Kristi: Exactly. After the end of this call, by tonight you’ll be able to get started. At the end of this call, the

people that stay on the whole call, we are going to send an acquisition market, an overview of what we’re



looking for, and some information sheets to fill out. I’m going to give you at least three to four more ways of

immediately getting started at no cost as far as where to look for deals, how to do some searches and things

like that, who to talk to. If you’re not afraid to pick up the phone, seriously, this can be done pretty quickly.

Now, to get a deal done, this obviously takes time. It takes due diligence. It takes some other things. But as

far as getting started with the process, we can do it right away. I’m going to give you that for both residential

and commercial, and some very specific criteria so that you’re not wasting your time out there searching all

kinds of things and you know what you’re looking for.

Lon: So, you’ve got interest (???). Tell me, are you talking about – I’m sitting in the Midwest, in the heartland.

If I see a property in my small town in USA, I see a small commercial building or I talk to a neighbor and they

have a commercial piece of land for sale or residential piece of raw land for sale or mobile home park, what

exactly are we looking for?

Kristi: Great question. We’re going to start with commercial and then we’ll also talk residential. Right now,

what we are looking for is recession-‐proof properties. When I say commercial, I’m not talking big buildings,

big office buildings, big supermalls – all that kind of stuff – in a downtown major city, which is what a lot of

people think about when they think about commercial. People look at it and they think that’s big and scary.

We’re going to show you how it’s not. What we are talking about is there’s four categories right now – this is

something I really want you guys to write down and think about – that are recession-‐proof, that are exactly

what our team is looking for. That’s multifamily apartments. I’m not talking… It doesn’t have to a big giant

apartment. Some of the best residual income and deals are made – 10, 20, 30, 50-‐unit, even a little bit less

than that, apartments. They don’t have to be… Most towns – you see small apartment buildings that are

maybe a little bit run down. They’re always for rent. A lot of them are owned by individuals or families. They

get tired of running them. They’re not very good at managing them. Maybe they’re not marketed right. Those

kinds of things. Those are all prime candidates. One of the things that Lon and I are going to focus on in

teaching you guys is go for the low-‐hanging fruit. Yes, everybody talks about these big giant deals. They’re

really difficult to get done. They all take a lot of work and time. I want you to focus on the low-‐hanging fruit,

the smaller, the easier deals to get done. They’re everywhere.

The next category is self-‐storage units. These are a huge opportunity right now. They’re in most towns. A lot

of them are mismanaged. They’re not fully occupied. As the market has shifted over the last few years,

apartments have gone up because a lot of people lost their house or they’ve had it downsized. When

somebody downsizes and they move into an apartment, they also have to have self-‐storage. America is one

of those countries that save everything. That’s the other category. There will be different deal submission

sheets for each of these categories, so you know exactly what you’re looking for. The third one is senior

living. Obviously, a lot of people are moving into senior living facilities. The fourth one is mobile home parks.

Those are the four categories that we want to focus on. Supermalls and those types of things – they’re not

what we’re looking for.

Lon: Those categories including RV parks and that kind of thing as well. Relative to residential and

commercial, why is it better for the participants of this call to concentrate on the commercial side? Not just



throwing away the residential if there’s opportunity with the residential for sure, but why is it better for

them? What’s the advantage for them to concentrate on the commercial side as opposed to the residential

right now? What are the reasons?

Kristi: Financing for residential obviously has gotten more difficult. It doesn’t mean we can’t do it. We can

absolutely do it, but as far as Lon’s question, to answer Lon’s question as why we focus, right now there’s a

critical timing with commercial properties. Most commercial loans are done for seven to ten years. There is

literally over a trillion dollars in commercial loans that are coming due or are coming to the end of their

period within the next few years. Right now, they’ve only started, and going on to the next couple of years.

With the economy, loans were taken out a lot. The banks said, “In five or ten years, we can refinance and

everything will be great.” As we know, the market has changed. The financing has changed. A lot of these

commercial properties are not going to be able to be refinanced in the condition they’re in because they’re

not at (???) occupancy – all that type of thing. These sellers are going to become more and more motivated.

It’s the perfect time to get in and start acquiring these properties. In a general sense, the idea is to acquire a

property that is distressed. We do not do anything retail. Everything is wholesale. You are looking to solve

people’s problems. As you go out in the community and you present yourself as being in real estate and this

is what you’re doing, you will be amazed at the people that you will come across. Their facilities are just not

doing what they need to, or they’re just tired of them. We’re going to discuss (???) in distressed properties

and distressed sellers – two different types and both of them are what we’re looking for. But the number one

thing with commercial is the same time and effort will create so much more income than it will with

residential. Lon and I have been through this for years. Everybody says you buy residential property, you rent

it out, you make it all this money. The realities of that: Yes, money can be made that way, but for the effort,

it’s better to put it into the commercial.

Lon: Yeah. We have lots of properties around the country actually. We can tell you that when it takes the

same amount of effort to close on a duplex as it does on a 50-‐unit piece of property, I can tell you from

experience and Kristi can tell you from experience – go with the larger units, the bigger deal. The economy

(???), their ability to be able to resell. It’s just a better value in so many ways – almost always that way.

Kristi: Exactly. Here’s the other thing from a human standpoint. When you’re dealing with a family that has

to sell their house, they’re losing their house or getting a divorce – all these different reasons why people

become motivated sellers – we spent so much time trying to help all those people, but in the end, a lot of

times there’s so much emotion involved when you’re dealing with residential. There’s a lot of emotion that

comes with that. There’s a lot of issues. Anyway, in commercial, you don’t have that. Commercial is about

business. It’s about the numbers. There’s no emotion involved. You’re dealing with people that understand

business and that understand what it is you need. The other thing is – and part of the reason that we’re all

going to be working together and why we can really teach you some things is – Lon and I started really

specializing over the last few years in owner financing, purchasing properties subject to the underlying

mortgage and stuff like that. I know there are a lot of people who don’t understand those terms, but you will.

At the end of this call, Lon is going to tell you how to get an eBook that we put together that’s just in very

generic down to earth terms we explain all that. But the number one way that we are going to be acquiring



these commercial properties too involves owner financing and some subject-‐to. We’re taking what we’ve

learned the hard way and mastered in residential and you guys will be working with us to transfer that to

commercial. There’s several reasons why commercial right now.

On the residential side, I’m going to teach you the categories that work for residential and how to locate that.

Please don’t think that we’re not going to do that at all. But I want to give everybody an opportunity right

now to do something bigger. I want to open your minds to the fact that you can take the same effort and put

it someplace that’s going to benefit you now and in the long run and really take advantage of these next

couple of years, because this market that’s going on right now and the opportunity that we all have, the

people that are on this call right now have, is not going to be repeated later on. We are no longer in our

lifetime going to have the opportunity to deal with (???) right now.

Lon: Okay, Kristi. It is 10:30 Central time. We have 30 minutes left to the call. In detail, now that we’ve

explained what the opportunities are, can you specifically talk about how the subject-‐to process works

relative to commercial or residential? They’re the same essentially, but can you explain that to the people

that don’t understand so that they have some confidence about how this process might work too?

Kristi: Yes. Let’s briefly discuss subject-‐to because this is going to be something that you’re going to hear over

and over again going forward. Subject-‐to basically means taking over a property subject to any liens or

mortgages that are on the property. If you have a house and say the house is worth $150,000 and maybe you

owe about that much on it… Most of the houses that are sitting on the market right now, they price to cover

mortgage, not necessarily the price of what the house is worth. When you take over something subject-‐to,

you buy the property. The loan stays in place, stays as it is in the seller’s name. Property is transferred to the

buyer, and then the buyer is responsible now for those payments, taxes, insurance, everything to do with the

house. It’s just a term of finding a thing. Again, we try to simplify the process. Subject-‐to is basically leaving

the loan in the seller’s name and buying the property with that loan staying in place. People say “Okay” and

I’m sure your question is “Why would somebody do that?” If you have a house for sale that you need to sell

and you can’t put it on the market with a realtor, list it, let it sit there for several months and sell it for

enough to cover the loan and realtor fees and closing costs and all that. That would be a motivation. You’ve

got somebody that will step in and take over your payments and let you move on with your life. That is the

reason why somebody would do it. There are lots of motivation. It doesn’t have to be even necessarily that

somebody is in a financial situation that they can’t make their payment. Sometimes we can even do this with

houses that have a lot of equity and then make payments to the seller on their equity. But there are many

reasons why people will do this. We’ve seen it all over.

One of the things that really is critical when you go into this business, when you go out to the marketplace, is

don’t prejudge. We’ve learned that the hard way too. You never know what somebody will do. The number

one thing that you can do to help your business, whether it’s residential or commercial, is learn to connect

with the seller and find out what their story is. I used to drive Lon and Donna crazy because I would get on

the phone and my first question is “Tell me what your story is. What’s going on? What’s your story?” That can

be a long phone call, but if you will ask somebody that and you will listen and take notes, they will tell you in



that conversation what it’s going to take to buy their house, what it’s going to take for them to sell you their

house.

Lon: We have some stories about that. We’re talking about major properties. We’re talking about properties

that range in the hundreds of thousands to over a million dollars. Every kind of professional individual, from

attorneys to doctors, you name it – people are people. Their situations are really no different. There may be

factors or multiples of what we are or whatever, but generally speaking, people are people. Generally, they

have the same problems. Don’t discount an opportunity because they may be a doctor, a lawyer, a

professional person, whatever, everybody – a pastor, a rabbi. It doesn’t matter. It happens to everybody. The

same thing with the commercial. Now, Kristi, relative to subject-‐to and commercial versus residential, the

reason why we prefer commercial now over residential is because of that dreaded act called the Dodd-‐Frank

Act. I say dreaded in the sense that it has really impacted real estate investors around the country. Talk a

little bit about that and why it’s easier to deal with commercial with the Dodd-‐Frank Act as opposed to

residential.

Kristi: I’m going to give – and this is probably going to be the most brief, concise overview of Dodd-‐Frank that

there is, because this law is literally over 2000 pages and it grows and there’s a lot of hidden details in there.

This is more of a “Buyer, beware” because I’m sure there’s people on this call that will end up working with

us and there’s others that will take the information and go do other things, and that’s fine. But this Dodd-‐

Frank Act is critical. It is amazing to me even people that are professionals in the industry that don’t

understand it, don’t even know that it’s there. But in a nutshell, it has done two things. One: it has changed

the rules as far as being able to buy and resell property immediately “flipping”. To me, flip is a four-‐letter

word, but it is a good four-‐letter word. We’ve been successful with that through the years. There’s nothing

wrong with it. In fact, this part of the law was snuck in right after Christmas. It states that if you buy a house

and you sell it in less than 60 days, you have to have two additional appraisals and there’s a lot of other rules

that go with it when you’re selling with a traditional loan – that type of thing. The other thing that it has done

is it changed the lending industry because it has upped the requirements so drastically for somebody to go

get a new consumer loan 30% down. You must be fully qualified in all these other areas. The lenders are

going to be held liable. If you go and you buy a house, they give you a loan, and a year, two years or three

years down the road you can’t make those payments anymore, and they haven’t followed all these details –

unbelievable rules – to get you that loan, then they can be held liable for the fact that you can’t pay your

house payments because they should have known you would have been in that position. Literally, you can go

back and sue the lender and collect up to three years of payments. After this call, think about that and let

that sink in. As a lender making 3% to 4% right now, which is what interest rates are, would you take that risk

on very many people? No. Unfortunately, the people that get cut out of the loans are a lot of people that can

really afford them. Anybody who is self-‐employed, who do business for themselves – that includes doctors,

lawyers, dentists, professionals, all of us who are real estate investors – anybody who is self-‐employed have

very difficult time getting along. I talked to a couple a few days ago and they have great businesses. They own

properties. They’ve got good credit, but they’re both self-‐employed. They’re looking at a $250,000 house and

the bank will not even talk to them without $100,000 dollars down. The lending industry has changed



drastically, and it is just happening. A lot of people are not aware of this. A lot of people don’t understand

some of the things that are going on. 30% down cash is huge, and like I say, a lot of other qualifications.

Lon: So what you’re saying, Kristi, is that there’s a huge opportunity using the techniques in the model that

we use – “owner financing”, subject-‐to – that the opportunities for us and for the folks that we’re partnering

with and they’re going to be bringing deals to us are going to be wide open because of Dodd-‐Frank?

Kristi: The opportunity is going to be wide open. However, the residential properties that we close are going

to be more expensive to close right now, but there’s also a lot more detail in getting them closed. You have

to make sure that you’re doing them correctly to protect yourself because when you buy a house subject-‐to

and you resell it on owner financing, we have to follow the same rules that the banks do. The good of that is

that scares a lot of people on the market that don’t know what they’re doing, and it opens up a lot of

opportunity. But the other side of it is you’ve got to know what you’re doing. You’ve got to work with the

right people. But we can get them closed. We just have to get it right. Part of the reason we start taking a

really hard look at commercial is those rules don’t apply to commercial.

Lon: That is the point that I wanted you to make. Dodd-‐Frank doesn’t apply. Like with apartment buildings,

five units, four above is considered commercial. Correct?

Kristi: Correct. The Dodd-‐Frank Act is geared towards consumer loans. That is the person living in the house,

buying the house and getting that loan. This is completely different. Another point that’s really critical – Lon,

you just made me come back to – is if you’re going to go into the market and buy residential properties to

own as rentals, buying them with subject-‐to/owner financing is a tremendous way to do it because, again,

Dodd-‐Frank does not apply to you because you are not a consumer living in that house. Those are some key

things that don’t sound that big a deal but if you think about them, they can shift how you’re doing your

business and really make money. There’s obviously a lot more details to it, but those are some things to think

about. Commercial – you don’t have the emotions. You don’t have the headaches of all the Dodd-‐Frank Act.

Yes, there’s a lost more details to it, but that’s why being in a position that you guys are in, you have the

opportunity to be involved without all the responsibility and risk, and it’s a great place to start.

Lon: Kristi, great. That’s fantastic. Question for you: Most of these folks on here, the majority of the folks on

here are first time looking at real estate and referring business to other investors, i.e. us at Swing Sign

Corporation. What would you tell those folks that are just looking at this as an opportunity? What would you

tell them would be some places that they would be able to look and identify commercial and residential, but

primarily commercial since that’s our focus? Where would they look? What kind of tips would you give them

to look? How would they approach finding the properties where they would submit them to us?

Kristi: Very good question. This is the place to take notes. There are two types of properties that we’re

looking for. Remember we’re looking for wholesale type properties. There’s problem properties and there’s

problem sellers, or distressed properties and distressed sellers. A distressed property is a property that’s

mismanaged. A lot of people get these apartment complexes or these mobile home parks or self-‐storage and

they want to run them themselves. Not a good idea. Their rents are way below market. Their occupancy is

low. They need some light cosmetic fixes. We don’t want major rehabs, but they’re just run down. They’re



the problem properties. A lot of times that seller doesn’t have the ability or the knowledge to manage

markets or the money to take them up.

Then, there’s problem/distressed sellers. That is somebody who is running out of money, who doesn’t have

the finances to continue to run it, who has reached an age where they want to retire, they just want out of it,

they’re tired of it, health problems, divorce. All those same things that affect residential also affect

commercial. You can have a perfectly beautiful property and a seller that just doesn’t want to deal with it

anymore, or you can have a seller that isn’t in financial problems but they just don’t want to deal with the

property anymore. There are two different kinds. If you will start seeing yourself as somebody scouting, bird

dogging, looking for these deals, you will be amazed what you’ll come across.

I’m just going to give you a few criteria. Pick a property that you want to focus on. We’re going to have to

pick a couple of areas. It doesn’t have to be right in your own little town, but it’s better to start local and then

maybe another area that you have some knowledge about, contacts and that type of thing. Of the four that

we’ve talked about – apartments, self-‐storage, senior living and mobile home parks – pick one of those that’s

more interesting to you, because if you’ll focus, you’ll do a lot better. Let’s just talk a little bit about income-‐

producing property or basically all of these, because in commercial, it’s all about cash flow. When you get

involved in commercial and you’ve got a spread in there of a couple thousand dollars a month versus a

couple hundred dollars a month on a residential, you can see how it changes drastically. Income property –

we’re looking for any kind of income property that we can add value to that has significant upside.

Sometimes you’ll see apartments advertised and it says, “96% occupied, in beautiful condition,” all that kind

of stuff. That’s not what we’re looking for.

Lon: That is not what we’re looking for.

Kristi: No. I know it sounds really pretty. You want the ones that are, like I said, run down.

Lon: “Oh my god” is what I call them.

Kristi: “Help me get out of this building.” Location – either downtown or on the edge of progress, that type of

stuff. You want something that has decent road frontage. If it’s got (50:56) with it, that’s great. We avoid

really bad areas or areas where government is fighting the growth – that type of thing. A lot of people that

did commercial talk about LoopNet. It is a place to search things. Craigslist – we can provide you with some

ads to go in on Craigslist in your area or search different things that let people know that you’re in the

business. You’re looking to help people. That means you buy commercial property to sell commercial

property.

Lon: This might be a good time to say that in future calls, we will have a call about just marketing and about

how to do that, how to build your business – that kind of thing. Once we identify the folks that are interested

in working with us, and once they make the decision to work with us, then we wrap our arms around them

and we try to help them with success, because if you’re successful, then we are successful. We’re depending

on you essentially. I do training on marketing – that kind of thing – as well. Kristi is right. We can provide

Craigslist ads and different things, ideas and help that way. I’m sorry, Kristi.



Kristi: That’s okay. In this call, you’re also going to be asked to send an email and we’re going to send you the

detail sheets of what we need for the different categories in the acquisition. There are five basic things that

we have to know about any property that’s submitted. This would include commercial or residential. These

are five that you just want to get down, you want to get them in your brain, and you want to be asking these

questions. The first one is the asking price. You gather the facts on the seller, on the prospect. Whether

you’re dealing with the broker or the owner, you have to know. If they don’t want to disclose what the selling

price is – sometimes in commercial they say “We’ll make an offer” – no. You want to know what is their

asking price.

The next question is “What is the as is value?” What is the value as it is right now? Not what they think it’s

going to be in the future. Not if you do all these wonderful things to it, because a lot of people try to sell

commercial on what it’s going to do in the future. We want to know what is it worth right now. Before we

can ever decide to make an offer on it, we have to know what it’s worth right now. Commercial is based

mainly on numbers. But even with residential, what is the current price, current value?

Lon: I would say that we can help them with that too. If that’s (???) information, then we can help them with

that process – determining as is price.

Kristi: Yeah, especially on the commercial because it’s a little bit more difficult. But if you’re dealing with a

broker or even getting that price, and then the after repair value. What is it going to be worth when fixed up?

What is the after repair value? Again, we can help figure out some of that stuff. But on residential, if it’s

falling apart, we’ve got to know the difference of what it’s worth right now and what it’s going to be worth

after it’s fixed up.

The other thing is – and this is where a lot of people hesitate and this is a thing that we can teach you how to

do very easily – “What is the debt on the property?” What is the loan amount? What is owed on that

property? That’s going to have a lot to do with how we structure an offer, residential or commercial, and

whether or not it’s even a deal. Don’t ever make an offer to somebody without knowing what the loan

amount is. If you find out what the loan amount is, the next question is “Are there additional liens on the

property?” Residential or commercial, you’ll be amazed how many people just leave that out.

These are very basic, what I’m going through right now. I don’t want to overload you, but that’s what I said.

We try to keep things simple for right now. Then, what repairs are needed? Does it need some light basic

cosmetic repairs? Is it a complete tear down? Is it major constructions? What repairs are needed? We’re

mainly looking for light cosmetic type jobs, but some things that would turn most people off. We love that

people will look at it and say “Oh my gosh, it smells bad,” or “It looks bad” or “The carpet is ugly” – that kind

of thing. Let’s ask that stuff because that’s stuff that’s easily fixed and it really increases value.

Lon: Or let’s say a senior living facility that’s got a lot of bad press in your local town. There’s things that

people will run away from that we would run to.

Kristi: Exactly. Very true. When you’re thinking about commercial – I know because this is what happened to

us when we first started getting involved with commercial – you think it’s this big scary management and all



these things. You don’t have to be doing those things. That’s for other people. We leave the details to the

professionals. We don’t manage properties ourselves. Don’t worry about all that stuff. Just worry about

getting the details about the deal. Try to connect with the seller if you can. If not, you’re connecting with a

broker. Getting a couple of commercial brokers on your team is a great way to do it. But you deal with them

all. Connect with people. This is a people business. Yes, it’s a numbers business and a money business, but

more importantly, above anything, it’s a people business. If you will make it about relationships and helping

people and helping solve their problems, then you’ll do very well in this. If you just focus on you’ve got to get

that one deal, it’s going to be more difficult. A couple of words of advice: Don’t fall in love with a deal. The

first deal is like your first crush when you’re young. You can get so wrapped up in it and so committed and

dedicated to it that you pass up a lot of other opportunities. But don’t fall in love with a deal. Trust me. Been

there, done that. I learned the hard way.

Lon: Go ahead. I’m sorry.

Kristi: That’s okay. Don’t try to take over somebody else’s problem that can’t be fixed. That’s why it’s a very

specific criteria of what we need.

Lon: And we will help them with that. We will help you identify what the opportunities are. We’ll also help

you understand if it’s not an opportunity for us. Of course it’s your deal, but we’ll try to coach you and help

you to stay away from those kinds of deals because we can save you a lot of time. That would be part of our

job as well with you.

Kristi: I want to go through a couple of criteria on residential because I know that people on this call – that’s

what they want to focus on, and that’s fine because there’s definitely opportunity there. One of the best

places to find deals – Again, we are focusing on deals that we could possibly buy, subject-‐to, owner financing,

that type of thing. We’re not looking for anything that we’re going to go in and have to cash out. You go to

Zillow and look for stuff in your area that fits the medium price range and a little bit higher, whatever that

happens to be for your area. There are a lot of houses in that criteria. You can look at the days on market in

Zillow the ones that have been on the market for several months. You want to look for keywords –

motivated, seller financing possible, distressed, reduced, those types of things. You want to look for the same

key search words on commercial too. But when it’s residential and if there’s a place on there where you can

contact them, if you’ll just send them a basic email, say “I’m looking for a house in your area. I’d like to get

more information about your property,” you’re not looking to list it. You’re looking to buy it. Make some

connections on there. You can go ahead and send out ten emails a day or 20 emails a day – whatever you got

the patience for. But that’s a way to find good properties in your area, people that need to sell, and they’re

the prime target for subject-‐to seller financing. It’s a great way to start building up some properties quickly.

Lon: And again, when they do that and we see that people are interested, active and engaged with the

process, then that’s when we are willing to spend the time to help them do the deal.

Kristi: Exactly.



Lon: That’s something to keep in mind. I know there’s nobody on the phone that’s like this, but we have met

folks that want us to do all the work. That’s not what this is about. If you find your job would be to bring the

deal to us, we can professionally analyze that deal then make the decisions of that whether we move forward

or not. That’s when we all get paid. The focus should be how to find the deals, where to find the deals, send

those deals in. When you are actively involved and engaged in that process, you will see that we will embrace

that, and that’s when we all make money.

Kristi: Exactly. If you just want to turn the lead in and get the small fee and then run, that’s fine. But if it’s

something you really want to stay involved in and move through the process, like Lon said, we can match the

energy and work together on it. One of the things that we do is we match action with action. If you’re taking

action and you’re putting energy into it, we’re going to match that. When you’re on our team, you’re not

alone. We’re working as a group. We can save you a lot of heartache and money and all that kind of stuff.

Lon: Kristi, it is almost 11:00 Central time, so we’ve been on for almost an hour. Let’s wrap this up and tell

them what the next steps are as far as what we’ll be sending them, the next training call of the people that

are interested, and how do they contact us.

Kristi: First of all, when we get off this call, we would appreciate it if you would send an email to:

[email protected] . That’s where you submit questions, suggestions, comments, all that stuff.

There’s few things you’re going to get for today. One: You’re going to get an eBook that talks about subject-‐

to. It’s focused all on residential, but it can transfer. But I think you need to get some basic knowledge of the

best way to purchase properties in this market. The other thing is you’re going to get an outline of what

we’re looking for, kind of an acquisition criteria. It will cover all the basics that we’ve talked about as far as

the different types of real estate. There will also be basic property overview sheets for each category. That’s

the information that we need.

Now, when you look at those, there’s a lot of questions that you might not have the answer to at the

beginning. Get what you can and send it in, and we’ll work through the rest. Don’t wait to send something in

because you don’t have every single last detail. We like to get them in and get started. What I’m going to ask

you to do is: Pick one to three markets, the areas that you want to work in, and chose the type of property

you want to look for. Spend one to two hours online within this next week, looking, getting used to doing

searches on properties. Don’t waste your time going down rabbit holes on all different types of things. Pick

what you’re looking for. Try to locate ten different properties and call ten brokers in the next 14 days, next

two weeks. Ones that are listed for sale on LoopNet, on Craigslist, anywhere online – just pick up the

phone and call them. They don’t know you. You don’t know them. It’s a great way to break the ice. You will

learn a lot doing that. Take notes. Even if you don’t get one of those deals that you turn in, it’s okay. It’s a

good learning process. Get used to asking the questions.

Lon: Just to sum everything up, I would like to say that if you are interested in moving forward and learning

more about how you could work with us – and right now you may be a little shaky. This may be more

information than you can process right now. It may be too little – whatever the case may be for you, if you

feel that based on what you’ve heard today that you would like to work with us, then please send us an email



and tell us that. That’s essentially how you’re going to get information back from us. We’re not going to

waste time. I don’t want to waste your time. We’re just happy to work with people that are engaged with us.

If you’re interested in working with us and learning more and working with us and moving forward, let us

know. My email address is [email protected]. Kristi’s is [email protected]. Send us an email

anytime and we will respond. It may take us a little while. As you all know, or many of you know, our

company is Swing Sign Corporation. We’ve been in business for over 14 years. We do a lot of business doing

Swing Sign, but concentrate on the bird dog side of this business so that we know that that’s where you’re

coming from, so that we can take specific interests and actions regarding the bird dog process. If you have a

deal… If they have a deal and they have the sheets, they send information “Yes, I’m interested. Lon, Kristi, I’m

interested,” I’ll send them the package and then they find the deal. They don’t even know what the deal is.

They just have to send the deal in and they send the deal to [email protected]. Any deals will go in

there. Donna Garcia – you’ll meet the person that does 99.9% of the work on the front end for us. She will

analyze those deals, get them to Kristi or I. Primarily, ultimately Kristi will get the deal and then we will look

at the deal and contact you.

Kristi: You’ll probably receive a phone call from me. We’ll set up a time and walk through. It’s a tremendous

way to get educated pretty quickly. Again, the reward for going out and doing some action is getting more

one on one. We’ll look at it together. We’ll walk through what is the best outcome for this. I look forward to

working with the people that really want to move forward. It’s a tremendous opportunity. I encourage you to

do it if you have a passion for this business. But make it more than not just about the money. Make it about

something that can help people and be passionate about it.

Lon: Right. Very good. Thank you so much for joining us today. We’re not going to take questions and

answers today, but if you’re interested, our next session will be questions and answers as well. We open it up

at the end after the first basic training call. We will get to know you all and look forward to…

Kristi: Yes. We’re happy to answer your questions by email.

Lon: Yes, we are. Kristi, thank you. Donna, thank you. I know you’re on. Everybody that has attended, I

appreciate your time. Good luck and hope to be working with you soon. Take care.

Kristi: Thank you. Bye Bye!



ABOUT US

www.BirdDogBucks.com

a division of:

SwingSign Corporation

PO Box 701586 San Antonio, TX 78270-‐1586

PO Box 3444

Carbondale, IL 62902-‐3444

www.SwingSign.com [email protected]

(210) 704-‐7708 (866) 631-‐1015

Lon Reed President & Founder

Kristi DuVall Vice-‐President & Principal

DISCLAIMER The information contained in this ebook is provided for informational purposes only, and should not be construed as legal advice on any subject matter. WE ARE NOT ATTORNEYS and you nor ANY recipients of content from this ebook, clients or otherwise, should act or refrain from acting on the basis of any content included in this ebook or on any of our websites without first seeking the appropriate legal (or other appropriate professional) advice on the particular facts and circumstances at issue from an attorney licensed in your state of residency. The content of this ebook and our website(s) contains general information and may contain out-‐dated and/or incomplete information, inaccuracies, errors, and unintentional failures in fact and may not reflect current legal developments, verdicts or settlements. Lon Reed, Kristi DuVall, SwingSign Corporation, partners, employees, affiliates, divisions, consultants or agents, and any affiliated businesses, expressly disclaims all liability in respect to actions taken or not taken based on any or all the contents of this ebook and/or our websites.

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