On this episode of the Note Closer’s Show, Scott interviews note investor, Gail Greenberg, who has closed on 30 note deals in her first year of being a note investor.

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Note Investor Gail Greenburg

I’m really excited to have as always our special guests but today’s guest, this lady, has been in the note business for right at almost exactly a year and done some amazing things. We’re overjoyed to have our good friend, Gail Greenberg, today.

Hi, Scott.

Gail, you have been in the note industry for just over a year now for the most part, right?

Yeah. This week coming up with Note CAMP signals the official one-year anniversary of my entry into the Scott Carson tribe.

What were you doing prior to the Note CAMP? Were you just getting your feet wet trying to figure things out?

Yeah. Like most people who come to Note CAMP and then later joined the Mastermind, I was stalking you online for a long time, watching lots of free videos, trying to put the pieces together. Then I really took the plunge at Note CAMP.

For those who don’t know, Gail was our social media winner, social media expert. One of the things that we run at Note CAMP is we run promotions pretty much every day of Note CAMP to see who puts out the most creative post and things like that. Gail did it on a consistent basis. At the end of it, she won the grand prize of having a year membership for the Note Mastermind and coming to a Fast Track training and stuff like that. You’ve really leveraged that to really kick-start your way into the note industry. You want to talk a little about that?

Yeah. Up until that time, you have a tremendous number of educational videos online. You put up more every week. It’s almost Scott Carson tribe. It’s almost more than someone can absorb. I remember I was visiting my daughter at college and she was in class one afternoon. You did a four-hour session where you were breaking down a tape and showing all the things and I had nothing else to do. I wasn’t even serious about notes yet, but I sat and watched the whole thing and it was just hilarious. I kept looking at you and thinking, “This guy really is committed and passionate about notes.” That really got my attention. I should say also I had been in real estate before this. Like most people, I had done some flipping. I didn’t own any holds of my own but I managed student housing here in Philadelphia for out-of-town investors and I bought buildings for them.

When I was in that experience, I really started thinking about notes because I had a student apartment that was home invaded twice in the first two months after we bought the building, which is crazy. It’s a terrible section of town but still nobody gets hit twice in two months. It’s very suspicious. It turned out they were drug dealers even though they look like students. There were lots of cash and drugs and the word was out. That’s not a great position to be in as a landlord to have an apartment that’s on everybody’s radar. I was literally cutting a bullet out of the wall for the police in that apartment. I was on my knees with a bread knife cutting a piece of dry wall out and thinking, “There has got to be a better way to make money in real estate.” That’s when I really started thinking about notes. No shooting involved in notes so far.

I’m not going to say you’re the first want to deal with gun shots or stuff like that because we have several ex-police officers that are in the Mastermind. They are closing deals. They have dealt with rentals and things like that and had rentals in rougher parts of town but that’s the first one I’ve heard where you’re actually cutting a bullet out for evidence of the police.

I have an investor right now, a JV, Eric Hyde. He’s a cop in California. He will, I’m sure, have great stories too. In fact, I know he got shot. That never happened to me.

Let’s talk about what the last twelve months has been. You went to Note CAMP. You won Fast Track seats, a Mastermind seat. You came in to Austin a couple of weeks later. You went through the training and stuff like that. How many deals have you done in the last twelve months?

If I close on all of the ones I’m doing due diligence on right now, I’ll have 30 altogether.

It’s a tape of sixteen? Is that what we’re working on? Is that right?

Right now, yeah. I’ve got twelve-ish that I’m bidding on and maybe getting.

You closed on about eighteen, nineteen right now so far for the year?

Yes. It’s been a big year. I went to Fast Track the weekend before Thanksgiving 2016 and then the December Mastermind was a whirlwind two weeks later, first weekend in December. That was really the big introduction and that was amazing because a lot of the people who are on Note CAMP as presenters are actually in the Mastermind so suddenly I’m hobnobbing. When you think of how small the note world is, you guys you’re longest, most experienced investors really are and your colleagues really are the royalty of the note world. They were all just friendly as all get out and we had a great time in Disney World.

I wouldn’t say we are royalty. I think we are all just average Joes. We do business as the whole theory of coopetition. I think we all live that and believe that because there is plenty around. I think the idea that we instill from the get-go of building a network nationwide has really been a big part of it and helped out a lot of people to not only leverage but also to reach out and pick people’s brains. You do a tremendous job with this as well of communicating and sharing what knowledge you have with people that are brand new in the industry. You want to talk a little bit about some of your experiences with that?

Yeah. I just want to say Jay Tenenbaum introduced himself to me at the Mastermind, which is amazing. Maybe you’re not royalty, maybe it’s more of a rogues’ gallery but you are collectively probably the most experienced people in the note business. I have found that right from the get-go. I could call anybody and they would pick up the phone and talk to me even about things that were really beginner’s questions. People are incredibly patient and kind. Every time I learn something new, I want to go ahead and let everybody know because I know how much this business, you learn it inch by inch. You get some big conceptual understandings very quickly. We all understand what a note is. We all understand how it works, you can get the house or you get payments. There are just a million details involved in every one of these things.

I’m sure you were going to ask me about this eventually but my first note that I bought after I had it for nine weeks and we were doing a forbearance plan and all excited. Everything is going so great. The borrower wanted to re-perform and it was super exciting. She suddenly went quiet and my loss mitigator couldn’t really find out what the situation was. It turned out that nine weeks after I bought the note, the house burned down to the ground. I wasn’t scared because I had insurance but I had very minimal insurance because until you have a certain number of notes, sometimes you don’t really qualify for insurance programs that let you insure the full value. I had paid $15,000 for the note. I only had it insured for $25,000, which would have given me a nice little return but it turned out that the borrower had it. Even though she hadn’t been paying her mortgage or her taxes, she had been paying her insurance. It’s a good thing her insurance company wasn’t suspicious about that. It was a question in my mind, “Why would she do that?” They gave her a full payout. I got a full payout of my unpaid balance which is $42,000 so that was a profit.

You paid how much for the note?

$15,000.

Unpaid balance or payout was roughly $42,000?

Yeah. That was a good one.

Did you file to claim money to your insurance as well?

No. I was told that it’s not like life insurance where you can get everybody to pay you but I could. Could I not?

Yeah, you could. The fact that you get an insurance on it, definitely both is better. Let’s talk about the first one. You’ve got $42,000 payoff on a $15,000 investment. What was the time frame?

It burned after nine weeks, only on that note for nine weeks. The insurance settlement was a long drawn-out affair because the borrower wanted more money than the insurance company was offering her, which was hilarious in a way. I had a realtor looked at that house before I bought the CFD. He told me it was worth $55,000. She had it insured for $113,000. The insurance company offered her $110,000 and she fought them for four months and probably got less because she hired an adjuster. She had to pay him. She probably got less than the $110,000 that she would have gotten if she had accepted it on the first day. This whole thing, this is just an example of how you can learn whatever in the classroom, but until you start buying notes, you don’t get in to the minutia of everything that really happens. In this case, I talked to many experienced note investors, many of them had never had a house burned down. I’m a trailblazer in this respect. I was just trying to figure out, “What happens? What am I supposed to do? What did she do? Can I do anything about the fact that she’s delaying? Can I just say just give me my part and you can fight with her forever?” But it doesn’t work that way. Nothing happens until everyone has signed off from it.

It’s a good point that you made there. There could be a video at every little niche of everything in the note industry and you would never get around to pulling the trigger on something. There are so many little different niches. I think I’ve had four fire claims throughout my ten plus years. You made a good return. Was that your own funds or you joint ventured with somebody on that deal?

That was a Roth IRA. I never have to pay any tax on any of that.

Let’s talk about this. That was your first deal, how many did you buy? Did you buy primarily just one-offs for the most part?

Initially, I bought two after the Mastermind when we were all bidding. I bought three or four more at the end of January, another one in February. I wasn’t really prepared for this. I didn’t know the cycle of note sellers but it seems like once March, April came, everything just went dead. There wasn’t a lot of tapes to look at. When you got one, a lot of the values were not good and they’re too expensive. I used the time to get my systems set up and just do some things that I had neglected when I was shooting myself out of a cannon back in December. I got things done but then even when I was ready again to dive in, there wasn’t a lot available. I started really looking at whether both upping my efforts in reaching asset managers but also looking at other ideas that were inspired by Masterminders. A lot of times we look at a note that hasn’t had any payment in five years and you think to yourself, “There’s a good chance I’m probably going to end up owning this house,” if people haven’t paid for so long, maybe it’s vacant or whatever. I thought, “If I’m going to end up owning that, why don’t I just look at houses that are for sale? REOs or even MLS-listed houses in inexpensive places. Maybe I should just buy a house where I can already see what the inside’s going to look like and I know how much renovation budget I need and I can turn it into a note by selling it with seller financing.” I didn’t end up doing that at the time, but I have one now that I’m buying that is my first foray. I’ve also taken back at CFD so that is up for sale with seller financing.

What happened with the CFD? Did you end up evicting because they didn’t pay or they just walked away or Cash for Keys?

No. I don’t think this happens very often but it was occupied when I bought it. We made all sorts of assumptions the way you do with a CFD if it’s occupied like, “It must be a functional house that someone is living there.” That’s a big assumption. It turns out not to be true. What happened was I think when they got the goodbye letter they thought, “People have left us alone all this time but now there’s somebody new. Maybe we should pack up and go.” It just went vacant. I never really got to speak to them about what their mindset was. They fled and left quite a pile of trash and busted up house behind when they left.

We have a question, “What avenue has been the most successful for you in getting JV partners to fund your deals?”

I had not really put that much effort into looking for JV partners. I had one investor when I started this who had been an investor for me in flips and in a student housing also. I had some funds on my own and he was pretty aggressive in what he wanted to do. The biggest thing I did is that I started getting active on BiggerPockets, which was just the tiniest little nugget that Scott gave at the Cape Coral Mastermind. Just set alerts in BiggerPockets for when people are talking about notes and just go in and say something. I did and since August, I’ve gotten six JV partners just from that.

That’s from just reaching out and talking to people. Basically what you’re talking about is you go and set up your keywords in BiggerPockets. I’ll share what mine is then you’ll share what yours is. I put in the mentions of my name, Scott Carson, in the keyword search, even my competitors. Then I also put self-directed IRA, notes, Quest IRA, SD IRA, and then SDIRA, and then 401(k) as well.

You must be getting alerts every minute.

Not really. I go through it. I spend about 30 minutes a day on it. I don’t really spend that much time on it, usually between 4:00 and 5:00. I go on and I just look a little bit. It may turn into an hour if I’m responding or communicating. I get some junk on there. It doesn’t make any sense so I just view it and delete the alert. If I don’t do it for a week, I’ll have a hundred alerts in my BiggerPockets to go back and clean through. A lot of those are just conversations to get rock and rolling as well.

You get an alert every time someone answers that person who said the word first. You get a lot of emails. You’ll never feel alone again if you put some alerts on BiggerPockets.

You said you’ve found some JV partners. What are some of the keywords that you have in there?

I really only have notes, SD IRA and Scott Carson. That’s what I say, if you got all these other ones, it would be a full-time job.

Surprisingly enough, most of the keywords are self-directed IRA and notes. That’s where 90% of the alerts pop up out and that’s okay. Wayne Snell has done the same thing. He’s been using that aspect for awhile when he was guest a couple of weeks ago on the show here and doing the same thing. He puts alert, somebody responds, he goes out and comments on them, gives them link to a video. You get on the phone and talked to him, right?

Yeah. Whenever I get an alert and I go and comment, Wayne, Adam, sometimes you, you come in later because you’re smart you only do it once a day, every time it goes off I’m like, “What have you been talking about now?” I was like a squirrel. Most people end up, if you answer them, they end up sending you a colleague request and a message. There are not a lot of people who want to learn about notes I find, because a lot of people had been burned. There’s a lot of people who are afraid to flip now because they think the market is about to crash again.

We’re taking on a lot of REO refugees and fix and floppers. That’s it because we still see a lot of deals. I could agree with what you said earlier on about how it’s slowing down after March a little bit, especially a lot of the funds. They’ve gone through and cleaned up their cupboards at the end of the year, at the end of the first quarter. I often find that’s a good time that I follow back up with the banks or the hedge funds that we’ve made offers and previously that weren’t accepted. That way, we just follow back and follow back up. Oftentimes, deals won’t close and they’ll fall in our lap as well. We also spend a lot of that time diving into especially hitting the banks hard because they often will have stuff that’s dragging around and you can’t go there. You’re getting most of your deals come from the hedge fund for the most part, low-hanging fruit?

Yeah. I haven’t been good at really developing my own sources though. I am certainly working a lot harder a bit now. Now that I’ve been through a year cycle and I see what happens, I joined up in November, December. There were notes everywhere. They were falling from sky but I didn’t realize that there are these droughts during the year. Now, I have all these new JV investors. They’re doing the same thing. They’re like, “There’s so much to choose from.” I’m like, “Buy this now. I’m showing you, these are excellent deals. I don’t care if you don’t love the house. Buy them now because in March, you’re going to be upset if you don’t and you’re going to be very sad. I will tell you that I warned you.”

We have a question here, “What are your 2018 funding goals?”

I’ve never made goals but now I can see that that’s important. That’s an important driver of one’s activities and it guides you how you spend your time. This year has been like putting out fire. There are some chasing the obvious things. Then what you realize is that once you’ve been through a year and you really see what the rhythm of the year is, you’re in a much more of a position to do planning. I do a lot more analysis now. I haven’t really made funding goals. I know my numbers so well; the planning that I do in terms of the acquisitions I want to make. I sat down once I had a portfolio of twelve to fourteen notes and I just did an analysis, “For every $1,000 I spend on a note, how much income do I get per month?” The number turns out to be $24. Based on that, if I have a goal and I do, and I think we all do, of having a certain amount of cashflow every month, how much do I have to have invested? Either my own money where I have 100% of the deal or JV where I have 50% of the deal. It’s been very helpful. Not only that, it’s going to bled out into other aspects of my life. I have analyzed my phone bill. I have analyzed my cable TV bill. I got rid of my cable TV. I just really understand all my numbers in my life. I would say I feel way more organized now in every way. I will be making some real plans now that we’re getting into the closing months of 2017.

That’s probably a good idea. I plan things starting usually about two months before the end of the year. I’ve already started planning my 2018. I already got the yearly calendar up here. Note CAMP is coming up. Once we get through that, then I really start diving into the numbers for 2018. I turn it into a fourteen-month year versus just a twelve-month year to plan out. I’m already planning out six months ahead of here for schedules and things like that, speaking gigs. Looking at our numbers what we end up with at the end of this year too will help us strategize, “Do I need to be buying more in the first quarter? Are we going to be spend time on workouts of what we’ve bought for the last quarter of 2017?” Jen in the office is like, “You’ve got to slow down a little bit.” We’re going to play catch-up a little bit. It happens. You get started, you close some stuff and you play a little catch-up. You close some more, you play a little catch-up. You get your systems in place and get things off and running and go from there.

We have another question, “What are you paying your JV partners?”

I do the classic split of 50/50. They fund, I do all the work, and we split everything 50/50. I’m at a stage where I’m new with a lot of my JVs. That’s actually what complicates my time a little bit too. Nobody is experienced yet with notes so I’m having to spend more time than I will down the road working with everybody, making sure they’re comfortable and they understand what I do that I think is a little different. I’ll probably only do this until I have more money than I can shake a stick at. If the JV split, I want that to give the JV partner at least a 12% return. If we need to jiggle it a little so I’m getting a little less so that they’re getting 12%, that’s what I want to do.

Are you using an LLC for that?

Yes.

You’re also using self-directed IRAs because people are funding with their IRA accounts, correct?

Yeah. I have two self-directed IRAs on my own so I’m very conversant. Now for the first time, I’m doing paperwork for other people. I’m really getting to see what the different custodians I like to work with.

What would you say your biggest weakness is at this point?

Probably the fact that I haven’t really been planning as much. It hasn’t really been a very deliberate process. I feel things have gone incredibly smoothly for me and I’ve come to realize, although I don’t normally give myself credit for things, that I think I’m really good at the note business, just temperamentally and my interests and my skills. It’s a great fit for me.

The sixteen that you’re working on, are these contract for deeds, first liens?

Yeah, contract for deeds.

Occupied, made payments in the last twelve months, what’s the situation?

I only look at occupied. I figured if they’re not occupied, I might as well go buy an REO and be able to send someone inside to look at the inside. I did buy an REO from a tape from Harbour back in January right before I saw you at the Distressed Mortgage event in New Jersey. That is an example of how I’ve been forced jumping my way through some of these early transactions. They advertised this REO as a duplex. It’s a little two-bed, one-bath house in Kokomo, Indiana with nice little street, cute little house. I keep looking at the street views, front and back. It’s one house and I argued with them. We’re negotiating price and I’m like, “This is not a duplex.” It was a shed behind it. I was like, “That is not a second unit. I’m sorry.” They finally caved. I guess they wanted out. I go to an overhead view and sure enough, there are two houses on this property. There were two two-bed, one-bath houses. I bought that first, $13,000. I put $20,000 into renovating the two units together so I’m $35,000 into it. It’s now rented. The gross rents are $1,100 and I’m putting it up for sale because I want a note. I don’t want to own a property. It’s for sale for $89,900 and getting a lot of interest. The guy from Korea is touring today. I didn’t see what it said but my property manager/listing broker just texted me while we were on the phone to say something about how that went. That’s pretty unbelievable.

If you sell it for $80,000 and you’re into it for how much? $35,000?

Yeah. If I’m getting a note, I’ll pay the realtor a little less than he would have gotten. There will be no listing realtor, so maybe it will be $2,000 plus insurance for tax. I’m probably going to get about $12,000 down which will reduce the money I have in the deal to $23,000-ish and I’ll have a note paying over $500 a month.

Above your equity, basically?

Yes. I don’t really want to hit thing back. I’m hoping an investor buys so we’re going to get refi.

Would you sell it outright?

I would, yeah.

That’s the biggest bang for your buck right there is selling it outright.

It’s a hard decision sometimes because you always need to redeploy the money. If you’re getting really high return you’re just like, “If I take the cash, am I going to be able to buy a note that’s going to give me that kind of return?”

Did you solicit other people’s money or your own funds on this one?

This was my IRA also. It’s pretty wild. It’s such a creative business. You’re never cornered. Did you ever try to catch a mouse in your house? They’re in the corner, you run after them, you dive for them and they go a different way. That’s how notes feel to me. Whatever happens, however dire it may seem at first, you ended up just like, “I will go this way if that’s not going to work.”

That’s definitely the case because there are many different exit strategies that happen along the way. Depending what the borrower does, they get their head up their butt or they respond or they don’t respond or they suddenly move out without knowing that they could stay or start paying on time and go from there. I guess you could tell it’s the Rubik’s cube of the real estate industry, figuring it out and it goes from there.

I feel it’s really a thinking person’s part of real estate more so than there’s a brute force aspect of flipping. This is a thinking person’s game which I love. I was a journalist at the beginning of my career. I became a journalist because I love to learn and I’m really curious. This is the perfect thing because every note has a story. Am I right?

Definitely. Sometimes they’re the best sellers, sometimes they’re killers.

I have a lady in Georgia who said this is a note, not a CFD. It was a sub-performer so she never stopped paying entirely but she’s four months behind. She maintains her four-month gap. We just keep moving it forward. When the debt counselors contacted her to see what her situation is, she’s on disability which you find is often the case with older people particularly. Yet when we did her financial, she has a hot car, a car payment and a car insurance payment that are equal to what she owes me on a monthly basis. You sit people down even though they’re older than you are and just be like, “Have you thought about the fact that this could become a choice for you? Car or house? How comfortable would you be living in your car?”

One of the things that it feels to me about this business too is the chance to help people fix up neighborhoods; that Kokomo property with the Harbour looks like the Addams family’s house. You just fix things up. You turn these little monster houses into the gems of the neighborhood and get them working and the tenant’s great and that really helps everybody out. With very tender heart, I really like helping people but a car instead of your mortgage, come on. The older generation, they’re supposed to be smarter than that.

We have a question here, “Who’s been the preferred custodians to work with that you’ve dealt with so far for self-directed IRAs?”

With the note question and Quincy Long will be on Note CAMP, Quest is the undisputed champion in terms of ease. I’ve also worked with Midlands, which I did not know anything about them but they’ve been really good too. The other people that I have, some are raising their own cash so I haven’t really had any direct experience with any others. I have to say that I’ve heard great things about CamaPlan and they’re right near me so I need to give a shout-out to Carl Fischer.

When you think now at a year compared to where you were, you’ve learned a lot, what was probably the biggest a-ha moment? You think back, “That makes a lot of sense prior to.” It’s different for everybody. If I were to ask Wayne Snell, that will be a different thing than it would be if it was a year in the business. What’s the thing that maybe you thought would be the hardest thing that it was like, “That’s not near as hard as I thought it was going to be.”

There had been so many little ones, just really silly things. I hope this doesn’t sound negative but I think one of the hardest things for me was that I came into this with a lifelong perfectionism that made it for many years. When I first was doing real estate, I had a hard time taking the risks involved because I was always afraid I didn’t know enough. I was always waiting to feel ready. I finally just made myself do things, flips mostly, without feeling ready. I realized that you can’t wait to feel ready. There is no such thing as feeling ready. People who are confident always feel ready whether they should feel that way or not. I think a lot of very earnest, hardworking, a lot of women particularly just wait to feel ready and they never quite get there so they don’t do anything and it’s just really a shame. Plunging in, knowing that you’re going to get your education by doing. As much as Scott and other people will prepare you and give you the overview, it is truly something you learn by doing it. There’s no way you could ask all the questions. There would have been a thousand questions if I took everything I’ve learned this year and now wrote down the questions.

I was talking with some friends and they were talking about, “It’s got to be perfect before we send it out.” I’m like, “Sometimes delivered is better than perfect.”

You have to take action. You have to push yourself beyond your comfort boundaries to do things when you don’t think you’re ready. I wanted to tell you something because I think I could be a future presenter on Note CAMP. I don’t know if you remember this from the Mastermind. I’m a certified hypnotist. I use a lot of self-hypnosis on myself to get myself to a place where I could really be brave and bold and do this business. I have seen so much paralysis in other people that I have decided to share what I learned and what worked for me. I am at some point, this could be two years from now, this could be in three months, I have no idea. I’ve got a bunch of new JVs I have to take care of. Things are a little crazy at the moment. I want to tell you that I have a podcast and a website coming out and I was just working on the logo, it’s called WhatTheBleepIsWrongWithYou.com. If you go there now and just enter you email address, whenever I get it together and launch this thing, I will let you know. If you are someone who is feeling stuck and unable to take action to get what you want, I am going to try and help you.

With your self-hypnosis, are you recording it beforehand and then going back and watching it? How does that work?

No. What’s great about this is you don’t have to find time during your day. No kidding, you can listen to the audios when you sleep. For those of you who complain there isn’t enough time in a day, you don’t even need a day. You just need a night. You just need to go to sleep. They make these headbands too with little flat speakers in them. There’s apparently quite an industry of people who try to learn new things while they sleep. I just have to say this little shout-out to you Scott that there are a lot of gurus out there. One of the reasons you have a very faithful following is because you appear, and I believe after knowing you for this amount of time that it’s totally true, that you really want people to succeed. That is your big touchdown; when you teach them and then they go out and they do something. I’ve seen your frustration when people come back time after time to Note CAMP, to Mastermind or whatever, they haven’t done anything yet. I know you’re just like, “What? What’s it going to take?” Being kind and supportive, “I’m yelling at you. What’s it going to take?” Definitely you have your tough love moments.

The thing is it’s not really at the decision makings. It’s not at the surface with people. It’s the subconscious thing. You have to go deeper. You have to really understand why you think you don’t deserve to succeed to begin with. That’s not really a big mystery either and you don’t need years of therapy to figure that out or address it. I do positive affirmations. That’s something that you can listen to. I don’t know if this will sound insane but I learned one. I stumbled into this because I was trying to understand my own resistance to success and happiness. I went to a self-development weekend once. One of the activities we did was to write a letter to our parents about basically listing the things that they had given us that we didn’t want anymore. The biggest things are the ideas about yourself that come from your parents and from your childhood that were never valid, have kept you back, and they’re really wrong. You don’t have to keep believing it anymore now that you’re a grown up. You can’t just decide to stop believing something because your subconscious is like those parts of the computer that you can’t get to somehow.

In this exercise, we wrote this letter and we did a visualization where we went back to our family home and greeted our parents there, sat down in the living room, presented the list to them and said, “Here are all the things you gave me when I was growing up that I don’t need anymore. Thank you for being my parents and doing the best job that you could.” You just hug them and you leave. When they were describing this before we did it, I just thought, “This is ridiculous. I’m not really going to see my parents. I’m not really going to tell them anything. Nothing is going to happen.” After we did it, I could not believe how different I felt. Something happened and that’s what made me get interested in self-hypnosis because stuff really can happen.

There’s no doubt that it can definitely help. I totally believe it. I think in an early age, we hypnotized ourselves with what we say to ourselves in self-talk and things like that. Whether we are on our own side or we are our biggest enemy with self-doubt a lot of times.

What you all be interested to hear probably then since you’ve thought about that, that babies and toddlers spend most of their time in that brainwave state. That is the state that hypnotist put you in to hypnotize you and give you suggestions. It’s just their natural brainwave state. They have a slower, deeper, brainwave state. Everything that happens to a baby, good or bad, they don’t have any way of interpreting it. They have no understanding of anything. But anything that scares them or startles them or frightens them, just gets wired in to them. Things that could have had nothing to do with what they later interpret, it’s just in there. Things happen to everybody. Even if you had the happiest childhood, most people have had bad experiences that they carry with them for a long time.

The trick is how to break the bonds of that and be able to reinvent yourself and feel the freedom and appreciate who you are and the opportunities that are there. If you go out there and make mistakes and I certainly have, that it doesn’t mean you’ve broken the perfectionist code and you’re a terrible person, you’re no good and you don’t deserve anything. That is the process of learning. It is all trial and error. You have to make mistakes. You won’t progress without them and you have to really make them your friends. It’s not difficult.

I see that with friends and people out there. I was very blessed early on to have a very big self-confidence with things like my parents ever told me I couldn’t do something. There are a few times they said, “You shouldn’t be doing that.” I always had that like, “You’re not going to beat me. If I want to do something, I’ll set my mind to it and get it done.” I realized I’m wired a little bit differently than a lot of people that way. Wired, it comes down a little bit different versus somebody who’s told, “No, you can’t do that” constantly growing up or, “No, you’re not good at that.” The things that we take in and listen to or the people that we surround ourselves with really do affect our chances for success.

You do seem really free. I never knew whether you had just been through so many difficult things that nothing scared you anymore or whether you have that for a lifetime.

A little bit above. I’ve been through divorce. I’ve been through facing foreclosure. I’ve been through job loss, shaking out the seat cushions of my car or my house at the couch to find money to put in the gas to drive to work. You got paid that day so you have enough gas to get back. I’ve been down that road before. Trust me, I would not want anybody to go through that. That’s not a fun time. It led to our divorce later on and things like that. Financial struggle is a lot of people go through and that’s the biggest cause for divorce. Once you’ve gone through that and pulled yourself up by the suspenders and dust yourself off, slap yourself in the face to get rock and rolling, you have to go.

I deal with self-doubts on a daily basis sometimes, “Should I really do that? Is that good?” I dealt with one a little bit a few days ago. This is a thing. I like to think I’m a little good at marketing, I’m okay. We ran the idea about being productive at Note CAMP, this online virtual event. I got some interesting photos sent to me from marketing people, from people like sitting in their pajamas or sitting at the pool. I have one guy sent me a weird email sent me a photo of guy holding a computer over his crotch. I’m like, “Wow.” I was talking to my friend, Kristie, and we were talking about, “It’s the one note convention a year where we don’t care what you wear. Come as you are.” I was like, “This is the sexy side of real estate. We don’t care what you’re wearing.”

I spent a little time jumping on some different websites, Shutterstock and things like that. I need to find something where they’re holding a sign. You’ve probably all seen that TV commercial for AdamAndEve.com where the three girls are holding the board and they’re dancing behind them. I said, “I’ve got to find something like that.” We’ve found one and posted it up there. I’m like, “It’s risky a little bit. They’re not showing anything.” The sexy side of real estate, everybody gets their VIP but we don’t care what you wear. You don’t have to wear a suit or wear a t-shirt and shorts. That’s the philosophy behind it but it’s been funny. Overwhelmingly when I posted it and I track my posting, 60% of the people that have clicked on the link have been women versus 40% of being guys. That’s on Facebook. On Instagram, it’s the most completely the opposite, 60% guys, 40% women. I really had a hard time deciding if I’m going to post this image. I was like, “We’re pretty humorous, cut up a little bit.” I’m actually looking for brunette versus blonde but I can only find blondes that made sense.

I sent it to my friend, Kristie Whites and she was like, “This is awesome. You got to post this.” I was like, “I’ll post it.” It had been pretty funny to see. I’ve only got a couple of negative comments from people about that. They’ve told me but sometimes it’s okay to go and shake things up.

I doubt things. I doubt myself on a daily basis on some things. One of the biggest things I think about when it comes to self-doubt is we all worry about what could happen. What’s the worst that could happen and also what’s the likelihood of the worst thing happening? What it’s like even if it does go off well? I had a marketing piece last April that we did that was risky. It wasn’t sexy or nudity or anything like that. We were just poking fun at somebody and around April Fool’s Day, we sent it out. I doubted it first, talked with the staff about it, we decided to ran with one thing. I got a few phone calls. A couple of people were upset about it and I’m like, “Whatever.” It turned out actually to be a good negative I guess you could say where a lot of people came afterwards that I didn’t talk to in forever on that stuff. You’ll never know.

Did they call to scold you?

A couple of people scold me. A couple of people that were close, “You shouldn’t do that. You’re a wildcard.” I’m like, “Come on, really? You’re calling me a wildcard now on stuff like that?” The biggest thing I’m trying to convey here is it’s okay to push the envelope a little bit every once in a while. What’s the worst? They say no and they unsubscribe for email list. Okay, thank you. You’re probably never going to do business with them anyway.

When you were talking about some of the hard things that you went through, really I think as much as we don’t like to experience it, having your worst fear realized and surviving it is the most powerful thing that you can do. I wouldn’t recommend people go jump into a lion’s cage or whatever, but welcome and be grateful for negative things that happen because they are so much more enabling than all the nice, sweet things that are so pleasant.

That’s the thing I think about overcoming your obstacles or overcoming your fears is one of the most important things you can do. You’ll learn more from pulling the trigger on your first note deal. You’re going to learn more from buying your own fix and flip. You’ll get more information than any video could ever teach you. That’s your self-confidence.

When I see people who are afraid to do notes particularly people with real estate experience, I’m really surprised because the amounts of money that you’re venturing are so small compared to flip or buying a rental or whatever. When I saw what you could buy for $10,000, sometimes you’re less than that, it’s unbelievable. I’m like, “What? I’m just going to be scared about this? Let’s go.”

What would you say is the biggest tip you could give somebody out there who’s looking to get started besides going to WhatTheBleepIsWrongWithYou.com and sign up for that?

I’d say it’s really what we’ve just been talking about. Make yourself do it. Do it afraid if you’re afraid to do it. Do it anyway because the only way to stop being afraid is to do it and realize that you can do it.

I will add one thing to it. Don’t be afraid to pick up the phone and call and ask. Go through the numbers with somebody who’s a bit more experienced or somebody who’s actually been there and pull the trigger. A great quote I love from my buddy, Greg Reid is, “Seek counsel, not advice.”

I think this is really important for people who are not yet have slid in all the way or maybe just thinking about it. This is a very generous community. When you think about flippers, they are daggers drawn. They have a scarcity mentality. They feel any deal that you get was taken from them. In notes, it’s completely different. There’s an abundance mentality because there are still a fairly small number of people who do it full-time. There seems to be a lot of things to buy. When you’re in the Mastermind particularly, people are just so generous. Going back to what I said about Jay Tenenbaum introducing himself to me. Everybody that you present who’s in your Mastermind, who’s a presenter in Note CAMP, I’ve personally called all these people. They’ve all spent more time than they should on the phone with me back when I was really new and asking pretty basic questions. People are really kind. It’s very collegial and very pleasant being in this world and being in the Mastermind.

Thank you, Gail. That’s the thing, reach out and talk to somebody who’s doing it. That’s the one thing I’m not a big fan of BiggerPockets about is you often meet a lot of people on there that are just trolling. They haven’t pulled the trigger in the long time. They spend more time on BiggerPockets than in their own business.

I’ll tell you something that’s great about it though. There are a lot of people on there who talk down the note business. There’s an investor in it, rejoiced because, “We’ll have it all to ourselves for awhile.” It’s like my REAL ESTATE. Someone asked on our LISTSERV about notes, “Is anyone doing notes? How is it?” Some of the most established biggest leaders in my local REA which has 2,000 people in it in Philadelphia, they were all just like, “Notes, I would never do notes.” I thought, “This is awesome. I’m going to have it all to myself.”

Let’s talk a little bit about that because you got a lot of people that used to doing business as normal. They’re doing one thing and one thing well. I get bombarded with, “Do you really want to do this?” I’m like, “No. I’ll stick to what I’m doing.” If that’s working for you whatever that is, it’s working for you. I think some people that gets so used to it and we’ve been very lucky over the last seven, eight years, we’ve been very fat and happy for the fix and flippers for the most part or the rehabbers or people that were funding REOs and going that route. You could find a lot but over the last two years, three years specifically, that market has dried up because the banks have gotten rid of the REOs prior to it because they’re selling the dead off to larger institutions. What happens in the whole idea of trickle-down economics? Those big pies got cut up into pieces and the big pieces got cut up into smaller pieces and eventually a lot of crumbs rained down that are still good, that make sense to someone who is locally or the price makes sense where you have enough of incentive now that allows you to buy cheap and still make a profit out of it. We make a very good living off of crumbs in piece of this pie.

People are victims of their own paradigms. People who have been buy and hold landlords cannot comprehend why you would sell the property even with seller financing where you’re still getting a check every month. In their mind, even though they’ll admit to you that they’re working their hearts out to maybe get a $100 net per door per month and here you’re doing nothing and getting probably at least the same if not a little more. Their attitude is, “But you don’t own it. You’re not going to have it to sell years down the road.” I’m in this for cashflow. That’s my end game. It’s really because I’ve been a freelancer and my husband also for many, many years. We were doing really well up until things crashed in 2007, 2008. When it did crash, we had a son in college and another child heading to college. It’s just been really tough and for the first time, I understood why people go after paychecks. This is now me having the best of both worlds because I’m still free as a freelancer but I am putting into effect a cashflow for myself. My first goal like many people was $10,000 a month. I’ve only been doing this for a year. I just did the calculation of stuff that is either we’re definitely buying or I already own. I’m already up to $6,500 a month in passive cashflow. It’s not going to take a lot to get to $10,000. I want to go further because I want to be a philanthropist. That’s my life goal. I want a house in New Orleans if case anyone’s listening has one who has a deal for me. I’m buying a CFD in New Orleans right now where the bullets are flying but I’m hoping maybe the neighborhood will turn by the time.

In your timeframe, you’ve gone to where you’re having $6,500 a month basically come in every month?

Not everything’s worked out yet but when it is, it will be. Either I’ll get the house back and I’ll resell it and get a similar payment or these people will start paying me.

You’re of making that six figures in that first year, right?

Yeah, pretty cool.

Very proud of how far you’ve come and how much further you’re going to go.

Thank you, Scott.

Thank you, Gail, for joining us here in The Note Closers Show. If you are listening to this on iTunes or Stitcher, please feel free to leave a review. You can get registered for every Monday note webinar by simply texting the word NIGHT to the phone number 72-000. Have a great day.

About Gail Greenburg

On March 10, 2015, the stock market plunged 332 points. Why? Because the economy was SO GOOD that Wall Street players were worried that the Federal Reserve might raise interest rates.

Does it drive you crazy that your net worth can be slashed at any time by such ridiculous thinking? Me too. That’s why I started investing in real estate myself and why I’m now giving others the chance to do it by Joint-Venturing with me.

I invest in distressed or non-performing mortgage notes. How can you make money investing in a mortgage that no one is paying? I’m glad you asked – I did a video explaining it. See it at http://WinWinNotes.com

Notes pay a much higher rate of interest than a bank, but offer far more security than the stock market. And unlike a stock, the value of a note is never going to plummet overnight because some Wall Street people got nervous.

If you are interested in learning more, please email me at Gail@WinWinNotes.com or call 215.805.1796.

 

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