TFC Chronicles (Chapter 2)

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lol-Karen...

Bill gone???, why??? your posts are the best! this site just wouldn't be the same without you!

Looking forward to many more of your posts!

Valerie

Wanted to post this on Friday but certain things got in the way of me doing that. So I thought I would tell you a story about having a very good day on Thursday. However, at first glance, most of you will not see this a good day. And I will try to get the point of the story and not drag it out with all of the small stuff. Here goes: One of our people made a horrible deal that began in 2008 and was scheduled for final payments about 10-12 months ago. Because the person in charge of this deal did not follow certain investigative standards, (basically took short cuts on due diligence because he thought it was a "normal" deal) we were standing to lose close to $880,000. Obviously, when this came to my attention, I was hopping up and down like a madman. I immediately took control of the project and have been working with the other parties for 9 months to mitigate this damage. Quite honestly, because the real estate market went "south" after the deal was signed, valuations had changed dramatically too.
My first step was to re-read all 103 pages of contract, addendum, exhibits and projections. Initially, I felt something was wrong but I couldn't put my finger on it. The more I looked, the more it seemed to evade me. I walked away from it for about a month and when I looked at it again; it popped right out to me. The problem was that their counsel drafted the contract under Tennessee law for a project that was located elsewhere. No party had a situs in Tennessee so the contract was either going to be 1) declared void or 2) revert to being enforced under Florida law (where the project was).
Obviously, the other party's counsel had used a boiler plate for the contract but had forgot to change the state information. No one had detected this error in over 2 years. Therefore, through negotiation, I took the course of action that had the quickest conclusion for us and reduced our exposure to only losing $192,000. But that's a savings of $688,000 and that is a good day.
If you wonder why I didn't push for the voided contract , there is a simple answer. I would rather deal with the devil I know that the devil I don't. If I wanted to void the contract, it would have been litigated and it is anybody's guess how it could have turned out. I could have found myself eating all $880,000. That would have been a really, really bad day.
The guy that made the big mistake at our company is no longer here as I bought him out in 2010 and reorganized the processes in which large projects are approved. The lesson here is to understand that everyone makes a mistake but if you're agile enough, you can live another day. Also, you should check your contracts and not get complacent with each deal; as every deal is unique.

Well Bill I see you made it back, we still haven't heard a peep out of those girls or the young bloods yet, glad you made it back. Hope the day held some promise for your time.

Bill, I see that as a great day. Anytime you can save $688k you gotta like that. Glad to see you made it back in one piece. Must have had to sneak through the woods to avoid everyone.

Bill,

ouch-that is a painful lesson and reminder for all of us...
I am very impressed on how you've handled it and kept your cool!

What do they say... the devil is in the details?

valerie

Great job! I bet they will keep you around for a while!

A good day for me is when I will even be able to TALK about doing an $880,000 deal!!!!!!!!!!!!

I think you deserve a diamond for that!

Karen It's getting out of hand that I have to go 12-13 pages before I can get I thread on here every morning.

Got a mailing today that Dean's Private Sales: The Insider's Edge is going to be in Middletown, OH on February 18 at Noon. And I just saw an infomercial that Dean's group will be in Cincinnati on February 12 or 16 (wasn't paying attention) at noon and 6pm doing their explanation of their system. I am sure that space is limited so if you are interested, send them a PM for more information. I just think it is so special when he comes to my backyard I want everybody to go that can.

to the one in Vegas in 2 wks not exactly sure of the dates they are in the book.

Sorry, I don't understand...

That sounds like the same one I went to last week. They also had sessions at 12 and 6. I didn't get out for five hours!

Don't you live in FL?

Are you just going to be in Vegas anyway? Or is this some special, special thing Dean is having?

What is the event in Vegas?

FL it's called the Edge buying summit in Vegas. It was supposed to be in Orlando but they had such a large sign up they had to move the venue. Stop by and see us.....but you'll have to bring a pie or 2

was a new video camera. Sony DCR-SR68 with 60x optical zoom and a 80Gb hard drive. Try to convert our ongoing housing information to video from still pictures. It is just plain crazy how small and light this sucker is. Hope to actually have some presentable video by the end of the month.

It had some great features for video but the sound quality for recording was not at the level I expected for a Sony digital camcorder. Took it back and will research for the attributes that are important. Probably going to focus on flash drive cameras so I can ship the flash drive to other people.

update Bill, please keep us posted on your finds. It could be very useful for everyone. People definately like videos over stills any day and it will give them a better look at the properties.

and the subject of Earnest Money Deposit (EMD) came up. I let the Realtor run on with his chatter about it and then told him that a buyer isn't required by law to make an earnest money deposit on a real estate contract. Not one dime. It isn't necessary to use an EMD; it is the promise to pay that is the consideration of the contract. In fact, the law doesn't require it and essentially says that the promise to buy the property is sufficient consideration.

But please understand, while that may be legally true, most sellers expect the buyer to put up enough money to show they are serious and to make it worthwhile for the seller to take their house off the market during the contingency period.

You just can't undue what real estate firms have been wrongly preaching for years, so don't expect to take the high road and try to convince your real estate agent any different.

So Bill When I buy a property from you don't expect a EMD from me.

there is nothing written in the law that I can't expect a gallon of seafood chowder.

With what I put in it the EMD is cheaper.

Bill as always you have some amazing information. I really wanted to take the opportunity you gave to some DGers to spend time with you. At the time it wasn't with in range for us.

I am late in commenting I know but the business card thing is very very true.

You said they also get something in the mail every month. What does she send?

I leave my cards in public restrooms LOL:) I also leave them at the gas pumps too:)

The 660 savings is HUGE. Wow what an amazing recovery. It also has me looking at my current contracts to make sure I have everything better than before LOL.

Two days till the event you were talking about. Please let us know all about it when you come back:) I would love to know any new information you found or wish to share with us.

As always we love your input and the things you share. Let me know when you make the chowder:) I will be making mine on Friday:)

I want to assume the deal you were talking about was commercial I would love to talk to you about that area of RE. I don't see it much on the site. I just came across some today that looked very interesting. I am looking more into it.

Hope you are having a wonderful night. And your joke earlier yes is so true. Cant tell you how many times a lender had changed rates on us 2 years ago anyways. This is when I had a credit partner:)

Bill I don't know How I got here,it must have been threw a portal from helpme2 website.

in columbia, ky all day and night for a meeting. be back on friday

We'll hold down the fort 'til you get back.

HOw was the event? anything new and exciting? How was your trip and meeting? Did you meet up with anyone?

I'm thinking I must clarify

Perhaps you misunderstood; I was only mentioning the DG events so other people were aware of them and could attend if they wish. I'm afraid to go as they will probably handcuff me and escort me off the premises. LOL

However, if you are speaking about the other meetings that I went to, they were TrustPoint corporate meetings where I was discussing the benefits of joining the TrustPoint banner with other investors. Sometimes we don't talk much business as the meetings occur around a dinner meeting whereby we just talk about life. I probably won't know the outcome of these meeting until mid-March.

Hope this clarifies the situation.

Thanks Bill,

I hope that it went well. I look forward to hearing about it in march but of course not posted:)

The one they had here a couple of weeks ago was the same except instead of notes they had tax deeds/liens.

That is what I would have bought (tax liens/deeds) if I had had any money because I have studied them before and even gone to TX for a tax sale. I found it to be interesting.