Best Real Estate Investing Advice Ever Show Podcast

JF1082: Not a Management Company, Not a VA, But The Best of Both with Linda Liberatore

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Secure Pay One is an amazing solution to landlord problems. They are not a full service management company that takes over control, but rather works with you to help with your duties. Listen in to find out how Linda and her team can help you. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!

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Linda Liberatore Real Estate Background:
-President and Founder of Secure Pay One; A quality service providing beneficial assistance for real estate investors
-Assisted more than 50 real-estate portfolios encompassing over 1000 units with 98% client retention rate Conducted 1000+ seminars on software applications, property management and desktop productivity
-Based in Chicago, Illinois
-Say hi to her at https://www.securepayone.com
-Listen to her Best Ever Advice here: https://joefairless.com/best-ever-success-habit-nations-1-landlord-helper/

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Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless. This is a show where we cut out the fluff and we only talk about the best advice that moves your real estate investing business forward.

This is the world’s longest-running daily real estate podcast, and with us today to help us keep the momentum going – Linda Liberatore. How are you doing, Linda?

Linda Liberatore: I’m good, how about you?

Joe Fairless: I’m doing good as well, and looking forward to diving in with you. Linda is the president and founder of Secure Pay One, which is a quality service providing beneficial assistance for real estate investors. We’ll get specifics as far as what that means.

She has assisted more than 50 real estate portfolios encompassing over 1,000 units, and has a 98% client retention rate. She’s conducted 1,000+ seminars on software applications for property management and desktop productivity, and she’s based in Schaumburg, Illinois, which is near Chicago. You can say hi to her and look at her company a little bit more at SecurePayOne.com. With that being said, Linda, do you wanna give the Best Ever listeners a little bit more about your background and what you’re focused on now?

Linda Liberatore: Sure, thank you for that really nice introduction, Joe. We started the business probably seven years ago, and as you know, and you dive deeper with all your guests, through that time our role has evolved; you always have the business plan, all the research you do, and then reality strikes and you have to zig and zag accordingly.

I say we are probably the number one tenant communication and payment assistance. We’re a little bit different than a management company, that’s what makes us so unique. We support people that are growing their real estate portfolio and do not want to flip over control, if you will, to a full management company. They use us as the form of a virtual assistant.

We have landlords across the nation. In fact, we have some across the big pond. They, for one reason or another — in those cases some men have gone on to Europe… They may have just a few couple investment properties, and then we have others that are out of state and they’ve selected us to be the liaison with their boots on the ground, with their maintenance team, their leasing agents, and then we handle all the servicing. We’re the main point of contact with the clients, meaning the residents.

Joe Fairless: Okay, that’s helpful. So you’re not the management company. Your ideal client would be someone who’s got a handful of rentals or more. They’ve been self-managing, and the paperwork and the time commitment that it’s taking to do all of it is becoming cumbersome, so you’re now able to work with them and you handle some of the tenant communication and then also get them paid on the rent.

Linda Liberatore: Absolutely. I love that you added a couple things to that description. So we are the main point of contact. We’re hired by somebody that no longer wants to be the main point of contact for the residents… So it’s not some, it’s everything. I guess you could say technically not everything, because we’re not the leasing agent. But once that lease is signed, it’s our phone number that’s given out, it’s our e-mail; we become their point of contact.
So the relationship really is with the landlords — when you say “a handful”, certainly they start that way, but we have ones that have gone from 3 to 60 in a couple years, so it’s for people that are realizing, identifying where the weak areas are in their system and outsourcing the lowest level tasks, but some very important tasks, like collecting the money.

Joe Fairless: What are your fees?

Linda Liberatore: We do it on a fixed income, so we don’t charge it based on the rents. Our standard fee for one month, one unit, would be $50. If your average rents are $1,000, if we say nationwide and affordable housing and the average rent is probably at $1,000, we’d be coming in at like 5%. As you know, most full-service management would be 10%.

Then one other important distinction is we don’t pay their bills. So while we coordinate with the maintenance teams — I think this is a really important distinction, Joe… I’m just gonna maybe back up that comment. So when we don’t pay the bills, it means a couple things.

To an investor it’s a very big selling point, I’d say, because those investors that aren’t looking for full-service are looking to remain in control. They want to do it all themselves. As you said, they’re finding themselves being buried, and they still want to be the one in total control, but they see that they’re losing control, right?

Joe Fairless: Yup.

Linda Liberatore: So if they bring in someone like us and they still get to pull all the strings – they get to use their favorite plumber, they get to use maybe their father-in-law as a handyman, it doesn’t matter to us. They provide us those lists of service people when we start, all their contact information; I have to be able to get a hold of someone, of course, so they give us that full list.

Then we have a full web-based application that we’ve built for us as a company, and I put it up against the big ones, Appfolio or PropertyWare; it tracks maintenance, it tracks payments… So it’s a transparent process to them, but even more so those liking to be in control. Everything we get is e-mail to them throughout the day. So it’s not somebody that’s gonna be off to  Aruba and never wants to see their properties again.

Joe Fairless: That makes sense, okay. When we’re talking about the leases, you don’t do anything with the lease and you don’t pay the bills, but you’re the main point of contact for the resident and you coordinate with the vendors if there’s a toilet that needs to be fixed; then you e-mail the bill to the owner and then they coordinate payment directly with the vendor, right?

Linda Liberatore: Absolutely, yes. That describes the process.

Joe Fairless: Okay. What are the main time-consuming aspects of your team’s job?

Linda Liberatore: [laughs] Come on, I know you know this one. Probably one of our very first clients, [unintelligible [00:08:52].29] original business plan versus now, we’d be collecting money only… ACH, to be honest; we thought it was gonna be all ACH seven years ago, which we know that’s not too right, and there’s certain markets that may never be true if they’re non-bankable. But one of our first clients is a big owner of a real estate agency that had investment property, and he looked square at me across the table and he said “Let me ask you something… Would you take those calls for me? Would you take that 30-minute call full of drama, and get it down to a concise, two-minute e-mail?” I said I could do it, which of course, I didn’t know what I was promising at that time, especially for the price I was given. If you know anything about ACH and transactions, you know that’s a pretty low-cost item, and the wholesale market, let’s say with some of the banking perspective, when you start answering calls, that’s a whole different game.

So yes, what’s the most time-consuming thing my staff is doing is giving those calls, watching for the legalities of those calls… You know the rental process is a very big legal process and we have to deliver of (I’ll call it) bad news. When people don’t pay or something isn’t going to get fixed, maybe in their lease it says they’re supposed to fix it; in single-family homes a lot of times the repair is on the resident, so we kind of have to do a lot of delivering things that people don’t necessarily wanna hear.

Joe Fairless: Do you do the eviction process?

Linda Liberatore: Let’s put it this way, we assist with it. When you talked about the couple of things when you said “You guys don’t do the lease”, well we kind of do it at the renewals time, as long as they provide that legal documents, because as you can imagine, even right here in Chicago – Chicago is different than what we refer to as Lake County; anything outside of Cook County might be a different lease.

So when it comes to the legal process with evictions, as long as they can give us their attorney to deal with, or give us (let’s say) their three-day notice, their five-day notice, they can give us a template, we can fill it in.

Now, as you know, in most counties you have to have that served, so then again, I’m looking for their boots on the ground. If they can give me the contact, we go ahead and get it to them, so that they can print it and go serve it.

We do this for a lot of people, so we do do it, but ours is a partnership, and if they’re willing to provide us the appropriate documents, we’re more than willing to do it.

Joe Fairless: Okay. What’s been a main challenge that you’ve had as you’ve scaled this company to 1,000+ units?

Linda Liberatore: Let’s just say it’s the passion of working with each landlord and trying to help them meet their goals; it’s been enlightening to see all the different approach as to how they go out there. I see it as a challenge, and it’s been somewhat of a success, because what it’s done has evolved us to more of a consultant role… Not intentionally, but just saying “Joe does it this way, and I see how successful he’s done it… Have you considered doing this?” So we do get a lot of different methods, so challenging I would say would be the training of a new employee; that has been very challenging, and yet they pick it up really quickly, but there’s no manual I can just give them, because if Joe does it different than Mary — and I’m a big process person. To me process, wherever I can reduce time on a task…

We do do a lot of texting, so that again cuts across all socio-economic levels… So that’s the best way to reach people, and we’ve found that that saves us money, of course, if we can do that. We’ve tried to add electronic forms to fill out some of the maintenance, to get them to qualify things versus just saying “There’s this big leak”, things like that.
We’ve looked at process where we can make things more repeatable to save everybody money and time, and get a more accurate assessment of what’s going on with the building.

Joe Fairless: When you take a look at your business — when you started your own company, Secure Pay One, what’s been something surprising that you’ve come across? And how long have you had your company, just for context?

Linda Liberatore: About seven years.

Joe Fairless: Okay, for seven years; you’re now at 1,000 units… What surprised you about this?

Linda Liberatore: Well, if I take it all the way back in time, I could go with — I don’t know if it’s a surprize or a mistake, or advice… One of the things I did, I did a lot of (I’ll call it) pre-exploration before I started the company, looking at other businesses, trying to look around… But the real disadvantage to me is that I was not already a property manager or already a real estate agent. I am a licensed real estate agent and I have been for years, and I had worked with some investors over the years, but what it means to somebody starting a business is I didn’t bring my book of business. So like, a lot of times somebody leaves a property management company and they spin off and go start their own down the block; let’s say you’re in a different market.

So it was really, really painful and tough when I first started to get my first clients. Actually, my first client came from a reference from the bank, so the ironic part is the bank trusted me and gave me an ACH tool that basically can take money out of anybody’s account anywhere, but I didn’t have a client that was going to give me their property to take care of. My very first referral came from there, so I’ve spent a lot of painful time — I feel like I was flown out of the gate, and I wasn’t in sales before I started; remember, as you read, my background was in training and technology and trying to simplify a data analysis… So yes, I like people, but it’s different than selling, and selling yourself and selling your own company, and that was a big struggle.

Joe Fairless: What’s your best real estate investing advice ever?

Linda Liberatore: I’m a big daily person. Whatever you’re going to do, you have to do it daily. You have to get out, whatever that activity is that’s gonna push you forward… You can’t do it on odd days, even days; you’ve gotta make the commitment to do it daily.

Joe Fairless: What’s an example of how you’ve played that out in your own life?

Linda Liberatore: I would say reaching out — when I first started, when I was describing that pain, I had to make many cold calls (very, very cold calls) and just couldn’t give up; I just had to keep going, keep going. I would say that one of the most successful things we find with these tenants is they’re all across the country, but our communication is consistent. We have a whole (I’ll call it) kind of a communication method of mailing, e-mail, text… So it’s that consistency, if you will, that we tried to be sure — now, we don’t do it daily… They’d be hanging up on us, right? But we do build a process that we’re going to commit to, and in our case it’s the monthly cycle… But making sure you’re consistent.

We make sure even to the point of the mail, no different than your utility bills – it gets there on the exact same dates. It’s not when I feel like mailing it. We make the commitment to a specific day, so that when they open that mail that day, they can expect it there.

Joe Fairless: What’s something now that you still do daily?

Linda Liberatore: I don’t know if you want me to say this, but I’d say I’m a podcast and a book junkie… So the education of the industry and absolutely committed to it every single day. I’m in probably 8 real estate associations here locally, and I go to those meetings. Now, that’s not daily, but to add value to those meetings, I have to do the research and the education and the self-education, and that’s every single day.

Joe Fairless: Are you ready for the Best Ever Lightning Round?

Linda Liberatore: I don’t know… [laughs] I think so.

Joe Fairless: Well, we’re gonna have to do it either way. [laughs]

Linda Liberatore: Alright, I’m ready.

Joe Fairless: Alright. First, a quick word from our Best Ever partners.

Break: [[00:17:16].27] to [[00:18:16].20]

Joe Fairless: Best Ever book you’ve read?

Linda Liberatore: This is a new one and I’m a big reader, but I’m gonna go with The 10X Rule by Grant Cardone. I can relate to that.

Joe Fairless: And Best Ever listeners, I’ve had Grant on the show before, so you can go check out episode 190. He talks about using a video LOI that netted him 20 million dollars in profit (episode 190). Best ever personal growth experience and what did you learn from it?

Linda Liberatore: I probably didn’t realize it at the time, but I would say it changed my life… Back in about 2001 I was exposed to a web-based application; that was new, obviously, very new at the time. I sat down and I researched it to the point where I found the owner of that company, and went and pitched myself for a job there, because I was so impressed and awed by it. Basically, that was a startup out of New York City, and the rest is kind of history.

Joe Fairless: Best ever deal you’ve done?

Linda Liberatore: I’m going to say that I invest a little bit, but I’d say it’s how we’ve supported — and there was somebody just most recently, she’s been a new client with us probably about nine months, and she had a building coming up for a purchase… And here in the Chicago area we have some areas that are more challenging and there’s some bigger numbers to be made on it; she got us at rent roll and we helped her get out welcome letters, everything, literally the day after closing. We’ve got an increase already coming up 1st August. That was a big accomplishment for her.

Joe Fairless: Best ever way you like to give back?

Linda Liberatore: I’ve actually just hooked up with our local college here. They have an entrepreneurial program for young men and young women, and they run kind of small Shark Tank [unintelligible [00:20:06].12] so I have volunteered to go up there and to do some working with the students, if you will, do kind of get them psyched.

Joe Fairless: What’s the biggest mistake you’ve made so far in real estate?

Linda Liberatore: Oh, my goodness, where would I start with that? You know, I have enough–

Joe Fairless: You and I both… [laughter]

Linda Liberatore: Thirty more minutes I need for that one! The biggest mistake… I guess I’d go back to that first story; I don’t know if it’s real estate-specific, but start a business — I really wish I had the first one signed on the dotted line before I open the door. I don’t know if it would have been just a confidence booster, but trying to get that first one was very tough.

Joe Fairless: What’s something that you’ve evolved in your business that you weren’t focused on as much when you launched it?

Linda Liberatore: I would say – this is a good learning experience – with the legal aspects of it… You never want to have a tenant be able to quote you the laws in that state. So yes, I think we’re much more sensitive to requiring having a lease. When we first started, remember we were a web-based application, so we didn’t necessarily need the lease to answer the information. Basically, if  you step back, if you’re an investor, all I needed from you was what day do I start collecting? How much do I collect? What’s the terms of the lease? What’s the phone and contact? But we didn’t realize when we took that shift with the phone calls — you would just think “Oh, that’s a simple call; they’re just gonna call in their toilet and that’s it. Next call.” But all of a sudden, you’ve got humans involved in this business and they can begin to ask things that, as I said to you before, we had to refer back to the lease to see what was covered.

I’d say that’s an area that I didn’t anticipate certainly as a risk factor, so now we’re definitely very sensitive to having that lease in hand when we get started.

Joe Fairless: What’s the best place the Best Ever listeners can reach you?

Linda Liberatore: Well, everywhere. We’re on LinkedIn, Linda Liberatore, as you said it, and Secure Pay One is the name of the company. We’re on Facebook, Twitter, we have a YouTube channel… We’re everywhere. We have an electronic newsletter that goes out once a month. One of the employees has been showing that for us for a couple of years; she does a great job, and we’re pretty much everywhere. I could give my cell number too, I guess. My cell number would be 847-436-9006.

Joe Fairless: Awesome. Well, Best Ever listeners, I recommend checking Linda’s company out if you are looking to start automating the process as a buy and hold investor but don’t wanna give up the reins entirely to a property management company. It sounds like a really interesting option.

Linda, thanks for talking about your business, because normally I like to not have it as focused on someone’s business, because I don’t want the self-promotional stuff, but you by no means did that. I was just genuinely interested in your company, because it’s a business model that I haven’t come across before, and any time I find myself in one of those conversations, I’m fascinated. I loved to dig into how you make money; you said you get $50 for every unit… At least for one unit; perhaps there’s economies of scale, we didn’t really talk about that, but just the overall “Hey, this is what we offer and this is what we get”, because as real estate investors we’re all entrepreneurs in some level. Even buy and hold investors, we’re entrepreneurs because quite frankly, when we buy a property and hold it, we’re buying a business if we’re thinking about it the right way.
So thanks so much for digging in there, talking about how you launched it, lessons you’ve learned in customer service, as well as the legal aspects and leases. I hope you have a best ever day, and we’ll talk to you soon!

Linda Liberatore: Thank you so much, Joe!

 

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