Webinars

Michael Krein: Is REO the way to go?

Guests: Michael Krein, Daniel Ramsey Recorded: September 5, 2019 Excerpt The REO & default servicing industry is an essential hedge against economic uncertainty – but even in an up-market, there are tremendous benefits to having REO specialization in your brokerage or on your team. In this webinar, we had a conversation with Dr. Michael Krein ... Read more

Guests: Michael Krein, Daniel Ramsey
Recorded: September 5, 2019

Excerpt

The REO & default servicing industry is an essential hedge against economic uncertainty – but even in an up-market, there are tremendous benefits to having REO specialization in your brokerage or on your team.

In this webinar, we had a conversation with Dr. Michael Krein – the CEO of RIO Software Solutions and President of the National REO Brokers Association. He explained the current state of the REO market and provided insights into upcoming trends & ways to effectively integrate REO into your business.

REO is the only renewable income stream in the real estate industry for most agents. The standard rule is that you should be spending 80% of your time prospecting and 20% listing and selling. For REO’s, it’s the exact opposite. When you land that REO client, they have lots of properties to sell, and they will keep giving you listings as long as you do a good job and spend about 10 to 20% of your time prospecting and 80% working. Which do you think is more profitable? REO is the only renewable income stream in the industry from that perspective that you can build a business model on.

When you control a large REO inventory, you tend to have the best price inventory in town because you can keep cutting prices, no matter what the market looks like. As a result, REO will always have the best price inventory and the best lead generation. This is an ideal business model because it is renewable and scalable, two crucial factors that build a great business. This can be possible as long as you have systems in place.

Michael Krein is currently the CEO of RIO Software Solutions, the parent company and provider of the RIO Genesis software platform. It was Dr.Krein’s 27 years of experience in the real estate and default servicing industry that led to the creation of the RIO Genesis system, whereby his ideas and management systems were incorporated and designed into a user-friendly software system for both general and default real estate companies and their affiliate partners.

Michael Krein is formerly the Owner of Sellstate NRES a/k/a Nevada Real Estate Services.  Over the past twenty-five years, he has personally listed and/or sold over 25,000 single-family homes — many of which were properties owned by various financial institutions from around the country. Michael is married with seven children and makes his home in Henderson, Nevada.

The NRBA is a multifaceted national organization comprised of a cohesive group of experienced, connected brokers, appraisers, and attorneys specializing in all phases of default management and servicing distressed real estate.

Transcript

00:00:07:21 – 00:00:26:21
Daniel Ramsey
Hi, everybody. Daniel Ramsey here with MyOutDesk. We’re the world’s leader in real estate, virtual assistants. And today we have Michael Cryan here from the NCBA, the national real estate where we are. So the National REO Brokers Association, he built and founded it, what, 20, 30 years ago, Michael?

00:00:27:11 – 00:00:29:19
Michael Krein
About 20 years ago this year, actually, it’s a 20th anniversary.

00:00:29:24 – 00:00:54:00
Daniel Ramsey
20th anniversary. I love that. Here’s the crazy thing. He sold more than 30,000 assets for different various financial organizations in his career. He’s also the founder of REO Genesis, which is a software platform that connects everything in the real estate world. It’s it’s very unique. So we’re going to talk through that. Michael, thanks for joining us today.

00:00:54:10 – 00:00:56:03
Michael Krein
Oh, any time. I love doing these things.

00:00:56:07 – 00:01:07:18
Daniel Ramsey
I know, dude, it’s so much fun. So I’m just going to pick your brain here because let’s let’s start out with your story. How did you get started in the real estate space and how do you kind of build in RBA?

00:01:08:13 – 00:01:33:14
Michael Krein
Well, the two different things really how I got started is I was doing my undergrad at Stony Brook when I was in school and I really didn’t like being broke. And I read somewhere that 90% of all millionaires became millionaires and made it real estate. So I said, okay, real estate, that’s good odds. I like that. So I got a real estate license while I was in school and I found out that all you actually have to do is work because most agents don’t.

00:01:34:02 – 00:01:51:00
Michael Krein
And within the first six months, part time, I had made more money than my friends who had graduated college with full time jobs. Right. So it becomes very the money becomes very addictive. And if you learn to have fun with it, I mean, it’s just a fun business. It really is.

00:01:51:09 – 00:02:11:17
Daniel Ramsey
Nice. Nice. And then like so you got into real estate right out of college and you started selling and buying for folks. How did you land in the aerospace? Like, like and and then how did you get into that kind of world of actually, you know, creating an industry? I mean, you really have built an entire industry, certified a bunch of people.

00:02:11:17 – 00:02:17:22
Daniel Ramsey
You’ve you call them family earlier. I love that man. I love that those those folks are like family to you.

00:02:18:02 – 00:02:35:19
Michael Krein
Yeah, the NBA. Yes. It’s a trade and support group. But honestly, most people would compare it to a cult almost numbers there. We’ve known each other 20 years. We help each other. Right. That’s a problem. Somebody ends up at the hospital, one of us goes and steps in to run the office for him. I mean, it really is a very tight knit group.

00:02:35:19 – 00:02:53:01
Michael Krein
We all know each other. We work together. And you have to remember, especially with Mario, half your business will come from referrals from other OrriO brokers because when an asset manager is looking for somebody in an area, the first thing they do is call one of the brokers, say, Hey, who do you know over here? Right. So we share a lot of business and we help each other quite a bit.

00:02:53:10 – 00:03:10:02
Michael Krein
We get together a couple times a year. We have our own annual conference and we actually have more clients at our conference that anybody else does now. Well, as a closed conference, it’s members only in the clients. Then we have a couple, we call them BDC ASSES Business Development seminars a few times a year where we all get together and work on our business.

00:03:10:13 – 00:03:25:09
Michael Krein
So it’s really a very integrated group, but it is kind of like a cult, but everybody helps each other and we share problems or headaches. Hey, how did you fix this? What are you doing with this? Hey, I need some help on that. What do you know about this client? I mean, that’s what we do is we all talk to each other all the time, right?

00:03:25:19 – 00:03:32:19
Daniel Ramsey
How did you how did you decide to start that business? Like, what was it that caused you to, like, kind of pull that those guys together?

00:03:33:09 – 00:04:00:04
Michael Krein
Well, that goes back to your previous question of what I get into area, and it’s really simple. It’s the only renewable income stream in the real estate industry. Most agents, the rule is you should be spending 80% of your time prospecting and 20% actually listing and selling. Right? RVO is the exact opposite because when you prospecting door knock you cold call, you’re looking for one seller who has one property to sell and then you got to go find another one.

00:04:00:11 – 00:04:23:15
Michael Krein
Right. When you landed Rio client, you have lots of properties to sell and they will keep giving you listings as long as you give. Do a good job, right? Spend about ten or 20% of your time prospecting and 80% working. Which way do you think is more profitable? Yeah, I love it. So it’s the only renewable income stream in the industry from that perspective and then you can actually build a business model on.

00:04:23:22 – 00:04:44:12
Michael Krein
So once I figured that out, that’s where I was going. Also, when you control a large area inventory, you tend to have the best price inventory in town because you can keep cutting prices no matter what the market’s doing, what a regular homeowner can’t, because they’re down perhaps after a short sale. So we always have the best price inventory, which means we have the best lead generation.

00:04:44:17 – 00:04:54:09
Michael Krein
So you take the real and even though the RPO department is very profitable, have like a loss leader for the lead gen and you feed the entire operation from it. The retail business. Right.

00:04:54:23 – 00:05:04:08
Daniel Ramsey
So is your is your opinion that you would want to run an Oreo and retail business kind of in conjunction and an Oreo is just a leg, another leg of your business, is that correct?

00:05:04:08 – 00:05:27:15
Michael Krein
Absolutely. About 75% of my are members own their own offices, some of which are quite large. And honestly, I spend more time teaching them about retail brokerage than I do about Oreo at this point. Right as it was only about 5% when we started. And you mentioned previously and I was going to kind of segue into that why I started the Ann Arbor was I figured out this business was scalable.

00:05:28:22 – 00:05:49:10
Michael Krein
Things you want in a business, you want it renewable and you want it scalable. Well, RPO could be scaled once you put systems in place, right. I mean, I was doing when you include the HUD contracts I had, I was doing about 3400 units a year with a staff of 14 GS. It’s a scalable business. So I started teaching everybody else how to do it.

00:05:49:10 – 00:06:06:18
Michael Krein
We formed the group and the benefit to me because it was never really my livelihood, but being the head of the largest group in the industry opened up a lot of doors for me. So I’ve got no bitching about that whatsoever. I was there any account that I wanted because that position and if I had to help a few other people along the way, not a problem, right?

00:06:06:18 – 00:06:07:23
Michael Krein
Deal. Right.

00:06:08:09 – 00:06:30:18
Daniel Ramsey
So what’s the difference in the for this piece of business, the RPO business, like who should think about it as an opportunity for one leg. I was you know how I got started in Rio is I was an investor guy like my my leg of choice was helping people buy investment properties and then those people just went away and then the market shifted.

00:06:30:24 – 00:06:43:15
Daniel Ramsey
You have a unique perspective because you’ve been through six different shifts in the market, which is just nuts. So who, in your opinion, should consider Aereo as a leg of their business?

00:06:44:16 – 00:07:03:24
Michael Krein
RPO is not for everybody from an if you’re talking about an agent or a broker, I’m going to give you two different answers. Yeah. As a broker owner, yes. You should have an Oreo BPO department in your office. If you don’t, you’re insane. BPOs run it about a 58% profit margin. Compare that to a supermarket at less than 3%, right?

00:07:04:05 – 00:07:24:19
Michael Krein
Yeah. So everybody goes on that only $60 BPOs. You’re running a 50, 60% profit margin. Are you insane not to rate one member that nets over a hundred thousand a month just from the BPO departments? Right. There’s that much business out there. So setting up a BPO department, incredibly profitable, very easy to set up and it’s 30 day cash flow.

00:07:25:07 – 00:07:44:00
Michael Krein
Sounds like you wait for closings. Most of the clients pay quite well quickly, so you could use that cash flow to build your entire operation. You can fund a recruiting program, expand right now that goes back to the RPO department in that the more BPO is you do, the more areas you will get because your BPO is really a form of advertisement.

00:07:44:00 – 00:08:02:13
Michael Krein
If you look at it right and do it correctly because it’s going to end up on somebody’s desk when that property defaults. So it’s a way into it. So those have to be run together. They’re very easy to set up. But in fact, for a BPO department, I taught that at a seminar live a while back. We actually have it up on free broker school, the entire for our presentation.

00:08:02:19 – 00:08:06:04
Michael Krein
Everything you need to know to set one up and stuff on the website.

00:08:06:04 – 00:08:15:06
Daniel Ramsey
Got it. Okay, so let’s, let’s since you’re given free stuff away, let’s mention that site specifically. What’s the website again.

00:08:15:06 – 00:08:40:14
Michael Krein
That is free broker school dot com. Okay, great brokers, fool.com. It was one of my retirement projects because I was bored. Yep. I started recording all these videos and I was teaching everywhere and getting invited everywhere. Yeah. Everything you need to know about real estate that no one else will ever teach you. Write something. I’m retired. I could care less what people think of me and I don’t want anybody to compete with, so I’ll give it all away also.

00:08:41:05 – 00:08:58:14
Michael Krein
And I’m not going to say this about all real estate trainings, but honestly, I hate most of all right. And I’ve been on stage and worked with pretty much everyone in the industry over the years. But there’s a lot of problems when you’re a real estate trader, one of which this is kind of my pet peeve. And they’re not all like this, but there are enough of them that are that.

00:08:58:14 – 00:09:18:07
Michael Krein
It bothered me. You know, a real estate coach or trainer is not there to make you successful and understand why they’re there to help you. Don’t get me wrong, but they’re going to help you just enough to keep you paying them. Because if they ever taught you everything you need to know to make you to be successful and self-sufficient, you would no longer pay them, right?

00:09:18:12 – 00:09:35:17
Michael Krein
That is their business model. Don’t kid yourself and some of you are very good at it. They really do care and want you to be successful. But I assume the business model. So it always annoys me. Like there’s one program I have up on free broker school and it’s something it’s a twist on a system I learned 30 years ago and it works right now.

00:09:35:17 – 00:09:43:17
Michael Krein
It’ll teach it because if you actually use it, you will never need anybody ever again. That includes your own broker. You’ll be fined, huh? Yeah.

00:09:43:17 – 00:09:45:17
Daniel Ramsey
All right. We’ll talk about that real quick.

00:09:45:24 – 00:10:07:20
Michael Krein
Because that actually works. So you understand that it always bothered me. So when I retired, I said, to hell with it. So I’ve got a couple hundred video lessons up there, I’ve got a forms library, I’ve got cheat sheets, pretty much anything, a broker, agent, whatever need to know. And in about two weeks we’re launching a new series and it should be 10 minutes a day to a seven figure income.

00:10:08:01 – 00:10:28:04
Michael Krein
Just we’ll give you every tip and trick. It’s called the tips and tricks. 10 minutes a day, you’ll learn everything you need to know, because real estate is not about working hard. It’s about working smart. And most real estate agents and how, unfortunately, some of the brokers or worse, really don’t know what they’re doing. They were just nobody taught them correctly and they don’t like to learn either, which is kind of a problem.

00:10:28:04 – 00:10:30:04
Michael Krein
But that’s the agents. Yeah.

00:10:30:16 – 00:10:57:03
Daniel Ramsey
I love it. Okay, if you’re listening right now, please, let’s put those that website in the notes of of this show so people can just click in and jump in there. You know, Michael, one of the things one of the crazy things that the reason Michael just was born was because I was an RPO broker and my asset managers started telling me that I had to do a weekly report and I had to do drive bys and the BPOs and all the paperwork that was associated with it.

00:10:57:03 – 00:11:24:03
Daniel Ramsey
So I actually hired somebody from the Philippines to actually do all that back office stuff, and then all my other REO friends and the industry guys that I’m sure, you know, started saying, Hey, Daniel, where do you get that virtual assistant? Like, how can you help me get a couple? And so we built basically an entire industry of helping people with leverage, and we started in the aerospace because back in 2008 when we launched this business, that was the only business out there.

00:11:24:08 – 00:11:45:22
Daniel Ramsey
And so if you’re listening right now and you want to have more information, you can text mod embody two, 31996. But we’re going to keep going deep with you, Michael. I want to understand, you know, this isn’t for everybody. I love that you say it’s a scalable business area, but how would somebody get started if they’ve never done it before?

00:11:45:22 – 00:11:50:01
Daniel Ramsey
Like, what’s what are this? What are the what’s the steps?

00:11:50:19 – 00:12:05:16
Michael Krein
All right. You putting me in a really bad position here? Because as head of the NBA, I train all of those members. Sure. And I help them and work with them. Yep. I pay to be a part of that group. Okay, Eric, careful what I’m allowed to say outside of that group.

00:12:05:19 – 00:12:07:05
Daniel Ramsey
I gotcha. I gotcha.

00:12:07:14 – 00:12:29:00
Michael Krein
But my best advice would be about a few things. RPO brokers require a very specific skill set. You have to understand the legal aspects from the eviction to take a property on. I do a cash for keys. You also have to have your own accounts utilities on. You also need a good construction background because you have to call the work scope and manage the contractors.

00:12:29:00 – 00:12:45:00
Michael Krein
You have a lot of work, but with using virtual assistants like you provide, that’s actually pretty easy. Yeah, worse than it is once you get it set up and organized. But you have to have that entire skill set, understand, listing and selling the property. That’s the easy part, right? So you have to have that skill set behind you.

00:12:45:10 – 00:13:06:13
Michael Krein
Yeah. The thing is with over probably half of the clients, you’re going to lay out the expenses if you don’t have the money to cover these properties, the rehabs, the cash for keys, utilities. I mean, at one point on any given month, I had 2 million of my own money floating right, waiting to be reimbursed. Right. And I scaled up quite large.

00:13:06:21 – 00:13:24:19
Michael Krein
So make sure you have a decent bankroll. That’s one of the reasons why I think it’s a lot better sometimes is the broker owner has the department, right? It’s like a set up the utility accounts with bonds rather than deposits, which is cheaper and there’s a lot of intricacies to it. But for an individual agent, the best thing I can probably tell you is go work for an Oreo broker and learn the damn business.

00:13:25:09 – 00:13:28:21
Michael Krein
Yeah, how you do is like we all did nothing like. Right.

00:13:29:17 – 00:13:49:01
Daniel Ramsey
Right, right. Right. Well we and we’ve got a link to the free broker school dot com here. So if you, if you wanted to kind of go deeper and learn a bit more about Michael and what he’s done and what he’s actually giving away, I think that’s a great spot to jump on, too. Michael, you had mentioned, you know, you did REO, too, so real estate information.

00:13:49:01 – 00:13:52:11
Daniel Ramsey
What’s the what’s the oh four organizer? Organizer, yeah.

00:13:52:14 – 00:13:52:22
Michael Krein
Yeah.

00:13:53:05 – 00:14:12:12
Daniel Ramsey
One of the challenges in our industry is no tech companies can ever get on the same page. So you have like 50 bazillion. I mean, you’d think they’d just play together nicely like this, would connect with this and that would connect with that. And they all think that they’re going to build the one system that the entire universe is going to use.

00:14:13:08 – 00:14:22:23
Daniel Ramsey
So yeah, you did. You actually built it a while ago. So let’s talk about that real quick. What talk about Rio. How did you get started in that and what does it look like?

00:14:23:01 – 00:14:41:10
Michael Krein
Well, let me back up a little bit and kind of foreshadow what some people understand. Sure. At somewhere around 2000, I think I was the first real estate broker in the country to put a computer on every person’s desk. Okay. Every agent, every staff person had their own computer. We ran our own network and we drove massive efficiencies that way.

00:14:41:10 – 00:15:04:04
Michael Krein
So we were one of the early adopters to technology. Yeah, I beta tested a lot of the software, talked about it. Like if you look at Equator, I have the fourth number ever issue because I was one of the beta testers four years ago. Gosh, I know all of them. So I was very heavily in technology. Then when we had our operations, the numbers are kind of gray, depending on who’s you’re quoting.

00:15:04:04 – 00:15:32:07
Michael Krein
They say the average realtor to 6 to 8 transactions a year. That’s kind of a misnomer because that’s skewed by the top producers going 30 and 50 and 100 like my people. A lot more than that. All right. But so the mode which is the most frequently occurring is by about 3.5 transactions. And if you own an office and you’re budgeting out and looking at trades and production, 3.5 is a good number to budget off of in my operation are prorated production was 14.7.

00:15:33:01 – 00:15:53:14
Michael Krein
Hmm that was done with technology right. And also understanding how you use technology to do the things that agents will not do for themselves. There’s certain things agents hate, like prospecting. Yeah. Okay. And there’s a lot of things that agents don’t like if you take away the things they don’t like and use technology to do that, you’re going to see a massive increase in production, right?

00:15:53:19 – 00:16:15:00
Michael Krein
So we’re very heavy on technology from day one, probably more so than any other office in the country spent a fortune on that. At one point. I think we’re running 450 computers in 16 different servers. Jeez, run the entire operation. Jeez. But my people were 3 to 4 times more efficient than anybody else. So it can be done where Rio came from.

00:16:15:19 – 00:16:33:10
Michael Krein
Couple of things that really I tend to do more. What motivates me usually is getting pissed off. If I’m pissed off, that’ll make me go do something. Okay? Okay. That’s kind of how I function in life. Yeah. I didn’t like being poor as a kid and I was pissed about it when I felt my kids that I couldn’t afford to buy them a bike.

00:16:33:21 – 00:16:51:00
Michael Krein
Right. So I was angry about that. And that’s what really what drove me to be successful. I was not going to be like that. Sure. So it was the same with the software. The majority of the software products in the real estate industry fall into two categories. These are old, outdated technology that should have been rewritten 15 years ago.

00:16:51:06 – 00:17:06:09
Michael Krein
Right. Are they were written by a bunch of geeks who had no idea what the real estate industry was about. They go, hey, let’s go tell these realtors. This is what they need, right? And they market the hell out of a lousy product, right? So when I was running my operation again, the volume we were doing was pretty insane.

00:17:06:10 – 00:17:27:24
Michael Krein
I have yet to meet anybody who did more on a per person basis. Size wise, I was probably running at any given time 8 to 10 different software products, everything from lead generation to lead management to paperless back office operations to accounting to tracking the agents. And we had all that. So it’s running like 8 to 10 different things and now you get to buy ten different things.

00:17:28:04 – 00:17:47:13
Michael Krein
Then you got to cross-train your staff on ten different things. And God forbid, I wanted to report, I’d have to have somebody go pull data from five different places. Right. Insane. So I building our own system and that kind of evolved to real Genesis. And we had the Genesis because Rio was a trademark issue. Otherwise we would have kept it simple.

00:17:47:13 – 00:18:04:21
Michael Krein
So what we did is we actually there’s about 116 different software products we track and we look at all the functions of the features in each one, and we put them all inside Rio. Whether you’re an agent or a broker, it is everything you will ever need from paperless. We have our own e-signature platform. You don’t need DocuSign anymore.

00:18:04:21 – 00:18:27:06
Michael Krein
It’s already integrated. Well, that system, right? Fliers, CRM, drip, campaigns back office paperless. We have every single thing you could ever need. We put it in one place, huh? I mean, we even have online offer management where the other agents want to put in an offer on your property. And this is kind of cool. They’ll actually submit the offer online to you.

00:18:27:08 – 00:18:52:13
Michael Krein
And the reason for that was a risk management tool. If you’re a broker, an agent, you’ve either been sued or you’re going to get sued. Deal with that fact. Yep. 80% of all litigation board complaints arbitrations will all originated the offer stage. So the online offer submission to track that they time, date stamp and all that keep the forms correct was actually a risk management tool because it eliminates 80% of your risk.

00:18:52:13 – 00:19:11:19
Michael Krein
So brokers love that funny thing happened this year. Google started indexing the pages. We had consumers making offers on the property directly because they’re used to it from all the auction sites. So it turned into a lead generation. And it’s not just lead generation. Anybody can get a lead. You’ve got a buyer who makes an offer, you’ve got a sale, right?

00:19:12:00 – 00:19:31:14
Michael Krein
Efficient, forget working leads, get an offer. Yeah, some cool things happened with it. So we put everything in one place that an agent or a broker will ever need. All integrated. And it also allows for the title companies, the appraisers, the lenders all to work together and keep your transaction flowing because the system is smart and it learns.

00:19:32:12 – 00:19:54:06
Michael Krein
See, one of the biggest problems and why realtors don’t adopt technology enough is whenever you buy a software technology product, you must work the business model of the software. Right. Okay. That the insane also. So we made ours completely flexible right from the ground up. You can make and change the system. You can change titles, words, logic, workflow.

00:19:54:06 – 00:20:16:20
Michael Krein
And if you do this, then it tells me to do that. So it tracks the entire transaction and knows what should happen next. And because every broker operates in a different state and a different state, laws under different realtor board rules the customizable nobody had done that before. So we were operating in multiple states. So I had to have a system that could be adapted for the different laws and rules, right?

00:20:16:24 – 00:20:22:02
Michael Krein
Once you set it up, it knows how a transaction flows and tells everybody what to do. It’s really pretty cool.

00:20:22:14 – 00:20:23:17
Daniel Ramsey
Yeah, that’s that’s awesome.

00:20:23:17 – 00:20:24:18
Michael Krein
Nobody’s done that before.

00:20:25:10 – 00:20:27:21
Daniel Ramsey
And has anybody done it since when you when.

00:20:28:17 – 00:20:47:05
Michael Krein
Nobody’s even close? The one thing we did, and I’ll be very honest about the problems, our transaction engine is the most powerful in the industry. It just we got lucky. It came. Sometimes things go right. It actually came out better than we hoped. The system was so powerful that agents and brokers, it was just too much for some of them because agents are not the most technologically savvy.

00:20:47:05 – 00:21:08:05
Michael Krein
They’re really not right. We just spent the last year redesigning a user interface and we gave all the agents and brokers big, bright, shiny buttons on all the tasks, and we had an artificial intelligence and logic into it. You’re actually the new version will launch in October. It’s mobile, big, bright buttons, and you can talk to it and tell it what you want.

00:21:08:16 – 00:21:13:05
Michael Krein
I love it. Nobody’s done that before, so we’re really excited. That’ll be out in October.

00:21:13:05 – 00:21:33:02
Daniel Ramsey
Awesome, awesome. You know, before we went live, we started talking about the Oreo market is actually kind of shifting again. Like it’s it’s coming back. We’re already in that space. You have a unique perspective as you’re in the front lines of that and you’ve been through six different shifts. So talk to me a little bit about what’s happening right now.

00:21:33:02 – 00:21:36:18
Daniel Ramsey
And you know what somebody should do to prepare for the future.

00:21:37:00 – 00:21:53:10
Michael Krein
All right. Well, a couple of things. See, there’s always area when people just realize that when there’s a lot of it. But typically in any given market, that 3 to 4% of all properties are Oreo in one form or another. You don’t realize it because the banks, especially the hedge fund, the private equity groups who actually control the Oreo, it’s not the banks anymore.

00:21:54:15 – 00:22:14:05
Michael Krein
They buy the NPLs and sell them. They don’t allow you to call it an Oreo or foreclosure. So if you’re searching on the last try to figure how much there is, you’re not going to find it that way. The other thing you have to understand, whenever you read real estate data in different articles, magazines, it’s not that they’re wrong, it’s just their data, right?

00:22:14:10 – 00:22:34:10
Michael Krein
Remember, when a property goes in the contract, it may not close for 90 days and then it may not get reported publicly for 30. Then the internet website scraped the date and republish it. Most of the data you’re seeing is really six months old from when that transaction actually started. Right. Most data is seeing a six months out understand that and then a lot of it is not published.

00:22:34:23 – 00:22:54:07
Michael Krein
So in any given time, you can count on, even in a normal market, 3 to 4% of that market is Oreo, right? I mean, there’s very few brokers that wouldn’t call that a 3 to 4% market share if they’re in a major metro area. That’s actually a pretty good sized number when you think about it. Yeah, last time we ran L.A. County, I think year to date there’ve been about 1900 Oreos there already.

00:22:54:24 – 00:23:12:20
Michael Krein
People don’t realize it, but it does exist. So I have two advantages. One, well, three actually, I’m working with the clients constantly so I know what their flow is because we assign a lot of those properties members also, you know, with the intermediate members out there, it’s got it’s kind of like I got my own little CIA network that sees everything first.

00:23:13:00 – 00:23:31:11
Michael Krein
Yeah, I get that data, but also no real genesis. We don’t sell data. Okay, so the information is confidential, belongs to the brokers who use it as agents. But I can see the patterns in the transaction count and I could see when an offer was accepted. Time in the market. So I can actually see the data in real time.

00:23:32:01 – 00:23:51:14
Michael Krein
Whereas the other day it’s six months old. So since everybody gets that, that’s part of the problem for sure. Okay, now what’s going on with the Oreo markets right now? Forget national economies, forget regional. You’re dealing with micro economies, individual markets, and they’re very different. So if you’re an agent or broker, don’t go by what the national statistics are.

00:23:51:14 – 00:24:16:06
Michael Krein
They’re not going to help you. In particular, what is driving the markets are relocation patterns. And this is what I track all day looking for where the default rates are increasing. So you have states like New York, New Jersey, Massachusetts, Connecticut, Connecticut is losing massive amounts of population. They’re going to Florida, Arizona, the Carolinas. So you have these markets where people are leaving and you have over a million Californians leaving every year.

00:24:16:14 – 00:24:32:22
Michael Krein
Right. Okay. And it’s not lower end. We’re going to get to that. Right. You’ve got states. Illinois is losing more than that. So you have certain markets where people are leaving. So the market is softening and a lot of them are defaulting is there’s still quite a few people upside down on their properties. So they’re falling through the roof.

00:24:33:11 – 00:24:53:19
Michael Krein
I have an R B members in the Northeast that are all carrying a couple hundred assets right now. Well, all right. So there’s a lot of it. But then you go to market. Phenix would be a great example. Phenix is an incoming relocation market. People are moving to Phenix. No RVO there because the market’s quite strong. So the markets, including the default rates, are being determined by relocation patterns.

00:24:54:03 – 00:24:59:23
Michael Krein
So you have to look at your own market. Are you an incoming market and outgoing market? And then you can kind of see what’s going on.

00:25:00:08 – 00:25:21:16
Daniel Ramsey
How do you find that data, Michael? Because one, you’ll love this story. So I was a real estate broker. I thought I was rich in 2005 and six because the market was just like this, you know? And I was a kid. Yeah, I was a kid. I was in my twenties. So I’m like, I’m rich. Yeah. And then all of a sudden, the Oreo market, you know, slaps me in the face, defaults everywhere.

00:25:21:16 – 00:25:47:13
Daniel Ramsey
And literally we had a 90% drop in our revenue in one quarter. So as a real estate broker, I was like, I’ve never experienced 90% drop. And this is this is when I had hired my first virtual assistant, I had started building like I was a broker and all that. But the mistake that I made back at that time was I didn’t track numbers like I didn’t know what was going on locally in my market statewide on the national.

00:25:47:13 – 00:25:54:00
Daniel Ramsey
So for people who are actually tracking the market, what are some of the stats that you think are important?

00:25:55:23 – 00:26:15:15
Michael Krein
Start looking at the homes. Okay. Before we go that far, you have to look at something a little further. For the first time ever, we have really segmented markets. Yep. Okay. You’ve got bifurcated markets. Someone tried for Katie. If you look, I’ll take Las Vegas because I happen to live just outside of Vegas in the lower end. Anything under 300,000 multiple offers?

00:26:15:18 – 00:26:39:06
Michael Krein
Yep. Anything 5 to 7. Maybe you’ll sell it in a couple of months. Anything over a million you can’t give away. There is no demand for it. Right. Okay. So understand that’s happening a lot of markets. And the interesting thing about the default cycle this time is the average sales price of an Oreo should be 20 to 30% below the median for most markets, it’s actually 30% above the median.

00:26:40:08 – 00:26:58:09
Michael Krein
So what it is is a mixture problem. Instead of low end properties foreclosing and being defaulted on, it’s the higher end properties that are fault defaulting. It’s the jumbo loans. So a lot of my members, they’re getting, you know, multimillion dollar listings on a regular basis because that’s where the defaults are actually occurring, is in the upper areas.

00:26:58:09 – 00:27:15:18
Michael Krein
And if you look at your own market, look at the low end, look at the mid segment, look at the high end, then target your business. Okay? This like right now here in Vegas, we try to give me a $2 million listing. Keep it. I’m not going to sell it. Give me three, 300,000 listings. That’ll be gone in a day.

00:27:16:03 – 00:27:42:24
Michael Krein
Right. What’s easier? Agents have to work smart based on their own market. So you have to look at your own market, look at the inventory, look at the deal, and look at the price differentials and get a feel for it. Spend your time and your marketing dollars on where the stuff is moving. So if you’re an incoming market like Phenix, you know, are you going to go out and take buyers around all day where they have to write five offers and they still don’t get a property right now?

00:27:42:24 – 00:28:02:21
Michael Krein
Let the dumb agents do that because that’s a waste of time. You be the one that controls the listing on that property where it sells that you’re getting the five offers on change focus. If you’re in some of the other markets, like in the Northeast, certain price ranges, you can’t give those houses away. Don’t list the lists, the price points that are moving or start working.

00:28:02:21 – 00:28:19:06
Michael Krein
The buyers with this inventory. By that same token, if I was here in Vegas, you’re getting a $250,000 buyer. I’m not going to waste my time. I’m never going to get my house. All right. There could be ten offers and everything in that price range. But if you give me $1,000,000 buyer, I know there’s tons of inventory for that.

00:28:19:06 – 00:28:27:24
Michael Krein
They can have their pick. Right. So pick and choose work the listings and the buyers as per the market segments and what it really is that’s efficient.

00:28:28:12 – 00:28:36:06
Daniel Ramsey
And pay attention to what’s happening in your market in the different price kind of strategy. Yes. Yeah. Makes sense. Okay.

00:28:37:13 – 00:28:38:13
Michael Krein
Where art?

00:28:39:03 – 00:28:50:13
Daniel Ramsey
Yeah. What? So what stats should a real estate broker know other than what’s happening in their market on a national level? And like, what are some of the stats that you guys track as ARIA brokers?

00:28:51:13 – 00:29:19:14
Michael Krein
We track the default rates and we track the portfolio sales, and it’s not really that we track the national market per say. What we’re looking for is the Oreo really isn’t with the banks anymore. That’s a misnomer, right? When a loan goes into default, it’s called an NPL, a non-performing loan. Well, because the way the banks are capitalized and structured, it costs them more to keep that non-performing loan on the books than it with cap reserves that’s backing one on one another day, another day, another.

00:29:19:14 – 00:29:20:07
Daniel Ramsey
That’s another.

00:29:20:07 – 00:29:42:16
Michael Krein
Webinar. Banks really work. Yeah, I just understand that banks are basically highly leveraged casinos. Okay. They’re risk averse. Casino never loses data to the banks of the smart. But so what’s happening is they’re taking these defaulted loans where people are no longer making payments known as NPLs non-performing loans, and they’re selling them off to private equity groups and hedge funds, primarily Wall Street firms.

00:29:43:05 – 00:30:02:16
Michael Krein
So then banks aren’t really the ones foreclosing, they don’t wanna be bothered with that. Now, the private equity groups, the hedge funds, they’re not under banking laws, they’re not banks. So they can handle these very differently in the banks. So I like the CFPB applies to them, are not aggressive in a lot of respects, right? Oh, it’s just a shift where they can afford the risk and the headaches the banks fixed.

00:30:03:01 – 00:30:20:23
Michael Krein
So what we look to do is track the portfolios and who they end up with and then go to that client. Got it. I’ll give you one secret. The quickest way to never get an Oreo listing is to ask an asset manager, Hey, do you have anything in my area? The only thing you’ve accomplished is telling that asset manager you’re an idiot, right?

00:30:20:24 – 00:30:35:23
Michael Krein
Because here’s the thing. Even the asset managers don’t know what they have coming in next. Yeah, if you’re a good Oreo broker, you would know that too. Okay. So to ask them if they have anything you just told them, you stupid and you’ll never get an account that way. That’s why one secret I’ll share with you today. Okay.

00:30:36:09 – 00:30:36:21
Michael Krein
What do.

00:30:36:21 – 00:30:40:10
Daniel Ramsey
You. What do you ask them?

00:30:40:10 – 00:30:55:09
Michael Krein
You basically don’t ask them. You offer to provide a service. And I’d say, Daniel, look, I know you’ve got an agent that handles your stuff here in the area. That’s great. If you love them, they’re good guy. Don’t ever knock a competitor. That’s dumb. But let me tell you, if you ever need a backup, you need me to cover anything for you.

00:30:55:09 – 00:31:12:14
Michael Krein
I’m here for you. Let me know what you need. Right. You make an offer of value. You don’t ever knock the other broker and you don’t ask him to have a thing. You just assume they will. Because going back to tracking those portfolios, they’re all over the country right now. They don’t even know what they’re going to get next.

00:31:13:00 – 00:31:15:03
Michael Krein
They’re buying these large pools of stuff everywhere.

00:31:15:23 – 00:31:36:19
Daniel Ramsey
Sure. So, okay, let’s break it down, because I think it’s important for your audience to understand how the industry works. So what happens is the bank originates the loan. They have a default. Maybe they keep it on their books, maybe they sell it, they have a default. It gets sold to somebody in Wall Street. And then those people are the ones that actually assign them to an RCO kind of servicer.

00:31:37:00 – 00:31:41:23
Daniel Ramsey
And then they’re the ones who give them to the broker. Is that a good breakdown of how it typically works?

00:31:42:13 – 00:32:05:04
Michael Krein
Yes, it’s a little oversimplified. It would have been a couple of years ago. No, you’re not wrong. But there’s been some changes in there that we’re seeing. Typically, the servicer does control the Oreo. Yep. Out always. Sometimes they’ll be an outsourcer that takes the Oreo for that investor. Being foreign owns it. But what we’re seeing is something really unique now and this is getting more and more typical.

00:32:05:12 – 00:32:26:12
Michael Krein
The funds who actually control the notes on these properties now own the properties. Yes, they’ll have their servicer here. They may even have their outsource of their, but they’re actually managing their own broker network for transparency reasons. So we’re dealing directly with that hedge fund or private equity group, whoever owns the note. And they’ll say, yes, so-and-so is our outsourcer, but you’re our broker.

00:32:26:21 – 00:32:33:09
Michael Krein
So yes, I’ll answer the outsource, but you report back to them simultaneously. That’s something that’s just recently occurred in the last 2 to 3 years.

00:32:34:02 – 00:32:40:17
Daniel Ramsey
It’s because they want the control to make sure that the broker isn’t screwing them. Is that I mean, I’m honestly right.

00:32:40:19 – 00:32:42:06
Michael Krein
Yes, it is. Yeah.

00:32:42:12 – 00:32:47:17
Daniel Ramsey
Because there was a lot of dirty stuff that went on in the last downturn. So I mean, I think that’s a.

00:32:47:24 – 00:33:04:16
Michael Krein
They’ve the guys who buy these notes, they’re brilliant numbers guys. They’re Wall Street guys. But when they first jumped in, they didn’t really know real estate. Some of them were actually finding. Agents are like Realtor.com, right? An agent couldn’t even spell Oreo. They got screwed. They came to us once they found out about us, so we reached out to them.

00:33:05:04 – 00:33:23:04
Michael Krein
So yes, it’s a lot more transparency. So it’s not that you have to be with the different platforms that the outsourcers control. You know, there’s the online platforms to manage Oreo, but you actually have to be with the investor in their database because they are dictating the broker and controlling the broker network itself. Yeah, that’s relatively new over the last 2 to 3 years.

00:33:23:13 – 00:33:56:13
Daniel Ramsey
I love it. Well, Michael, you’re you’ve been awesome today. And I before we keep going on this interview, I want to stop and just let our audience know that Michael does actually has a book. I love Michael. You said scalable business. I love it. Our actual book is called Scale with Virtual Professionals. So it it actually is a step by step process of how to add virtual assistants into your real estate business and actually grow a business because, you know, we’re all stuck in that that rat race of sell, sell, sell, sell.

00:33:56:18 – 00:34:20:23
Daniel Ramsey
And we don’t think service, we don’t think operations. We need more people pounding the phone because I you know, most agents don’t like the prospect. So if you’re thinking about hiring a virtual assistant, just text SVP 231996. You’re going to get a free copy of that book along with a consultation. Will will walk you through everything you need to know about growing and scaling a business with virtual assistants.

00:34:22:00 – 00:34:33:24
Daniel Ramsey
Michael What are some of the things that are snake, you know, like traps for agents who are thinking about RPO as an option? What are some of the things to avoid?

00:34:33:24 – 00:34:57:13
Michael Krein
Well, that actually piggyback that into what you just said you’ll learn from Marshall. Yeah it’s don’t understand. And for the typical agent you want to assume your value is $300 an hour. Okay, let’s do the math. Let’s just be ultra conservative. Average sales price at 200,000, which is low. Right. The 3% on is six grand. Okay. What the split is with your hundred percent, whatever, we’ll call it six grand.

00:34:58:03 – 00:35:19:07
Michael Krein
A typical transaction will require for an agent. Or is what they’re doing. They’re organized will take somewhere between ten and 20 hours is what time you’ll actually have into it. That’s about right. So let’s just call it 20 hours. That’s $300 an hour. Anything that can be done for less than $400 an hour that you can pay somebody less than that should not be done by you.

00:35:19:18 – 00:35:42:13
Michael Krein
Right. It’s business 1 to 1. So if you could pay somebody 20 bucks an hour to do your paperwork, do your filing and your MLS is your ass, you’d be out there getting another $6,000 check, not doing that. That’s the only way you will ever scale. It’s the only way you will ever have a life. And so for you, listening to this out there, your value is $300 an hour minimum.

00:35:42:13 – 00:35:54:09
Michael Krein
I used to calculate mine at 1500 and anything less than that somebody else did that paid them. Yeah. Okay. So that’s what has to be done. That’s why these systems are so important and virtual breakers, you know, how able to deal with every week.

00:35:54:18 – 00:36:17:12
Daniel Ramsey
Well and you don’t have to worry about getting them an office or payroll or health insurance or any of that. We all handle that for you. You know, it’s you know, it’s crazy. I’ll just I’m Nas says that it’s 45 hours to close one transaction so I mean it’s nuts how many hours of because really an agent should only be getting a deal negotiating a deal and then closing the deal.

00:36:17:12 – 00:36:23:01
Daniel Ramsey
Those are the three things. And that takes about two or 3 hours, maybe four and. Everything else can be leveraged off.

00:36:23:22 – 00:36:48:03
Michael Krein
Well, it depends how you calculate it. Keep something in mind. There’s about 2.9 million real estate licenses in this country. Nor is carrying, what, 900,000 right now? Yeah. Okay. So understand, they’re only looking at one third of the industry when it puts out a report from their own people. Sure. On the NA list, one of the things I saw and correct me if I’m wrong, because maybe I am, but I think it was like half of agents that are licensed and realtors didn’t even sell anything last year.

00:36:48:11 – 00:36:49:08
Daniel Ramsey
Yeah, yeah, yeah.

00:36:49:16 – 00:37:06:18
Michael Krein
Can’t go by those numbers. Right. But realistically, any agent, once you learn a few tricks and know how to deal with things. Sure. Okay. And that’s really what the free brokers will tips and tricks are about. You shouldn’t be spending more than 10 hours a transaction. You really shouldn’t write. 45 is way too high. It’s just inefficient.

00:37:07:23 – 00:37:09:15
Daniel Ramsey
Yeah. Nah. Who knows?

00:37:09:21 – 00:37:11:09
Michael Krein
Yeah, I don’t know.

00:37:11:09 – 00:37:27:00
Daniel Ramsey
So let’s, let’s talk about those things though. What, what are some of the trap doors to avoid or sandpits or tar pits or whatever? Like what are some of the things as a real estate broker or agent, we should know about the REO industry to avoid or or kind of watch out for.

00:37:27:17 – 00:37:47:17
Michael Krein
There’s a lot of scams. Yeah, tremendous amount. One of the things we do is we keep the interview members informed of all the scams out there. A lot of times you’ll get lists of asset managers that will be offered to be sold. You don’t pay for them, they’re scams. I can tell you right now there’s about 150 legitimate rdl clients right spread out right now.

00:37:47:17 – 00:38:06:01
Michael Krein
It’s no longer like five big banks. We track all of them. We know who they all are. We keep a list of them. We have relationships with them. Yep. That’s all there are. All right, so anybody selling you a list? It’s bullshit. Sorry for language, but do not pay them. The next thing is there is not a legitimate Oreo client out there that will charge you money up front.

00:38:07:02 – 00:38:29:02
Michael Krein
Occasionally you may be asked to join a platform one legitimate ones. Yeah, we have an Oreo platform as well as our broker stuff. Pyramid equator resonate above legitimate. Okay. There are other platforms out. They’ll tell you some platform that doesn’t really exist and they’re hitting people for 40 bucks at a clip. There is one company in Illinois, another one out of Salt Lake City, one group, I should say.

00:38:29:07 – 00:38:45:20
Michael Krein
They changed their name every three months and they send out a million emails saying send $40 and we’ll guarantee you a listing. Okay. I do not ever pay for that. And if you’re unsure whether a company is a scam or not, email me at the NBA. My info is right on the website of free brokers going from email.

00:38:46:00 – 00:39:08:07
Michael Krein
I’m more than happy to tell you before you spend your money. Yeah, it’s ridiculous. Now the one way you should identify a scam website is it usually instant websites like Out of a box? Yeah, you can tell they’re a box website, but about two months ago some of these scammers and it’s the one I to Salt Lake City because they’ve been around a while and obviously they’re making a good money at this because they keep doing it every three months.

00:39:08:12 – 00:39:30:13
Michael Krein
So obviously falling for this, but they’re actually copying legitimate Oreo asset management firms websites. They’re copying the entire website word for word and exchanging the name where it’s very similar. So you Google it, that would create some problems because when you because these are real web pages and real websites that are copied, it’s just a duplicate fraud site.

00:39:31:09 – 00:39:49:02
Michael Krein
Google indexes the pages. So you search for new management, it shows up like it’s legit, right? Looks like a legit site and the name is close enough where you go, Oh yeah, I’ve heard of that. And there we all sign up with that. Right. What? They’re getting very good at this, huh? Any of you, you’re ever asked for money for an Oreo?

00:39:49:07 – 00:39:57:09
Michael Krein
You don’t know if the is legitimate. Call me, email me. I’ll tell you. I just cannot stand watching agents get screwed. And we like to shut these places down.

00:39:57:09 – 00:40:11:15
Daniel Ramsey
Yeah, because it’s making the whole industry look bad. What is? Okay, so the real question, I can tell you, we’ve got a lot of people watching us live right now, but what’s the real question they’re all wondering is how do they break into Oreo? Like, that’s the real question.

00:40:12:07 – 00:40:28:12
Michael Krein
I know. And it’s putting me in a position where I can’t really talk about that because my role at the AARP, I have to help those people first. And activation is confidential. Yes. I will tell you this. Make a lot of friends get to be friends with other Oreo brokers. That’s where half your information and referrals in your business will come from.

00:40:28:12 – 00:40:47:20
Michael Krein
It’s all about networking. Second thing is, do a lot of BPOs but also know who you’re doing them for. Right? Okay. Anybody, if you’ve got a clue and you understand the basics of the business, you know, you can spend some time on Google and you can figure out who some of the actual clients are and there are some forums out there.

00:40:48:03 – 00:41:05:12
Michael Krein
Be very careful some of the Oreo forms that are out there. You’ve got people that are part of these Oreo fraud schemes chiming in there, putting fake messages, Oh, this is a great company. They just gave me three listings. It only cost me $30 actually putting fake messages in the chat rooms. So. Yeah, all of that. Yeah. All right.

00:41:05:13 – 00:41:23:12
Michael Krein
Yeah. If you’ve got some Oreo experience now, understand the interview. We don’t take newbies, we cannot. Right. The clients use our database first is because we guarantee them a certain level of expertize. Sure, you kind of have your bachelors degree in Oreo. We’re going to take you to graduate school. We’ll get to take you to the next level.

00:41:24:14 – 00:41:38:13
Michael Krein
More business to show you how to run it at scale. That’s what we do. So if you’ve got some more experience, you’re free to apply. We actually track everything you’ve asked about. Okay, you know, there. But I’ve got to be careful what I say outside the group. Yeah, yeah, I get it to the members.

00:41:38:20 – 00:41:55:20
Daniel Ramsey
What I’m. How long does it take to break out into the Oreo world? Like if somebody said you know what, I’m I’m certain that this is a space that I want to be in. I know it’s important to my business long term. Would you say a year or two years? Three. I what’s the normal timeframe?

00:41:56:16 – 00:41:57:08
Michael Krein
It really going.

00:41:57:08 – 00:41:58:20
Daniel Ramsey
From zero going from.

00:41:58:20 – 00:42:17:06
Michael Krein
Zero zero. It really depends how aggressive the individual is and what type of budget they have. I’ve seen some people jump in and within six months they had a couple listings and a few small accounts. Yeah, realistically, on average I’d say it’s probably about 18 months. Right. And you make it 18 months, you’ve got four or five accounts are each feeding you two or three listings a month.

00:42:17:15 – 00:42:27:19
Michael Krein
You know you got ten or 12 listings a month coming in, you do want 100 deals a year, then you can start expanding into the next. But that’s normally about 18 months. Got to ballpark it.

00:42:28:11 – 00:42:41:00
Daniel Ramsey
If you had to ballpark it. And then what’s the I mean, do you believe that this is the best opportunity for people or I mean, like, what’s your opinion about the opportunity from zero to to 18 months?

00:42:41:18 – 00:42:44:07
Michael Krein
Okay. That’s kind of a really broad question.

00:42:44:07 – 00:42:44:23
Daniel Ramsey
I know.

00:42:44:23 – 00:43:03:01
Michael Krein
I like it. If you’re looking for a specific answer to a very vague question there, Oreo is not right for anyone. I’ll tell you something that’s really interesting. We polled the Arab members years ago and about 40% of them were ex-military. Oh, we never planned that, by the way. It’s just those are the people that we’re attracted to.

00:43:03:01 – 00:43:23:13
Michael Krein
Oreo, because, you know, worked for the banks in the military. Do what you’re told, don’t ask any questions and whatever happens, it’s your fault. Okay, that’s working for bank. Most people don’t have the temperament. It’s not like a regular deal. We can call the seller, Oh, I got an offer. Can I come by on Saturday? No. Everything with Oreo is timelines, occupancies, 24 hours.

00:43:23:13 – 00:43:38:04
Michael Krein
24 hours for this, 48 hours for this must be done. And understand something on time is not on time. A day early is on time because they have scorecards on you. Yeah, you better understand that. And most agents don’t. The time management skills are strong enough. We have a.

00:43:38:04 – 00:43:51:08
Daniel Ramsey
Score card like talk to me about like if I got into Oreo, wouldn’t want to lose the business once you got into it. What what are the scorecards? What are the important things about the scorecards?

00:43:51:24 – 00:44:13:08
Michael Krein
Every client is a slightly different metrics, but scorecards are timeframes. How long it took you to get to the BPO? How successful you were with the cash for keys? What was your final sales price to initial BPO price? It’s all about timelines and they’re all about performance. Nowadays, it’s no longer about friends. I mean, 30 years ago, I made all my money drinking in bars with asset managers.

00:44:13:16 – 00:44:35:08
Michael Krein
Yeah, I got all my accounts. Yeah. Now it’s all about performance. And on time is not on time. Early is on time, right? And whatever you say, you’re going to live and die by those numbers you quotes, you better be accurate. The other thing is you’re going to deal with some pretty messed up people. The majority of people see it’s not like it was years ago when we’re cleaning out crack houses and meth labs all the time and people crazy.

00:44:35:16 – 00:44:54:20
Michael Krein
Yeah. The crash banks started giving five and ten $20,000 cash for keys checks. Yeah. No, it’s not like we used to get shot at which we did or, you know, people practice all the time now reach at the door like you’re edit but man from Publisher’s Clearinghouse what kind of check my getting. Yeah right so it’s much easier because you know when I started it was all male dominated.

00:44:54:20 – 00:45:14:07
Michael Krein
Now there’s a lot of women in industry, but it’s not as dangerous as it was. Right. But you’re still going to run into some nutcases, you know, sovereign citizens. We have a lot of problem with them in different locations where we call on SWAT teams, you better have a thick skin and you better have the balls to walk up to a door and say, by the way, you’re not going to live here anymore.

00:45:14:13 – 00:45:15:04
Daniel Ramsey
So what’s.

00:45:15:04 – 00:45:24:04
Michael Krein
That? You’re free to do that, obviously, and you try to help people, but you better have a pair on you if you got to do this business because you are going to get threatened and sometimes it’s dangerous.

00:45:24:11 – 00:45:31:17
Daniel Ramsey
What’s the craziest story you have in the area world like you personally went through?

00:45:31:17 – 00:45:35:02
Michael Krein
Oh, as far as violence.

00:45:36:01 – 00:45:38:16
Daniel Ramsey
I don’t know about violence. I’m just saying crazy.

00:45:39:07 – 00:45:58:21
Michael Krein
On that because I’m not going to admit what I had to do either. So I’m going to leave that one alone. Okay. Crazy stuff. Oh, the funny stuff is I’ve been propositioned more times than I can count. Oh, please let me stay another month. Uh huh. What can I pay you to stay? We’ve had several members help. My daughter found a dead body.

00:45:58:21 – 00:46:16:12
Michael Krein
One of her properties. Yeah. You know, you’re going to see all sorts of crazy stuff. Yeah, and it’s never quite the same. The one thing you have to understand is if you want to talk to these people and you really do try to be affable and make it work for them, like, look, I know this is a bad situation for you, Daniel.

00:46:16:18 – 00:46:31:13
Michael Krein
I’m going to try to help get you some money, help you move. It’s a chance to start out with your life. Let me work with you. So we really do try, right? And that’s really what you look to do. But some people are crazy and you’re going to be threatened. Yep. How I got whacked upside the head with the tennis racket once.

00:46:31:21 – 00:46:32:19
Michael Krein
But it’s crazy, lady.

00:46:33:03 – 00:46:33:17
Daniel Ramsey
Nice.

00:46:33:22 – 00:46:52:08
Michael Krein
Yeah. She would not sign me up. So you’re going to have issues like that. Most of us have had guns pulled on us. It does happen now. That is not the norm and it’s not anywhere near as bad as it used to be. Most people, there’s really no shame in being foreclosed on anymore. Everybody has, so they’re much better about it.

00:46:52:08 – 00:46:59:03
Michael Krein
They also know they’re going to get money, so they treat you much better. So it’s not nearly as dangerous as it was years ago, huh? But there’s some weird stuff.

00:46:59:18 – 00:47:11:22
Daniel Ramsey
Is is the Oreo market coming back in the next six months or a year? Or like when I say coming back, like where where a good percentage of the homes sold are going to be somehow in the world.

00:47:12:22 – 00:47:30:24
Michael Krein
It’s already started. It’s never going to be as severe as it was in 2007 when everybody goes back to 2008, the market crashed in July of 2000, it actually peaked, if you look at the numbers, December of oh six, because I had my first batch of Oreo in July zero seven, I got 75 properties that month. Yeah, that’s where it started.

00:47:31:14 – 00:47:48:18
Michael Krein
Yep. Will it ever be that severe again? No. Back then we were getting a lot of first payment defaults. People were buying new four or five new houses, never making a first payment because they got caught when the crash happened. But it is coming back and it’s already started. Just depends where you are again. Forget the national economy.

00:47:48:24 – 00:48:02:23
Michael Krein
You’re in a bunch of micro economies. They are influenced by the economic aspects actually, but they’re really local markets and it’s being driven by population patterns. So it depends where you are, what you’re seeing. Oh.

00:48:03:09 – 00:48:24:16
Daniel Ramsey
It’s interesting. I think we’re getting close to the end of this. Our time together, you know, it’s crazy. You’ll love this story. Michael, my wife was eight months pregnant and she was my initial services person, so she was actually drilling locks and I sent her into the ghetto and she comes back to the office and she goes, I don’t know if I can do this anymore.

00:48:24:20 – 00:48:47:03
Daniel Ramsey
You know, she’s got a big oil and she’s drilling lox and. You know, that was that was the last time my wife worked in the aerospace. And I have I just have a love for this business. I really appreciate you coming here today and sharing all your wealth of knowledge. And I really I really love, you know, just spending time with you and hearing your story.

00:48:48:02 – 00:49:06:15
Michael Krein
Well, thank you very much. You know, like I said, I’m retired. I want to see everybody be successful. Real estate is a fun business. And when you make that kind of money, it’s even more fun. Trust me on that one. But yeah, we’re here to help. If you need software, you really want to get an office or get your business running efficiently where you actually get to have a life.

00:49:06:23 – 00:49:18:06
Michael Krein
Yeah. Take a look at real Genesis. What I’m probably proudest of is free broker school. Yeah, it’s. You want to know that no one else will ever teach you. And it’s all the stuff I always to say but couldn’t. But now I.

00:49:18:06 – 00:49:18:19
Daniel Ramsey
Can.

00:49:19:00 – 00:49:36:06
Michael Krein
And now I can. Because I’ve got to say it like I’ve spoken for all the majors as well. You know, when you take a speaking gig and it could be a franchise or a title company, whatever the event is, you’re kind of giving a program of what you have in push. You don’t realize that when you hear all these real estate speakers, they are given an agenda.

00:49:36:15 – 00:49:54:12
Michael Krein
If they’re at that event right now, it’s really cool to be able to tell everybody how it really works and teach people things about real estate that no one else celebrity job is because they don’t want to share it. It’s not in their best interest or because it’s political suicide. They won’t get another speaking gig. Yeah. So I will warn you, for the free brokers stuff, I’m.

00:49:54:12 – 00:50:12:00
Michael Krein
I’m assuming if you’re watching it, you’re real estate agent, you’re over 18, you can handle what I tell you. But it is the cold, honest, politically incorrect truth of how this business works. And honestly, forget, you know, a six figure producer. There isn’t anybody who can’t make a million a year in this business. If you know what you doing, you just apply it.

00:50:12:06 – 00:50:22:08
Michael Krein
And I’m not even talking working more than 40 hours a week. That’s crazy. You got a life. But anybody can do this if you just want it and you want to do it. So I put everything out there you’d ever need to know and more coming.

00:50:22:22 – 00:50:34:20
Daniel Ramsey
I love it. Michael Crain Ann Arbor Founder, Chairman, RPO Genesis. I really appreciate your time today, man. Thanks for hanging out with us and answering all these questions. The Hard questions.

00:50:35:16 – 00:50:42:24
Michael Krein
Yeah. And if anybody has any questions, email me. And finally, just Google make. I don’t seem to get screwed in especially about the scams out there, so please feel free.

00:50:43:06 – 00:50:44:19
Daniel Ramsey
Amen. Thank you so much. Bye bye.

00:50:45:08 – 00:50:47:13
Michael Krein
As.