March 11, 2025 • 36 mins
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Ed Mathews (00:00):
Greetings and salutations.
Real Estate Undergrounders.
It is Ed Mathews with the RealEstate Underground.
Thank you so much for joiningus today.
So today is an interesting showin that we discovered our guest
.
A friend of mine gave me hisbook and I read it I can't say
in a weekend, it probably tookme about a week to read but
nevertheless really enjoyed it,thought his approach was unique
(00:22):
and then spent the last coupleof months trying to figure out
how to get him on our show.
Joel Miller, welcome to theshow.
Thank you so much for theopportunity to speak with you
and I'm really looking forwardto this conversation.
Joel Miller (00:32):
It is my pleasure.
I've been looking forward tothis too.
This is going to be really good.
Ed Mathews (00:37):
Yeah, it should be great.
For those of us who haven'tdiscovered you out in the
audience, can you tell us alittle bit about who you are and
what you do?
Joel Miller (00:44):
I'm based in Erin, Pennsylvania, and I have last
month, from when we recordedthis, I had celebrated 47 years
in the rental property businessand about 1991 or so, started
flipping houses, flipped over ahundred houses and then, about
2018, got into hard moneylending and I get great
(01:05):
satisfaction out of being a partof the equation for many of the
other investors in my area here, providing money to finance
their flips or acquisitions ofkeeper rental properties that
they want.
And I asked you earlier, beforewe came on and I'll tell the
audience what we were talkingabout I asked you if you ever
had a professional mobile discjockey on your program before,
(01:26):
and that was something that Idid.
I pioneered the mobile DJbusiness in this part of the
country back in the mid-70s andI after being on the radio for a
while and you did that for 35years, 5,057 appearances, and
retired from that about 14 yearsago.
But I bought my first rentalproperty just a short time after
starting that and a short timeafter I graduated from college
(01:50):
with a degree in accounting.
So that is my educationalbackground.
But doing two things like thathaving a career that you're
passionate about and having arental property is the premise
of my book Build Real EstateWealth.
Enjoy the Journey of RentalProperty Investment.
Because the book deals withrental real estate to your
(02:12):
already busy life, when youdon't necessarily want to give
up a career or vocation or somehobby that you're totally
involved in that.
Having the rental property inaddition to that can provide you
additional income and buildyour retirement, because a lot
of those things people areinvolved in it isn't building a
(02:32):
retirement for them and, as youand I both know, that is
certainly one of the features ofinvesting in rental property is
, of course, cash flow along theway and retirement income and
perhaps cashing in and thenhaving money when you're
retirement from selling yourproperty, something like that.
But I also in the book, ofcourse, provide information
(02:55):
about how you can justsupercharge your existing
portfolio if you've alreadytaken a step to invest in rental
property.
If, in fact, you want to get toleaving your day job you know a
job stands for is it's justover broke If that's your goal
to do that.
So the tools are in there aswell.
Ed Mathews (03:15):
Yeah, excellent, and it's something that I talk with
folks that I mentor all thetime, and that is you do not
need to leave your job.
This is, and there's so manyways to get involved, whether
that's as a side hustle, likeyou were talking about, or as a
passive investor, where you'reinvesting in someone else's
project, like you do today, andany number of ways.
(03:38):
You don't have to necessarilybe the landlord right.
Joel Miller (03:43):
Yeah, that's right, and I think that there are
really three main reasons whypeople don't think that real
estate is for them.
They don't want to invest andagain, that is actually one of
the target audiences of the bookis people who don't think that
real estate is for them.
And it's the first to stem fromone of the misconceptions that
people have about rental realestate that it's all about
(04:04):
broken toilets and bad tenants.
So we try to dispel the mythsabout those sort of things.
So one of the reasons whypeople don't invest is because
they don't want to deal with themechanical part of it actually
working on houses and so we talkabout how to do some of those
things, but also the fact thatit's totally okay to pick up the
(04:25):
phone and call somebody to dosomething for you that you don't
know how to do, and so, ifyou're the owner of the property
, your skills that you want todevelop might be more with
learning who to call as opposedto how to do it yourself.
And, of course, the other thingthat I mentioned was interacting
with tenants, and that isperhaps the biggest skill that
(04:48):
you need to develop, and I willtake that back to before you're
actually interacting with thetenant.
You already have to talk abouttenant selection, which is
totally key I talk about in myclasses that I teach and in the
book about how your ability toselect tenants is in direct
(05:09):
proportion to how good of a timeyou're going to have in this
business.
Because you might be reallygood at finding deals or even
financing deals or even doingthe work on the properties, but
if you don't know how to selectthe tenants that are going to
use your thing that's valuedtens, maybe millions of dollars
(05:30):
for an extended period of timewithout your direct supervision,
if you can't get really good atmaking those selections, then
it could go really bad for you,even though you have the skills
with finding the deals andworking on the properties.
Couldn't agree more.
Ed Mathews (05:44):
Yeah, a difficult tenant is one of the biggest
stressors in a property owner'slife, right, yeah, and so what
are your thoughts on how to makesure that you're obviously
there's fair housing?
So there's a qualificationprocess.
That happens, but in terms ofthe qualifications of a good
resident, what are you lookingfor in particular?
Joel Miller (06:06):
First of all, I just want to complete the answer
to your last question, just tomake sure we don't leave
anything hanging.
The third thing is, since I didmention there were three things
, the third thing is people areafraid of losing money.
Yes, learning the skills forproperty selection as well and
managing property, managingcontractors, managing tenants
(06:28):
Property management and tenantmanagement are actually two
different things, and tenantselection is part of tenant
management, but those are thingsthat are overcome by education.
Education overcomes fear, andso it boils down to people not
wanting to get involved becausethey are afraid of something
they don't know 100%.
So the key is to becomeeducated, and that is what the
(06:51):
book is about, and sometimes youwin, sometimes you learn, but
in any case, if you becomeeducated on something else that
you don't have to fear anymoreand of course, then you need to
take action you can learn all.
Go to all the seminars you want.
People they just think thatthey need to just go to that one
more seminar or take one moreclass and that finally they're
(07:14):
either it could be they'reeither going to buy their first
property then or, one way oranother, they might have some
property going to that.
One more thing is going to makethem rich.
But it's not that.
It's what you do with theinformation.
You have to take action andthen beyond that you have to be
committed to seeing it through,because you start some action
and unfinished it, so that kindof doesn't count all the way.
(07:35):
You have to take it all the waythrough.
Right on that there's.
There can be some pitfalls.
Did you hear about the landlordthat was seeing a clinical
psychologist, a psychiatrist anda licensed counselor and he had
an apartment complex?
Yeah, he had a complex.
He had to go see somebody.
And that joke works on twolevels, because an apartment
(07:57):
complex could drive you crazy.
You don't know what you'redoing.
Ed Mathews (08:00):
Can and will.
If you don't figure it out
Joel Miller (08:02):
yeah, of course, a realtor could see somebody
because they can't get closure
Ed Mathews (08:07):
Right, Indeed.
Joel Miller (08:07):
Closure on a deal, of course,
Ed Mathews (08:09):
As opposed to emotional closure.
Joel Miller (08:11):
But of course a tenant or a landlord is really
just a realtor without a senseof humor,
Ed Mathews (08:17):
Without a sense of what?
Joel Miller (08:18):
A landlord is, just a realtor without a sense of
humor?
Yeah, that's In some cases.
But anyway, to answer yourquestion, what are we looking
for in a tenant?
Yeah, one of the firstquestions I ask people is how
many?
Like I'm talking to a caller,somebody that responded to an ad
of some sort and, by the way,this is not where tenant
(08:38):
selection begins.
I say a question like where'stenant selection begin?
I want to say when you get acall and you start talking to
them.
Tenant selection actually beginswhen you are thinking about the
possibility of maybe buyingsome real estate.
Because if every decision youmake after that from the type of
property you're going to buy,to the location of the property,
(08:59):
to the condition of theproperty, how you prepare the
property, how you advertise theproperty, all you know there's a
whole string of things thathappen before you even talk to
somebody about the apartmentsthat you have available, and
every one of those things isslightly narrowing, or more
defining the universe of thepeople that are likely to
respond to your app.
Ed Mathews (09:20):
Sure
Joel Miller (09:21):
Location, the property, all that stuff we're
talking about.
So let's say you've got them onthe phone, sure, are looking
for places.
They might make a list ofplaces to call and they just
(09:44):
simply might write the wrongphone number down.
Like we have a two bedroomadvertised and they are looking
for a four bedroom and they justcall it wrong.
So we just wanted to assure youthat I don't spend a lot of time
on the phone talking whensomebody's got too many people
and then, depending on what yourpreference is with pets, I'm
going to ask whether they haveanswered and go from there, and
(10:05):
sometimes they might say yes.
I said, what do you have?
And they got an hamster.
I'm not worried about thehamster, I'm not talking about
other furry things that can walkaround on their own.
If you're a no pets property,that would be one first things
established.
And then I, we all, we have allof our units are not smoking.
That's my next question is areyou a smoker?
So then, beyond that, thereally important stuff of course
(10:29):
to establish is what theirincome is, because they have to
prove that they can pay theamount of rent that you have.
There's the whole list.
Yeah, we would ask for that.
Ed Mathews (10:39):
Sure.
What do you look for in incomerelative to rent?
Joel Miller (10:43):
Generally, let's say, the apartment does not
include utilities and generallylike the take-home pay, not the
gross.
The take-home pay about threetimes whatever the rent is per
month.
Ed Mathews (10:55):
Okay, interesting you clarified that to take-home
rather than overall.
Joel Miller (11:01):
Yeah, yeah, because who knows what's coming out of
a paycheck overall?
Yeah, yeah, because who knowswhat's coming out of a paycheck?
They might be paying all kindsof stuff like child support or
who knows what might be deductedthat they don't have usage of
in their net pay.
And you get what I'm saying isyou have to.
You're looking for how muchcash they actually have
available, not how much theygrossed, and the part about
(11:24):
whether it includes utilities ornot.
If you were including a lot ofutilities that they otherwise
would have to pay on their own,like gas and electric, for
example, then I don't think youneed to have the same multiple
because you're not worryingabout them using their money to
pay utilities outside of yourrent.
That's standard, but it's goodto make the distinction of
(11:46):
whether it's gross or net.
Ed Mathews (11:48):
Yeah, and your points are well taken right.
Folks can have garnishments,they can have additional taxes
taken out for whatever reason,any number of reasons why they
would have additional moneycoming out of that net, say five
$6,000 a month.
Money coming out of that net,say $5,000, $6,000 a month.
Joel Miller (12:06):
There's nuances there, though.
You have to develop some skillsto discern how you feel about
their income.
If they're self-employed, itcould make a difference whether
you're talking.
It would make a differencewhether you're talking with
somebody that's established in abusiness.
Then they can show you howevermany years you want a Schedule
C's for what they reported ontheir tax return, and somebody
(12:30):
who started their business twoor three months ago and you
determined that it's a seasonalbusiness Got it Just to take a
couple of extreme examples there.
My theory on tenant selection isthat it's up to the tenant to
qualify them and not for you towork to qualify the tenant.
(12:54):
Your job is to eliminateeverybody in the world until you
find somebody that is likely topay the rent on time and not be
to place up, and then only timewill tell still even in that
case.
But landlords sometimes getinexperienced.
(13:14):
Ones might get involved withtrying to overlook something
that is a negative on somebody'sapplication, or because they
like the when they just want tofigure out how they can qualify
them Like we won't worry aboutthat thing or that.
No, you have to just look forevery reason why you don't want
to rent to somebody and makethem prove you wrong as far as
(13:38):
how you're looking at theinformation.
Ed Mathews (13:40):
Totally agree.
Yeah, the fact is that we have,here at Clark St, we have a hard
and fast set of qualificationitems, and it's binary you
either meet it or you don't.
The one thing, there's only onething, that we are willing to
work with you on, and that ishealthcare have brought your
(14:01):
credit rating down below whereour standards are, and it's due
to the fact that you had tobring your child to the
emergency room, or you had to goto the emergency room and
you're you know, and that thathealth care facility has dinged
your credit that we can workwith you on.
Joel Miller (14:27):
Other than that, a whole other life situation than
just deciding that you're notgoing to make your car payment
or you're going to make yourcredit card payment because
those are optional things thatyou chose to do and now you're
paying for them or you're maybenot meeting your obligation to
pay for them, whereas thathealth situation was probably
totally beyond control.
Ed Mathews (14:44):
Exactly.
Couldn't agree more, okay, so,as you're buying the property,
you're thinking about theprofile of the type of human
being or human beings that wouldlive in the building.
What's the kind of next stepfor you in terms of looking at
these properties and evaluatingthem?
Looking at the properties withthe tenant?
You're talking about One of thethings you said earlier was
(15:04):
that you're already profilingthe type of the, the economic
facilities of the resident andall that when you're buying the
building.
So what else are you looking at?
Joel Miller (15:17):
10 minute selection begins with the selection.
The building is what you'rereferring to.
I think that you are makingthose decisions as you.
You go along.
First of all, if you say I wantto invest in my town, there you
go.
You've narrowed it down to justpeople that live around where
you do, as opposed to oh, I'mlooking for an apartment complex
in the next state or somethinglike that.
But and then you're.
(15:38):
You either are accepting thetype of tenant you're going to
get with the type of propertythat you're going after because
you think that property itselfis a good deal, yeah.
Or you are thinking of acertain type of person you want
to rent to and then you try togo find the property that
somebody of that description islikely to want to rent.
(16:00):
I tend to just chase the gooddeals and then rely on my skills
to do the best I can with thetype of tenants that property is
likely to attract, the best Ican with the type of tenants
that property is likely toattract.
And, of course, when you'readvertising a property, you
never want to advertise the typeof person you want to have in
(16:20):
the unit you want to, or elseyou're going to run afoul of,
perhaps, discrimination issues.
You always want to describe theproperty or the units you're
offering and hope that the typeof people you want are attracted
to what you have to offer.
Ed Mathews (16:34):
Yep, okay.
So when you're buying aproperty and you're mentoring
somebody else to buy a property,what does the capital stack
usually look like?
You mean the type of financing.
Yeah, are you more of a privatefinancing or are you more
looking at private financing?
Are you looking at bankfinancing with partners?
What do you usually advise?
Joel Miller (16:52):
Well, let me answer that by telling you the first
property that I bought inJanuary of 1978, I got from
savings and loan.
I financed it with a savingsand loan with 20% down from my
savings at Adam Org, which gotrefinanced a few times over the
years, and then it finally paidoff because I still own that
same property.
You really that's great Cashout.
Yeah, because I still own thatsame property.
(17:15):
You really, that's great.
The cash out, yeah.
And then I can tell you that isthe last property that I bought
with conventional financingusing a realtor, other than a
couple of nice apartmentcomplexes.
That was in the past six oreight years after I retired from
DJing Yep.
All the other ones were ownerfundsfinanced with low amounts
down.
Okay.
And in fact I have a son who ishe turned 19 over the winter
(17:39):
but he graduated from highschool last June and he bought
his first rental probably abouta week after he graduated from
high school.
That's awesome With autofinancing 5% down, 30-year
amortization, 6% interest,8-year balloon at $10,000 off of
the asking price, which wasoriginally $135,000.
(18:01):
We got it for $120,000.
Ed Mathews (18:03):
Good deal and it follows a lot of the
instructions that I've used overthe years.
Joel Miller (18:16):
Yeah, but of course as a hard money lender, I get
involved with the equation froma different angle there.
When people are wanting to, welend under two circumstances.
One, the investor is borrowingmoney to buy and or rehab a
single family home that they aregoing to sell to a third party
who is going to live there, inwhich case that's a flip to a
third party who is going to livethere, in which case that's a
(18:36):
flip.
Or we're lending to an investorwho is wanting to buy and or
rehab a keeper rental propertythat they need to stabilize in
some fashion, either with arehab or putting different
tenants in there, perhaps andcertainly getting higher rents,
in order to stabilize thatproperty and make it attractive
for long-term permanentfinancing from a bank, in which
case we get paid off wheneverthey have the refi closing for
(18:58):
their permanent financing.
But in that case what hashappened is that I have given
them all the money that theyneeded to buy the property and
closing costs and all the rehab,and they had an interest-only
payment each month as theyworked their way toward getting
conventional financing.
But in the meantime they areforcing up the value of the
(19:19):
property so that by the timethey go to get the bank
financing and the bank givesthem 80% of an appraised value,
that 80% is more than the 100%that they owed me and they still
leave the closing with money.
So they got that property fornothing.
Now it's just cashflow andequity growth and take your
profit down the road.
That's a good model right there?
(19:40):
Yes, it is.
So you have to be sure, whenyou do something like that, if
you're an investor, that you doin fact have a relationship with
a bank, that you're going to beable to get the long-term
financing or loans for a year,generally within a year and a
half.
Ed Mathews (19:53):
Yeah, and usually I find for the audience out there,
I usually find that those typesof lenders in terms of the bank
end of that conversation likethe refi out, you want to find
portfolio lenders, and portfoliolenders tend to be your local
credit unions, your local banks,folks where you can walk in and
shake the hand of the personwho's making the loan decision.
Joel Miller (20:15):
Exactly.
Ed Mathews (20:15):
You build a relationship.
We're not talking about Bank ofAmerica and Chase, who don't
view you as a relationship.
They view you as a number andthe same thing is true with hard
money loans.
Joel Miller (20:26):
I only deal with the investors that are in my
immediate geographic area, mycounty, the next county.
We're close to Ohio and NewYork along where I'm from an
area where I'm halfway betweenCleveland and Buffalo, a little
tiny part of Pennsylvania thattouches Lake Erie.
I'll lend in that whole area.
But what I sometimes have todiscuss with investors that have
gone online and found somequote unquote hard money lender
(20:49):
for states away.
You know that I said look, thefurther away your hard money
lender is from you and yourproperty, when they can't view
your property and get to knowyou personally in the local
landlord association, the morethat hard money lender is going
to seem like a bank and act likea bank in terms of underwriting
(21:13):
and so on.
So to your audience I would sayif you're interested in doing
hard money lending, look rightunder your nose.
Is that the other investors whomight've been in the business
for a long time and have maybeaccumulated some capital and
maybe they've recently sold offsome properties or they have
some money to lend, but at thesame time they're not just
(21:34):
somebody that's never been inthe real estate business who
happens to have a pile of moneyand thinks they want to do hard
money lending, which I stronglyrecommend against.
The only reason why it worksfor me is because I've done
everything that any investor hasever asked to borrow money for
me, for I've done your at somepoint in the past.
Oh, I can walk it with you, andsometimes at the end of that
(21:56):
walkthrough because I don't landon any property that I'm not
going to, I don't see I'll asksome questions during that
interview or that walkthroughand by the end of that they're
absolutely sure they do not wantto buy that.
That's something that I saw.
Ed Mathews (22:11):
Yeah, the fact is that sometimes the best deal is
no deal.
Joel Miller (22:13):
it's better to put this how do I say it sometimes?
A a missed opportunity isbetter than a guaranteed loss.
Ed Mathews (22:21):
Yes, amen to that all right, Joel, I could talk
for days with you.
Oh yeah, so I want to get intoour lightning round.
We call it the final five andpretty easy questions.
I just want to.
I just want to know and helpthe audience understand how your
brain works and what makes youtick.
So with that we're going todive in.
Okay, all right, sir,
Joel Miller (22:41):
I heard these questions before.
Ed Mathews (22:43):
That's the idea, right?
Okay, I want your off the cuffanswer.
I'm always interested in howand what gets people out of bed
on Monday morning, and so in theway that I think about that is
purpose, and so I'm curiousabout what gets you out of bed
on Monday morning.
What is your purpose?
Joel Miller (23:00):
I have really enjoyed this career to the point
where now it's not just aboutjust making more money, it's
about giving money back.
So I'm real active in thecommunity with my time and money
, both in the community at largeand in my church, and just
being able to make more of it soI can give more is exciting.
(23:22):
That's great.
That's what keeps me going.
That and the fact that did Imention that 19 year old that
wants to come up with a realestate business yeah, so he
keeps me sharp, put it that waybecause he's got a lot of
questions.
Ed Mathews (23:36):
That's what kids it's.
One of the beautiful thingsthat kids do for us is keep us
young and fire a whole bunch ofquestions at us.
Smart kids do, so that's good,all right.
So second question I'm alwaysinterested in mentorship, and
not only providing mentorship,but also receiving, and so I'm
curious about the mentors you'vehad in your life.
What's the best advice you evergot, and who gave it to you?
Joel Miller (23:58):
The best advice is don't take advice from anybody
you wouldn't want to changeplaces with.
That's good.
Ed Mathews (24:03):
That's all I got to say about that.
Yep, that's good.
Yeah, no, no need to elaborate.
How?
About mistakes?
I think and you alluded to thisyou either win or you learn,
right, I think, is what you said, and I fully subscribe to that
as well.
So I'm curious about a mistakeyou made in your business that
you learned a valuable lessonfrom it.
(24:24):
How'd you recover from it?
Joel Miller (24:26):
From a professional standpoint, speaking strictly
with real estate investing, thebiggest mistake that I made was
when I replaced the existingmanaging partner in a three-way
partnership that owned a fairlylarge commercial about a
60,000-foot office building,yeah, and 50% of that building
(24:48):
was from a.
It was the corporate offices ofa catalog showroom type company
and 25 of it was a well-knownlocal restaurant and bankrupt.
And that was in like September,uh, one year and by November
both of the entities I justmentioned had gone bankrupt, and
(25:10):
first into chapter 11, which isa workout, and then chapter 7,
whatever.
It just went on all together,and so that was the beginning of
the years of trying to put outfires.
And so the lesson, really, thatI would point to is that if you
(25:32):
are buying any type of propertyand it seems like this would be
most applicable to commercialproperty, where you might have
some large tenants and somesmall tenants, as opposed to
residential, where you've got awhole bunch of tenants that have
the same size of apartment andsame amount of rent the lesson
would be to do a little bit moredigging into the financial
(25:54):
condition of the major tenants.
I think I might've been able touncover what was going on with
these companies and maybe notdone that deal, because there
was a lot of hardship,especially with me being the
managing partner and so on, andwe made it through.
But I can tell you that at theend of 10 years and so on and we
made it through, but I can tellyou that at the end of 10 years
I gave my share to the othertwo partners.
(26:15):
I gave it to them just to beout from under them, yeah.
But there is one silver liningto this whole thing and that is
that I met my wife in thatbuilding because she, one of our
tenants, was a realtor in oneof their branch offices and she
worked in that office and, asthe managing partner, I kept an
(26:37):
extra key ring in there in caseI were to show up at the
building and didn't have my keyring with me and decided I
needed to do something.
I could go into that office andretrieve my extra keys, and she
was the keeper of the keys.
There you go, yeah.
Ed Mathews (26:52):
So it's worth it.
Joel Miller (26:53):
Yeah, just to give an example, there can be a
silver lining in every difficultsituation.
Ed Mathews (26:58):
There usually is, and that's a pretty good one.
Okay, I'm also interested inhow leaders like yourself, how
you sharpen the saw, how youcontinue to learn, and I'm
curious about the book on youreither virtual or physical
nightstand.
What are you reading these daysand who you pay attention to?
Joel Miller (27:14):
I had to read my own book on podcasts.
I don't have a book at themoment, but I make sure that I
keep up with things that are putout by some of the people that
I follow online that are puttingout things like, for example,
relating to this FinCEN thingwe've gone through lately with
the registration of the entities.
(27:36):
Well, if you want a couple ofbooks to recommend because I do
go back and look at these thingsevery once in a while I would
recommend Napoleon Hill's bookGrow Rich with Peace of Mind,
but he also wrote Think and GrowRich.
Yeah, sure, the copyright on mycopy is like 1967.
These are older books.
(27:57):
Write on my copy is like 1967.
These are older books.
And then the one by SterlingSill is how to Personally Profit
from the Laws of Success, andall it is is 99 laws in here and
a chapter for each law 33 laws.
But Sharp though I teach, it'ssharpened me to write the book,
which took over years, and Iteach Landlord 101 to the
(28:21):
members of the professionalorganization of landlords that
I've belonged to since the early80s and in fact that would be a
big recommendation that I wouldhave is wherever you are.
Find your local group,like-minded investors and
landlords network and rub elbowsand ask who they use, what a
contractor they use for this, orask what bank they use for that
(28:43):
.
You don't want to be an islandin this business, and that's one
thing that has been a big partof my career is my membership in
that, and I've been on theboard since probably 2009, I
think.
I'm vice president and I teachclasses and that keeps you sharp
, wonderful.
Ed Mathews (29:02):
All right.
Last but certainly not least,how do you define success?
Joel Miller (29:06):
Like I said, I sometimes teach these classes or
end up talking in front ofpeople or masterminds and so on,
and I am known for what I'mgoing to answer this question
with, and that is that if I hada choice of losing all my money
or losing my relationships, Iwould lose my money in a
(29:28):
heartbeat because myrelationships will help me get
my money back.
Correct, if I make a bunch ofmoney and lose all my
relationships, I would havenobody to share that with and
that wouldn't be interesting.
So, really, success having adegree of money that you maybe
set a goal to have is could bepart of living a successful life
(29:51):
, but it's not.
The thing is more what kind ofperson you are, what kind of
relationship you have with yourcreator and the people that you
love and that you and yourcommunity.
When you leave, is it going tobe a good footprint?
Is the world going to be betterfrom you being here for a while
or not?
(30:12):
And that's the areas that Ilook in a person for their
success.
You don't impress me if youhave a whole bunch of money, and
I can see that you don't treatpeople right.
Ed Mathews (30:22):
Yeah, that's a big turnoff for me as well.
We used to in my corporate days.
We used to have this test wherewe would bring somebody in that
we were recruiting and we wouldsend someone who was pretty low
on the totem pole, like areceptionist or a maintenance
person or somebody, to interactand to see how they'd react.
And if it was yes, sir, no, sir, yes, ma'am, no, ma'am, thank
(30:45):
you and please, then they wereprobably someone we wanted to
deal with.
But a lot of people fail thattest and that was a pretty easy
test.
Joel Miller (30:53):
I have something here that is extracted from my
book.
I just keep it handy and I'llread it to you.
That kind of touches on what wewere just talking about.
Watch your environment itproduces your thoughts.
Watch your thoughts they leadto your words.
Watch your words they lead toyour actions.
Watch your actions they setyour reputation.
Watch your reputation.
It influences your limits.
(31:13):
Know your limits.
They determine your destiny.
Envision your destiny and youwill avoid negative environments
.
Which takes you back to thefirst line about watching your
environment.
But that's what I think of whenI think of trying to live a
(31:34):
successful life is doing thingslike that, and I also encourage
you to use your ability tohandle your first stolen
business money and to createcash, of course, but use your
cash to create wealth, andthere's a big difference between
riches and wealth.
I spend a whole chapter on thatand it's not the same.
It's the difference betweenwisdom and knowledge.
Knowledge is just the facts.
Wisdom is knowing what to dowith the facts in the right
(31:55):
fashion and then use your wealthto create a great life.
By enjoying your great life,share your joy with your
relationships.
Your relationships will helpyou create more cash and a cycle
starts Indeed.
Ed Mathews (32:08):
That's great.
So, joel, when you're nottalking about real estate, what
do you like to do for fun?
Joel Miller (32:16):
I have six things that I do real quick Ski,
snowboard, mountain bike,whitewater rafting and going
down a river, and things likeropes courses and just things
like that.
Unfortunately, I can do themwith my son, and he likes to do
those same things, but the thingI spend the most money on,
though, is probablyfour-wheeling.
Ed Mathews (32:36):
Fun but expensive habit.
Joel Miller (32:37):
Yeah, yeah, those things those machines aren't
cheap.
Ed Mathews (32:42):
And you certainly live in the right part of the
world to do all those things.
So,
Joel Miller (32:45):
yeah, we have four seasons here.
Ed Mathews (32:47):
Yep, absolutely so, Joel.
If folks want to get to knowyou or learn more about you,
obviously they can get your bookBuild Real Estate Wealth enjoy
the journey of rental propertyinvestment.
They can find that on Amazonand other websites.
But if they want to get intouch with you, what's the best
way to do that?
Joel Miller (33:05):
They can find me on Facebook, LinkedIn, Instagram
and X.
What I would encourage peopleto do and this is my call to
action is go to my websitethat's created your book.
It's joelmillerbooks.
com,J-O-E-L-M-I-L-L-E-R-B-O-O-K-S
dot com, and on the front pageor on the homepage of that,
(33:26):
scroll down.
There's a button there that youcan click on.
It'll show you the entire tableof contents, fairly detailed
table of contents for the bookso you could see what we cover.
And we cover everything frommindset through formation of an
entity in which you could investin acquisition of the property,
financing the property,acquisition and management of
(33:48):
tenants and property and so on,all the way through either
evicting a tenant or keeping atenant and, in addition to that,
best practices for any kind ofbusiness.
But it's slanted toward therental property business.
To keep your life and yourbusiness out of calamity.
I'm all about, don't have thecalamity in first place.
(34:08):
Takes some precautions with theway you have your record
keeping, because we do coveroffice creation and management
and taxes and preparation andtax.
It's all there.
And if you get the book, at theend of the, we do cover house
flipping, but the book isprimarily about rentals, but
there's a short chapter abouthouse flipping and at the end of
(34:30):
that there's a QR code thatwill take you right to a bonus
information on the how-to ofhouse flipping.
I didn't want to include thaton the book.
Use the QR code and you get thewhole how-to house flip thing.
You could see the whole tableof contents and the other thing
that you can see on anotherbutton is sample writings from
(34:50):
each of the chapters.
Two or three of the keyparagraphs for each chapter is
there and you can really get anidea of what it is.
And then, like I said, the bonusmaterial is there if you have
the book for the house flippingbut that's what I would
encourage you to do and there'sinformation about my background,
of course, on there, but it's afairly concise website.
It's not something clunky andunuseful things on it, All right
(35:13):
, but it'll take you.
There's another plenty ofbuttons on there that'll take
you right to where you can buyit on Amazon.
We don't sell it from thewebsite.
You just click on a button toAmazon.
Buy it there.
Ed Mathews (35:23):
Got it, Joel.
I've really enjoyed thisconversation.
I learned a lot and I'mgrateful for your time today.
It's a pleasure to finally meetyou, and thank you again for
taking the time to meet with usand to help educate our audience
.
Joel Miller (35:36):
You're very welcome , Ed.
It was my pleasure.
I hope we've gotten undergrounda little bit, gotten a little
behind the scenes.
Ed Mathews (35:43):
I feel like we have
Joel Miller (35:44):
Talked about some stuff.
Ed Mathews (35:45):
Yeah, excellent.
Appreciate it All right.
Thank you, Joel.
Have a good night
Joel Miller (35:49):
You too.
Greetings and salutations.
Real Estate Undergrounders.
It is Ed Mathews with the RealEstate Underground.
Thank you so much for joiningus today.
So today is an interesting showin that we discovered our guest
.
A friend of mine gave me hisbook and I read it I can't say
in a weekend, it probably tookme about a week to read but
nevertheless really enjoyed it,thought his approach was unique
(00:22):
and then spent the last coupleof months trying to figure out
how to get him on our show.
Joel Miller, welcome to theshow.
Thank you so much for theopportunity to speak with you
and I'm really looking forwardto this conversation.
Joel Miller (00:32):
It is my pleasure.
I've been looking forward tothis too.
This is going to be really good.
Ed Mathews (00:37):
Yeah, it should be great.
For those of us who haven'tdiscovered you out in the
audience, can you tell us alittle bit about who you are and
what you do?
Joel Miller (00:44):
I'm based in Erin, Pennsylvania, and I have last
month, from when we recordedthis, I had celebrated 47 years
in the rental property businessand about 1991 or so, started
flipping houses, flipped over ahundred houses and then, about
2018, got into hard moneylending and I get great
(01:05):
satisfaction out of being a partof the equation for many of the
other investors in my area here, providing money to finance
their flips or acquisitions ofkeeper rental properties that
they want.
And I asked you earlier, beforewe came on and I'll tell the
audience what we were talkingabout I asked you if you ever
had a professional mobile discjockey on your program before,
(01:26):
and that was something that Idid.
I pioneered the mobile DJbusiness in this part of the
country back in the mid-70s andI after being on the radio for a
while and you did that for 35years, 5,057 appearances, and
retired from that about 14 yearsago.
But I bought my first rentalproperty just a short time after
starting that and a short timeafter I graduated from college
(01:50):
with a degree in accounting.
So that is my educationalbackground.
But doing two things like thathaving a career that you're
passionate about and having arental property is the premise
of my book Build Real EstateWealth.
Enjoy the Journey of RentalProperty Investment.
Because the book deals withrental real estate to your
(02:12):
already busy life, when youdon't necessarily want to give
up a career or vocation or somehobby that you're totally
involved in that.
Having the rental property inaddition to that can provide you
additional income and buildyour retirement, because a lot
of those things people areinvolved in it isn't building a
(02:32):
retirement for them and, as youand I both know, that is
certainly one of the features ofinvesting in rental property is
, of course, cash flow along theway and retirement income and
perhaps cashing in and thenhaving money when you're
retirement from selling yourproperty, something like that.
But I also in the book, ofcourse, provide information
(02:55):
about how you can justsupercharge your existing
portfolio if you've alreadytaken a step to invest in rental
property.
If, in fact, you want to get toleaving your day job you know a
job stands for is it's justover broke If that's your goal
to do that.
So the tools are in there aswell.
Ed Mathews (03:15):
Yeah, excellent, and it's something that I talk with
folks that I mentor all thetime, and that is you do not
need to leave your job.
This is, and there's so manyways to get involved, whether
that's as a side hustle, likeyou were talking about, or as a
passive investor, where you'reinvesting in someone else's
project, like you do today, andany number of ways.
(03:38):
You don't have to necessarilybe the landlord right.
Joel Miller (03:43):
Yeah, that's right, and I think that there are
really three main reasons whypeople don't think that real
estate is for them.
They don't want to invest andagain, that is actually one of
the target audiences of the bookis people who don't think that
real estate is for them.
And it's the first to stem fromone of the misconceptions that
people have about rental realestate that it's all about
(04:04):
broken toilets and bad tenants.
So we try to dispel the mythsabout those sort of things.
So one of the reasons whypeople don't invest is because
they don't want to deal with themechanical part of it actually
working on houses and so we talkabout how to do some of those
things, but also the fact thatit's totally okay to pick up the
(04:25):
phone and call somebody to dosomething for you that you don't
know how to do, and so, ifyou're the owner of the property
, your skills that you want todevelop might be more with
learning who to call as opposedto how to do it yourself.
And, of course, the other thingthat I mentioned was interacting
with tenants, and that isperhaps the biggest skill that
(04:48):
you need to develop, and I willtake that back to before you're
actually interacting with thetenant.
You already have to talk abouttenant selection, which is
totally key I talk about in myclasses that I teach and in the
book about how your ability toselect tenants is in direct
(05:09):
proportion to how good of a timeyou're going to have in this
business.
Because you might be reallygood at finding deals or even
financing deals or even doingthe work on the properties, but
if you don't know how to selectthe tenants that are going to
use your thing that's valuedtens, maybe millions of dollars
(05:30):
for an extended period of timewithout your direct supervision,
if you can't get really good atmaking those selections, then
it could go really bad for you,even though you have the skills
with finding the deals andworking on the properties.
Couldn't agree more.
Ed Mathews (05:44):
Yeah, a difficult tenant is one of the biggest
stressors in a property owner'slife, right, yeah, and so what
are your thoughts on how to makesure that you're obviously
there's fair housing?
So there's a qualificationprocess.
That happens, but in terms ofthe qualifications of a good
resident, what are you lookingfor in particular?
Joel Miller (06:06):
First of all, I just want to complete the answer
to your last question, just tomake sure we don't leave
anything hanging.
The third thing is, since I didmention there were three things
, the third thing is people areafraid of losing money.
Yes, learning the skills forproperty selection as well and
managing property, managingcontractors, managing tenants
(06:28):
Property management and tenantmanagement are actually two
different things, and tenantselection is part of tenant
management, but those are thingsthat are overcome by education.
Education overcomes fear, andso it boils down to people not
wanting to get involved becausethey are afraid of something
they don't know 100%.
So the key is to becomeeducated, and that is what the
(06:51):
book is about, and sometimes youwin, sometimes you learn, but
in any case, if you becomeeducated on something else that
you don't have to fear anymoreand of course, then you need to
take action you can learn all.
Go to all the seminars you want.
People they just think thatthey need to just go to that one
more seminar or take one moreclass and that finally they're
(07:14):
either it could be they'reeither going to buy their first
property then or, one way oranother, they might have some
property going to that.
One more thing is going to makethem rich.
But it's not that.
It's what you do with theinformation.
You have to take action andthen beyond that you have to be
committed to seeing it through,because you start some action
and unfinished it, so that kindof doesn't count all the way.
(07:35):
You have to take it all the waythrough.
Right on that there's.
There can be some pitfalls.
Did you hear about the landlordthat was seeing a clinical
psychologist, a psychiatrist anda licensed counselor and he had
an apartment complex?
Yeah, he had a complex.
He had to go see somebody.
And that joke works on twolevels, because an apartment
(07:57):
complex could drive you crazy.
You don't know what you'redoing.
Ed Mathews (08:00):
Can and will.
If you don't figure it out
Joel Miller (08:02):
yeah, of course, a realtor could see somebody
because they can't get closure
Ed Mathews (08:07):
Right, Indeed.
Joel Miller (08:07):
Closure on a deal, of course,
Ed Mathews (08:09):
As opposed to emotional closure.
Joel Miller (08:11):
But of course a tenant or a landlord is really
just a realtor without a senseof humor,
Ed Mathews (08:17):
Without a sense of what?
Joel Miller (08:18):
A landlord is, just a realtor without a sense of
humor?
Yeah, that's In some cases.
But anyway, to answer yourquestion, what are we looking
for in a tenant?
Yeah, one of the firstquestions I ask people is how
many?
Like I'm talking to a caller,somebody that responded to an ad
of some sort and, by the way,this is not where tenant
(08:38):
selection begins.
I say a question like where'stenant selection begin?
I want to say when you get acall and you start talking to
them.
Tenant selection actually beginswhen you are thinking about the
possibility of maybe buyingsome real estate.
Because if every decision youmake after that from the type of
property you're going to buy,to the location of the property,
(08:59):
to the condition of theproperty, how you prepare the
property, how you advertise theproperty, all you know there's a
whole string of things thathappen before you even talk to
somebody about the apartmentsthat you have available, and
every one of those things isslightly narrowing, or more
defining the universe of thepeople that are likely to
respond to your app.
Ed Mathews (09:20):
Sure
Joel Miller (09:21):
Location, the property, all that stuff we're
talking about.
So let's say you've got them onthe phone, sure, are looking
for places.
They might make a list ofplaces to call and they just
(09:44):
simply might write the wrongphone number down.
Like we have a two bedroomadvertised and they are looking
for a four bedroom and they justcall it wrong.
So we just wanted to assure youthat I don't spend a lot of time
on the phone talking whensomebody's got too many people
and then, depending on what yourpreference is with pets, I'm
going to ask whether they haveanswered and go from there, and
(10:05):
sometimes they might say yes.
I said, what do you have?
And they got an hamster.
I'm not worried about thehamster, I'm not talking about
other furry things that can walkaround on their own.
If you're a no pets property,that would be one first things
established.
And then I, we all, we have allof our units are not smoking.
That's my next question is areyou a smoker?
So then, beyond that, thereally important stuff of course
(10:29):
to establish is what theirincome is, because they have to
prove that they can pay theamount of rent that you have.
There's the whole list.
Yeah, we would ask for that.
Ed Mathews (10:39):
Sure.
What do you look for in incomerelative to rent?
Joel Miller (10:43):
Generally, let's say, the apartment does not
include utilities and generallylike the take-home pay, not the
gross.
The take-home pay about threetimes whatever the rent is per
month.
Ed Mathews (10:55):
Okay, interesting you clarified that to take-home
rather than overall.
Joel Miller (11:01):
Yeah, yeah, because who knows what's coming out of
a paycheck overall?
Yeah, yeah, because who knowswhat's coming out of a paycheck?
They might be paying all kindsof stuff like child support or
who knows what might be deductedthat they don't have usage of
in their net pay.
And you get what I'm saying isyou have to.
You're looking for how muchcash they actually have
available, not how much theygrossed, and the part about
(11:24):
whether it includes utilities ornot.
If you were including a lot ofutilities that they otherwise
would have to pay on their own,like gas and electric, for
example, then I don't think youneed to have the same multiple
because you're not worryingabout them using their money to
pay utilities outside of yourrent.
That's standard, but it's goodto make the distinction of
(11:46):
whether it's gross or net.
Ed Mathews (11:48):
Yeah, and your points are well taken right.
Folks can have garnishments,they can have additional taxes
taken out for whatever reason,any number of reasons why they
would have additional moneycoming out of that net, say five
$6,000 a month.
Money coming out of that net,say $5,000, $6,000 a month.
Joel Miller (12:06):
There's nuances there, though.
You have to develop some skillsto discern how you feel about
their income.
If they're self-employed, itcould make a difference whether
you're talking.
It would make a differencewhether you're talking with
somebody that's established in abusiness.
Then they can show you howevermany years you want a Schedule
C's for what they reported ontheir tax return, and somebody
(12:30):
who started their business twoor three months ago and you
determined that it's a seasonalbusiness Got it Just to take a
couple of extreme examples there.
My theory on tenant selection isthat it's up to the tenant to
qualify them and not for you towork to qualify the tenant.
(12:54):
Your job is to eliminateeverybody in the world until you
find somebody that is likely topay the rent on time and not be
to place up, and then only timewill tell still even in that
case.
But landlords sometimes getinexperienced.
(13:14):
Ones might get involved withtrying to overlook something
that is a negative on somebody'sapplication, or because they
like the when they just want tofigure out how they can qualify
them Like we won't worry aboutthat thing or that.
No, you have to just look forevery reason why you don't want
to rent to somebody and makethem prove you wrong as far as
(13:38):
how you're looking at theinformation.
Ed Mathews (13:40):
Totally agree.
Yeah, the fact is that we have,here at Clark St, we have a hard
and fast set of qualificationitems, and it's binary you
either meet it or you don't.
The one thing, there's only onething, that we are willing to
work with you on, and that ishealthcare have brought your
(14:01):
credit rating down below whereour standards are, and it's due
to the fact that you had tobring your child to the
emergency room, or you had to goto the emergency room and
you're you know, and that thathealth care facility has dinged
your credit that we can workwith you on.
Joel Miller (14:27):
Other than that, a whole other life situation than
just deciding that you're notgoing to make your car payment
or you're going to make yourcredit card payment because
those are optional things thatyou chose to do and now you're
paying for them or you're maybenot meeting your obligation to
pay for them, whereas thathealth situation was probably
totally beyond control.
Ed Mathews (14:44):
Exactly.
Couldn't agree more, okay, so,as you're buying the property,
you're thinking about theprofile of the type of human
being or human beings that wouldlive in the building.
What's the kind of next stepfor you in terms of looking at
these properties and evaluatingthem?
Looking at the properties withthe tenant?
You're talking about One of thethings you said earlier was
(15:04):
that you're already profilingthe type of the, the economic
facilities of the resident andall that when you're buying the
building.
So what else are you looking at?
Joel Miller (15:17):
10 minute selection begins with the selection.
The building is what you'rereferring to.
I think that you are makingthose decisions as you.
You go along.
First of all, if you say I wantto invest in my town, there you
go.
You've narrowed it down to justpeople that live around where
you do, as opposed to oh, I'mlooking for an apartment complex
in the next state or somethinglike that.
But and then you're.
(15:38):
You either are accepting thetype of tenant you're going to
get with the type of propertythat you're going after because
you think that property itselfis a good deal, yeah.
Or you are thinking of acertain type of person you want
to rent to and then you try togo find the property that
somebody of that description islikely to want to rent.
(16:00):
I tend to just chase the gooddeals and then rely on my skills
to do the best I can with thetype of tenants that property is
likely to attract, the best Ican with the type of tenants
that property is likely toattract.
And, of course, when you'readvertising a property, you
never want to advertise the typeof person you want to have in
(16:20):
the unit you want to, or elseyou're going to run afoul of,
perhaps, discrimination issues.
You always want to describe theproperty or the units you're
offering and hope that the typeof people you want are attracted
to what you have to offer.
Ed Mathews (16:34):
Yep, okay.
So when you're buying aproperty and you're mentoring
somebody else to buy a property,what does the capital stack
usually look like?
You mean the type of financing.
Yeah, are you more of a privatefinancing or are you more
looking at private financing?
Are you looking at bankfinancing with partners?
What do you usually advise?
Joel Miller (16:52):
Well, let me answer that by telling you the first
property that I bought inJanuary of 1978, I got from
savings and loan.
I financed it with a savingsand loan with 20% down from my
savings at Adam Org, which gotrefinanced a few times over the
years, and then it finally paidoff because I still own that
same property.
You really that's great Cashout.
Yeah, because I still own thatsame property.
(17:15):
You really, that's great.
The cash out, yeah.
And then I can tell you that isthe last property that I bought
with conventional financingusing a realtor, other than a
couple of nice apartmentcomplexes.
That was in the past six oreight years after I retired from
DJing Yep.
All the other ones were ownerfundsfinanced with low amounts
down.
Okay.
And in fact I have a son who ishe turned 19 over the winter
(17:39):
but he graduated from highschool last June and he bought
his first rental probably abouta week after he graduated from
high school.
That's awesome With autofinancing 5% down, 30-year
amortization, 6% interest,8-year balloon at $10,000 off of
the asking price, which wasoriginally $135,000.
(18:01):
We got it for $120,000.
Ed Mathews (18:03):
Good deal and it follows a lot of the
instructions that I've used overthe years.
Joel Miller (18:16):
Yeah, but of course as a hard money lender, I get
involved with the equation froma different angle there.
When people are wanting to, welend under two circumstances.
One, the investor is borrowingmoney to buy and or rehab a
single family home that they aregoing to sell to a third party
who is going to live there, inwhich case that's a flip to a
third party who is going to livethere, in which case that's a
(18:36):
flip.
Or we're lending to an investorwho is wanting to buy and or
rehab a keeper rental propertythat they need to stabilize in
some fashion, either with arehab or putting different
tenants in there, perhaps andcertainly getting higher rents,
in order to stabilize thatproperty and make it attractive
for long-term permanentfinancing from a bank, in which
case we get paid off wheneverthey have the refi closing for
(18:58):
their permanent financing.
But in that case what hashappened is that I have given
them all the money that theyneeded to buy the property and
closing costs and all the rehab,and they had an interest-only
payment each month as theyworked their way toward getting
conventional financing.
But in the meantime they areforcing up the value of the
(19:19):
property so that by the timethey go to get the bank
financing and the bank givesthem 80% of an appraised value,
that 80% is more than the 100%that they owed me and they still
leave the closing with money.
So they got that property fornothing.
Now it's just cashflow andequity growth and take your
profit down the road.
That's a good model right there?
(19:40):
Yes, it is.
So you have to be sure, whenyou do something like that, if
you're an investor, that you doin fact have a relationship with
a bank, that you're going to beable to get the long-term
financing or loans for a year,generally within a year and a
half.
Ed Mathews (19:53):
Yeah, and usually I find for the audience out there,
I usually find that those typesof lenders in terms of the bank
end of that conversation likethe refi out, you want to find
portfolio lenders, and portfoliolenders tend to be your local
credit unions, your local banks,folks where you can walk in and
shake the hand of the personwho's making the loan decision.
Joel Miller (20:15):
Exactly.
Ed Mathews (20:15):
You build a relationship.
We're not talking about Bank ofAmerica and Chase, who don't
view you as a relationship.
They view you as a number andthe same thing is true with hard
money loans.
Joel Miller (20:26):
I only deal with the investors that are in my
immediate geographic area, mycounty, the next county.
We're close to Ohio and NewYork along where I'm from an
area where I'm halfway betweenCleveland and Buffalo, a little
tiny part of Pennsylvania thattouches Lake Erie.
I'll lend in that whole area.
But what I sometimes have todiscuss with investors that have
gone online and found somequote unquote hard money lender
(20:49):
for states away.
You know that I said look, thefurther away your hard money
lender is from you and yourproperty, when they can't view
your property and get to knowyou personally in the local
landlord association, the morethat hard money lender is going
to seem like a bank and act likea bank in terms of underwriting
(21:13):
and so on.
So to your audience I would sayif you're interested in doing
hard money lending, look rightunder your nose.
Is that the other investors whomight've been in the business
for a long time and have maybeaccumulated some capital and
maybe they've recently sold offsome properties or they have
some money to lend, but at thesame time they're not just
(21:34):
somebody that's never been inthe real estate business who
happens to have a pile of moneyand thinks they want to do hard
money lending, which I stronglyrecommend against.
The only reason why it worksfor me is because I've done
everything that any investor hasever asked to borrow money for
me, for I've done your at somepoint in the past.
Oh, I can walk it with you, andsometimes at the end of that
(21:56):
walkthrough because I don't landon any property that I'm not
going to, I don't see I'll asksome questions during that
interview or that walkthroughand by the end of that they're
absolutely sure they do not wantto buy that.
That's something that I saw.
Ed Mathews (22:11):
Yeah, the fact is that sometimes the best deal is
no deal.
Joel Miller (22:13):
it's better to put this how do I say it sometimes?
A a missed opportunity isbetter than a guaranteed loss.
Ed Mathews (22:21):
Yes, amen to that all right, Joel, I could talk
for days with you.
Oh yeah, so I want to get intoour lightning round.
We call it the final five andpretty easy questions.
I just want to.
I just want to know and helpthe audience understand how your
brain works and what makes youtick.
So with that we're going todive in.
Okay, all right, sir,
Joel Miller (22:41):
I heard these questions before.
Ed Mathews (22:43):
That's the idea, right?
Okay, I want your off the cuffanswer.
I'm always interested in howand what gets people out of bed
on Monday morning, and so in theway that I think about that is
purpose, and so I'm curiousabout what gets you out of bed
on Monday morning.
What is your purpose?
Joel Miller (23:00):
I have really enjoyed this career to the point
where now it's not just aboutjust making more money, it's
about giving money back.
So I'm real active in thecommunity with my time and money
, both in the community at largeand in my church, and just
being able to make more of it soI can give more is exciting.
(23:22):
That's great.
That's what keeps me going.
That and the fact that did Imention that 19 year old that
wants to come up with a realestate business yeah, so he
keeps me sharp, put it that waybecause he's got a lot of
questions.
Ed Mathews (23:36):
That's what kids it's.
One of the beautiful thingsthat kids do for us is keep us
young and fire a whole bunch ofquestions at us.
Smart kids do, so that's good,all right.
So second question I'm alwaysinterested in mentorship, and
not only providing mentorship,but also receiving, and so I'm
curious about the mentors you'vehad in your life.
What's the best advice you evergot, and who gave it to you?
Joel Miller (23:58):
The best advice is don't take advice from anybody
you wouldn't want to changeplaces with.
That's good.
Ed Mathews (24:03):
That's all I got to say about that.
Yep, that's good.
Yeah, no, no need to elaborate.
How?
About mistakes?
I think and you alluded to thisyou either win or you learn,
right, I think, is what you said, and I fully subscribe to that
as well.
So I'm curious about a mistakeyou made in your business that
you learned a valuable lessonfrom it.
(24:24):
How'd you recover from it?
Joel Miller (24:26):
From a professional standpoint, speaking strictly
with real estate investing, thebiggest mistake that I made was
when I replaced the existingmanaging partner in a three-way
partnership that owned a fairlylarge commercial about a
60,000-foot office building,yeah, and 50% of that building
(24:48):
was from a.
It was the corporate offices ofa catalog showroom type company
and 25 of it was a well-knownlocal restaurant and bankrupt.
And that was in like September,uh, one year and by November
both of the entities I justmentioned had gone bankrupt, and
(25:10):
first into chapter 11, which isa workout, and then chapter 7,
whatever.
It just went on all together,and so that was the beginning of
the years of trying to put outfires.
And so the lesson, really, thatI would point to is that if you
(25:32):
are buying any type of propertyand it seems like this would be
most applicable to commercialproperty, where you might have
some large tenants and somesmall tenants, as opposed to
residential, where you've got awhole bunch of tenants that have
the same size of apartment andsame amount of rent the lesson
would be to do a little bit moredigging into the financial
(25:54):
condition of the major tenants.
I think I might've been able touncover what was going on with
these companies and maybe notdone that deal, because there
was a lot of hardship,especially with me being the
managing partner and so on, andwe made it through.
But I can tell you that at theend of 10 years and so on and we
made it through, but I can tellyou that at the end of 10 years
I gave my share to the othertwo partners.
(26:15):
I gave it to them just to beout from under them, yeah.
But there is one silver liningto this whole thing and that is
that I met my wife in thatbuilding because she, one of our
tenants, was a realtor in oneof their branch offices and she
worked in that office and, asthe managing partner, I kept an
(26:37):
extra key ring in there in caseI were to show up at the
building and didn't have my keyring with me and decided I
needed to do something.
I could go into that office andretrieve my extra keys, and she
was the keeper of the keys.
There you go, yeah.
Ed Mathews (26:52):
So it's worth it.
Joel Miller (26:53):
Yeah, just to give an example, there can be a
silver lining in every difficultsituation.
Ed Mathews (26:58):
There usually is, and that's a pretty good one.
Okay, I'm also interested inhow leaders like yourself, how
you sharpen the saw, how youcontinue to learn, and I'm
curious about the book on youreither virtual or physical
nightstand.
What are you reading these daysand who you pay attention to?
Joel Miller (27:14):
I had to read my own book on podcasts.
I don't have a book at themoment, but I make sure that I
keep up with things that are putout by some of the people that
I follow online that are puttingout things like, for example,
relating to this FinCEN thingwe've gone through lately with
the registration of the entities.
(27:36):
Well, if you want a couple ofbooks to recommend because I do
go back and look at these thingsevery once in a while I would
recommend Napoleon Hill's bookGrow Rich with Peace of Mind,
but he also wrote Think and GrowRich.
Yeah, sure, the copyright on mycopy is like 1967.
These are older books.
(27:57):
Write on my copy is like 1967.
These are older books.
And then the one by SterlingSill is how to Personally Profit
from the Laws of Success, andall it is is 99 laws in here and
a chapter for each law 33 laws.
But Sharp though I teach, it'ssharpened me to write the book,
which took over years, and Iteach Landlord 101 to the
(28:21):
members of the professionalorganization of landlords that
I've belonged to since the early80s and in fact that would be a
big recommendation that I wouldhave is wherever you are.
Find your local group,like-minded investors and
landlords network and rub elbowsand ask who they use, what a
contractor they use for this, orask what bank they use for that
(28:43):
.
You don't want to be an islandin this business, and that's one
thing that has been a big partof my career is my membership in
that, and I've been on theboard since probably 2009, I
think.
I'm vice president and I teachclasses and that keeps you sharp
, wonderful.
Ed Mathews (29:02):
All right.
Last but certainly not least,how do you define success?
Joel Miller (29:06):
Like I said, I sometimes teach these classes or
end up talking in front ofpeople or masterminds and so on,
and I am known for what I'mgoing to answer this question
with, and that is that if I hada choice of losing all my money
or losing my relationships, Iwould lose my money in a
(29:28):
heartbeat because myrelationships will help me get
my money back.
Correct, if I make a bunch ofmoney and lose all my
relationships, I would havenobody to share that with and
that wouldn't be interesting.
So, really, success having adegree of money that you maybe
set a goal to have is could bepart of living a successful life
(29:51):
, but it's not.
The thing is more what kind ofperson you are, what kind of
relationship you have with yourcreator and the people that you
love and that you and yourcommunity.
When you leave, is it going tobe a good footprint?
Is the world going to be betterfrom you being here for a while
or not?
(30:12):
And that's the areas that Ilook in a person for their
success.
You don't impress me if youhave a whole bunch of money, and
I can see that you don't treatpeople right.
Ed Mathews (30:22):
Yeah, that's a big turnoff for me as well.
We used to in my corporate days.
We used to have this test wherewe would bring somebody in that
we were recruiting and we wouldsend someone who was pretty low
on the totem pole, like areceptionist or a maintenance
person or somebody, to interactand to see how they'd react.
And if it was yes, sir, no, sir, yes, ma'am, no, ma'am, thank
(30:45):
you and please, then they wereprobably someone we wanted to
deal with.
But a lot of people fail thattest and that was a pretty easy
test.
Joel Miller (30:53):
I have something here that is extracted from my
book.
I just keep it handy and I'llread it to you.
That kind of touches on what wewere just talking about.
Watch your environment itproduces your thoughts.
Watch your thoughts they leadto your words.
Watch your words they lead toyour actions.
Watch your actions they setyour reputation.
Watch your reputation.
It influences your limits.
(31:13):
Know your limits.
They determine your destiny.
Envision your destiny and youwill avoid negative environments
.
Which takes you back to thefirst line about watching your
environment.
But that's what I think of whenI think of trying to live a
(31:34):
successful life is doing thingslike that, and I also encourage
you to use your ability tohandle your first stolen
business money and to createcash, of course, but use your
cash to create wealth, andthere's a big difference between
riches and wealth.
I spend a whole chapter on thatand it's not the same.
It's the difference betweenwisdom and knowledge.
Knowledge is just the facts.
Wisdom is knowing what to dowith the facts in the right
(31:55):
fashion and then use your wealthto create a great life.
By enjoying your great life,share your joy with your
relationships.
Your relationships will helpyou create more cash and a cycle
starts Indeed.
Ed Mathews (32:08):
That's great.
So, joel, when you're nottalking about real estate, what
do you like to do for fun?
Joel Miller (32:16):
I have six things that I do real quick Ski,
snowboard, mountain bike,whitewater rafting and going
down a river, and things likeropes courses and just things
like that.
Unfortunately, I can do themwith my son, and he likes to do
those same things, but the thingI spend the most money on,
though, is probablyfour-wheeling.
Ed Mathews (32:36):
Fun but expensive habit.
Joel Miller (32:37):
Yeah, yeah, those things those machines aren't
cheap.
Ed Mathews (32:42):
And you certainly live in the right part of the
world to do all those things.
So,
Joel Miller (32:45):
yeah, we have four seasons here.
Ed Mathews (32:47):
Yep, absolutely so, Joel.
If folks want to get to knowyou or learn more about you,
obviously they can get your bookBuild Real Estate Wealth enjoy
the journey of rental propertyinvestment.
They can find that on Amazonand other websites.
But if they want to get intouch with you, what's the best
way to do that?
Joel Miller (33:05):
They can find me on Facebook, LinkedIn, Instagram
and X.
What I would encourage peopleto do and this is my call to
action is go to my websitethat's created your book.
It's joelmillerbooks.
com,J-O-E-L-M-I-L-L-E-R-B-O-O-K-S
dot com, and on the front pageor on the homepage of that,
(33:26):
scroll down.
There's a button there that youcan click on.
It'll show you the entire tableof contents, fairly detailed
table of contents for the bookso you could see what we cover.
And we cover everything frommindset through formation of an
entity in which you could investin acquisition of the property,
financing the property,acquisition and management of
(33:48):
tenants and property and so on,all the way through either
evicting a tenant or keeping atenant and, in addition to that,
best practices for any kind ofbusiness.
But it's slanted toward therental property business.
To keep your life and yourbusiness out of calamity.
I'm all about, don't have thecalamity in first place.
(34:08):
Takes some precautions with theway you have your record
keeping, because we do coveroffice creation and management
and taxes and preparation andtax.
It's all there.
And if you get the book, at theend of the, we do cover house
flipping, but the book isprimarily about rentals, but
there's a short chapter abouthouse flipping and at the end of
(34:30):
that there's a QR code thatwill take you right to a bonus
information on the how-to ofhouse flipping.
I didn't want to include thaton the book.
Use the QR code and you get thewhole how-to house flip thing.
You could see the whole tableof contents and the other thing
that you can see on anotherbutton is sample writings from
(34:50):
each of the chapters.
Two or three of the keyparagraphs for each chapter is
there and you can really get anidea of what it is.
And then, like I said, the bonusmaterial is there if you have
the book for the house flippingbut that's what I would
encourage you to do and there'sinformation about my background,
of course, on there, but it's afairly concise website.
It's not something clunky andunuseful things on it, All right
(35:13):
, but it'll take you.
There's another plenty ofbuttons on there that'll take
you right to where you can buyit on Amazon.
We don't sell it from thewebsite.
You just click on a button toAmazon.
Buy it there.
Ed Mathews (35:23):
Got it, Joel.
I've really enjoyed thisconversation.
I learned a lot and I'mgrateful for your time today.
It's a pleasure to finally meetyou, and thank you again for
taking the time to meet with usand to help educate our audience
.
Joel Miller (35:36):
You're very welcome , Ed.
It was my pleasure.
I hope we've gotten undergrounda little bit, gotten a little
behind the scenes.
Ed Mathews (35:43):
I feel like we have
Joel Miller (35:44):
Talked about some stuff.
Ed Mathews (35:45):
Yeah, excellent.
Appreciate it All right.
Thank you, Joel.
Have a good night
Joel Miller (35:49):
You too.
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