Some investors don’t like deals that have mold damage. Jason Lucchesi discusses the extent of damage he is okay with for his rehab deals.
There’s a few resources out there that know about mold damaged houses, including real estate agents, mold remediation specialists, and insurance agents.
Mike: Welcome back to the FlipNerd.com REI Classroom, where experts from across the real estate investing industry teach you quick lessons to take your business to the next level. And now let’s meet today’s expert host.
Jason: Hi there, everyone. It’s Jason Lucchesi, with jasonlucchesi.com, and I am your host today on REI Classroom. Today, we’re going to be talking about how to find and flip mold-damaged properties.
Mike: This REI Classroom real estate lesson is sponsored by theinvestormachine.com, FlipNerd’s private investor coaching program, and your blueprint to investing success.
Jason: Now, this is one that I really like. I’ve been finding mold-damaged properties ever since I became a full-time real estate investor. And the main reason why is mold is gold. That’s the good old saying that a lot of people use. And again, a lot of investors just like I talked about in some of my previous episodes, especially the fire-damaged one, is that some investors tend to stay away from mold just because they don’t know about it. There’s a lot of different types of mold out there. Black is obviously going to be the worst, and you want to tend to stay away from that, but if you do go into properties and they do have black, make sure you wear that good old mask.
Now, you know, what typically happens here in the Midwest is the property starts off with green mold, turns into black mold, and tends to just go ahead and have homeowners freak out and want to move out of the property, which most of the times does happen. So the things that you could be on the lookout for is we have basements here in the Midwest, typically it happens by the sump pump being off for a period of time and causes some sort of flooding in the basement.
Now, what I tend to look for is if the mold has gone from the basement to the floor joists. If it has gone to the floor joists, then you’re obviously going to start seeing some significant numbers for how much it’s going to cost to repair a whole main floor. So I just look out for properties that just need the basement remediated from a mold remediation company.
Now, where I’m finding properties from is, a lot of times, from real estate agents themselves. Real estate agents have a pulse on being able to find these properties on the MLS, and yes, these aren’t off market all of the time. So you do want to use an agent to find these properties on the MLS. We’re finding some great properties by them doing a simple search and pulling up properties that do have either mold or significant levels of mold damage.
Now, another source that you could definitely reach out to, are the people themselves that are cleaning up the properties, the remediation companies. Contact the remediation companies. These are going to be people that are going to tell you what properties have mold and what levels. You know, has it gone from the basement to that first floor, that main floor? Is it going to cost a lot of money to repair?
Then you could get in, you could send out a direct mailer to those people by having the contact information from the mold remediation company, or you could just simply give them a phone call. So there’s a couple of different ways that you could reach out to these individuals, and you could have a lot of great opportunities.
Last, but not least, from my top three that I want to give you here for this REI Classroom, is insurance agents. An insurance agent is going to have a pulse on if their client gives them a call and states that their sump pump went out while they were on vacation, and their whole entire basement is now completely flooded with mold. So, again, you could contact the insurance agents, make sure you have about three to five of them that you could constantly being reached out to, or them reaching out to you. And it’s going to turn out to be a really great opportunity for you by having insurance agents, because they always will know when people are trying to sell properties or put in claims.
So, with that being said, this is the REI Classroom with giving you how to find and flip mold-damaged properties. If you would like more information on this or other topics that I have, go to jasonlucchesi.com. Thanks. Have a great day.
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