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In this episode I talk to Eric Persha. Eric is a native Detroiter who went away for college then decided to come back to the area and get into real estate. He’s in REI to make money, but he also likes participating in the renaissance of the city.
REI News
NO REI news this week. My conversation with Eric went way long, so we skipped the news and went right into the interview.
Current Business
Eric’s company is called Rehab Detroit. It’s he and his mom working together, and together they’re rehabbing and selling everything from single family homes to four-plexes.
They’re focusing in specific areas in the metro area, and they also do quite a bit in the city of Detroit.
How He Got Started in REI
Score another one for Carleton Sheets! Eric’s parents had been investing down south, so when he moved back here after he graduated from college, he asked his parents why he couldn’t invest here.
His dad went over to the bookshelf and gave him his copy of the Carleton Sheets program.
He went into business with his dad, and four months later he found his first deal. And he hasn’t stopped since.
Biggest Mistake
Eric’s biggest mistake was his first deal. Like most investors, he made a lot of mistakes on his first deal. He hired a friend of a friend to do the work, and it was a disaster. So much so that it cost him almost $15,000 to sell the house.
Biggest Success
His biggest success was a house that he bought just after New Year’s this year. He did a six week rehab, and then had it sold within SIX hours of listing it.
He would have sold it in TWO hours if he hadn’t demanded that the buyers actually go and physically visit the house.
Money Talks
Private money is the main source of funding. They had been strictly using family monte, but when they lost out on a couple of deals because they couldn’t sell their current inventory fast enough and free up cash they decided to start using private money.
Answer to Listener Question
The question that I asked Eric was “How do you keep contractors honest on a job?”
He had a great answer – he screens them heavily in terms of prior references and work completed. Then he has then fill out six documents on every job, which include:
- Scope of work
- W9
- Release of Lien
- Proof if insurance
- Payment schedule
- Materials list
Like most of us he had to experiment to find a great contractor. And unfortunately it seems that they all go bad at some point.
Links and Resources
Eric is looking for:
- Wholesalers
- JV Partners
- Private Money
And if you’re an aspiring wholesaler who’s serious about learning the craft, Eric will spend the time to teach you how he does business and what he’s looking for.
To get a hold of him, you can call him on his office line which is (248) 817-2224 (x3) or send him a message through his facebook page which is here: https://www.facebook.com/RehabDetroit
If you have feedback on the show, a question you’d like answered, a news item, or perhaps a recommendation of someone you’d like me to interview, or if you’d like to be a guest on the show, go to http://www.REITalkDetoit.com/contact and let me know about it.
