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Investing Strategies

Remote Rehabbing: Why So Many Chefs in the Kitchen?

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loriFrom Lori Greymont, Rehabbing Adviser...

This is another lesson from our fascinating conversation with remote rehabber Lori Greymont.

Lori’s experience in real estate is varied and diverse. Since 1987 she’s been involved in all matter of traditional and creative deal making – rehabs, wholesale, lease options, sub-2, land contracts, bulk REO, etc...

At the moment Lori’s modus operandi is buying and rehabbing distressed properties across the country, then reselling them in tip-top shape to passive cash flow investors as turnkey rentals. She does this remotely from her home base near San Jose, CA, and until recently had never even seen any of the 1,350+ houses she’s turned.

Not long ago Real Estate Mogul had the chance to corner Lori for an extended, unscripted dialogue about her operation and how she does what she does.  So far in our chat with Lori, we've explored the following topics:

…all from 2,431 miles away!

Today we continue sharing some of the key takeaways for anyone who may want to learn how one of the greats does what she does, or maybe even follow in Lori’s footsteps. So here’s another slice of awesomeness from our little chat – with a specific focus on managerial efficiencies.

stoogesYou Can’t Do This Stuff All By Yourself

During Lori’s lesson about due diligence, were you thinking to yourself, “Goodness! Does she have a lot of cooks in her kitchen, or what?!”  Well, yes, Lori does have a lot of cooks in her kitchen, but for good reason, and I’d say they are more than just cooks – they are “chefs!”  Essentially, Lori relies on a well-trained and efficient team of specialists who work together with her to ensure that her rehabbing business is successful.  She’s running an incredible remote rehabbing system with processes and people that are working together seamlessly.

In today’s latest lesson, Lori describes each member of her team – the chefs in her kitchen, if you will – and why she has so many people working with her.

Lori’s Remote Rehabbing Dream Team

I have three different players involved in all of my remote rehabbing deals, from the minute I decide to move into a new area until I’m finished with a rehab and ready to flip it to an investor buyer, including:


The realtors I work with know my methodology and what I’m looking for, and they make offers for me on a regular basis.  They look for deals on my behalf and understand that I’m going to be writing 40-50 offers a week while maybe only two offers will be accepted.  These are realtors I work with closely, and they get to know my business inside and out.

inspectorsProperty Inspectors

In each region, my property inspector knows that I’ve got an inspection contingency in place, requiring him to go out and complete an inspection quickly (within 3 days) while providing me with all the information I need to make a timely decision about whether to close on the property.  (As a side note, I pay him $200 because I use him all the time and I have a good relationship with him; he standard fee is $350 per inspection).

The property inspectors also gives me a good “feel” for each neighborhood, in order to make sure we are all doing the right thing.  If they drive into the neighborhood and realize it’s not a neighborhood in which we want to invest, then we don’t even follow-through with the inspection.  By this time I’ve trained the property inspector enough to be able to identify desirable/undesirable neighborhoods, so we don’t waste any more time on the deal if it’s a “no-go”; we simply cancel the contract.  Strategic neighbourhood selection is key to us getting higher value out of each deal after we do all the work.

Our property inspectors are really important because do they do not simply help us identify neighborhoods we want to invest in – they ultimately help us make the final decision regarding the “go/no-go” aspects of closing a deal.


Right now we utilize five separate contractor teams.  That way we always have one contractor available to take on a new project and/or evaluate a new deal.  I send my contractor out to each property on two separate occasions.

Before I close on any deal, my contractors visit the property to give me a good rough estimate of repair costs, so I can make an accurate decision on whether I want to close on the deal or not.  If you remember from one of my earlier lessons (“What I Buy and How I Find Them”), I want to pursue light rehab jobs – nothing major with foundations or mold.  I train my contractors to give me the best information to be sure I’m not spending more than my budget will allow for me to make a good profit on the back end.  Again, we usually have only three days contingency before needing to decide whether we will close a deal on which we have made an offer – so we need to get our contractors out there fast!

I also have my contractors return to the property once I’ve closed on a deal, in order to review my bid for rehabs and either adjust the bid or accept it.  If you remember from one of my other lessons (“Due Diligence from 2,431 Miles Away”), I handle contractors a bit differently than most.  I take the initial contractor rough estimate, the inspection report and all the photos from both the inspection and “before” photos and have my field supervisor put together a bid.  I want to be in control and know exactly what needs to be done to a property and then have the contractor agree to the price I’m willing to pay for the work.

Babysitting My Rehabs

Essentially, my team is babysitting the rehab deal.  You need to have trustworthy people on the ground so they can (i) watch your back and (ii) ensure that you are getting good deals, (iii) ensure that the right work is being done for you to turn a profit on the backend.

You may think, it would be cheaper to just have one person manage the whole thing.  But not really.  In fact, by utilizing only one manager, you could be opening yourself up to scandal!  Here’s how I learned the hard way…

storyA Little Story to Help Explain the Size of My Team…

I was rehabbing in Merced.  I had two projects going and I was eight months pregnant.  A Realtor on the ground found a contractor to do the work for me.  I went over, got the bids done, we agreed to it.

The realtor said, look, I’ll manage it, take pictures, I’ll send you the pictures and then you send me the money and I’ll pay the contractor.

I thought, “Great – there is a little system of checks-and-balances here.”

So things went on, I had the baby and all that comes with having a baby, time passed, I paid the realtor around $30K and then drove over to see the house and NOTHING had been done.

Turns out the realtor was in cahoots with the contractor.  They had bought materials at Home Depot, generated invoices and then just returned the materials.  I was sending money, paying Home Depot, the contractor, the realtor, etc. and they hadn’t done a thing to the house.

Fortunately for me I recovered because the market was going up then.  But it could have been a really bad situation.

A lot of people ask me if I sued him. And, again, this was a contractor that didn’t have anything, so why go after him?  I can’t replace my time but I can replace the money so I just moved on.

But the lesson here is this: Don’t assume that one or two people can do the work for you.  Have multiple people working on the project.  It’s harder for 5-6 people to get into cahoots and steal your money than it is for 1-2 people to do the same.

teamworkThe Chefs In Lori’s Kitchen

To finish off this lesson let’s summarize all the people you’ll need on your remote rehabbing team.

Your RealtorThey should know your methodology, what you are looking for and make offers for you on a regular basis.

Your Inspector – Since you have an inspection contingency in place, he knows that he needs to go out and do the inspection quickly and get you the information you need, so you can make a timely decision on whether or not to close on the property.  He will also give you a feel for the neighborhood – which is key to getting the higher value out of a deal after you do all the rehab work.

Your Contractor(s) – You will need at least one, and it’s better to have several so that you can get (i) the best bids on your rehab work and (ii) a back-up contractor for multiple deals going at once. Not to mention someone who can go out quickly to give you a rough estimate of repairs before you make a final decision to close on  a deal.


Do It To It! Immediate Action Steps

Explain – Thoroughly explain your remote business model to a team of realtors, so they can explore appropriate deals and submit appropriate offers on your behalf.

Coordinate #1 – Coordinate your due diligence with a team of seasoned property inspectors who can (i) effectively screen your pipeline of potential acquisitions and (ii) quickly provide you with reliable cost estimates for rehabbing.

Coordinate #2 – Coordinate your rehab work with a team of seasoned contractors who can (i) quickly provide you with their own reliable cost estimates and (ii) review, adjust and/or accept your bid for rehab work.

Get More Helpful Context – Check-out Lori’s previous lessons, and enjoy the fact that remote rehabbing may be a viable option for your real estate investing business!

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