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This week Bruce is joined by Tony Alvarez. Tony is a successful investor. He now lectures inside and outside California. Tony is the author of Breaking Into The REO Business. How I Went From Bankruptcy to $7.2 Million in 7 Years While Making Friends.
Tony never thought he would write a book. He began considering to write this book after Bruce asked him to speak at the Millionaire Maker. This offer made Tony nervous, because he just thought of himself as a regular person, not a successful business man. Tony was worried about speaking in front of a large group of people, but Bruce helped him to calmly think about exactly what he did to succeed. Bruce structured the Millionaire Maker event so that the audience could analyze each speaker and find at least one successful person that they could replicate. He also was hoping that the audience would be able to take advice from a variety of very different and successful people.
Tony was the last man to speak at the Millionaire Maker event. Bruce assigned Tony the last position because he knew that no one would be able to match Tony’s story. Before he began to speak, he felt nervous and frozen. The reaction the audience had to Tony’s story surprised him immensely. One of the audience members actually stood up and requested that the event organizer cancel the next speaker, so that the audience could hear more of Tony. Tony feels that Bruce has a great talent for recognizing the talents of different individuals.
Tony’s parents traveled to Florida from Cuba in 1960. Because Tony’s parents wanted him to assimilate into the American culture, they quickly moved to Massachusetts. Tony’s family was very poor. His whole family slept in a 10×10 room, and he shared a kitchen with other families. However, he did come away with a sense that opportunity was out there. His family did not complain about anything. Tony’s first playground was the alley behind the International Institute, and he was ecstatic to be there. All of his clothes were donated to him by the Catholic church.
Tony’s parents bought their first home with no down payment. They were told that they would never have anything of their own unless they bought a home rather than renting. Tony’s father taught him to work harder than anything else, and stay focused on what you want to accomplish. Tony’s father is all about people and relationships. His mother was a maid for Phillip’s Academy, where the Kennedy’s visited occasionally. Tony’s grandmother was diagnosed with terminal cancer, and she wanted to die in Cuba, but she couldn’t afford the ticket. While Tony’s mom was working at the academy, she met Bobby Kennedy and befriended him. When the Kennedy’s found out that Tony’s mom was from Cuba, they were more interested in her than she was in them, because she didn’t know who the Kennedy’s were.
Tony’s mother told him that you can accomplish anything you want to in life, so long as you learn to love other people first. That is exactly what Bruce has observed. Bruce and Tony’s work is not about a manipulation, it is about a true concern for the people working with you, and people can sense that kind of concern.
In the 80s, Tony was in the business for the money, and he didn’t pay much attention to the people around him. He eventually left the business because he got burnt out. He no longer wanted anything to do with real estate. He invested all his money into another business and lost it all. When he started investing in real estate again in 1995, he wanted to find a better way of doing business. He did not want to make money at someone else’s expense. He started buying in the Antelope Valley which was known as the foreclosure capital of the United States. People were fighting tooth and nail over all the HUD homes. He decided he did not want to do that, and he discovered these people called REO agents. Tony realized that these brokers needed to have someone who would buy the REO inventory from them. However, you have to be a certain kind of person in order to gain their attention. He discovered that the personal attributes these agents were looking for were the same two attributes his parents had instilled in him. You have to be a hard worker and you have to care about other people. You need to have just as much concern for the success of your partners as you do for yourself. The majority of Tony’s business life revolves around answering his phone, saying “How are you doing? How is your family?”, and saying, “Yes, I will take that”, or “No, I don’t think that is right for me.” When you care about your business partners, they will start caring about you.
When Tony chose to re-enter the real estate business, he began looking for where the opportunity was. At that time, the Antelope Valley was the land of opportunity. The first thing he did was he found a home for sale. The first “for sale” house he found had 3 bedrooms, 1 bathroom, and was selling for $37,000. That house would have cost $100,000 to build that day. The rent was anywhere from $650 to $850 depending on who he wanted as a tenant. This got him excited because he was looking at his second opportunity to succeed.
When Tony left the real estate business long ago, he was very emotionally damaged by his failure. He declared bankruptcy and began working at a pizza business. When you lose everything like he did, you wake up every morning and disgrace the image you see in the mirror. You lose the ability to trust your own decision making.
Coming out of Tony’s life downturn, he learned that he was still the same person who his parents wanted him to be. The love he had was the ultimate tie breaker that opened the door to opportunity. People think they have to assemble all these pieces to become a great investor, but once you develop trust with your business partners, you can assemble those pieces later.
When you have nothing to brag about, like Tony when he restarted his real estate career, all you have to convince an REO agent that you are the real deal is your own personal attributes. REO agents hear enough about personal accomplishments from people and they discount it. People can tell when someone in being disingenuous.
There are more elements to investing than just finding a good product. REO agents have control over these products, so developing a good relationship with them is more valuable than finding a couple good deals. What will help you develop a relationship with an agent has little to do with money.
REO agents do not have the mentality that they have the A-list of buyers. Unlike a marriage where you cannot keep looking for a better partner, REO agents have relationships that are more based on performance. If an agent can find a new guy that can perform just as well as their other partners, but will also complete transactions that aren’t profitable, that new guy will become their number 1 partner. However, getting on an REO agents list of preferred business partners is not easy.
For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 170 podcasts in our free investor radio archive.
