Short Sale Secrets, Upstate NY Cash Flow & Investor-Friendly Agents w/ Ambreen Faruqi

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Show Summary

In this conversation, Ambreen discusses her journey in real estate, emphasizing the importance of quality of life in investment decisions, the need for an investor-friendly team, and strategies for overcoming client objections. She shares personal anecdotes and insights into the real estate market, highlighting the significance of building trust and integrity with clients.

Resources and Links from this show:

• • • Investor Fuel Real Estate Mastermind
    • Investor Machine Real Estate Lead Generation
    • Mike on Facebook
    • Mike on Instagram
    • Mike on LinkedIn
    • Ambreen Faruqi’s Website
    • Ambreen Faruqi’s Phone Number: (917) 841-1008

  Listen to the Audio Version of this Episode

  Investor Fuel Show Transcript:

  Ambreen (00:00)
  So we’re talking 2007 when the market was about to turn into a crash. So the default mortgages were coming up. And I think because of my first flip that happened that I fell into by accident and really took on real estate like a student more than a realtor. And I started to understand mortgages and then I got myself certified. So I got intellectually engaged in how and why are people taking these bad loans, right? 80, 20, not making any sense.

  And so as I was doing that, met an attorney who said, you need to come and work for me. We need to negotiate some mortgages. So I did that and then went independent. didn’t like his work ethics too much. So went on my own and then negotiated maybe 85 short sales over a period of less than a year to commercial, ⁓ know, commercial large multifamily with receivers on them through the bank. So really, really just got into that end of things before I got licensed to sell homes.

  Dylan Silver (02:30)
  Hey folks, welcome back to the show. Today’s guest, Ambreen Faruqi, is a licensed real estate broker in New York who leads her team, the Faruqi team. She has been investing in New York for 14 years. Ambreen, welcome to the show.

  Ambreen (02:47)
  Thank you for having me. Thank you so much for having me here. You did a precise introduction. I will just edit a few things in that if that’s okay. So I did start out first as an investor actually. I flipped my first property. My husband was a broker when I met him and so I did the fastest flip in New York probably all within three days.

  saw a house with a lock box on it and got curious and dug into it and found out it was owned by a person who had the mortgage and I got very curious and found the owner and just dug further into it. This is coming from no knowledge of real estate literally going to the books and understanding foreclosure while I was doing it. I was like, what’s a foreclosure? Let me learn and would go back and call him and

  Dylan Silver (03:13)
  Wow.

  Ambreen (03:34)
  My husband didn’t take me very seriously, but three days later I was like, I think I’m in contract. And then we’re talking like when you could flip like three times. So I got that into contract before I closed on it. I had a buyer for it and then somebody else bought it from me.

  Dylan Silver (03:54)
  So you were mentioning you got started on the investor side of the business and that’s I didn’t get started doing my own flips but I got started in the single family wholesale space. So walk us through you know that first year or two in the business and what it looks like for you.

  Ambreen (04:07)
  Mm.

  So we’re talking 2007 when the market was about to turn into a crash. So the default mortgages were coming up. And I think because of my first flip that happened that I fell into by accident and really took on real estate like a student more than a realtor. And I started to understand mortgages and then I got myself certified. So I got intellectually engaged in how and why are people taking these bad loans, right? 80, 20, not making any sense.

  And so as I was doing that, met an attorney who said, you need to come and work for me. We need to negotiate some mortgages. So I did that and then went independent. didn’t like his work ethics too much. So went on my own and then negotiated maybe 85 short sales over a period of less than a year to commercial, ⁓ know, commercial large multifamily with receivers on them through the bank. So really, really just got into that end of things before I got licensed to sell homes.

  And by that time, ⁓ we had flipped a few properties, but I’d never bought anything we negotiated because of fiduciary and didn’t want to negotiate something lower than what the bank would take. Because my job was to get the client out of the loan faster than to get a good deal for myself. So kind of did it really by the book and then got licensed, sold a ton of homes because after short sales, everything looks so easy.

  Dylan Silver (06:21)
  Yeah.

  Sure, sure. I

  can understand that. It’s interesting you mentioned short sales. I’m licensed, or I shouldn’t say licensed. I have a short sale and foreclosure certification and I’m curious, so you were doing this before you were a realtor. Walk me through that. Were you negotiating with the banks? How were you doing short sales prior to being a real estate agent?

  Ambreen (06:44)
  Yeah.

  I’ll take it. ⁓

  Yeah, so I could do them because I ⁓ asked the bank, I’m not a realtor, I’m negotiating this for an attorney. How do I get paid? And they told me, you’re negotiating, put a negotiation fee on the HUD. And I’m like, I’m in New York, I can’t do the HUD. I don’t create the HUD. So the bank themselves said, why don’t you just call it the net sheet like the other agents do? Don’t call it the HUD, you’ll be fine. So I actually got coached by the banks who were going under.

  Saxon mortgage Bank of America before it got equator system like when they were like give us the money now right now Why are it borrow because we are we need it right now? And so there were that’s that’s the time I got into it So was speed it was like get the package together send it over They just want to negotiate they just want a number and they need a buyer and in New York You know you reduce the price by 20 30 percent you got flies all over that right? It’s like the honey. That’s the

  So selling property was not really as a realtor. I didn’t have to do that. The agents that I was negotiating for would just find ton of buyers, right? From that, I met some very bad agents that I did not admire, did not want to become licensed because I thought the whole field was scummy, to be honest. I did not respect it. Although my husband was a broker, he’s more commercial heavy. So when I got my license, I wanted to do everything right.

  So from that, the reason I was able to negotiate so many, because I also had two assistants, one of them was a loan processor who knew how to process loans. So she was very quick at getting packages over to the banks. I slowly realized in the first two, three months that my job was really to speak to the negotiators and meet the clients. So I was just meeting the people who wanted, the agents who wanted negotiations done and homeowners who came to us directly, went to my husband to list it and I negotiated it.

  So yeah, banks were allowing negotiation fees. Banks were even allowing title clearance fees because some of the properties had such bad title issues that I as a third party could say with my LLC on the HUD that I am actually negotiating with the water company and they would pay me for it substantially at the time. And some of them, my husband was the broker. That was full disclosure. See, full disclosure is everything. If you’re disclosing…

  what your job is and you’re doing a job and not sliding yourself into a into sport, so try to get paid for things you haven’t done. That’s a problem. But if you’re disclosing and you’re saying I did this, how do I get paid for this? The bank will help you and tell you how or they’ll say we can’t, know, then you should get paid by the agent, which started to happen after 2009 when the equator came into the system. Things got more organized. They were like, well, sorry, you have to get paid by the agent if you didn’t do, you know, if you did the agent’s job.

  So all of this changed in front of my eyes and as the market got healthy by 2012, I was licensed, I got my own license and just really came on as an educator to my clients. So anytime I met someone, I would be like, before you sign a listing agreement, please read it. You’re to be locked with me for six months. And ⁓ you should have an out for that. So with me, you have an out. If you don’t like me, you should be able to get out.

  So I became that agent that kind of…

  change things around and I loved it and I still love real estate and service and flipping, flipped a few houses, maybe altogether, fixed and flipped six, seven houses. Not my favorite model, I will tell you. I don’t like the pressure and projection that comes from a flip. You’ve got to do it within nine months, otherwise your projection’s off, right? Because you don’t know, especially now, right now. And some parts of 2020 were like that too.

  also managed an Airbnb through this time, bought two Airbnb homes, Airbnb them. I think our favorite model is buy and hold rental income for sure.

  Dylan Silver (11:28)
  I think there’s a lot that can be said about finding the segment that best suits you.

  Ambreen (11:35)
  So much.

  Dylan Silver (11:36)
  If you don’t like hosting, Airbnb is not for you, but at the same point in time, if you never want to have to ever process an eviction, you might not want to go into ⁓ long-term buy and holds. I want to ask you a granular question about those, short sale time period. You had mentioned, ⁓ because you were disposing everything, you were able to collect a fee. ⁓ Were you at that point in time more

  Ambreen (11:49)
  So well said.

  Dylan Silver (12:06)
  so representing or working with the sellers, meaning you would go to the sellers and say, hey, let’s short sale your home? Or was there an angle there where you are working with investors who wanted to buy their property as well?

  Ambreen (12:20)
  So I if I was investing in representing the investor I was the buyer’s agent Okay, so I would be the buyer’s agent assistant so I would get paid by the buyer’s agent So there were situations where the listing agent would come to me and say I can’t negotiate this Can you negotiate this and then I would be like yeah, and I have a buyer for it My husband would be the broker and we would have our own database of investors who were because by that time you had become very known Then I would be ⁓ the buyer’s agent

  assistant basically. ⁓ So there were a few hats, but it was always full disclosure. So that’s the thing. I couldn’t wear this hat and that hat. couldn’t be the, my husband couldn’t be the broker while I did this unless I cleared the title too. Right. So, so there were times they would be right on the title report, fire department lien. Now that’s knocking on the fire department door a lot to remove that. Fire department in New York is not easy to remove a lien or

  Dylan Silver (13:04)
  Right, right.

  Ambreen (13:18)
  It’s a vendor that provided services for someone at that house and they never got paid. And I have to negotiate that lien because it’s the number, lien number three, the carpenter, first loan, second loan and carpenter or a contractor. So if I did those negotiations, I did ask for compensation for them right on the head. And I called it the net proceeds sheet. I sent it to the attorneys. And this is technicalities people don’t really understand, but they’re not that hard to do. You create the net proceeds sheet, you send it to the attorney. The attorney calls it a HUD.

  because they’re finalizing those numbers, sending it to the bank for approval. The only catch to all of this was that had to be there for every closing. Kind of became the closing agent for the bank because I was the authorized party.

  So in a situation, I remember I delivered my son and there was a closing. had to happen. Bank was not extending. And I went literally six days after delivering him to this closing.

  Dylan Silver (14:11)
  ⁓ my goodness, that’s

  dedication right there. I do want to pivot, Ambreen, and ask you about the investing side.

  Ambreen (14:15)
  Yeah. Yeah.

  Dylan Silver (14:20)
  You got in on the short sale side, effectively ⁓ negotiating the short sales with the banks, either representing the seller or being an assistant to the buyer’s agent. Now, when we talk about your investments in your personal portfolio, you mentioned fix and flips, you also mentioned buy and holds. These days, of course, if we compare it even to five years ago, it’s a different ballgame entirely. What are the deals

  Ambreen (14:40)
  Yeah.

  Yeah. 100%.

  Dylan Silver (14:50)
  that you’re looking at or what segment of real estate are you looking at for investing these days?

  Ambreen (15:37)
  For myself, and it’s different from how I advise the client, for myself personally, for us, we have been increasing our cash flow properties upstate New York. It’s a part of the country that I feel has great returns, cash and cash return, if you know what you’re doing and you have the right team in place, which we do. We bought over there maybe 12, 13 years ago, and we’ve been there all this time.

  bought some sold, rented, then sold, fixed them, bought more. So we’re still there. Now I’m looking at potentially buying land just because it’s very hard to say if there’s going to be another depression crash upstate New York or they’re going to put factories and it’s all going to boom. It’s very hard to say. But I think we’ll have a good time frame before it goes either way to be able to read it. Right now it’s standstill.

  Dylan Silver (16:30)
  Now,

  your investments in upstate New York, are these in the single family space? Are they all single family?

  Ambreen (16:37)
  4Family, 6Family, 222.

  Dylan Silver (16:41)
  Okay, so small multis effectively. A lot of people will be looking at, I’m getting into real estate, I’m getting into real estate investing, which asset class is right for me. You chose the small multi family space. Was there a reason you went small multi instead of say, know, single family like Airbnb model or long term, you know, rent out a single family home?

  Ambreen (16:54)
  Yeah.

  Yeah, good question. We did Airbnb. I didn’t like it. I thought it was very heavy in management. We gave it to a management company which left very little for profits. We did use that vacation home. I owned it up until last month. We did purchase multi-large multifamily over 120 units along with other groups. So we did do large pool investment and sold it for a decent return, R &R.

  been done. It’s a much, much more heavy management heavy model. So for lifestyle choice, I always tell people before you think about investing, think about the lifestyle you want. You can adopt a problem that does be you a decent amount, but then what is the quality of your life? And that’s really where you should be starting what quality of life that comes first. ⁓

  Dylan Silver (17:58)
  Absolutely, absolutely.

  Ambreen (18:00)
  I don’t think

  enough people do that. They’re just like, I want to invest in real estate. That looks good. That looks good. I’m like, yeah, you’re going to drive. Are you OK with this long distance? ⁓ just to just to tell you, ⁓ Dylan, upstate New York was an accident for us. What we bought, we bought for very little. It was nothing. I was like, OK, it doesn’t work out. It’ll be OK. But it did. And then we got our attention when we started to see our returns. And I was like, this is insane. Thirty two percent return on money. Like, how could anyone match that?

  And so it got us more interested while we were selling houses in the city. Upstate was really not where our attention was. But as we changed the quality of our life and wanted to, you know, kind of restructure the quality of our life, that’s where our attention went, is to add to that portfolio.

  Dylan Silver (18:48)
  want to ask you about your team, the Farooqi team. ⁓ The agents on your team, are they all investor-friendly agents?

  Ambreen (18:57)
  So my team is basically led by myself and my husband and we are very, very investor friendly. when you say investor friendly, what do you mean? Like, do we like investors as our clients?

  Dylan Silver (19:10)
  So yeah, exactly.

  Ambreen (19:12)
  I only like investors as my clients. First time buyers are a very different mindset and I think that requires a very different kind of agent. I don’t think the same person who has the patience to work through the details of a single family first time buyer is the same person that’s going to do investment. I really believe it’s tapping into a very different type of service. ⁓ So we are very investor heavy because that’s just how we think as well as does the numbers make sense, right? We just helped

  He flip. He bought it for 550. He put a, you know, he’s now in it for 820 and he just went into a contract at 1.2 million. And he did that with us over a period of nine months to a year. He’s very happy with it. It was his first flip. His father is a contractor, I will tell you. That’s why we felt comfortable with him taking on such a big project. But I have several stories of many people that I see now, you know,

  retiring over their investments because we help them through them and talk. It’s great feeling. It’s really great to have your clients be family and get into their lives and help them organize it. Finance should be part of it.

  Dylan Silver (20:15)
  That’s wonderful. That’s wonderful.

  Now,

  when we talk about working with investors, I’m a realtor myself and I’ve struggled with this. I’m sure there’s other realtors who may be listening to this or may have the same question. If you’re an investor-friendly agent, you work with investors, a lot of times, especially if they’re submitting creative offers, creative financing subject to you, they don’t want to sign a buyer’s representation agreement. They’re like, I don’t want to be locked into you. So how do you handle that?

  Ambreen (20:36)
  Yeah.

  Yeah.

  think that anybody should ever feel like, especially an investor, ⁓ you know, you’re asking me how do I handle the objection from a buyer investor who’s saying, why should I get myself tied up in to you? I would say, why wouldn’t you? In fact, how would you find a property any other way? We get to have access to things that are not on the market. And if you want me to go outside of that and look at listings that are expired, that didn’t sell.

  that I have access to or for sale by owners or people who are not on the market. And still you want me to go and approach them in ways that you can’t. I think you would need an agent to do that for you. And then, you know, it’s an investor, right? So you could give it a shot for two months and see, and then they’ll be like, wow, yeah, they are reaching people I’m not seeing on Zillow. I didn’t see that property on Zillow. And they’ll stick around if they see that you’re working for them to do that. I think it’s a loyalty thing. I think we’re reaching an age right now where I…

  personally don’t want to convince anyone to work with me.

  Dylan Silver (21:53)
  Hey, I’m with you. I think that question was as much for myself as it was for anybody else. I’ve dealt with this. ⁓ Emrean, we aren’t coming up on time here though. Where can folks go if they’re in the New York area they’d like to reach out to you? Maybe they have a deal in upstate New York for instance they’d like you to take a look at. How can folks get in contact with you?

  Ambreen (21:55)
  It feels like integrity.

  They can call me, my phone number is right there, 917-841-1008, that’s my personal number. And also they can reach me on my webinar, which is FaruqiTeam.com, slash webinar, I do webinars, so they can come and reach me and see me and watch me run some of them and educate them through that, so that’s one way to do it. Or if they want to be more active and get right on it, they can just give me a call.

  Dylan Silver (22:36)
  Ambreen, thank you so much for coming on the show today.

  Ambreen (22:39)
  Thank you for your time Dylan, it a pleasure.