Cyndee Harding

“Our youngest son was working for BestBuy, and they closed his store in a mall in Tucson. They gave him a severance package, and so he moved back home. He was in his mid 20s. He was talking with a friend about doing single-family investments. Their plan was to buy a house and then rent it, and then every year buy another one. Of course he ”

Interviewed by Jonathan Rozek for Ten Paths. David Lindahl was not involved in editing these interviews.

Jon: Where are you guys located?

Sherry: We're north of the Phoenix Metropolitan area, and Cyndee and Lynn live on the far west side of the metro area.

Jon: Where did it all begin for you with real estate?

Cyndee: Our youngest son was working for BestBuy, and they closed his store in a mall in Tucson. They gave him a severance package, and so he moved back home. He was in his mid 20s. He was talking with a friend about doing single-family investments. Their plan was to buy a house and then rent it, and then every year buy another one. Of course he talked to his dad, because his dad would be his financial backer on this little adventure.

Anyway, in the process of researching different real estate opportunities, he found a seminar on tax liens, where you would buy a tax lien and acquire properties through that. We looked into that, and began the process of it. I wasn't super hip on it personally, because I kind of felt like people were in distress, and that's why they hadn't paid their property tax. Maybe we shouldn’t be taking those properties.

So we decided not to do that. My son said: “OK, I have another plan for us. I’m going to this event from some outfit called ‘RE Mentor’; do you want to come?” We went with him and did the two-hour introduction, and then we signed up for the three-day event.

Jon: When you say “we”, was it the four of you?

Cyndee: No, it's my husband, our son, and I. The three of us went and we thought it was good information that aligned with our value system.

Jon: What if anything did you not necessarily believe was possible at that point? Did anything not ring true?

Cyndee: With multifamily?

Jon: Yes.

Cyndee: No, we totally could see the possibility. This was definitely doable. After the two-hour thing, where we got introduced to it, we signed up for the three-day event.

Around that time, my dad was diagnosed with throat cancer in Florida. We're in Arizona, so I left for a couple of months to take care of him. My son went back with BestBuy and he was moving to Utah, to take a job up there. My husband Lynn and I were kind of stammering and stuttering, trying to get this real estate thing going. We have some skill sets and I'll let each of the Hatches tell you their skill sets.

Lynn's background is in construction—he's been in that field for about 30 years. Mainly in distribution with roofing, but also in plumbing, so he knew that he could look at a property, and all the systems, and really be able to have some sort of assessment of where the property was. My background is I had an accounting business for 25 years. I felt I could look at the deal analysis and the financial due diligence, and also could do asset management on the back end.

We felt we could do this, but we were really struggling to get ourselves going. It was the two of us, and we just thought we needed to have a little more oomph in our step. We have been friends with the Hatches for over 30 years. We've done a lot of things together like vacations, holidays, and so on. We thought of their skill sets and were like: “Hey if you guys want to go to this meeting one night, you can see if this is something that you want to do. We're looking at it as a way to build a legacy.”

They went to the introductory event and then they signed up for the three-day; and from there we created our business. I'll let them tell you their background, and that leads into how we came up with our business.

Jon: OK, but before you do that, what was it about single-family that didn't fit with your interests, the way multifamily did?

Cyndee: With single-family, it would take too long to build what we were looking to build. One single-family versus 80 units—there's no comparison. When my son and his friends were presenting to us and told us of their plan, we could see the potential of it. But the fact is that they’re in their 20s and we are not. We don’t have that kind of time. We wanted to scale way faster.

Jon: Was there an aspect where you were sort of up against the wall because one of you maybe lost a job or you're trying to replace income urgently? Or was this more like no, we're OK but we don't want to just be OK?

Cyndee: We were fine. We weren't facing any financial crisis or anything. We just were trying to forward-think: what would we like to do in the future. Once we partnered with the Hatches, then we had more of a sense of urgency, because we wanted to move together as a team.

Jon: Is there any background information that you think is relevant in terms of education or where you guys grew up?

Cyndee: Lynn grew up in Montana, and was one of 12 children. He really had a desire around being self-sufficient. Being able to take care of anything has really helped us when we're looking at properties, because he definitely sees it from all different angles, not just one. As far as myself, my accounting background has really helped.

Jon: If we now turn to the Hatches, what's your background?

Sherry: Lynn and Cyndee invited us to look at the RE Mentor program. I'm retired from the title-insurance business. My career spanned 35 years in title insurance. During some of that, I was also in education. My family owned a title company in the Maricopa County area, and I was in the title business right out of high school before college. After college, I taught for a couple of years and they called me back to the title-insurance industry. I did commercial, residential, land, and land development, so a little bit of everything.

Jon: Was that as an examiner or was that in a different function?

Sherry: I started out chaining titles, which involves intense document research, and then I moved into escrow. I was a branch manager from 1986 until 2013, when I retired. I went from looking at microfiche and film on spools, to doing commercial transactions, and large tracts of land being developed into single-family homes. I also did individual single-family homes, apartments, commercial malls, and strip malls.

As Cyndee said, my husband and I spent quite a bit of time with the Hardings. We have two daughters, they have two sons, and our kids grew up together. It was fun from that aspect, though we never anticipated that we would be related through our kids. Our youngest daughter, Andrea, married their oldest son, Loric. So we became in-laws to Loric, and they became in-laws to Andrea. We all became something to each other, so we decided to call each other “The Outlaws”.

Jon: That's great. Do you guys have T-shirts or something?

Sherry: We have an idea for some shirts, so at the next event that we have with RE Mentor or the next time we go to something big, we're all gonna have those shirts on.

Jon: Before we turn to Laird, I'd like to ask you: what do people not understand about title insurance? People who aren't in the business?

Sherry: They don't understand what title insurance covers. They don't understand why they need title insurance. They don't know how to read a title report, or how to interact with the attorneys and the lenders around the title report; they don’t know how to eliminate Schedule B items. I could go on. Those are some of the things I can do in this partnership. In addition, I can review a survey to see if there are encroachments. If so, I can talk to the surveyor, lender, and attorneys about the nature of those. Readers of this interview should make sure they have someone on their team who can do these things and not rely on outside real estate attorneys for that advice, not to mention the expense.

Jon: I know a guy who's made a whole living out of finding deals that got bogged down, or financing couldn't be put together because of title deficiencies. He's like, “I know how to cure these things.”

Sherry: Yes, I can cure stuff. In fact, we have a property in Idaho that’s been in the family for over 100 years. When my husband's parents passed away, I reviewed the title. It was a mess and had been passed back and forth through several family members, many of them deceased at the time the issues were found. All kinds of things were a problem. Easements for mining and other things that weren't being utilized or had expired that needed to be taken off the title exceptions. I worked really hard with the title examiner and cleaned that up. I feel good about that, because then we can either sell it, or pass it down to our posterity, with a clean title.

Jon: What a skill to have. So Laird, what’s your story?

Laird: I've been in the medical device industry for a long time—over 40 years. I started off as a kind of repair guy in biotech. I then worked in sales and found out that I was horrible at sales. To be more specific, I found that I was good at sales, but I didn't really like sales. So then I moved into product development, and found out that it was kind of where my life's niche was. I specialized in orthopedics, and I developed orthopedic devices for arthroscopic surgery. I specialize in the shoulder and have been doing that for the last 27 years.

I was with a company based in Andover, Massachusetts from 2000 to 2014. About six months after I turned 55, I was “released” from my position.

Jon: You were “right sized”?

Laird: Yeah, I was right sized. They never explained why. Basically one day they pulled our whole team in—four of the five members were over 55—and they let all of us go at the same time. They just wiped out the team.

Jon: Just take out the whole area, huh.

Laird: That’s right. It didn't matter what our performance was. Since I'd been with this company from 2000, the division I was working with grew year over year by over 24%. Even with that type of growth, I was disposable.

I did some other things in regenerative medicine and then was doing some consulting work. That's when Lynn and Cyndee called and said: “Hey listen, we're thinking about doing this apartment-investing system. Take a look at it.”

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