How to JV a probate deal with the estate as your partner | Live probate real estate coaching with Chad Corbett

Probate Podcast Episode: Live probate training with Chad Corbett and Christie Duffie, probate mastery coaching on how to JV a probate deal

Live Probate Training With Chad Corbett: Episode 28 of the Estate Professionals Mastermind Podcast

Christie Duffy took the Probate Mastery certification course one year ago this week. She got her deal flow up high enough to quit her W2 a month later, got her real estate license, and scaled out of residential into multifamily commercial, and now is doing more advanced deals in residential.

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Training Topics In This Episode (YouTube Links):

  • 0:00 Probate Mastery Reviews: Christie was able to quit her day job 1 month after taking Chad Corbett’s Probate Course
  • 3:04 Transaction Engineering: How to do a JV deal with an estate; JV deal structure
  • 5:51 Live Real Estate Deal Analysis: How to sell probate property and net more; as-is vs retail flip ARV
  • 7:31 Transaction Engineering: Funding the retail fix and flip probate sale
  • 18:01 Letting your story inspire more people and open the door to bigger opportunities
  • 20:48 Hitting your probate marketing strategy out of the park with story-telling


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  2. Take Chad’s Probate Course – Become a Certified Probate Expert and unlock Alumni Group membership
  3. Learn Probate, Real Estate Investing, Creative Finance, and more on our YouTube Channel
  4. Digital Door-Knocking for Real Estate Agents and Investors: A social media marketing checklist for B2B networking – Probate Mastery


Probate Mastery Reviews: Christie was able to quit her day job 1 month after taking Chad Corbett’s Probate Course

All right. So we have Christie Duffy from what part of Jersey,
north Jersey.
From north Jersey. And your business you’re predominantly an investor.
Yes, I’m also a licensed realtor, but I’m predominantly an investor in New York and New Jersey
And you’re doing fix and flip as your main strategy?
Well, we try to focus more on multi-family, but we do a lot of fixes and flips along the way.
So we dab fix and flip to generate cash. And then you use that to buy multi-family. So you don’t have to pay taxes, the earned income tax on your flips. Exactly. Yeah. Somebody got one of the good breaks.
[Laughs] thanks!
yeah, and I just got licensed as a realtor late last year to try and help also offset some of the costs of listing the properties.
And just so it’s easier to kind of go and see things and make offers and stuff. So
How big is your team?
It’s just me and my husband. I quit my job last year to do this full-time because we’ve been doing the parts. Thank you. Yeah, it’s been great. It was a dream to be able to do that. So my husband and I have been doing this as a side hustle basically for the past four and a half years, and then I quit my job last year to do it full time. So it’s been great.
I’m curious what you would say to somebody who’s working a W2 job that is afraid to take that jump, If you had it to do over again, would you have committed earlier to full-time and, and scale the business faster?
Or do you think you did it the right way?
No, I wouldn’t, I wouldn’t have committed full time from the beginning because we were dumping a lot of money into the properties and refinancing them out. Cause it was a snowball. And so to get it started, we essentially saved money for the first time payment for the first renovation.
And then it’s gotten easier and easier from there. But there was a huge learning curve for us because neither of us worked in the construction or real estate or anything to do with it. We just kind of got the bug and renovated a two-family moved in there, kind of house hacked, and then progressively worked up the courage to do a flip.
Now we’re building a small apartment building. So it’s been a slow progression and it’s gaining momentum and speed. And it got to the point where I couldn’t it was overwhelming to manage the business and be working. So we made the decision that I was the lucky one to quit first.
He’s still working but works with me when he can. And, um, it’s, it’s picking up speed momentum. So it’s, it’s been a lot of fun.
Awesome. Does your passive income stream equal your old salary or surpass it?
Yes. And we have, well, yes. So this year, it will be my first calendar year in November that I left my job.
So with the flips, we’re selling and with our rentals, I should surpass, my income and we have the building that’s going up that’ll be a game-changer when it’s done, but it’s not going to be done this year. No, no way.

Transaction Engineering: Putting together the right JV deal structure with an estate

So awesome. Well, that’s it. That’s an exciting story. So you had reached out to look for some help on how to potentially JV with the estate.
Tell me, do you have a live one, or is theoretical
Yes, so this is a real-time scenario that I’m, I’m working on right now that I, I, so we’ve done a lot of renovations and we’ve started seeking investors with sort of silent partners. We own the house and we flip it and we do what we normally do, but they invest.
When you say investor, are they taking, an LP spot on an operating agreement or are they taking the first mortgage or how are you carrying these?
Yeah, no, they’re just signing a contract. They’re not a party to the LLC and they’re not well in one of them, they are in another, we have two others we’re doing right now that they’re not on the LLC and they don’t have a lien on the house or anything.
They’re just basically, sorry. My dogs are going.
[Dogs barking very happily because the mail is here]
sorry, the dogs hear the mailman and they go nuts!. Um, so yeah, it’s just a signed agreement like, uh, that we agree to pay them X amount of interest, and we have 12 months similar to like terms that you do with a hard money lender.
So you’re doing it with a promissory note.
Yeah, exactly. Yes. So, but for this new example, I’m a little, I want to make sure I’m structuring it correctly cause we’re not going to own the house. So it’s they own the home they’re distressed and they were just like, let me just sell it as is. And I said, we really could get triple if we renovate for very little cost, like $25,000.
And I just am trying to figure out how to structure it in a way that I’m protected and they’re protected. So that they don’t turn on and say, you know what? I don’t want to sell any more after I do the work. Cause I’m fronting all the renovation costs. Yep.
How many errors are there? Two and one is the executor or executrix?
Then, yes, there’s one executor. And I’ve, I’ve spoken to both of the heirs as well.
They’re both on the same page and they want to sell period, but you’re trying your goal is to get them the most equity possible and get a free house.
Yes exactly. They both
“You can’t do that, that. That sounds too good to be true!”
Well, they, they were like, I want to sell, how much can it get?
And as a realtor, I said, well, you can get a lot more if you fix it. And they were like, let’s do that. But then they were struggling with insurance and I don’t think they could or wanted to come up with the renovation. They were just sick of it. They’re not local. They’re like, please just list it for us for a fraction.
And I said, look, we’re leaving so much money on the table. Like, why don’t I. Split the profits with you and I’ll do all the work and I’ll make an investment for you? So it’s, it’s a great deal. I think for everybody, you know,

Deal Analysis: As-is vs retail flip ARV

So, your as-is value. Like if you put it on MLS as-is, what’s it worth right now?
I think as-is, about a hundred thousand.

Okay. And what’s your ARV, like retail flip ARV?


Okay. And your cap-ex like your repairs,


No way!

Yeah, because it’s, it’s a great house. It’s just that the pipe burst and flooded the kitchen area, the living-dining room area, and buckled all the floors, but the cabinets are great. The appliances are all new.

So you have a cost basis of 125,000 with a sale price of three hundred.

Yeah, yeah.

They also have, I think I and this is, this is where like the concerns come in. So they told me they have a mortgage on the house for, I think about 60,000 is the total lien amounts. But I, you know, I wonder… [Chad in Background] Is that in the decedent’s name?
That’s a good question. I don’t know. It’s gonna…

It’s more likely than not.

It’s probably in the estate’s name by now because they’ve been dealing with this. This has been going on for a while. I’d have to find out,
…but the title hasn’t transferred, otherwise the note would be paid, right? Probate.
The probate is still open. Otherwise, I couldn’t have transferred the title and satisfied the note.
I think probate is still open. I didn’t find them through the normal way of sending letters cause they filed for probate. It was a referral. So I’m, I’d have to look to see how long.

Transaction Engineering: Retail fix and flip probate sale

Well, this is a fun one. So normally what we do is we establish an as-is value, like a basic value for the asset that gets that’s on the side of the balance sheet of the family.
That’s the estate. So they’re bringing a hundred thousand dollars in as-is value to the table, you bring in construction, insurance, systems, you know, all the expertise you bring to the table. And you’re paid top line; you take your real estate commission on the disposition you take any construction fees like it’s very generous to do cost plus 15 on a deal like this, but you can do cost plus 25 is still within reason, especially what contractors are demanding today. So you could take know 15% construction management fee. You can take your, your 6% brokerage. That’s all above the line, but what are you going to split as the true net? Now it sounds like in this scenario, we’ve got a couple of small unknowns, but what you may end up doing to not transfer title, and I’ll go back and say, there’s, different ways to structure that you can use joint venture agreements.
You can use limited partnerships. You can use a fresh LLC. My favorite is a land trust. So my company is the trustee and the beneficiary of our, one of the benefit beneficiaries, but the sole trustee of 123 Walnut street land trust. I’m not a hundred percent sure in Jersey. Another like in Pennsylvania, you still have to pay a transfer tax, but in Virginia, you don’t. So I can close into a land trust and not have to pay for tax stamps.
I can close until the land trust, and most likely, never trigger a due on sale clause from a lender. So that’s the sticking point on this one. The big question mark is that $60,000 note. So let’s talk about the options for that option one, as you pay off the lender and they’re not a problem. If the family has that money, they can do that.
If you have that money, you can do that. You basically would need to just adjust the cap table. Right. So if you were to do that, then they would have a hundred thousand dollars in equity that they’re bringing to the table. You have everything that you’re going to do in the future. If you bring 60,000 cash, then their basis value comes down to, you know, that you take that off.
So they have a $40,000 position. You have, you covered the 60, so you can account for it that way and just basically buy it, like roll it into a land trust, with a purchase agreement where you could purchase the home subject to. The existing agreement staying in place.
And then they would be either a limited partner in an LLC or a beneficiary on a land trust, either way, however, that, that works out, you know, I think you can do the deal. You may have to pay the lender off worst-case scenario, and then we just adjust your equity in the deal on the front.
Um, so you, that gets accounted for. In a perfect world. The easy way to do this is if we could just talk to a New Jersey attorney and say, Hey, can we set up a land trust, roll this asset in. My company is the trustee, we’re the beneficiaries at this percentage. And if. If we can take it subject to that existing lien staying in place, then you can be 50, 50 partners and you split the net.
these ultimately come down to the creativity is up to you. The legality is up to an attorney that says, Hey, this is the best vehicle for your tax situation, for the estate’s situation. We always let an attorney make that final call, but you have it. It’s, it’s a doable deal. Um, and, and you’re, you’re going to put an extra, probably 75 grand in their pocket.
So that’s a great idea. And I did reach out to my attorney and me, but I didn’t, I, that, that putting it in a land trust is an excellent idea. I just, what I’m wondering is if we close on it to put it in the land trust, does that mean essentially title would be run at that time to determine if there are any other liens that I don’t know about, for example?
That’s why I’m suggesting that because we want to have clear general warranty deed proof out. The only lien we hope that comes up is that one first mortgage four for 60,000 bucks. If that’s the case, then take it subject to, into the land trust. And again, if it’s on their side of the deal, they’re responsible for debt service.
So we need to make sure that they’re going to continue to service the debt while you, while you’re holding the housing inventory. It sounds like a key, key. You’re probably going to be 60 days back on the market wouldn’t you agree?
Yeah, hopefully.
Yeah. I mean, it’s, this is, this is, uh, this is a nice base deal. So even if they don’t, even if they can’t service the debt, it’s not a huge risk because there’s no way you’re going to get foreclosed on in 90 days.
And, you know, I mean, you’re going to be able to sell the home quickly at that price. Right. But I’m not too concerned about that, even if they, I get, and it sounds like they probably can easily afford to service the debt. They just didn’t want to come out of pocket for construction and, you know, bigger things.
And I mean, what’s the payment of 250 bucks.
Yeah, I don’t know. I hope so. Cause I know they stopped paying the utility bills because the lights were out when I was over there last time I notified them about that. So there, they’re not local, but I am. So I’m trying to step in and help them where I can.
Um, But yeah, this makes me feel much more comfortable about it because of course, my big concern was simply like, without ownership of the home, I don’t have the control if they turn around and say, you know what we don’t want to sell anymore. I wanted to make sure that I was,
and that’s, that’s the number one thing that your attorney needs to address for you is what happens?
How can I control the sale of the? And the land trust, like the home, can’t be sold without your signature as a trustee. So they can’t sell it out from under you to somebody else. If you roll the home into a land trust, they decide, screw her. We’re going to sell it anyway. We’ll cut her out of the deal.
Well, what they’re going to find out is when they go around the title, then they’re going to come to you saying, Hey Christie, can we get your signature on this? So you can, so we can transfer the title. Sure. Where’s mine. Like I put all that money into that and did exactly what I said. Where’s my 80 grand.
And by the way, there’s a mechanics lien there too. And that’s something you can do on the construction site. You guys can do to protect yourself is record mechanics liens for, you know, for the contract work against the house. If everybody does what they say, it’s no big deal. It just gets released.
It’s an extra 20 bucks or whatever, but if anything were to go sideways and they tried to go a different direction than what you agreed to, then you’ve got protection on the, on the.
Good to know. Yeah. I didn’t even think about this scenario of them trying to sell out from under me. That would be bad as well.
I have friends that do this just on a handshake and they’ve been fine even in San Francisco and we’re talking a million dollars net profit in those deals on that the family gets a half a million. Brett gets a half a million, but he’d been lucky He’s never had anyone try to, you know, turn off, turn around on him and the deal and it’s unlikely to happen, but we’ve already, we always have to protect our assets.
Yeah. So that’s why having the LLC route is going to be far more expensive because you’re going to have to sit down and forge the operating agreement that offers you these protections specifically, you know, says here’s what the rights are and differentiates between your stock and their stock, like a stock and the b stock, or a general partner share and a limited partner share.
Wherewith the land trust. Everybody’s, you know, beneficiaries all have the same rights, but as the trustee, you have some control there. And also ask your attorney, you know, like what is the best way to, to explicitly say, Christie has control of the sale. and if they’re not okay with it, if any, any time, and I would do all of these meetings, I would do transparently with all parties present.
So it’s over zoom, probably more likely than not, but do zoom calls where everybody says, Hey, the whole point of this first call is to get all of your concerns. Every, all of your questions, let’s get everything on the table. and I’ve done this with bigger groups. Like I just finished putting together an investment club with 12 high net worth friends and family.
And we just that’s how we did it. We, we sat with the attorney. We had a very transparent meeting. We said, all right, what’s, what’s your biggest fear? What do you not understand? What apprehension do you have? No matter how big or how small everything was put on the table and dealt with one, one item at a time.
And with the. Uh, within two hours of meeting like two hours, one day an hour, one day an hour, the next we had, we had a 45-page operating agreement that I think we’ll survive anything we can invest in as a group. So it can come together really quickly. Now that’s probably going to cost you four to $5,000.
If you’re doing that for an LLC. Yeah. Now, if you do that as a trust, it’s going to be far less. I mean, I formed a land trust for 500 bucks. Um, and you’re done now. That’s in Virginia and a low cost of living area, it might be a thousand bucks where you are, but it’s typically more affordable to do it that way.
You know, you could, you could even start with a letter of intent, like, uh, you know, accuracy, Duffy, and tend to do X, Y, and Z. And then the second part estate of Mary Jones, we intend to do… and just document intents from the very beginning. So if anything ever would go sideways, you can always say, look, this is signed, notarized, witnessed.
You guys expressed your intent. And here’s a, here’s a trail of every meeting we had and everything that we did, I’ve never seen one of these go sideways because these families aren’t looking for… Why are they going to cause trouble for you? You just showed them how to make an extra 80,000 bucks and do nothing.
Like you’re, you’re going to be a trusted advisor to them. I’m overly cautious when it comes to litigating, legalities of things like this, usually, but I’ve fortunately never had a situation because of later because we had really clear expectations from the outset and everybody felt like things were being done above board.
They didn’t question things that I was doing. They just trusted. Hey, you know, he’s, he’s got our back. He has, from the first time we talked to him. It sounds like you already have a good attorney.
Yeah. I have a fantastic attorney and I think it’s really smart to bring them in on the meeting. I didn’t think of doing that because I want them to trust me.
I feel like they I’ve never even met the actual, um, executor he’s out of state he’s in the military, so he’s all over the place. And so I’ve met the sister, but you know, they don’t, he, he seems pretty trusting and very excited about this whole thing, but obviously, he doesn’t know me at all, so I want them to feel

Letting your story inspire more people and open the door to bigger opportunities

Yeah, the other part, the more human part of this once you’ve got the deal structured, like the legal structure in place, and everybody’s clear on a strategy, get out, get out a camera every opportunity you have, every zoom call you do with sound, like capture that emotion, capture what you’re doing for the family.
Clip that down into a highlight reel. So the next time one of these deals. You can be like, oh my gosh, I have an amazing case study that I did with the Jones. Here’s what we did for them. And that should be a page on your website, like, you know, probate partnerships and like have that as, as part of your marketing campaign, that’s where you cold traffic can come to it.
But a page, you know, a link in your menu to probate partnerships, and then just document the story as we met, we were getting ready to dump the house for a hundred grand. We actually, less than 60 days later sold it for 300. Here. Watch, watch the story here. So document the heck out of this, because so few people find the courage to do it.
Like I’ve, I’ve trained thousands of people and dozens of actually completely like done deals this way. And the other thing is when you’re, like you guys, it’s so fun to watch you, like, thanks for telling us your story, but as you grow and you guys continue to scale this, so, I mean, it’s obvious, you’re thinking big and you’re acting big, there are opportunities to do this with big parcels of vacant land and you can create subdivisions with seven-figure paydays just by doing everything we’ve talked about here only instead of on our house, which is done on a piece of raw land. And unfortunately, we lost them to COVID, but one of my early students and, was in central Ohio, like in the Columbus market. So you had a lot of farmland that, you know, the, my generation inherited the farm and moved out of town.
They had their lives in Chicago, but it was along the interstate or it was near an industrial park or he would find these estates that had a couple of hundred acres of ag land. He would go in do this exact thing: Structure the JV just like we’ve been discussing. He would do the planning, the permitting, the curbing, the guttering, and subdivide the property.
He might put a hundred or 200 into it, but hell he would create a couple of million dollars in equity and he would get a million, they would get a million. So you take a piece of farmland that you know, needs a bunch of work. Cause it hasn’t been, it hasn’t been farmed and kept up. It might have a quarter-million dollar market value and he was turning them into like $2 million subdivisions.
And he only did one or two deals a year, he rode his motorcycle and playing with his grandkids. But, uh, unfortunately, he was a friend of mine too, but you can, you can, I mean, think bigger on these deals. Think about how many families inherit property in Jersey that even if it’s turned into a parking lot or, you know, whatever it might be.

Hitting your probate marketing strategy out of the park with story-telling

So like, this is a great deal for you to cut your teeth on. It sounds like a really easy one. You should be able to impress the heck out of them because your cycle is going to be so short, maybe inside of 30 days back to the market.

Yeah. And it’s, it is such a good deal for it. Cause it’s, the margins are so healthy that I feel comfortable.
I’m not worried at all about it, you know, being slim Hudgens, and they’re not excited about it. And the biggest hangup we get when we meet with people is of course, like haggling over price. Well, the market’s so hot right now. I should just list it with a realtor. so I think this will be a great example.
We can kind of show some other families where if they’re stuck on price, Kind of show them how much more they can get if we renovate it. Cause all these houses, this one instance, you know, with the burst pipe, it’s unlivable, but every single house we go into pretty much looks the same.

Where it’s like, we can take this deal we’ll rebuild your whole marketing approach. We will do a story campaign. And the whole idea there, you, you capture this deal and you open a letter and say, we have a social enterprise right here in the community that just helped the Jones estate make 200,000 or, you know, make 150,000 more than they thought they could.
And that’s like a headline. And everyone else was saying, I’m a realtor, you know, I’m an investor. I buy houses, I list houses and you’re just sending them a story in the mail. And it’s like, you know, hi, my name’s Christie Duffy. I’m a certified probate expert and I have a social enterprise right here in the community.

I’m sure you probably don’t know what that means. That’s why I’m sending you this story.

And just go in and it’s like, we met, they wanted to sell. I hold myself to a high standard of ethics and professionalism. So I have a real estate license. Also. I have an investment company, but what I saw was best for them wasn’t for me to buy the house or for me to list the house. I found a way to turn it into, in less than 30 days, turn it into $80,000 for the And just a simple, concise version of the story and say, you know, please go to this page to jump on my calendar or feel free to call me anytime at this number.

And we’re going to take a whole different approach. We didn’t say we’re not trying to sell anything. We’re not trying to self-promote. The story isn’t about your business. The story is about the family that you helped. And that’s what we’re trying to get them to do is we want them to identify as the Joneses and like see them working with your team.
I mean, you, you document this and get a good story. We can turn them into a hell of a marketing campaign and we can go to social. We can get, take it and form community Facebook groups for these families, you know, use that story to kind of build momentum in the community.
Now, this is, this is a good deal because one it’s going to be easy.
It’s going to be profitable. It’s a great one to learn from. That’s very low risk.
And I think we’re going to get some really good marketing collateral out of it.
Awesome. Yeah. That’s a great idea. I love the idea of sending out the story in the mail for our monthly mailing. Yeah.
So yeah, as much video as possible on this one, because we can, we can make a cool highlight reel, like put together the zoom calls, bring in some of their concerns, some of their negative comments, like, well, Christie, what if this happens?
And then we can contrast that toward the end of the video and I’m talking to three or four-minute video, but toward the end of it, with their testimonial, we’ll create that contrast in the story. Like we were scared to death. We didn’t know her. We’ve never done a deal. Like, you know, we didn’t know that things like this could be done.
And in the end, they were like, oh my God, she made $80,000 in a month. She’s amazing. And it’ll be a really powerful marketing piece for you. Well, cool. Well, thanks for, thanks for reaching out by the way. Um, Grant said, Hey, you know, I, I think, I think you probably ought to handle this one. And I’m like, oh, I love these deals.
These are the best and good for you for having the courage to do this. Like, this is easy. You got this. Um, as I said, most people won’t even try it, but you’re thinking big and taking action on it.
Well, thank you for all the sound advice. I think this is going to be a huge, huge help because I was stumped on how to approach it.
And now I feel much more excited about the deal and ready to kind of get it going for them.
You’re developing multi-family! This is a bunt!
Well, that’s
that’s I think this deal will be a lot easier than, than that. That’s for sure, a lot easier. So totally.
Yeah. Cool. Is there anything else I can do to help you?
No. No, Chad this has been immensely helpful. Thank you so much. I can’t wait for our follow-up call. Good luck with this one.
If you get stuck or have questions anywhere along the lines, give me a shout.
I certainly will. Thanks, Chad.
Thanks, Christie.

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