Mold Is Gold In Real Estate
by Pete Youngs
If you have seen me speak in the last 20 years, you know that one of my biggest topics is using mold testing in real estate. I only do this in vacant properties, normally bank owned too. The reason I do this is because I have been able to consistently teach people how to get a 25% or more discount on the sale price of properties nationwide.
There are only two ways a mold test can come back, one is elevated and the other is non-elevated. Once you have
established that molds, toxins, allergens and bacteria exist, your discount is just a few steps away.
As an EPA accredited teacher in lead based paint RRP rules, I also teach a mold inspection class. This has nothing to do with mold remediation, only the detection and cleanup of mold. Here is how it works. When I speak at real estate investment clubs or give seminars, my main topic is getting the property fixed up for about 50% off the regular general contractor rates. When I do a follow up full day Saturday class, I teach mold inspection as a part of the day. I then give you a test and upon passing it, you now can inspect houses for air quality problems that will lower the cost of buying the property.
In the training, I teach you all about molds. How they form, what types are there, and whether or not it is toxic. With an air testing machine, I teach you to secure an air sample that is sent to an independent lab who then tells you what types of molds, toxins and bacteria’s that are in the house. The test is only $20 and will establish that molds are present in the house.
When I present the mold results to the bank, I include a copy of the mold test, an estimate from a mold remediator, and my offer to buy the house “as is.”
I also print out from the web that the detected molds and such have been known to cause serious illness and or death in some cases. That being submitted, the bank, by law, has to disclose a copy of the lab results to any and all other buyers interested in the property. So to avoid any further problems they normally accept my offer. This is an absolute killer tactic to get bank-owned properties for big discounts. I have been able to help investors all over the country get huge discounts by teaching them the mold techniques in my classes.
Here is the latest major big deal that my mold training has provided. We were on a cruise when a water pipe burst in my father’s attic. This in turn flooded the two story house leaving water inches deep on both floors. We contacted his insurance company who sent out a water disaster company to handle the water issue. When they got there, I was surprised with the lack of equipment they had brought for the job.
My first thought was to document everything, so as I would teach you, I took loads of pictures of the water affected areas. Also for documentation, I got business cards from all involved: the water company, the insurance company and all contractors who showed up.
Knowing what I know from teaching mold classes, I sent an e mail (paper trail) to the insurance company and the water damage company explaining that I did not feel there were enough men or machines to dry the house out fast enough. I received an e mail back the following day saying, “we do this for a living; we know what we are doing.” I sent the email to the insurance agent and he replied that he had used them before.
As I teach in my classes, you must shop vac all the water up and use fans, blowers, heaters and more to dry the areas within 48 for best results.
The next day I sent more emails to all involved saying there were not enough workers or equipment to handle a job this serious. I was ignored. The third and fourth day I continued my paper trail of emails to all involved. This time I asked for a face to face meeting with the insurance agent and the owner of the water restoration company. They showed up and I walked them around voicing my concerns about the handling of this issue.
The agent and water guy stepped aside to talk and both came to me saying not to worry, this will be fine. I knew it was going to be a problem. So I let three more days go by and went back in the house and took more pictures of the still wet areas and lack of equipment. Once again I sent emails to all, saying this is going to turn into a mold
nightmare and no one seemed to care. I received e mails back saying the job was moving forward just fine and not to worry.
Fourteen days after we reported the damage. I decided to get serious and let them know what I thought…with no holding back. After dealing with at least five individuals telling me that they were experts and I should just back off, I got mad. I sent a new email flat out accusing them of negligence and unsafe practices.
I also put in the e mails that I did not think anyone was taking me seriously and that my opinion did not mean anything. I included a copy of all my EPA accreditations to teach classes and asked them to google my name so they would see that my expertise was nationwide. I also sent pictures that showed that mold was now forming on most every wall and flat area in the house.
Well guess what, when they saw I was a mold teacher and a national speaker/ general contractor with 30 years teaching experience, my phone started blowing up. All of a sudden I had a new insurance agent from the Major Case department and the water company was fired and was replaced with a new remediation company. There were about 20 people who showed up in hazmat suits, the house was filled with equipment and there was plastic put up everywhere.
It has been over 10 months since the incident and my dad is still living with me. What could have been about a 20K repair has now become almost 300K.
They had to remove all the drywall, carpet, tile, cabinets and everything down to the studs. All furniture, beds, chairs, curtains, everything had to be thrown out and replaced. TV’s, appliances, computers, basically only his personal stuff was saved, even all his clothes were replaced due to mold.
It just goes to show you that a simple mold class can prove to anyone that MOLD IS GOLD IN REAL ESTATE! So not only can it pay big money in your investment portfolio but it made a major remodeling job of almost 300K for the mere cost of a $2500 deductible to attend a class.
Reprinted by Permission. Visit www.peteyoungs.com, (770) 565-0973 or Email: firstname.lastname@example.org