How to Find Investors – It’s Fairly Simple!

When you’re looking for private money, it is not an art. It’s a fairly simple process.

How to Find Investors – Benefits

The benefits really depend upon the negotiation with you and the lender. Here are a few of the many possible benefits:

• You’re dealing with an individual who can make the decision right then and there, or as close to right then and there as you can.
• You generally pay points for loan origination fees to traditional lenders, with private lenders, whether points are paid or not is a matter of negotiation.
• Traditional lenders require payments on loans; with an IRA it may be possible to arrange a no payment loan.
  • If you need a one-year or two-year loan to do a rehab and the investor says “I don’t need the cash flow because it’s in my IRA, I’d rather have the extra one or two percent.” That’s great; you’d rather not make any payments until the house sells.
• You set the terms with the private lender, not the bank.
• Many times, there’s no personal credit required; however, not always.
• There are often no personal guarantees; this varies by lender and negotiation.
• In some cases, you can get dollars upfront for funding expenses.
  • That’s not always the case. Many private lenders will say “no money upfront”; still others will say “100% as long as the Loan to Value is 65% or less.”
• Some lenders will require some sort of equity, “skin in the game”, to make a loan. That’s one of the nice things about dealing with private lenders; the terms are completely negotiable between you and the lender.

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Let me ask you a question; are you properly managing your prospects? Are you taking the time to follow up with the sellers who didn’t initially accept your offers, or the sellers you still need to make offers to? Did you know that you are leaving thousands of dollars in potential income behind if you aren’t following up with sellers? One of the easiest ways to make a fortune in the real estate business and gain the advantage over your competition is to take the time to follow up with motivated and semi-motivated sellers. You’ve already got the seller in your pipeline, you’ve already done the marketing and spent the money to find this person, now all you need to do is to follow up with them until they either sell you their property or tell you to go away. How much simpler could it be?

There are two types of sellers we are going to follow up with, those we’ve already made offers to who haven’t accepted our offer and those who have not made any decision after our initial contact with them. Quite often, you will need to make multiple contacts with sellers before their situation changes and dictates that they sell their property to you. If you stay in touch with these sellers, you build credibility with them and when it comes time to sell they will contact you first, even if they have been contacted by someone else in the meantime. Read More→

Working on short sales is always exhilarating when you receive updated title work which shows there are additional liens against the property.  Many Realtors, Investors and Short Sale Negotiators aren’t knowledgeable or prepared to fight the fight against Credit Card Liens on short sales.  I recommend that the first thing you do when working a short sale is to order a title commitment which will do a search to see if there are any liens on the property.  Are you aware that the title companies also do a name search for your Seller and Buyer?  When a name search is done against the Seller, any outstanding judgments or liens show up on title.  In addition, the title company is to order a lien search against the property for water, sewer, and code violations which cost approximately $140.  Due to the cost, this additional lien search is done right before closing.   I always recommend that the Realtor or the Investor make a personal call to the water, sewer and code violation departments as soon as they start negotiating their short sale. By making the personal call, you can minimize some costs versus have the title company search for you.   Some counties provide this information online.  However, don’t depend on your inexperience of checking liens on the property, I would highly recommend that you contact the County Department and talk to a live person for confirmation. Read More→

I thought this might be a good time to explain why a seller will be better off selling their property they have never personally lived in if they were to give the investor/buyer seller financing terms instead of the seller getting all cash for their property. When you are negotiating with a seller who thinks they want all of their money at closing you know isn’t thinking very clearly and it is your obligation to inform them why your seller financing offer will always be better for them than if they were to get all cash at closing.

Let’s think about why I said the seller will always be better off taking your terms deal rather than getting all cash for their property, especially if they are planning to use the money as part of, or most of their retirement plan. Most people want their retirement income to last as long as possible. The key words in this example are a property they have never lived in they are selling. Let me do a simple example of the difference of a seller getting all cash at closing, and giving seller financing terms to their buyer. For this example I want to use simple math to show you how to negotiate with a seller who is stuck on getting all cash when your seller financing offer will be better for them. Read More→

I regularly get phone calls asking me “Do you do Flips?” and my response is always the same: If done correctly I am willing to do a Flip. While many people, even some lawyers will tell you that any Flip is illegal, in fact there are legal ways to do Flips in Georgia.

The simplest way is when everyone in the transaction is using cash. If the A to B closing is cash and the B to C closing is also cash, then a Flip transaction is not illegal.  Even if you used the funds from the B to C closing to fund the A to B closing, you are all right in an all cash transaction. Disclosure is still generally a good idea. A lot of buyers are having their own attorneys review the title exams or a title commitment. They then will freak out when they see that the B seller is not on title. Let your C buyer know “I will be buying this property on the same day,” and you will save yourself a lot of trouble in the long run. You are not required to disclose your purchase price. I will suggest as a rule of thumb making more than 10% may cause hard feelings. Remember that your customer today may buy more houses from you if you deal with them openly and directly. Read More→

One way to invest at auctions is to not bid at all. This sounds crazy, but hear me out… First, you must attend a few of the auctions in the counties you would like to invest. Secondly, identify the winners and/or the regulars. These are the bidders/ buyers you want to speak with, get to know, and begin doing business with. If you have ever prepared for an auction correctly you know it is a time consuming and tedious process.

Once you have developed a working relationship with these individuals you may begin to ask if they are open to selling you some of their winning bid properties. Keep in mind that they have invested plenty of time and resources into these acquisitions. For this reason they have earned and need to be properly compensated. Each property will be different so do not agree to a flat fee but rather give them your buying criteria and a proof of funds or letter of intent. For example, many investors look to be at 65% LTV all in including repairs while other investors look for 15% ROI. No matter what the criteria, make sure that you are very clear in what you will buy. The last thing you want to occur is that they bid and win a property with the intention to sell to you and you are not interested in purchasing it. This may happen but it should be rare or for a reason out of your control. However, if this does happen, make sure that you assist as best you can in liquidating that property if they do not want it. By doing this, you remain in their good graces and free their capital to be invested again at the following auction. Read More→

Method Number Two: Direct Mail Campaigns

This can be a full marketing machine all in one if you do nothing else. Not only does it work well for many people, but also the list of targets is so big you can target your chosen prospects and never run out of mailing campaigns. Even though signs work well, the best target you can hope for is an area you like. With direct mail, you can use a rifle approach.

1. Pre-Foreclosures are a goldmine if worked correctly. This is a whole business within the business that’s worth the time and expense to learn.
2. Out-of-town owners almost always work. The list is easy to get from a Realtor or your local record office. This is one Kathy specializes in (with a 12% response rate if I remember correctly). Be sure to mention the property address in the letter and include a response card to make it easy for them to reach you without calling. Some people simply WON’T call. You must call them!
3. New Homeowners who’ve been in the house less than two years. I’ve heard over 70% of the foreclosures occurs within the first two years of ownership and a large percentage of those occur in the first year. Any broker can get you the list. You’re looking for pretty houses so you can get the deed!
4. Vacant Ugly Houses.
5. Target Zip codes you want to buy in. Just pick an area, rent the list of homeowners from a list broker and mail a postcard. Read More→

Once again, we are at the end of the first quarter. Over time, I have asked you to make a plan, do your research, and utilize your mentor’s skills. Now I want you to consider something essential. As a mentor, I have begun to ask people these questions:

What kind of relationship do you have with money?

How does this affect your success?

Think about it. Many of us were programmed to see money as the root of all evil. We think that people with money are corrupt and greedy—and yet we want what they have! How can you achieve wealth when you believe it is bad?  You are contradicting yourself, aren’t you?

Do you continually shut yourself down with thoughts like “I can’t afford that”? If so, how can you think this and simultaneously expect to attract wealth into your life?

The answer is that you can’t.

I can help you to see that you can.

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How’s it going? I was recently talking with someone about a real estate deal he was working on. After listening to him for a couple minutes, something became painfully clear to me:
He was obsessed with this ONE deal because he didn’t have a good, consistent, reliable SYSTEM of bringing in more real estate leads for him to work with.

As a result, he was trying to beat a dead horse, or, for those of you who are sensitive to that kind of talk – he was trying to put a round peg in a square hole and pushing to make a deal out of one that really wasn’t.

Ever have that happen to you?  Yeah, I didn’t think so.

There’s a Terrible disease that can infect a real estate investor, new or experienced.

It’s called, “One-Deal-Itis.” This is a condition that will kill your wealth, sap your motivation, and suck up all your time and energy faster than a visit from your in-laws.

One-Deal-Itis is when you don’t have (m)any leads coming in your buying pipeline, and you’re stuck on ONE deal, trying to make it work, when your time & efforts would be much better invested elsewhere.  Don’t let this happen to you! Read More→

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Roof Rescue will provide you with a free, no obligation roofing inspection. A bulk of their work comes from insurance damage related issues. With an in-house specialist, Roof rescue deals with the insurance adjusters on your behalf as your advocate get the right roof repairs/replacements needed and/or replacements. Read More→

Focusing on current real estate comps will prepare you for making deals happen in today’s real estate atmosphere.  Are you ready to dive into the real estate market by investing in a rental property? The opportunities are ripe, but don’t make rookie mistakes. Follow these tips and you’ll be on your way to securing a successful deal.

1. Don’t trust the owner’s numbers.  Your due diligence should involve checking with unbiased sources to determine the expenses, maintenance fees, leasing commissions and other costs associated with any property. Double check data provided by the broker or seller using your own real estate comp source . Talk to another apartment owner. Check public records. Confirm all numbers so you know exactly what kind of expenses to factor into the deal.
2. Don’t underestimate property taxes.  Factor in the right property tax amount, not what the current owner had been paying, particularly if it’s a long-term owner. Your property taxes could be based on the sale price. Check with the county assessor for accurate numbers.  
3. Give special attention to the big-ticket items.  The heating system and roof can be your biggest headaches and most costly repairs. Know what you’re getting into. Have them inspected by HVAC and roofing specialists, respectively, not a general inspector.  Issues are not a deal killer, however. In fact, it can work in your favor and give you the negotiating room to improve the deal. Read More→