The March 2014 Edition of The Profit Newsletter is available for download just in time for our Atlanta REIA Main Meeting on March 3rd. You can download The Profit Newsletter as a High Quality PDF or Low Res PDF for slower devices. The Profit is the official newsletter of the Atlanta Real Estate Investors Alliance and is a digital, interactive newsletter for new and seasoned real estate investors delivered as an Adobe PDF file to read on your PC, Mac, Smart Phone, iPad or other mobile ready devices with a PDF reader. Many of the articles and ads in The Profit contain many hyperlinks you can click or tap to visit websites, watch videos, listen to audios, download content, send emails, comment on articles, share socially and much more! The high res version of The Profit is “print ready” for those who want to print the newsletter on their home or business printer. Also, be sure to Subscribe to The Profit Here so you don’t miss a single monthly issue.

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Elmer was my adopted dad when I first got started investing in real estate. He had spent 31 years in the Marine Corp and retired as a Colonel. His career had been as a pilot and the first portion of that was spent as a fighter pilot. He had been in flight training in 1938, the year I was born. The latter part of his career was spent flying military cargo planes and eventually doing administrative jobs as a senior officer in the Marines. What a blessing it was for me to have Elmer as a discipline coach, He didn’t reach that point being a jerk with no discipline. He had class!  He had discipline! He had leadership abilities. He had very valuable experience.  All of that could be my reward for being a true friend. He would teach me provided I wanted to learn but he wouldn’t waste his time if I could not at least jot down my spending plan.

Thus my habit of spending New Year’s Day going over all of my financial affairs was developed. I had to have all of the mortgage balances for outgoing payments and incoming payments. The interest would be deductible on the outgoing payments and I needed to get that information ready for the tax preparer. The interest would be taxable on the incoming payments and I needed to send that person a Thank You card (yes, always say thank you when someone makes your wallet thicker) and a statement for his taxes before January 20. Elmer always said the best way to get your money is in the mail. Now we might say the best way is direct deposit. Make it convenient for people to pay you.  We don’t need an ivory tower office. We need a bank account that acts as a collection point.  We don’t want to pay office rent! We want to run a skinny operation. Remember that it is better to stop an outgo than it is to start an income. It is better by about 25% which is about the average for taxes and cost.  Read More→

Okay, now we are out at the house. Next step is to ask the seller if you can take a quick look around, and do just that. I don’t spend more than three minutes walking through the house, taking a look at it. Please do not make any com­ments if you see anything wrong with the house. You’re not there to downgrade the house. You’re there to either buy it or lease option it, and you don’t do that by upset­ting the seller. I’m sure that most sellers are clearly aware that their walls need painted or whatever you see, they can see as well.

Once you’ve looked around, the next step is to ask them if they have any questions. You’d be surprised what happens when you let them do the talking and you not doing the seminaring. Simply ask them if they have any questions. If they do, answer them shortly, to the point, but simply enough so that anyone can understand them.

If they don’t, then the worst thing you can do is start rambling off at the mouth and create questions by trying to deliver a real estate seminar. If they don’t have the questions, don’t answer the ques­tions. If they have the questions, answer the questions. Read More→

Over the last two months we discussed Step #2 of “Determining Your Marketing Plan in 7 Easy Steps” which was to “Determine Your Market”. We broke Step #2 down into 2 parts which were to determine “Who and What is Your Market?” and “Where is Your Market Place?” This month we’re going to move along to Step #3 which is to “Determine Your Marketing Methods”.

Webster defines a “method” as a careful or organized plan that controls the way something is done. Coming up with an organized marketing plan is exactly what the 7 Steps are all about so we want to put some careful thought into the methods we will use to get our desired results.

In Step #1, you determined how many leads you need to achieve your personal and business financial goals. In Step #2, you determined who you want to market to and where you want to market.

In Step #3, you need to determine what marketing “methods” you will use to promote your real estate investing business to your desired prospects in your market area so you can generate your desired number of leads each and every week/month to reach your financial goals. Read More→

There is money to be made in real estate, but you need to think about real estate investing as the business it is. Allow me to share some common mistakes that beginning and even seasoned investors should avoid.

For those of you connected to REIAComps, the control and feeling of confidence you have over your deals is priceless. Using REIAComps to investigate the value of houses as they come to market, against the recent sold comparables, will provide you a solid position to “make your profit when you buy”.

1. Getting emotionally involved. This is the biggest and most common mistake beginning investors make. Emotions and business do not mix well.
2. Paying too much. To make money investing, you have to find a good deal. Look for properties that need a little fixing up. Your goal is to find a distressed property that you can purchase at 60- 70 percent of other sold comparables. REIAComps makes that part of your investing business much easier.
3. Ignoring schools. Good schools attract good renters. Conversely, only the most desperate renters are willing to subject their children to failing schools. Read More→

“I accidentally forgot to graduate from college.” ~ Anne Lamott

Last week my Aunt Blanche came to dinner and told us all about a class she was taking: Financial Markets, at Yale. Really? THE Yale? Blanche is pretty imaginative, so I thought she was making it up. Sure enough, though, she proved it: She’s got a certificate in Financial Markets from Yale University. I have to admit I was impressed. It had to have taken work and dedication, and, I imagined, lots of money, too.

That got me thinking about how important it is to invest in ourselves, particularly in our own education. So many of us think we don’t have the time or money to spend on ourselves. We feel overwhelmed just facing the details and expenses of daily life. In my experience, though, learning something new gives me new energy and motivation to spend on all the mundane stuff.

Maybe you’d like to invest in yourself, but someone else has told you it’s just silly. That sounds like a naysayer to me, so let’s talk about naysayers for a minute. You know who they are: the folks who tell you it’s dumb to spend 15 weeks on a college course. The ones who say you’re too old, you’re too busy, you’re not smart enough. There’s a naysayer in every family. And too often, the worst naysayer of all is YOU. Read More→

I want you to be wealthy. I want you to make $5000 in the next 30 days. I know  I can show you how. So every month, I explain how to navigate the very real possibilities in the real estate market. I encourage you to get out and beat the bushes for motivated sellers because I know they are out there and they are ready, willing, and able to sell to you.

This month I want to explain how you can avoid real estate ditches, potholes, and blunders. Believe me, I have found them through trial and error, and my experience can help you to avoid them.

The most common mistakes are:

1. Not following your business model.
2. Buying with someone else’s numbers.
3. Buying from a control freak realtor.

3 Ways to Avoid These Mistakes

I. Follow Your Business Model

Your business model is the most important thing to stick to when buying or wholesaling a property. It should include

• How much money you want to make
• The area of town you’re interested in
• The type of buyer you need (owner occupant versus investor) Read More→

There’s no doubt that the number of properties being advertised for foreclosure has been plummeting for the past year and a half.  The question is, why?

In 2009, when foreclosure numbers began to skyrocket, the only way a bank could deal with borrowers who were behind on their mortgages was to foreclose.  The fact that banks – actually it was loan servicers like the infamous MERS – didn’t have possession of the borrower’s note, nor the legal right to foreclose on the property, is a topic for judges and attorneys.

At the same time, you had thousands of borrowers who, because they couldn’t/wouldn’t make their mortgage payments, simply “gave the house back” and walked away.  (It didn’t matter to the borrowers that the bank didn’t give them a house; it gave them money…and the bank – rightfully so – wanted their money back, not a house.)  A bank’s only tool to deal with this situation was to foreclose on the property, and then sell it in hopes of recouping some of their loss. Read More→

Last month I mentioned I had discovered that every property I drove past was one of four different types of houses every investor needs to be able to quickly recognize if they want to increase their bottom line every year. This month I will explain two types of houses that can really increase your income every year.

I struggled for years to find properties that would allow me to make enough money to feed my family and pay my bills. I had no idea what I was doing or what I was looking for. All I knew was I was trying to buy any house I could find just to make money. I struggled to figure out what I should look for so I started buying houses that I could fix and sell retail. This was a good idea but I could only do a few of these houses each year because I did my own rehabs at that time. It was taking long periods of time to fix and get every property sold and I kept running out of money. It was always a struggle to pay the bills each month. I wasn’t getting checks from my closings very often. All I could do was try to buy houses I thought would make me the most money.    Read More→

In the first two parts of this article, we covered a few nice things like wholesaling, when & why you might not do a deal, and then how to make money even when you don’t buy a house.

The big secret I revealed in the last article was: You SELL the leads of the houses you don’t buy.

Now Your Question Is: “Ok. It makes sense! But HOW do I sell these leads?” Good question! 

Again, let’s keep this simple.  I suppose you could go and build a squeeze page, make a sales funnel, put up ads on Facebook or Adwords, etc. But don’t. Please. What a waste of time – especially at this point. Let’s keep it simple, ok?

Instead, why not just make a few phone calls to some of these local people? Ring a few Realtors. Call a couple of contractors. Get the Interest of some Investors. Dude – Dial for some Dollars!

Go on Google & do a search for “YOUR CITY Realtor” or Contractor. Or do a search for “We Buy Houses CITY”. Ex: “We buy houses Seattle” Read More→

The problem…

You and/or your client have found real estate to purchase. The inspections go beautifully and then a giant road block shows up. What’s the road block? Your client wants to purchase it with their Self-Directed IRA and their IRA can’t qualify for a non-recourse loan because it doesn’t have the cash reserves for the 35% down payment the non-recourse lender is requiring.

The solution…

Self-Directed IRA investors have a technique they call “Subject To” that can solve this funding problem.  The “Subject To” loan qualifies as a non-recourse loan and can be used to purchase real estate within a Self-Directed IRA. It should be noted that the “Subject To” method can be used for deals whether the property is being purchased by an individual or by their IRA.

“Subject To” defined

Subject To means “Subject To the existing mortgage on the property.” Put simply, the owner of the property transfers the deed to the property into the buyer’s name (or the name of the buyer’s Self-Directed IRA) and the buyer (or their Self-Directed IRA) is responsible for making the payments on the seller’s existing mortgage. Read More→