Archive for October, 2014

Wed, Oct 15th @ 6:30 PM in Buford, GA
Atlanta REIA North Meeting
Taking the Mystery Out of Closing
& Understanding the Hud-1 Settlement Statement

with Attorney Fred Kross on Oct 15th

Fred KrossOn Wednesday, October 15th 6:30PM at the the Atlanta REIA North Meeting located at 1960 Skylar Hill Dr, Suite D, Buford, Georgia, Attorney Fred Kross will discuss the typical real estate closing process and will dissect the Hud-1 Settlement Statement and explain how to read this important document used in almost all traditional real estate transactions.

The HUD-1 (closing or settlement statement) is a form used by a settlement or closing agent that itemizes all charges imposed on a borrower and seller in a real estate transaction. This form gives a picture of the closing transaction, and provides each party with a complete list of incoming and outgoing funds. “Buyers” are referred to as “borrowers” on this form even if no loan is involved. The HUD-1 is the road map used to document where the funds in a purchase and sale are applied.

The Real Estate Settlement Procedures Act (RESPA) requires the HUD-1 form be used as the standard real estate settlement form in all transactions in the U.S. involving federally related mortgage loans. RESPA states borrowers should be given a copy of the HUD-1 at least one day prior to settlement, although entries may still be coming in a few hours before closing. Although borrowers are supposed to get a copy of the closing statement the day before closing, it is rare that this occurs. Most buyers and sellers study the form on with their real-estate agent and the settlement agent. The more people who review it, the greater the likelihood of detecting any errors.

Attorney Fred Kross is an experienced Real Estate and Bankruptcy Attorney who has closed over 1,000 transactions and has been a practicing Attorney for over 25 years. Prior to becoming an attorney, Fred received a degree in Real Estate and worked as an appraiser. Prior to becoming an attorney, he was a million dollar producer as a real estate agent.

Come join us on Wednesday, October 15th at 6:30PM, as Attorney Kross takes the mystery out of this important topic.

5 Days & 4 Nights in CancunWIN A 4 NIGHT STAY IN CANCUN: All participants who attend the North Meeting will entered into a drawing for a chance to win a *Complimentary 5 Day, 4 Night Stay in Cancun! *You must be present at the meeting to win. Giveaway does not include dining, transportation, transfers, taxes, upgrades, etc.

Late Nite Networking After North Meeting

Tannery Row Ale HouseAfter the conclusion of the Atlanta REIA North Meeting (after 9:30 PM), we will be reconvening at the Tannery Row Ale House located at 554 W Main St in historic downtown Buford, GA for the “Meeting after the Meeting”. We may arrive late if the Atlanta REIA North Meeting runs late. So please come eat, drink, network and have fun with us as hang out late into the night!

See Atlanta REIA Events Calendar for More Events!
Mon, October 20th @ 6:00 PM in Sandy Springs, GA
Beginning Investors Group
Insider Info on Building a GREAT Working Relationships with Realtors!
with Alisha Spence

All Members & Guests Must RSVP Online to Attend
Members Attend for FREE and Guests for $15 Online or Pay $20 at the Door.
Guests can join Atlanta REIA for Only $100/year and Attend for FREE!

Alisha SpenceYou may have heard that investors and realtors don’t always work well together. This is true in many cases. The smart realtors are the ones who do work with investors for a mutually beneficial, long lasting working relationship. There are many things to know when it comes to creating a successful working relationship with a realtor as an investor.

Join us at the Beginning Investors Group (BIG) on Monday, October 20th, at 6:00PM at Hudson Grille located at 6317 Roswell Rd in Sandy Springs where dynamic, investor-friendly real estate agent, Alisha Spence of Duffy Realty, will show you the insider secrets on making a working relationship with a realtor really work.

RSVP Now!

You will learn:

  • What To Look For In An Investor-Friendly Realtor
  • What Language Realtors Speak, (It Isn’t What You Think)
  • How To Cultivate A Great Realtor/Investor Relationship
  • What Realtors Look For In Investors
  • And Much, Much more!
His First Two Deals!

Anthony BostonCongratulations Anthony Boston, a new investor, Atlanta REIA Member and frequent BIG attendee, who did his first two deals recently! Anthony will tell us all about how he found a seller with two properties for sale, got them under contract and sold them for a tidy profit. One of them he purchased for $9,000 and re-sold via a double closing for $25,000!

All About Due Diligence

Gordon Catts, Alisha Spense & Catherine McFarlandAlisha will also give you a “Sneak Peek” of her upcoming full day Due Diligence Workshop on Saturday, November 1st at the Atlanta REIA Office in Buford, GA with Gordon Catts and Catherine McFarland.

Overcoming Common Investor Fears

Mike Cherwenka of Goldmine PropertiesIn anticipation of his upcoming new book on his many years in the wholesaling and renovations business, Mike Cherwenka of Goldmine Properties, fondly known as the “Godfather of Wholesaling” will be doing a special short presentation on “Overcoming Fear When Fixing and Flipping” that will be ideally suited for new investors.

Creative Deal Structuring Examples

Rock & RussWe will also have a Creative Deal Structuring interactive session with Russ Hiner and he and Rock Shukoor will be telling you about their upcoming “Ugly House Boot Camp – Part 1: Wholesaling” 3 Day Intensive Training on Nov 21st – 23rd at the Atlanta REIA Office in Buford, GA!

Late Nite Networking After BIG Meeting

Hudson GrilleAfter the conclusion of the Atlanta REIA BIG Meeting (after 9:00 PM), we will be reconvening hanging out at the Hudson Grill for Late Nite Networking also known as the “Meeting After the Meeting”. So please come eat, drink, network and have fun with like-minded investors and real estate professionals as we hang out late into the night!

Event Agenda*
6:00 pm: Networking, Haves and Wants & Introductions
6:30 pm: Intro & Announcements
7:00 pm: Mike Cherwenka: Overcoming Fear When Fixing & Flipping
7:15 pm: Creative Deal Structuring with Russ Hiner
7:30 pm: Educational Opportunity with Russ Hiner and Rock Shukoor
7:45 pm: Main Presentation with Special Guest Speaker, Alisha Spence
9:05 pm: Closing Comments & Late Nite Networking

*Please Note: Meeting agenda is subject to change.

5 Days & 4 Nights in CancunWIN A 4 NIGHT STAY IN CANCUN: All participants who attend the big Meeting will entered into a drawing for a chance to win a *Complimentary 5 Day, 4 Night Stay in Cancun! *You must be present at the meeting to win. Giveaway does not include dining, transportation, transfers, taxes, upgrades, etc.

If you become an Atlanta REIA member before midnight, October 19th, you may attend this BIG Meeting at no charge as well as other great Atlanta REIA Meetings, plus get great discounts on other Atlanta REIA Workshops.

About the Beginning Investors Group (BIG)

Beginning Investors GroupBIG is an educational and networking special interest group, hosted by Alan McDonald, and Dustin Griffin for new investors who are just getting started in real estate investing as well as “new again” real estate investors who’ve taken a few years off and are looking to start investing again. The entire purpose of this group is to educate and inspire new investors working on their “first deal” and help new again investors get their “next deal”. Please join us on the 3rd Monday of each month at Hudson Grille located at 6317 Roswell Rd in Sandy Springs.

See Atlanta REIA Events Calendar for More Events!
Sat, November 1st at 9:00 AM in Buford, GA
Atlanta REIA Presents:
Know Your Facts Before You Buy:
Due Diligence Workshop
A Full Day Workshop with Gordon Catts, Alisha Spence & Catherine McFarland
Saturday, November 1st from 9:00 AM – 5:00 PM at 1960 Skylar Hill Dr, Suite D, Buford, GA
Bring Pen, Paper & Dress Accordingly for
Home Inspection Tour

Gordon Catts, Alisha Spence & Catherine McFarlandWith the scarcity of listed properties, tight inventory of investor type deals, and the changing market, it’s critical to be able to look at purchase and re-sale prices objectively, know your rehab/repair expenses, and avoid overpaying for a property. With the intensely competitive market, it is imperative that you know how to determine if an opportunity is a “Deal” or “No Deal”, be able to “pull the trigger” quickly and beat your competition.

At our Due Diligence Workshop on Saturday, November 1st at 1960 Skylar Hill Dr, Suite D in Buford, GA, you will learn from three dynamic real estate investor professionals… Professional Investor Gordon Catts, Certified Housing Inspector Catherine McFarland, and Realtor/Investor, Alisha Spence as they show you how to determine accurate property values, repair estimates, property inspection and methods to determine what an investor should pay for the property and much more!

Here are some of the things you’ll learn:

  • How to know the differences with a property’s rental income and it’s value
  • Reliable sources of “comparable” information
  • What an investor should pay for the property
  • Identifying the target market for the property
  • How to utilize public and near public information
  • How to inspect the property
  • What is a deal or not a deal
  • Pitfalls to avoid
  • And much more!

But that’s not all. You will actually go out into the field to inspect and value a real property, hands-on.

You will have THREE real estate professionals teaching you some very critical lessons when it comes to being a successful real estate investor. Take advantage of this rare opportunity and sign up NOW! Seating is limited, so the longer you wait to register, the more likely your space will not be there.

Register Now!
Download The Profit Newsletter for October 2014 (PDF)
The October 2014 Edition of
The Profit is Available for Download!

The Profit Newsletter - October 2014The October 2014 Edition of The Profit Newsletter is available for download just in time for our Atlanta REIA Main Meeting on October 6th. The Profit is an 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.

Download The Profit Now!
See The Profit Archives for our past editions.

Read More→

How Land Trusts Can Benefit You

Posted on October 1, 2014 by

The land trust is an agreement that allows real property to be held privately for a beneficiary. That way, the beneficiary, whether it be you or your entity, does not show up on the title in the public records.

Follow me here. Say you have $1 million insurance coverage for liability. You hit an attorney in the cross-walk with your car. Will he settle for the insurance limits or will he sue for more? Or what if your insurance company denies your claim for some reason? How much will the suit be?  Well, that usually depends on how deep he thinks your pockets are. If you own property in your own name, the lawyer suing you will easily find your house and any other properties you own in the public records. This could easily become a $3 million suit.

Before you even know you will be sued, the opposing attorney could have the sheriff park in front of your house, knock on your door while you are eating dinner and hand you your lawsuit in front of all your family and the neighbors!

But, if you have your property in a land trust, beneficial ownership is hidden. Your land trust is not filed in the public records. Your ownership stays private. No one knows who the beneficiary is but you. Read More→

Okay, we’re almost at the end of our series of articles on how to get through the entire process of buying and selling on a lease purchase, ACTS or owner financing deal. The last two steps in our process are to follow up with your buyer to get them to the closing table, and set up the closing so you can actually get it down and collect the final check.

Alright, so let’s assume that to this point you have been out into the market place and attracted prospects to call you and have found one or more that have enough money to get your attention. Now, you’re ready to move forward. In our case, we try to find 2-3 prospects, and, of course, the ones with the most money rise to the top quickly. Unless they get screened out from something we discover about them, they usually win the battle.

Once they are located and they have seen the house, now it’s time to get an oral commitment from them that they want it. Then, it’s time to do your due diligence prior to setting a meeting. When we put a lease option tenant buyer in a house or sell it with owner financing, there are a few things we want to see in the form of a report. That list is a credit report, a Megan’s law report for sex offenders, a background check, a criminal check, a debt-ratio report, and proof of income. Read More→

If it’s a combination of high contribution limits and downright simplicity and ease of administration you’re looking for, and you have significant cash flow coming from your own business, practice as an independent contractor or other earned income from self-employment, then the SEP IRA, including the Self-Directed SEP IRA may be the way to go.

How it Works

The SEP IRA, or Simplified Employee Pension plan, is an employer-funded, defined contribution pension plan available to businesses of any size, including single-employee corporations, independent contractors and self-employed individuals.

Entrepreneurs in each of these categories initiate a SEP IRA plan to cover all qualified employees. The plan sponsor then funds the plan on an equal basis for each covered employee. You cannot set up a plan to cover yourself alone, if you have other employees. You must contribute to the plan for all qualified employees, equally, across the board. However, this is obviously not much of a concern for independent contractors and for businesses owned and operated by a single employee or a husband and wife team. Read More→

A Few Horror Stories

Posted on October 1, 2014 by

To maintain the spirit of the season (Halloween) I thought I would tell you about a few of the mistakes that I have made in the real estate business and share the lessons with you.

Know the value of something before you buy it!

My first mistake was to pay way too much for my first deal. It was a duplex. The numbers worked as far as cash flow was concerned but I never researched my comparable sales in the area. I paid twice what everyone else had bought duplexes for. It cash flowed so I was able to operate but that killed any exit strategy of selling or refinancing. Cash flow is great but you must always have an exit strategy before you buy. Make that a part of your deal analysis.

If something is cheap… there is probably a reason.

I have bought some tough properties in some tough areas. I have been successful with them but I also managed them myself. Learning the art of management has been great but it has also been a tough road and has kept me from buying more deals sometimes. What I have learned is that if you want to a reposition a deal you need to make sure it is in a good area. Most of the repositions I have done were in areas of town that were not so great. When you see an apartment complex that is selling for a good price you need to analyze the deal with your eyes wide open. Sometimes properties are selling at a discount because they need physical repair and sometimes they are selling cheap because they need repair and are in bad area. When looking at reposition deals pay close attention to the demographics of the area the deal is in. Look at the median income of the area. Is there job growth? What is the vacancy of the other properties in the area that are like yours? Look at the rent roll in the delinquency column. Are they actually collecting rent? You don’t want to do reposition deals in marginal areas even if you can buy them cheap. Your property is only as strong as the tenants you can rent to. No matter how much work you do to the property…if you can’t collect the rent it’s not a good deal. Read More→

It is the goal of this column to answer questions about QuickBooks and how it is used in the REI arena. Knowing how to record transactions in the proper way and have your set of books in good shape when it comes time for taxes. It is our intention to do this with you, the members, submitting questions to info@smallbusinessadvisor.biz and getting answers here in this column.

From time to time I have clients ask me questions that are related to the finances of their business and how they should implement certain business practices. These questions do not always relate directly to QuickBooks® but how these things are handled may directly affect how they are entered in QuickBooks®. I felt that one of these may be of interest to the AtlREIA membership and have compiled a few answers here:

Q: Why would I need a Receipt of Payment Policy- in writing – for my business?

A: A uniform payment policy keeps customers and employees on the same page and improves cash flow management. You may use your payment policy to spell out accepted methods of payment and accounting practices. If your business extends credit to customers or sells a subscription or membership service, you should clearly define the expectations for payment as well as the consequences for failing to make payment. As a landlord you should have already done a credit check on your tenant – which does not mean they can’t have problems from time to time. Read More→

Knowledge = Success

Posted on October 1, 2014 by

The third-quarter results of the Atlanta real estate market are exciting and positive!

It IS possible to make money in this market, and I’ve been in this business for long enough to guide you through it.

On the market right now there is a

  • 3.5 month to 5.3 supply of single family houses above $250,000
  • 2.9 month to 5.1 supply of single family       houses below $250,000
  • There is high demand from cash buyers
  • There is an increase in demand and value in the rental market

What do YOU need to know?

Marketing through your own resources for “off market” leads is the best tactic. Hedge funds have slowed their buying. They are recovering their assets right now because they moved too fast and have a lot of vacant inventory that is nonperforming.

Consider your time value. Working FMLS and hoping to get a 30% off price tag is not a good strategy because you will spend all of your time making offers just to get one deal. Realtors are doing a great job of pricing properties correctly to sell in 90 days; take advantage of this. Even the beat up properties are being priced right. Read More→

As many of you know I have taught hundreds of students over the years and I am constantly asked what the most important things a new real estate investor needs to know. First of all I believe every new investor needs to realize that if they plan to be successful and make money from the real estate they buy, they will find that every situation will require a different strategy and structure that they will need to learn if they wish to achieve their goals and dreams.

The key to make almost every deal work is not to “Buy High and Sell Low”, it’s how you structure the deal. Actually this has happened to me a few times over my 35 years as an investor, this IS NOT a good strategy to adopt but it shouldn’t mean you need to lose money. Over the years I have done two deals where I bought a property and because of circumstances beyond my control I was forced to sell those properties for less than what I paid for them. Even though I paid too much for those properties “over time” I made a nice profit on both of those deals.

Each of those properties I bought with seller financing terms and then sold each with seller financing terms. Even though I sold each property for less than what I paid for them I received a higher interest rate when selling than the interest rate I was paying to buy each property. I was able to make a nice profit on each. Read More→

Places Count: Your Healthy Office

Posted on October 1, 2014 by

“If it weren’t for the fact that the TV set and the refrigerator are so far apart, some of us wouldn’t get any exercise at all.” ~ Joey Adams

As autumn arrives and the summer heat evaporates, it’s a great time to “reset” your fitness routine. Last month, I talked about the importance of taking care of yourself, and why you should do it now. I also told you about one of my favorite apps, MyFitnessPal.com, which is a great tool for building and executing your good-health plan.

But there’s a lot more to getting healthy than just downloading an app onto your smartphone. There’s eating right, and exercising, and yearly physicals, and – well, all the stuff your mother told you to do. And she was right!  

But I’m not your mother, so let’s just stick to the workplace. You probably spend more waking hours in your office than anywhere else. Hopefully, you’ve done your best to create an office that’s efficient and comfortable. You’ve got a desk and a comfortable modern chair. Maybe you have a couch. And while you might move around a little bit while you’re working, you probably spend most of the day sitting. For hours and hours at a time.

But hey, you go to the gym after work, so it’s okay, right? Read More→