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Real Estate AuctionIt never fails.  Several times each year, we shockingly watch inexperienced real estate investors come to the foreclosure auction and bid on a junior mortgage which they mistakenly think is a senior mortgage.

For example: Let’s say a $100,000 house is being sold at this month’s foreclosure auction.  The mortgage being advertised for foreclosure reads $20,000.  An inexperienced investor, who doesn’t know the difference between junior and senior mortgages or how to look them up, shows up ready to bid.  The bidding opens at $18,968.35.  The inexperienced investor confidently bids $19,000.  Slowly, all of the experienced investors back away.  They’re terrified of catching a terminal case of “stupid disease,” which has obviously infected this inexperienced investor. Read More→

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The Key is Finding MOTIVATED Sellers

Posted on March 21, 2011 by

The Key is Finding MOTIVATED SellersAs folks pass from their thirties into their forties, they suddenly realize that sixty-five and retirement isn’t that far away. They also realize that Social Security is a great retirement plan…if the thought of living under a bridge and eating cold beans out of a can is appealing.

These realizations are why Kim and I are asked to speak to groups around the country about real estate investing. Most folks know that more people achieve financial freedom through real estate than from any other type of investment.

There are lots of reasons why real estate is a great investment/retirement vehicle. Here are just three: 1) Rental income has a very low tax rate. Remember, how much you keep is more important than how much you make. 2) Everybody needs a place to live and about 37% of Americans rent, not own, a home. 3) In the end, the tenant pays off the property for you!

We’re often asked, “To be a successful real estate investor, what is the MOST important thing that I need to do?” Easy answer: Read More→

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Are Your Property Taxes Too High?

Posted on March 18, 2011 by

Are Your Property Taxes Too High?Do you think your property taxes are too high?  If you do, how do you get them lowered?  And who’s responsible for determining the amount you pay in property taxes, anyway?

Let’s begin with the last question first.  I greatly respect and much admire the folks who work in the Tax Assessor’s office.  They have a daunting, thankless job!

When Kim and I first began disputing our property taxes in 2006, I viewed the Tax Assessor’s office as my adversary.  Over the years, after spending a lot of time getting to know these folks and learning how the process works, I now realize how WRONG I was. Read More→

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Pete Fortunato (PeterFortunato.com) has been one of my main real estate investing teachers for many years.  The guy is phenomenal! (Not to be confused with pneumonia…I’m dyslexic – what happened to “spell it like it sounds?”)  Pete is one of the best and most creative deal structurers on the planet!

Pete has a great saying: “Use what you have, to create what you need, to get what you want.”

Until recently, I’ve never fully understood what he meant.  But finally, the light turned on!

As real estate investors, we’re often asked by prospective tenants or buyers, “Will you work with me on the deposit?”  The usual answer is, “No.  Are you nuts?”  Ok, perhaps we only think the “Are you nuts?” part.

Point is, we’ve always required the cash up front in order to make the deal work.

Similarly, when we’re buying a property, all too often, the homeowner also wants all the cash up front.  Since I’m always light of having the amount of cash the seller needs, the deal is lost.

Now, let’s think like Pete.  It’s not the cash that the seller wants, is it?  Isn’t it what the cash will buy or do that’s the key? Read More→

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A few days back, Brad flew in from Virginia to discuss his real estate investing business.  He’s an experienced investor who, for the past three years, has been having a really tough time keeping his head above water.

Brad owns 17 single-family homes, 2 duplexes and a 26-unit apartment building.  He wanted me to look over his portfolio to find out what he’s doing wrong and what he can do to become more profitable.

Over the years, I’ve had the opportunity to meet with a lot of investors, study their portfolios and discuss ways they can do better.  One of the biggest and most common mistakes made – by both new and experienced investors – is doing deals that should never have been done. Read More→

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How to Buy a Home for $101There Kim and I were, standing in front of the Bartow County Courthouse in Cartersville, Georgia, at the December 2010 foreclosure auction – freezing our tails off.  We’ve been working the monthly foreclosure market since 1995.

Cheryl Bagby, the young lady who cries the foreclosures for McCalla Raymer, the largest foreclosing attorney in the southeast, had just finished reading the legal notice for a home in Acworth, Georgia.

It was a nice 3-bedroom, 2-bath home in a great location on about an acre of land.  The home was rented to a tenant who was paying rent of $795 per month.

When Cheryl finished reading the legal, she said, “The opening bid for this property is $100.  Are there any other bids?  Going once, going twice….” What happened next will blow your mind!  But you’ll have to read along a little further if you want to know how this story ends. Read More→

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