She rang the doorbell and silently prayed for guidance: “Lord, help me to say the right thing.”  The homeowner answered and invited her in…and she started yakking.  Yak. Yak. Yak.  She yakked about her experience in real estate, her precious dog and her friend’s struggling business.  The homeowner listened patiently, even offering encouraging words of advice.  When the meeting was over and she walked to her car, she realized that she knew nothing about the homeowner’s situation and hadn’t a clue how to help – but the homeowner sure knew a lot about her! 

That ‘she’ was me, sixteen years ago.  Understandable, since I was a newly minted investor.  But the sad thing is, that ‘she’ was also me last year, when I ventured out into the field after six years of sitting behind the comfort of my desk coordinating short sales.

I can’t tell you how many houses I’ve walked into – homeowners I’ve talked to – only to screw up the deal because I talked more than I listened.  Ugghhh!  Nervous energy would override my brain and cause my mouth to go into overdrive.  I would yak, yak, yak and not learn a single thing about the homeowner’s situation.  Then I would try to structure the deal!  Well heck, NO ONE can structure a deal when they don’t know what the homeowner’s needs are.  So I had to teach myself to listen.  Truly listen. Read More→

A couple of weeks ago, I spent the day inspecting several of our rental properties.  At one of the properties, I quickly realized that something was definitely amiss.  The home’s interior was filthy and the yard hadn’t been mowed.  Turned out the tenant’s wife had left him two months before.  The poor fella didn’t know whether he was coming or going.

As we sat at the kitchen table discussing his problems, a big, honkin’ two-pound cockroach ran across the table.  I FREAKED out!  I HATE roaches!!! The man finished what he was saying with: “Oh, and I have roaches, too.”

This family had been in the home for three years without any problems.  The wife was as neat as a pin.  Now that she had left, everything had gone to pot.  Dirty dishes were everywhere, the trashcans were overflowing, and when I opened the cabinets, I found more roaches.  This is called a we’re-gonna-solve-this-right-now-today problem.

Because the tenant was no longer able to take care of the property by himself, he decided that it would be best for him to find a smaller, more affordable place.  He moved the following weekend.

As soon as he moved out, we got busy scrubbing, cleaning and disinfecting.  We also called Dale Yarborough, our long-time friend and bug man with Guardian, to get rid of the roaches.

Landlords, there’s something you need to know about roaches: It takes time and several applications to get rid of all of them.  Oh sure, back in the good old days, when we could use DDT, you could kill all the roaches in one day…but then you also killed the dogs, cats, birds and small children at the same time.  The point is, if we discover a roach problem, I know it will be several weeks before I can put the house back up for rent because no one wants to move into a roach-infested property.

There’s an important lesson to learn from this story: You should regularly inspect your rental properties – both inside and out.  By doing regular inspections, you’re able to keep small problems from becoming big ones.  For example, in this situation, what if it had been three more months before I discovered the roaches?  How bad would the infestation have been then?

There are other advantages to doing regular property inspections: They help you to build good relationships with your tenants.  Also, since the tenants know you do regular inspections, they take better care of the property.  Finally, inspections will save a ton in repair costs.

How often do I inspect my rentals?  With newer tenants, the property is inspected once or twice a month.  Once I’m positive the tenants are good tenants, I only inspect the property every couple of months.

Hope this helps you to become a better, more effective landlord.

Bill & Kim Cook are a husband and wife real estate investing team. They live in Adairsville, Georgia and have been investing in real estate since 1995. They specialize in buying single-family homes, mobile homes and mobile home parks. They also run North Georgia REIA and teach folks how to successfully invest in real estate.

When it’s time to buy an investment property, most would-be real estate investors think that it’s as simple as going to a bank, filling out some paperwork and getting a mortgage.   While that may have been true back in 2004 and 2005, that’s not how it’s done today.  In fact, if you need purchase-money funds, good luck getting them from a bank!

So how and where do you get the money you need to fund a real estate investing deal?  Easy answer – the money is all around you!  Do you think anyone likes keeping their money in the bank, where they’re only earning around 1% interest?  Think about it: Inflation is at 4%; this means that someone with money in the bank is actually going backward 3% each year!

The big question is: What would make someone want to loan you the money to do a deal?  First, the lender needs to make a much better return than he can make at a bank.  Second, his loan must be safe, and by safe, I mean that it’s secured by a whole bunch of collateral! Read More→

Joseph David English, welcome to the world!  By the time you’re able to read and fully understand this letter, your parents, Joe and Ashley, will be wealthy real estate investors who, it will appear to you, have nothing better to do than travel the world having fun while constantly interfering in your life. 

I’m writing this to you, Seph, because it’s important you know that your parents weren’t born with silver spoons in their mouths.  Their success wasn’t due to luck or a winning lottery ticket.  Your mom and dad’s success was a worked-at, strived-for thing.  In the early years of their marriage they sacrificed greatly.  They lived like no one else so that one day, they – and you – could live like no one else!

You were born on Friday, August 24, 2012 at 11:57 p.m., at the Gordon County Hospital.  There to welcome you was a waiting room full of joyous family and friends, many of whom were real estate investors.  You may think that there’s no such thing as a born real estate investor, but trust me on this, Seph – you are one! Read More→

Business owners, here’s something to consider: Let’s say you’re a real estate investor and you’ve spent the past fifteen years working and sacrificing to build a portfolio of twenty single-family rental homes.  Your portfolio has a lot of equity and great cash flow.  You’ve finally reached the point where you can relax, travel and enjoy life – Oh, and yes, you DID build it yourself!

Then you get The Call.  It’s from one of those one-call-that’s-all, flea-bag attorneys who tells you that he’s representing one of your tenants who was seriously injured after falling down some steps at one of your rentals.  Of course, he fails to mention that your tenant was inebriated at the time he fell – the attorney doesn’t want things like facts and the truth to get in the way of his big, easy payday!

The attorney threatens to sue you for ten million dollars, or explains that you can simply write a fifteen thousand dollar check and avoid the lawsuit.  Oh sure – in many circles this “offer” would be considered extortion, but because it’s an attorney making the call, it’s instead called “settlement negotiations.” Read More→

Last week, Houston Long, a fellow real estate investor and longtime friend (though he doesn’t like admitting to the “longtime friend” part), had to take a tenant to Magistrate Court to seek an eviction.  The tenant had quit paying rent.  This left Houston with no option but to try and get the tenant out and his rental property back.

Taking a tenant to court should be a no-other-choice decision.  For Houston, who’s been managing tenants and rental properties for more than eight years, this is the first time he’s had to take a tenant to court.  Previously, he had been able to resolve all landlord-tenant issues at the tenant’s kitchen table without getting a Magistrate Judge involved.

Houston didn’t ask me to attend his dispossessory hearing, but with it being his first time in court and because I was secretly hoping his case would turn into an exciting landlord-tenant train wreck, I couldn’t keep myself away. Read More→

We bought two properties at the August foreclosure auction in Bartow County.  After the auction, a new real estate investor asked us a question we hear often: What do you see when you’re out working foreclosures?  Today’s column answers this question.

A couple of days ago, I headed out to look at some properties scheduled to be sold at the September foreclosure auction.  Joining me were my buddies Houston Long and John Clark.  Houston is an experienced investor who has one of the best creative deal-structuring minds around.  John is new to real estate investing and is a quick learner.

Our goal was to see 27 properties that day.  (There are a total of 115 properties advertised to be sold at September’s foreclosure auction in Bartow County.)  To make finding the properties easier, Houston maps them on his iPad, then breaks Bartow into quadrants and sectors.  Working with him reminds me of a Tom Clancy novel and having “John Clark” in the car definitely adds to this feeling.

Of the foreclosure properties we saw, a little over a third were abandoned.  A good number of these had been empty for six months or longer.  Sadly, this ratio is pretty typical. Read More→

We’ve built a successful real estate investing business by constantly knocking on seller’s doors and asking Pete Fortunato’s famous question: Why are you selling such a nice house like this?

Remember: The BEST way to find great deals is to meet face to face with sellers and help them solve their real estate problems.

We knock on seller’s doors because it’s – BY FAR – the most effective, affordable and quickest way to get face to face with a seller. Read More→

For real estate investors, the magic happens at the seller’s kitchen table!  Three Big Questions: How do you get to the seller’s kitchen table?  Once there, what do you say?  Finally, how do you “convince” the seller to sell you his/her home?

Austin Boston Berry recently graduated from Georgia Tech.  There were two career paths from which he could choose: Either get a J-O-B with a big company working in a cubical and becoming a wage slave, or go to work for himself without the “security” (or constraints) of working for someone else.  Austin Boston chose the brave – and much harder, hungrier and riskier – path of going to work for himself.  He decided to become a real estate investor – in the worst real estate market this country has ever seen!

Before making his decision, Austin and I spent a good bit of time together.  It was critical that he understand what it takes to be a successful, full-time real estate investor…especially starting out.  Simply put: You gotta meet face-to-face with a minimum of 15 sellers each and every week.  There is no shortcut to this primary directive.  Meet with any less and you will fail.  Period. Read More→

I couldn’t stop myself from watching a real estate investing TV infomercial last night.  You know the one, the guy promises big bags of cash if you’ll just buy his special, super-secret “system.”  In the infomercial, you can’t help but notice that the “millionaire” guru is driving a new Mercedes-Benz.  Sadly, a lot of folks tell themselves, “I gotta get me some of that!” and then pick up their phone and dial the number.

The next morning I got in my vehicle, fired up the engine, and headed out to do property inspections at some rentals.  While driving, I thought again about the guru’s Mercedes.  No successful investor we know drives an expensive luxury car.  Can you imagine pulling into a tenant’s driveway in a $75,000 land yacht?  Talk about going over like the proverbial lead balloon!

After lovingly patting the cracked dashboard of my 1998 Dodge dually, diesel, 4×4, pick-em-up truck that has nearly 300,000 miles on it, I realized that I am my truck…and not some fancy-dancy, new Mercedes! Read More→

Last month, because of a job transfer, one of our long-term tenants moved out.  They’d been in our single-family rental for six years.  The home was returned in great shape, but we decided it was time to paint the property and replace the ten-year-old carpet.  The shave-and-haircut rehab came out great, and the home looked wonderful!

As soon as we put For Rent signs in the yard, the phone began ringing like crazy.  Folks love to rent nice looking, well-maintained homes that are located in solid neighborhoods and rent for below-market rates.

One of the first applications faxed to us was a landlord’s dream!  It was neat and complete.  The applicant had been on their job for seven years, had the security deposit and rental payment in hand, and wanted to move in immediately.  I was so happy…someone get me a bib just in case I start slobbering all over myself!

If you’ve been reading our weekly newspaper column (Bill’s Articles / Kim’s Articles) for any length of time, then you know there’s one more – very important – thing I must do before signing a lease with this “perfect” tenant.  I must first do a surprise inspection – both inside and out – of their current residence.  Remember, wherever they live now looks exactly like how they’ll have your investment property looking one week after they move in.

Thank God I follow this rule! Read More→