Atlanta Real Estate Investors Alliance Blog

“What the world really needs is more love and less paperwork.” ~ Pearl Bailey

Welcome to 2015 – I know it’s going to be a great year! And while the weather is cold, what a good time it is to review office procedures and forms to make sure the business is humming along as efficiently as possible. I guess you could call it a kind of pre-spring cleaning. I know, it’s not as good as sledding, but work with me, here.

If you’ve taken any of my courses, you know how much I like to automate. The fewer steps it takes to get something done, the better I like it. Creating a good system of business forms is a big part of automation, especially if I can get forms to share information with each other, or feed data into a spreadsheet. So part of my pre-spring cleaning is to review my forms every now and then to make sure they still make sense.

And let’s face it: There’s nothing more annoying than trying to work with a badly designed form. If you doubt that, get online right now and try applying for a job at some big company. It can be a real nightmare!

Forms, of course, have always been a pain in the neck. The military is famous for them. Heck, the Romans probably had rotten forms, too. Until just a few years ago, there was no relief from bad forms. You were stuck with whatever form somebody handed you. Read More→

In January of 2014, Florida passed a law that allowed the Banks to push their foreclosures through the court system faster than the normal 879 days that it used to take. I have seen foreclosures go through the court as quickly as 4 to 5 months because the Sellers, even though they do not have an attorney, do not take the time to file an “Answer” when they are served with the Summons and Complaint. An Answer, in which they themselves can file, simply states that they would like this matter set for trial. This letter includes the caption of the court pleading and their address and telephone number. They would have to file this Answer with the Court along with a Proof of Service that they mailed a copy to the Attorney representing the Plaintiff (Bank). Once an Answer is filed, the Court must slow down the Foreclosure proceedings to allow enough time for the proper hearings that are entitled to the Sellers.

I used to advise my students to wait to send marketing letters to Sellers who were in Foreclosure for at least 6 months. Times have changed! I am now recommending, due to this new law, that the marketing starts as soon as the Notice of Lis Pendens (a document letting the public know that the Sellers are in Foreclosure) is served to the Seller. Many Sellers are running scared. They are moving out before they even have time to fight the fight. I say “Don’t Run and Don’t Let the Bank Win” and do a short sale. Even if you are doing a Loan Modification and/or Short Sale, the Bank is still pushing through the Courts to get a foreclosure hearing date set. However, a short sale takes control of the Sellers destiny. Read More→

It is the goal of this column to answer questions about QuickBooks and how it is used in the REI arena. Know 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 by you the members submitting questions to Karen@smallbusinessadvisor.biz, and getting answers here in this column.

Q: What are the important tasks I should be doing to prepare for Year End?

1. There are a number of things to do for Year End and tax filing:
   1. Reconcile all bank statements and credit card accounts – you may have to reconcile the credit cards into January to capture all your December expenses
   2. Order w-2’s and 1099’s forms and envelopes
   3. Print W-2’s and 1099’s – W-2’s if you are using the Pay Roll module and 1099’s for all subcontractors (they should be set up as vendors and you must have their Social in order to print a 1099). You have until January30th to produce these.
   4. If you have inventory that you track in QuickBooks you must take a physical inventory and reconcile with book inventory for accuracy.
   5. Check with your CPA if he/she requires a full back up of your QuickBooks or an Accountant’s copy. If they take a full back up that they are going to make adjustments to you cannot work in your copy – if they are going to send you a printed copy of the adjustments for you to enter then you can continue working.
   6. An Accountant’s copy will ask for a cutoff date for the accountant to work in a certain period and this allows you to continue work – when the accountant has finished you should be able to import the accountant’s changes.
   7. Back up your data as an additional safety at year end for you to keep after you send the file to the CPA
   8. Print out your Income Statement and Balance Sheet with a comparison to the prior year. This will provide you with some information on increases/decreases in expenses, income, liabilities, assets, etc. Don’t forget the Income statement is only half the picture – the Balance sheet is the other half.

Read More→

Want to recover the most for your remodeling dollar at resale? Keep it simple, pay to have it done right and don’t over improve. Moderately priced materials and finishes are a smarter bet than top-of-the-line treatments. Use quality, but the least ornate options. The simplest but most ideal forms of renovations you can do add the largest bang for the buck.

You will find, in a neighborhood of $100,000 homes, adding a $50,000 kitchen may give you the edge over the competition at resale, but it probably won’t boost the sale price much. Those who use REIAComps along with getting advice from the Valuation Support Desk have the edge knowing the right improvements to make in most any market area across the country. The complete control and feeling of confidence REIAComps users have over their deals is priceless.

At InvestorCompsOnline, the developer of REIAComps, from 2010-2014 smart investors who use a valuation first approach to investing, doing projects nationwide (no do-it-yourself), have attained excellent ROI at resale. When it came to adding the most dollar value at resale, here are the “Secret Six” which proved time and again to be the best areas in a home to address.

Drum roll please….in reverse order working towards the best renovation options, Upscale Owners Suite Addition comes in sixth. Focusing on the interests of the actual buyer, making them feel good when they lay their head down at night, is hard to mess up. Read More→

There are three stages of real estate investing: Starters, Estate Builders and Enders. Do you know which stage you’re in? Many flippers and wholesalers think they’re Estate Builders when, in fact, they’re actually running a highly taxed retail business – they’re not real estate investors! (Saying this is sure to ruffle some feathers, but read on before you call me a liar.)

As the stage implies, a Starter is someone who’s just getting started in real estate. He usually knows little about contracts, rehabbing, landlording or how to creatively structure and fund a deal. He’s been to the closing table less than six times. We’re talking about someone who’s wet behind the ears!

An Estate Builder may still be new to real estate, but his focus is different from a Starter’s. An Estate Builder’s deals are structured to increase the investor’s monthly mailbox money! Mailbox money is money made when your capital assets are working for you instead of you working for your capital assets. Examples of capital assets are rental property and notes.

An Ender has been investing in real estate for decades. He’s very experienced at creatively constructing deals. Many Enders cut back on the number of rentals they own in exchange for simpler-to-manage capital assets like notes, options and master leases. Read More→

The sky was clear and it was a nice warm summer afternoon. My flight instructor had just stepped out of the small trainer airplane and left me alone for the first time. I was just about to taxi the plane out and to do my first solo flight as an aviation student. I was terrified and exhilarated at the same time. Just before my instructor closed the door behind him he leaned back in and gave me one last lesson that I will never forget. “Remember kid, takeoffs are optional but landings are mandatory.”

This was a great aviation lesson and an equally valuable business lesson. When flying a plane we need to make sure everything is ready before takeoff. Do we have enough fuel? How is the weather between here and where we are going? Do we know where we are going? Once you leave the ground there are no timeouts. You don’t get to pull over and walk home once you are in the air. You will land that plane in one piece or in many but either way you will land. Years later I realized that doing a real estate deal is no different. You can chose to close or not to close but once you do buy the deal you are in it for the long haul.

The point I am making here is, that like safely landing an airplane, our exit strategy for our deal is just as important. Some people say “you make money when you buy”. I wholly disagree with this statement. You may create value when you buy but you don’t make money until you exit the deal profitably. Saying that you make money on the purchase is a cliché that I find to be dangerous. This is like saying as long as I get my plane into the air everything else will take care of itself. I hope you would not get on a commercial flight after hearing the captain saying that. Trust me, your investors and partners will not want to hear you say anything like that either. Read More→

This month, I’m going to take a break from the normal subject matter that I write about (marketing, real estate, technology, etc.) to focus on something a bit more… important. If you’re not ready for a little introspection, go ahead & stop reading now. I won’t judge.

However, if you’re open for some insight that just might help you grow not only your business but yourself as well, I humbly invite you to keep an open mind & keep reading. Please know that I’m usually a very private person, so a lot of the subject matter I’ll be writing about here is challenging for me to open up about.

There’s nothing like a challenge or personal tragedy in your life that will almost compel you to stop or at least slow down to re-evaluate the things you’re doing and the direction you’re heading. For me personally, I had such a tragedy occur recently when my father passed away from a combination of Alzheimer’s, old age & a heart condition just one month shy of his 96th birthday. Three months later, his older sister (my aunt) joined him. She was mere weeks away from turning 100.

My father was a full colonel (retired) in the U.S. Air Force. He served his country honorably, and, as I recently discovered, contributed to many (Classified) projects during the time he served that set the framework for things that are still in place today. By the time this article is published, he will have been laid to rest at Arlington National Cemetery with full military honors. I have no doubt that this will be an experience that will be cherished by all who attend. Read More→

Are you doing absolutely everything in your Wholesaling business? Are you driving for dollars, writing your own letters, stuffing your own envelopes, building your own websites, creating your own flyers, taking the calls from sellers, inspecting the properties, getting them under contract, then posting the properties online, pitching them at meetings, showing the properties to investors, etc? Whew – that’s a lot of stuff eh??

Well if you are doing absolutely everything on your own, it’s time to stop! There is help out there. And yes – there is a balancing act: “do I do it myself” or “do I pay someone else to do it”??? Naturally there are some things you will want to do on your own – mainly talking with motivated sellers, making offers, and then getting the deal sold to other investors. So how can you get to where those are the ONLY things you have to do? There’s a lot of other stuff right?

MARKETING

Well the marketing is obviously important – probably the most important thing. There are services out there that can do your marketing for you. Namely letter writing services like www.YellowLetter.com and companies like that. They will create either Yellow Letters or Postcards to send out and they will mail it for you. You just need to provide the list. I believe you can buy lists from them as well. And there are plenty of other list providers out there – do your research. So if you get a list and send it to YellowLetters.com now that part of your marketing is done. Sit back and wait for the phone to start ringing.

ANSERING THE PHONES

You could also outsource your call answering or your return calls by hiring a Virtual Assistant (VA) to handle this for you. You can either set up a voice mail service where the person leaves their info and then have the VA call them back OR there are live call answering services like “VoiceNation” and “PATlive”. Those services you can provide with call scripts which tell them what questions to ask when the people call in. This screens the motivated sellers with the tire kickers (people who aren’t that motivated just want to see what you would offer). At this point now you are only dealing with the motivated sellers and in the Making Offers phase (revenue generating activity!).

MISCELLANEOUS

There are many other ways to utilize outsourcing in your Wholesaling business. Go to www.Fivver.com and you will find all kinds of great services you can use for as little as $5! I have used them I feel like 100’s of times for little jobs:

• Logo Creation
• Website help
• Flyer design
• Data Entry
• Internet Research
• Transcription
• Formatting files
• Creating marketing videos
• Website/blog content
• Photoshop work
• Social Media help
• And on and on and on!

Bottom line is, if you are not good at this stuff, don’t do it because it will take you hours sometimes and you will want to pull your hair out.

Another thing you can do is actually just hire a real assistant. It could be a college student, it could be somebody looking for part time work, but you can more than likely find somebody for $10/hr – and have them work 20 hours a week for you doing the things you don’t want to do or don’t have the time to do. Like managing all these things we’ve mentioned above. Another big time killer is going to look at properties – you can have your assistant do it and take pictures and send them to you. This alone could save your tons of time.

So it all comes down to what your time is worth and as a Wholesaler, I would say your time is worth at least $50/hr. If you are on a tight budget, I know it’s tempting to do it all yourself, but just start gradually outsourcing these things more and more and then your time will really become more effective and valuable. Then you will eventually get to the point where you don’t have to spend much time on this at all! Can’t wait for that right? Advice – go read the book “The eMyth” and then start to create systems that work for you instead of you working. That’s how you create a real business that can eventually run without you which is how you build true freedom and wealth. OK – off to it.

Feel free to check out our site www.HowToWholesaling.com for tips, advice, and a free course on Wholesaling and getting into the biz. Good luck!

There have been over 20 million foreclosures in the United States since 2007 and more than 5.5 million homes have been repossessed. Meanwhile the major banks have been laughing as they cash in to the tune of $65-75 BILLION dollars every month from the Federal Reserve. According to the regulators in charge of protecting our currency we should rest assured that this was all an innocent mistake. Well we now have leaked documents that show that the major banks created their tangled web of risky financial transactions not by accident, but with the specific intent of bypassing local jurisdictions’ recording requirements and taxes.

By now most real estate investors have heard of MERS as it has taken on a kind of bogey man type of presence. They might not know what it’s all about, but they know it’s bad. The concept behind MERS was fairly simple. The banks were creating so many loans and transferring ownership so much that it became an expensive nightmare to file the right documents in the right jurisdictions and pay the resulting taxes from each transaction. Instead of doing the honest and ethical thing – paying the taxes and filing the paperwork properly – more than 25 of the largest financial institutions and insurance agencies in the nation teamed up to create MERS, Inc. When a loan was originated, MERS would appear as the owner. Meanwhile, in the back office system of MERS, actual ownership and administration of the loan would be bought and sold countless times without the local jurisdictions or borrowers ever being notified, thus allowing the bank to avoid the taxes and document filing that were legally required. Read More→