Atlanta Real Estate Investors Alliance Blog

It’s pretty easy actually. Get (“contract”) (10) unwanted houses from a seller at a great price and turn around and wholesale all (10) to a cash buyer. Boom – easy right? We’ll of course it’s never THAT easy. What if it was your 1^st deal ever? That would be scary. What if it was your 6^th thru 15^th deal? That was my scenario. But I did it. And you can do it too – because I knew practically nothing when I did it – had done 5 deals at that point. So how is it possible?

Well it was around November timeframe (2012) and we had just done our very 1^st Wholesale deal a few weeks prior. Our 2^nd deal was with a guy who had (13) or so rental properties down in the “South Side” of St Pete, which is a very rough side of town for the most part and you can get houses pretty cheap. We had done a lot of “driving for dollars” in the South Side and found a house and sent a letter to the owner and they called us off of our letter. I think he said he would sell the house for $20K, so I went and looked at it. It was terrible! Terrible, terrible house! Old, rickety, wood frame, termite infested, tiny house in the rough side of town. So I offered $11K and we finally settled on $13K I believe. I wrote up the contract and would close in a few weeks. He also mentioned he had (12) more houses and he’d be interested in selling them all – but he’d let me know about those after we closed on this one. Read More→

Buyers should be extremely cautious about entering into a contract for deed to purchase a property. There are two main reasons. First, it is possible for the seller to lose control of the property while the buyer is making his payments according to the contract. Second, if a buyer defaults he will likely lose any equity developed in the property.

This first reason may seem counterintuitive. But, sellers are allowed to borrow against the same property they are selling under a contract for deed. In other words, a seller can go to a bank and obtain a mortgage on the exact property they have contracted to sell. They are also allowed to borrow against the property without notifying the contract-for-deed buyer.

The lien that a bank would place on the property would be superior to any rights that a buyer would have under an unfiled contract for deed.[1] Thus, if the seller defaults on his loan to the bank while the buyer is making his payments, then the buyer is in trouble. The bank would foreclose on the property, and the contract-for-deed buyer would lose all rights under the contract for deed, including the right to possess the property. Read More→

Self-Directed Real Estate IRAs are a powerful tool that allow for tax-free and tax-deferred profits. In some cases, capital gains taxes can even be avoided when investing within an IRA. Still many people are still unclear on how to transition from investing in real estate outside their IRA into investing in real estate within their IRA. We’ve compiled a cheat sheet summary in this article to serve as a reference tool.

The Account

First and most importantly, you need to open and fund a Self-Directed Real Estate IRA. This involves simply filling out an application which is quick and easy with American IRA [Hint: The American IRA staff will be standing by to help with this]. The second and most important part is to fund your new account. You can fund an account by making a contribution, transferring funds from another IRA, rolling over funds from another IRA, and/or any combination thereof. When transferring from another IRA, it is important that you follow up persistently with your prior custodian to make sure they move your funds in a timely manner [Remember: You are moving money “away” from them so they are in no hurry.].

Finding Assets

Once your account is open and funded, you are ready to find deals on those assets that you want to purchase. Before making an offer on that asset, make sure you review the list of prohibited assets to ensure that the asset you want to purchase is permitted. Prohibited assets include: life insurance, certain kinds of precious metals, art, alcoholic beverages, and collectibles. You also need to make sure you are not purchasing the asset from a prohibited individual including: yourself, your spouse, your descendants, your ascendants, nor their spouses or entities they own or control. Read More→

When most people start out in the real estate business they don’t have all the money they need to buy all the properties they want to buy. I may be describing you and I am certainly describing myself when I got started. If you don’t already have all the cash you will ever need to buy properties then you will need to meet the right people (investors and sponsors) to help you get your investing going.

Meeting great people is just the beginning to creating great business partnerships but it certainly is not the only aspect of the art. Here are some things to keep in mind when networking.

Friends are great but there is much more to a successful business partnership than just liking someone or getting along with them. I am friends with all of my close partners but the relationship didn’t start that way. When you first meet a new contact you should be asking yourself two questions.

What do they bring to this relationship?

What do you bring to this relationship? Read More→

In July, fans of common sense and decency everywhere won a huge victory – in California of all places! The California Appellate Court ruled that Chase created and recorded false documentation in order to prove ownership of a property so they could foreclose on it. This is big news because it shows that the major courts in some of the biggest states in the country are catching onto the long con the banks have been playing in this country for over a decade. Not only is this a good thing for the country in general, it is creating a huge opportunity for real estate investors to do some killer deals while helping homeowners in need.

In 1998, Jan and Rosalind Kalicki secured a mortgage for their home in San Marcos California. A specialty mortgage banking company originated the loan, and Washington Mutual became the servicer. After WaMu went into receivership, Chase bought a large amount of WaMu’s interests, including the Kalicki’s loan. After being foreclosed on in 2008, the Kalicki’s filed a suit for wrongful foreclosure against Chase in 2009. The Kalicki’s claim was that Chase claimed ownership of the loan based on fraudulent documents.

In 2012, the court ruled not only that Chase had created and recorded fake documentation to show that ownership of the loan had been transferred to Chase, it was also exposed that a Chase executive had created a document that “fraudulently represented that a prior assignment had been lost and that Chase owned the Kalickis’ mortgage.” The judge ruled that the Kalicki’s owned the property and quieted the title in their favor. Chase appealed the ruling, but lost. Read More→

Some would say home flipping, in which a buyer resells a property quickly for a profit, is on the decline as U.S. residential price gains slow and foreclosures dwindle. The exception are those individuals who know a valuation first approach to real estate is key to buying right. REIAComps.com insure you have a complete feeling of confidence and sense of control over all the deals you intend to flip.

In the second quarter of this year, almost 31,000 single-family houses were flipped, representing a solid percentage of U.S. home sales. These are quite consistent with data from earlier last year and not much different from the second three months of 2012, when prices bottomed after the crash. Remember we define a flip as a property sold within 12 months of purchase.

Real estate investors who are using REIAComps.com are making stronger profits and finding better opportunities for deals even after a two-year surge in property values that’s now slowing. The median existing-home price climbed 4.9 percent in July from a year earlier, compared with a 13.1 percent jump in the same month of 2013. Distressed homes still account for their share of sales going back to 2008. Read More→

Even before investing in real estate or considering it, you may have heard radio advertisements announcing a national “guru’s” meeting coming to town, seen the latest no money no credit infomercial, been pitched on $25,000 real estate investment programs, and the list goes on. I have been invited to many meetings, courses, classes, groups, etc. and have learned plenty but I didn’t spend thousands to do so. I have learned that not all “gurus” are created equal. Here are a few tips to consider before attending another course or pitch meeting.

1. Does this “guru” still invest in real estate TODAY? If they do not invest in today’s market I more than likely will not spend any money on this person. It is OK to make an exception if the meeting is free to attend to see for yourself if the info is still relevant. I personally have been in the real estate investment business for nearly a decade and the market has constantly changed. What did work years ago does not work as well as it once did.

2. If the person does invest, do they invest in your market? It may be an informative meeting but may not be overly useful in your market. I would strongly suggest that you find a person at your local REIA that invests in your local market. 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 Karen@smallbusinessadvisor.biz, and getting answers here in this column.

Q: I need to segment my balance sheet AND income statement into three departments (classes). Which version of QuickBooks can provide me with this capability?

A: The lowest edition you can use to have classes on both the balance sheet and the income statement is the QuickBooks Premier.

 Q: It takes me all day to reconcile my bank account. I thought it was supposed to be easy in QuickBooks. Every rent check I receive shows up as a separate deposit in my check register, but when I go to the bank I deposit several checks at a time in one deposit. Why doesn’t it show up the same in my register as on my bank statement.

A; If you did not turn on the “Undeposited Funds” feature in preferences, then QuickBooks will put each received payment directly to the bank. You want the “Undeposited Funds” feature on so you can “collect” your received payments together as one deposit duplicating what you actually take to the bank. Read More→