Archive for February, 2014

Jon & Stephanie Iannotti

Posted on February 28, 2014 by

Jon & Stephanie IannottiJon & Stephanie Iannotti are Amazon #1 Best Selling Authors of “The New Masters of Real Estate, Getting Deals Done in the New Economy.”  12 of the 18 contributing authors were mentored or coached by them personally.  They are also National Speakers and National & International Mentors to well over 250 students over the past few years.

With over 30 years combined experience in Real Estate Investing/Teaching, and Mentoring and over 1500 creative deals under their belts, they are considered one of the best in the industry.  They have also come up with some amazing ways to structure deals that are cutting edge and they have done many deals with their student partners using these state of the art techniques which are now being taught across the country and internationally. 

They have trained and worked with some of the biggest names in Real Estate Investing.  To name a few, Ron LeGrand, Robin Thompson, Lee Phillips, Al Aiello, Ted Thomas, and many others. Read More→

The Profit February 2014 Edition

Posted on February 10, 2014 by
The Profit Newsletter for Tampa REIA February 2014
Download the February 2014 Edition of The Profit Newsletter Now!

The Profit - February 2014 - High Quality PDFThe February 2014 edition of The Profit Newsletter is now available for download. You can download The Profit Newsletter as a High Quality PDF (Recommended) or Low Res PDF for slower devices. The Profit Newsletter is the official newsletter of the Tampa Real Estate Investors Alliance and is a 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 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 so you don’t miss a single monthly issue.

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You want success, right?  That’s essentially the purpose of any kind of training. However, It doesn’t matter how much “how to” you absorb, it will not cause the result you want – which is the achievement of a specific goal or milestone.  How much action are you putting behind what you learn?

Let me say something to all of you out there trying to get traction in real estate investing and haven’t been able to do it yet. First I want to state the obvious, Don’t Give Up.  But now I have to give you some cold, hard facts.

The only difference between the few successful people vs most other people out there is the amount of TV you watch.

I know that sounds funny, but it’s true.

9 out of 10 people WASTE the most valuable asset they have, which is time. You can’t ever get it back, and the minutes you’re taking to read this is an investment in your future. Time spent watching worthless TV is robbing you of your life.

Part of this mental preparation is understanding the disciplined principal that you can’t always give in to mental candy, which is what TV (and music) are.  You have to lessen your donuts, i.e. the mental candy of TV and frivolous music or you can’t achieve anything. Read More→

Marketing MethodsOver the last two months we discussed Step #2 of “Determining Your Marketing Plan in 7 Easy Steps” which was to “Determine Your Market”. We broke Step #2 down into 2 parts which were to determine “Who and What is Your Market?” and “Where is Your Market Place?” This month we’re going to move along to Step #3 which is to Determine Your Marketing Methods”.

Webster defines a “method” as a careful or organized plan that controls the way something is done. Coming up with an organized marketing plan is exactly what the 7 Steps are all about so we want to put some careful thought into the methods we will use to get our desired results.

In Step #1, you determined how many leads you need to achieve your personal and business financial goals. In Step #2, you determined who you want to market to and where you want to market.

In Step #3, you need to determine what marketing “methods” you will use to promote your real estate investing business to your desired prospects in your market area so you can generate your desired number of leads each and every week/month to reach your financial goals. Read More→

I recently had a telephone conversation with one of my students who asked me what I thought was going to be the next best strategy to use to do more deals in 2014. My student is thinking the market is making a real come back. He is very excited because he is seeing house prices starting to go up, house sales are increasing every month and he had just been told by a traveling Guru that the market has huge profit potential and the market is headed back to 2006 price levels just like it was before the crash.

I can truly appreciate his bright eyes and positive enthusiasm. This student is someone who spends time and money constantly in seminar land listening about the latest niche that will be the next million dollar method for investors to create wealth. I must admit that some of the most recent strategies being pitched could, if done using thorough research and use the correct paperwork could be profitable. My problem with all of these new strategies…. Most of these new strategies aren’t really new. Many have been around for years. The problem, many new investors quickly bore with each strategy as they hear about the next great money making idea that is making investors wealthy. Most of these new strategies will require large sums of money to learn and implement. As market conditions continually change another will soon appear and the investor is again quickly off in a different direction without perfecting the last. Read More→

Get Seller Financing

Posted on February 10, 2014 by

Buying and rehabbing distressed properties can be a lucrative business but it can also be risky. Rehabbing and flipping often generates quick checks but may also take some upfront cash to get the deal done. Here are some tips for rehabbing property with seller financing so you keep more of that cash in your own pocket.

If a property is in need of repairs or it won’t cash flow at that price the seller is asking then you may have difficulty getting a bank loan for the deal. Get the seller to finance the deal. Create an offer that will give the seller the price they need but only if they will carry back the loan on the property in a first position mortgage.

If a seller will carry back the loan then you will likely need to pay the asking price or close to it. Your offer must create value for the seller. The majority of the time when a seller carries back a note on a property they are usually more concerned about the price they are getting than the terms of the loan. This can be in your favor. Create an offer that is close to or at full price but with an interest rate and terms that will allow for small payments and bigger cash flow. One example would be making a full price offer with interest only payments. The full amount of the loan would be due when you sell or refinance the property. The risk here is that you don’t pay down any of the loan amount but it would be much easier to cash flow. This works well if the market is appreciating quickly. You can cash flow the deal and then flip it in a few months for a big check. Read More→

Presenting Offers – Part 1

Posted on February 10, 2014 by

In our last article, we talked about Constructing Offers, so now we have to decide how to present them. The first step is to decide what your offer’s going to be. If you’ll remember, you can either lease option the property from the seller, you can buy it with owner financing, you can take it subject-to the underlying debt or sometimes you can pay all cash when you’re dealing with FSBOs.

You make this call by looking at the math on the property information worksheets as we discussed last month and deciding what your exit strategy is going to be. Are you going to stay in the deal or get out of the deal by flipping it on an ACTS?

Your next step, when you can get a YES on the property information sheets, is either: I will sell for what I owe, I will lease purchase, or I will con­sider monthly payments. Then it’s time for you to pick up the phone and call the seller to verify the facts you have are correct and to have a preliminary negotiation of what the seller has in mind. This is where scripts are very important, and you must get to the bottom line as to the seller’s true intent before you can make an appoint­ment. Many people who are new in the business go ahead and make the appointment without being clear about whether the seller’s really motivated or not. And, even if they were sometimes, it’s not clear what we’re going to do when we get there even if the seller is motivated. So, before I go any further, let me back track just a hair. Read More→

Money Loves Speed

Posted on February 10, 2014 by

Did the title of the article get your attention? I thought so. Money does love speed. Money in general loves speed. That means getting off your “you know what” and putting in to action whatever it is that needs to be done in your business (and in life). And the faster you do it, the more likely you are to be rewarded for it, financially. This will be one of my resolutions for this year – act with more Speed.

Let’s face it. You’re not getting any younger, the clock is always ticking. And, the sooner you realize the inherent value of speed, I promise you this; the more seriously you take your goals, the more urgency you will build into your daily habits.

Ever watched a commercial for some gadget or concept that you had thought of in the past and said “hey – that was my idea”? It may have been your idea and you should have acted on it. Instead, somebody else did and now they are billionaires. (Yep – I thought of Facebook too, but Mark Zuckerberg beat me to it).

But I’m not talking about just ideas. In general, things tend to work out better when you act on it faster. I don’t recall ever succeeding at something because I got there last.

Naturally, I’m going to relate this concept to Real Estate Investing, where Speed = Money. Because Money loves Speed. Read More→

Every once in a while, I like to take a close look at my business to make sure I’m still reaching my full income and personal potential. Hopefully, you do the same from time to time, because it takes diligence to maintain success for the long haul.

Students of mine know that if something isn’t working well, it means one of three things: their business is underfunded, underexposed, or undermanaged.  This basic principle hasn’t changed since I started investing in real estate in 1997.

But how you meet that third requirement – adequate management – has changed a lot, because one of the keys to good management is the productive use of available technology. And boy, has technology changed since 1997!

Do you remember when a car phone was cutting edge, but it was a huge, expensive, ugly block of a thing with a foot-long antenna. There was no texting, and that phone sure didn’t take pictures, or save documents, or keep track of my appointments, or give me directions, or, well, do anything except make a phone call. And even though I was pretty tech-savvy, I was still very dependent on low-tech solutions like filing cabinets and calculators and old-fashioned film cameras. Read More→

By this time, most people are at least aware that mortgage banks were less than honest in how they created and sold mortgage backed securities over the last 15 years. It has driven a lot of negative sentiment towards the banks since the housing market crashed in late 2007, but very few people have a clear understanding of exactly what the banks did. That is completely understandable because the banks set up an extremely convoluted system of fake transactions specifically to avoid people catching on to what they were doing. In this article I am going to attempt to break it down into simple terms.

As the housing market heated up in the early 2000s, investors began to invest in what are known as mortgage backed securities. These are securities that consist of large pools of mortgages. The idea behind these investments was to capitalize on the housing boom while minimizing their risk.

In order to do this, investors had to work through brokers who compiled mortgages into securities on the investors’ behalf.

The way the investors would invest in these funds was use their money to fund a trust that would acquire mortgages either by originating them as the lender, or by purchasing existing mortgages. In a perfect world, the trust itself would then be the lender or purchaser designated on the mortgage. Read More→

Now that January is past, it’s time to settle in and think about some of the more important but often forgotten items. Chief among them is your beneficiary designations. The person or entity currently slated to inherit your Self-Directed IRA account may no longer be the person you want to inherit your account. This applies to your Self-Directed IRA, accounts under employer plans such as 401(k)s, 403(b)s, profit sharing plans, pension plans, and the many assets you have worked hard to acquire. There are numerous documented cases of individuals or estates inheriting retirement accounts and assets when the owner wanted the beneficiary to be a different party. The following tips can help you to track your beneficiaries and assets:

  • Maintain a beneficiary file: Create a list of all of your retirement accounts/assets and identify the named beneficiaries. If you do not already maintain all of this information in one easily accessible area, now may be a good time to start. This will help you to keep track of both your current beneficiary designations and all of your assets.
  • Perform annual check-ups: Check your beneficiary forms and your Will at least once per year to determine if you need to make any changes. Events involving your beneficiaries may necessitate changes to your current named beneficiaries. For instance, you may have gotten married or divorced, and need to update your beneficiary form to add or remove your spouse or former spouse. Read More→

When working with a Seller on purchasing a short sale it is very important to know the terms and conditions that the new buyer must uphold with the Homeowners Associations. Recently, we started working on a short sale wherein the Seller owed the Homeowner Association a fee of $457.00 per month and another Homeowner Association issue wherein they would only allow the Buyer to be an owner occupant. The Homeowner Association claims that the percentage of rentals have been filled and since that quota was met, this leaves only owner occupants eligible to purchase the property. Now your pool of buyers has been decreased greatly leaving only homeowners to buy the property.

The first thing you need to do when obtaining a short sale or any type of deal from a Seller, that you are interested in purchasing the property to fix and flip or just rent, is to obtain the Homeowner Associations Bylaws. There are Bylaws and Declarations that the Homeowners Associations are to provide to a new buyer. Here are some of the things you must look for to prevent any show-stoppers: Read More→

When you know the best pockets or market areas around the U.S. to find discounted real estate, you are half way home. All that is left is evaluating the inventory for maximum profit. For those of you connected to REIAComps , the control and feeling of confidence you have over your deals is priceless. Using REIAComps to investigate the value of “Shadow Inventory” houses as they come to market, against the recent sold comparables, will provide you a solid position to “make your profit when you buy”.

First, let’s define “Shadow Inventory”. The general definition goes like this; the current stock of properties in the shadow inventory, also known as pending supply, by calculating the number of properties that are seriously delinquent, in foreclosure or held as REO by mortgage servicers, but not currently listed on multiple listing services MLS’s.

CoreLogic released its November National Foreclosure Report with a supplement featuring quarterly shadow inventory data as of October 2013. According to CoreLogic analysis there were 46,000 completed foreclosures in the United States in November 2013, down from 64,000 in November 2012, a year-over-year decrease of 29 percent. On a month-over-month basis, completed foreclosures decreased 8.3 percent, from 50,000 in October 2013. Read More→

In Part One of this Article, we discussed what most people do with leads, a typical wholesale deal, and a few reasons why you might NOT buy a house. And just when things were getting good & was about to reveal how to STILL make money even when you DON’T do the deal, I had to leave you hanging and make you wait until this part of the article came out to reveal the secret. Sorry about that. :)

But here’s where it gets interesting. So keep reading, won’t you?

Typically, if you can’t get a deal negotiated with a seller (usually because they don’t want to accept your low, wholesale price offer), you’d be stuck. You’d either throw the lead in the trash, or you’d ask them if it would be ok to call them back in a few weeks to see how things are going, then remind them of your offer to buy at your low price. Yeah, sometimes you’d get those offers accepted. Sometimes.

So what do you do if you still want to profit on this deal that you’ve already spent some time on?

Here’s your answer. Are you ready? Good… Read More→

Learning About Real Estate Investing

Posted on February 10, 2014 by

If you’re a Baby Boomer or a Gen Xer, then you’re thinking more and more about retirement – mainly, how are you gonna afford it? After all, we all know that Social Security is not much of a retirement plan.

This need-to-know desire is driving lots of folks to learn about real estate investing. After all, more folks have achieved financial freedom from real estate than from all other types of investments – combined!

The question we’re continually asked is, “What’s the best way to learn how to successfully invest in real estate?” Here’s a hint: All those TV infomercials are nothing but hot air. Those “gurus” who come to town offering a “free” seminar are just snakes in the grass…but then, you already know this.

After 19 years of investing in real estate, we’ve learned that the two best ways to learn are 1) Meet with sellers and ask Pete Fortunato’s famous question: “Why are you selling such a nice house like this?” 2) Hang out with been-there-and-done-that investors.

Sure, neither of these ways is sexy, but they are incredibly effective. Gotta add one other thing: You’ve got to do both a lot…once or twice just won’t cut it. Read More→

Marketing to Senior Homeowners

Posted on February 10, 2014 by

One of my favorite techniques for locating motivated sellers in my real estate investing business is to create direct mail campaigns targeting Senior Home Owners in my area. These homeowners are a good source of leads for my business for a variety of reasons.

After having bought and sold hundreds of properties throughout my real estate investing career, I have discovered that senior home owners may be interested in selling a property for many reasons. Most of the time these homes are in nice neighborhoods where people want to live.

One reason a senior home owner might want to sell would be that a spouse has passed away and the remaining home owner doesn’t want to continue living in the property alone. Or perhaps the senior home owner wants to move in with a relative or relocate to another state and sell their home. The homeowner may want to move into a smaller home or an assisted living facility. The home they have for sale may also have been a vacation property they owned or perhaps a retirement home they purchased and now they either don’t want to or are unable to live in it any longer. We have purchased homes that have been inherited by a senior home owner that they simply don’t want or need. Read More→

Why an IRA-Owned LLC or Trust?

Posted on February 10, 2014 by

I am often asked if an IRA-owned LLC or trust makes sense. Well, like a lot of things, it depends. If your normal custodial account is working well for you, there may be little reason to add these structures. But there are situations for which you may want to consider them as covered below.


Promoters push the IRA owned entities as a way for you to have checkbook control over your IRA funds. While it is an arguable point as to whether you should be the manager or trustee of your IRA-owned LLC or trust (we will postpone that discussion until the class next month), there are other reasons to use these entities. For example,

Privacy – These IRA-owned entities will keep individual IRA account holder’s names off the public records. This is true even for low liability paper investments such as contracts, notes, mortgages and options as well as real property ownership. Read More→

What is Your 2014 Headline?

Posted on February 10, 2014 by

It’s the beginning of the year. We all have resolutions, but they often fail. Why? Because we don’t ask the right questions before we dedicate ourselves to the success we want. Consider these questions:

  • What do you need to keep you inspired?
  • What is blocking you from success in real estate?
  • Is it accountability?
  • Is your personal life interfering with your professional life?
  • Are you too negative?

At the beginning of 2014, I focused on goal setting. This year, I want to offer you simple techniques for creating and getting support with your investments.

Let’s begin with raising capital. Keep in mind that even great deals need ACTION ITEMS! Read More→