Tampa Real Estate Investors Alliance Blog

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With a degree in finance and over 15 years of experience investing in real estate, I thought I knew how to structure my cash flowing investment deals correctly, but I didn’t, and chances are, neither do you.

Most investors know how to calculate returns, but very few understand how to quantify and minimize the risk in their deals, which can (and usually does) destroy their chances of creating long term success.

I was one of the many investors (99% in fact) who thought I knew how to structure my deals correctly when I actually did not. Then I discovered The Wealthy Code and it changed everything for me, just like it has for hundreds of other investors all over the country.

So what makes The Wealthy Code Workshop different from any other training out there? Well, A LOT! Here are just some of the things you’ll learn (AND PRACTICE) when you attend this training: Read More→

Consider this… You find a good piece of income producing real estate that you decide to buy.

You have little money to buy it, but you decide to use whatever money you have as part of your down payment.

You get qualified for a 90% LTV loan.

You call around and you are able to raise the remaining money from your close friends and family for the remaining down payment. You promise to pay them a generous interest rate of 8% for lending you their hard-earned money.

The following month, you find another good real estate property that you decide to buy.

You have no money to buy it, but you know you can raise the money.

You get qualified for a loan with 90% LTV.

You call around and you are able to raise some of the money from your close friends and family. Again, you promise to pay them a generous interest rate of 8% for lending you their hard-earned money. This time, you remember about a line of credit you have, and so you decide to use all of it to close the deal. Now, you have raised all the money to buy this property. Read More→

Last month we began talking about commercial properties. This month we will continue talking about opportunities you can find with small apartments, self-storage, large apartments, shopping centers, office buildings and industrial.

I think of my friend, Lance Edwards, who specializes in small apartments. Small apartments meaning anything from 4 to 100 units. In fact, Lance will be at our upcoming boot camp in August, and he will be at the summit in February. Lance is very successful in that small apartment niche.

And there’s self-storage. My friend, Scott Myers, is the king of self-storage, he has hundreds of units starting from scratch with no money or credit and has built an empire by buying and redeveloping or by buying land and building self-storage units on it, which has always been a hot commercial component in the market because even when people use their homes, they still need a place to store their Junk. Did you know that self-storage is the only type that you can literally get 100% financing on? That’s how much the banks think of self-storage. Scott will also be at my commercial boot camp, and he is a wealth of information when it comes to the self-storage business. Read More→

Let’s say you’re behind on your mortgage and the bank has filed foreclosure. You look into it a little bit and you see that your loan was securitized and sold as part of a big bundle and has been traded around the banking industry for the last 5 years like almost every other mortgage out there. You decide you’re going to take action and, using the rules established in the Truth in Lending Act (TILA), you send a notice of rescission to the bank and anyone who might try to claim ownership of your loan. The 20 days have passed and all the bank has done is sent you a letter saying they’re not going to honor the rescission. If you’ve been reading my previous articles you know that holds no water, and that by operation of law your note and mortgage are void. You can now be expecting the bank to return your canceled note, remove it from the property records, and return all of the money you ever paid on the loan, right? Wrong. You still have more work to do.

While the Supreme Court has given homeowners some power back against the banks with the January’s Jesinoski ruling, the chances are you will still need to take the bank to court to enforce the rescission. You’re going to want to move quickly because after one year from the rescission, you lose all right to the money that you paid the bank for the loan. The mortgage is still void, but you’re never going to get your money back. On the flip side, after a year the bank can no longer collect any of the money that you received with the loan. Read More→

Many people want to invest in real estate “if I could only find the cash for the down payment on a property or two.” But for many would be investors – the answer to getting started in direct real estate investment is right under their nose: You can use a self-directed 401(k) to invest in real estate.

Techniques

For Employees

If you don’t own your own company (so you can become the sponsor of your own 401(k) plan, you have a couple of options:

Borrow. If your plan allows, you may be able to borrow up to $50,000 or 50% of your account value (whichever is less) to invest in real estate in a taxable account. If you go this route, understand you only have five years to repay the loan. Otherwise it’s considered a taxable distribution and if you are under age 59½, may generate penalties to boot. Read More→

I’m writing this on Friday, October 9, 2015. It’s a heavy day for me. Today is the sixth anniversary of Jack Miller’s passing, and for the past few days he has been frequently on my mind.

Many of you have never heard of Jack Miller; even fewer took the opportunity to learn from this great man. Jack, hands down, was the best all-around real estate investor I’ve ever met. He was the definition of original. There was no boundary he wouldn’t push.

Put simply: Many of the creative deal-structuring and funding techniques investors use today were born in Jack’s wonderful imagination. There has never been, or will ever be, another Jack Miller.

I wish I had a do over. Although I attended most of Jack’s seminars, there were more than a handful that I missed. If I could get that do-over, I’d be front and center at each one of the meetings – taking notes like crazy!

Kim asked what I’d pay to attend just one more of Jack’s seminars. I said one hundred thousand dollars wouldn’t be too much. God, to hear Jack ring his big bell that let folks know that class was back in session…yep, one hundred thousand dollars would be well-spent money!

When Jack passed, he was nearly eighty years old and at the top of his game. Here are some of Jack’s quotes I wrote down at his February 2009 Money Matters seminar…which turned out to be the last seminar he taught!
Read More→

I have spoken with several Realtors and Investors who say that they don’t like short sales and I always ask them “WHY?” They tell me that the Short Sale Lenders never come back with a value that matches the offer that they have on the property. I always ask them did they go out and meet the real estate agent or the appraiser who was sent from Short Sale Lender to provide the value back to the Lender? Their answer is always “NO.” In fact, many Realtors who list short sales will list high because they are paid on commission thinking that the house should sell at list price. However, they never take into account all the repairs needed or the updates that are required to allow the house to obtain an appraisal at list price. Therefore, their short sale sits for months and ends up going to foreclosure sale. In fact, because they said they didn’t go meet the BPO Agent and just gave them the lockbox code or they have an electronic lock box on the house, the BPO Agent is able to get into the house and only spends about 5 minutes at the house.

As a Real Estate Broker who gets commission on short sales, I would always like to get as much as I can, however, not meeting the BPO Agent can cost me big time and big money. Read More→

Over the past six months I have discussed excuses on why people are failing in the real estate business. I had discussed the excuse of lack of money, the excuse of lack of time, the excuse of lack of leads, the excuse of lack of a system, and last month I did a piece on accountability partners. Each one of these segments has been designed to eliminate the distractions and excuses for individuals that are desiring to get involved in real estate and are not accomplishing anything. This month I want to discuss how persistence and consistency will get you to your financial goals faster.

I go to the gym on a regular basis. There are individuals in the gym every time I am there, and I typically go 5 times a week. I have noticed that those individuals who are dedicated to their weight training and eating right have absolutely incredible bodies. The individuals, who come inconsistently, do not have the same success. For example take the individual who comes in on Monday and because it’s a Monday decides that they are only going to do a short exercise routine. That same individual on Friday decides that “hey it’s Friday and I will just do a light day”. That same individual comes in and spends 20 min. talking to everybody and socializing. That individual is not making head way on their exercise routine, maintaining their weight, and eating right. There are individuals who say that they are doing all of the right things, however their actions speak louder than words. These “quasi health nuts” are consumed by distractions and excuses. Read More→

“Measuring and laying out a room in advance can save you a lot of headaches.” ~ David Bromstad

Design for iPad By Black Mana Studios is one of my favorite apps. I usually don’t bother with apps if they exceed $3, but I heard good things about this. I think it’s worth every penny to be honest. I’m not colorblind, but I do struggle sometimes with how to pair materials and textures together. This app doesn’t build a lush virtual world, but it gives me a base to plan interiors that don’t disappoint.

It is a drag and drop interface, which is great since you can change things around in an instant. I find that the color and materials palette has great variety, so I can find that same wood finish or paint color (or something close to it) when I get to the big box store or wholesale warehouse.

This app is really useful with placing furniture too. It has a lot of different options to offer with sofas and tables. You can find items that you already purchased and arrange them before you move them. Or you can play with shapes and placement before you commit to buying anything. I found the dimensions to be very accurate. Read More→

Almost two thousand years ago, the Roman leader Julius Caesar used three bold words to describe a quick victory he accomplished in a war: “Veni. Vidi. Vici,” meaning “I came. I saw. I conquered.”

The fact that we, as a species: 1. Still know who Caesar was, 2. Still know what he said that long ago, and 3. Still hold him in high regard – is a testament that he did some great things in his time.

So how the heck does that apply to you as a real estate investor? Or anything else, for that matter?

It actually applies in many ways. You see, Caesar was the kind of guy that didn’t really mess around. He went to work and handled his business.

If Julius Caesar was a real estate investor in today’s times, he’d probably be someone like a Donald Trump. Wait…Did I just compare Caesar to Trump? Yeah, I guess I did.

In fact, I can pretty much assure that any time anybody did anything worthwhile, they were acting in a BOLD way.

Want to run for President? (on any level, even Grade School) You’ve got to be BOLD. Read More→

Over the past two months I have written about using “Paper” assets as income for your financial future. But did you know you are already using “Paper” for debts you personally owe. I am sure most of you have some type of consumer debt you pay every month. Every one of those individual consumer debts is also a form of “Paper” owed someone else. Your creditor’s hold a form of “paper” you signed and agreed to pay. Consumer debts are a drain on your monthly cash-flow and the sooner you get those debts paid off the sooner you will be able to use the money you no longer have to pay out every month for a better lifestyle or to invest and grow your financial future.

If you have never thought about your consumer debts as another form of “Paper” but as paper you owe I believe it’s time. I’ve decided to give you a very important lesson how you can use the “paper” or debt you owe for your own personal debts that are working negatively for you and show you a simple strategy that can help you become free of those high interest debts you owe in the shortest possible period of time. If you understand this simple strategy, it will make a huge difference in the quality of life you are seeking once you become debt free from the debts you personally owe. I believe this is a good place to really learn how “paper” works sitting at your own kitchen table so you better understand how to quickly eliminate the debts you owe. Read More→

In these days of the real estate sites like Zillow and Trulia, the marketing and lead generation tools on these sites draw millions of page views every month. What you shouldn’t be doing as an investor, home buyer or seller is using the value estimates on these sites to make decisions.

Truly good real estate investors know the valuation of their deals is key to insuring success and protecting projected profits. To effectively determine if a deal is a rental building wealth or flip to make some much needed cash, you have to analyze a deal fully. All the market areas covered by REIAComps, insure you easily know which way an investor should go.

Even Zillow will tell you that they aren’t always on the money. They have a chart of median error percentages in estimates in major cities, and they run mostly between around 7% and 9%. That’s around $16,000 on a $200,000 house, so you don’t want that kind of number in your research for a wholesale or flip deal for sure. Feel free to use a Zestimate for a quick idea of approximate value, but what you want to do to arrive at an accurate market value is what real estate agents do; develop a CMA, Comparative Market Analysis. Read More→

In many past articles I have stressed the importance of knowing the current real estate market. You should take note when property prices are rising, falling or plateauing. If you are a flipper, is your inventory selling faster or sitting on the market longer? If you are a wholesaler, are you having to work harder to find deals or have you suddenly found an abundance of deals? Are the deals you are finding getting easier or harder to sell? If you are a real estate agent or work closely with one, is his/her listing receiving multiple offers and flying off the board? Or are they sitting on the MLS with a few showings here and there? These are questions you should always be asking as a real estate investor.

One can always pick up an article or see a news report about what is going on in real estate but it is usually a report of real estate as a nation not just your market place. Most realtor associations have monthly reports that are helpful but they are not out until the middle of the following month. As an investor, even these reports may be too late in providing the information. If you are in real estate or plan on being in real estate you must keep your finger on the pulse. If you are doing plenty of business you will feel the change in the market and can begin to prepare for it immediately. However, if you only dabble in real estate, you might not know what is coming around the bend. If you dabble or are just getting started make sure to network with people that are full-timers. If you find a deal you plan on flipping or holding on to for a rental, discuss it with a veteran investor. They can mentor you on the best option and possibly keep you from making a mistake. Read More→

Finding ways to attract motivated sellers to your Real Estate Investing business is probably the most important element in your business, since without the motivated sellers, there are no deals to be made.

There are several different ways to find motivated sellers for your real estate investing business using a shot gun type of approach to locate as many sellers as you can. A shot gun approach is where you “blast” your message out to your market and hope that there are motivated sellers among the bunch. Some of these techniques include yard or vehicle signage, business cards, t-shirts and hats, door hangers, pens, buttons, business card magnets, flyers and auto shades. What I really want to focus on today though, is using business cards to locate motivated sellers.

When having business cards printed, there are a couple of things you want to keep in mind. One is that your business card needs to have a grabber headline and it needs to catch people’s attention by looking different from every other business card out there.

Use bright colors and a benefit driven message on your business cards. List the reasons on your card why that seller should work with you and how you can help them. Remember business cards are a highly effective inexpensive lead generating tool for your business. On your business card, you want to provide your potential seller with a couple of different ways to contact you so they can contact you in the way that is most comfortable for them. So for example your card might include your phone number, your email address and a website for them to check out. The more ways you give a potential seller to contact you, the more of them will. Read More→

We’ve all been there. We go through and estimate repairs on a property and miss something. Sometimes, that something may be minor however it could be quite significant. This tends to happen when the rehabs are larger in scope or have a structural or foundation issue that needs addressing. I don’t usually see wholesale courses that teach how to address these sorts of things when dealing with these points beyond generalities. However, generalities is usually not going to get this done right and does little to build confidence in Buyers.

While Buyers of course are expected to do their own due diligence, it has more than frustrated countless Buyers when wholesaler numbers end up being way off due to this common ignorance. I thought I would take some time to outline some common figures for our market for a variety of these often overlooked items. Take this and adapt it to your area and this will give you a solid starting point. Read More→