Tampa Real Estate Investors Alliance Blog

The March 2013 edition of The Profit Newsletter for Tampa REIA is now ready for download as a High Quality PDF or Low Res PDF format. The Profit Newsletter is a digitally delivered, interactive newsletter for real estate investors to read and use with your PC, Mac, Smart Phone, iPad or other mobile ready device. 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! And “Yes”, The Profit is “print ready” and prints out beautifully on your black and white or color printer. Be sure to Subscribe to The Profit so you don’t miss a single monthly issue.

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What is the first thing you need to do for your first or next successful real estate deal? You need leads of course. How many leads do you need to do one single deal? If you are a new investor or even a seasoned one, you may need to go through as many as 10 leads to get one solid, profitable deal.

So how many leads are you generating each month? Are you generating 5, 10, 15, 20, 30, 40 or 50 leads per month? If you are not generating at least 50 leads per month, you are not alone. Most investors don’t generate anywhere near 50 leads per month. In fact, it has been said that only the top 5% of all real estate investors generate and capture 80% of all the leads floating around out there. So what do these top investors know that the average investor doesn’t know?

The answer is simple… the top 5% of all investors know how to generate all the leads they can handle and more. Perhaps you know some of the top lead generating real estate investors in your area. Chances are you see their marketing efforts every time you turn around.

One such investing company that you should all be familiar with is HomeVestors^®, the nice folks with the “We Buy Ugly Houses^®” signs all over town. HomeVestors^® used to be a huge 800 Pound Gorilla before the housing market crash, but as of mid-2012, they are back in force and are quickly regaining their marketing dominance once more. 

An “800 Pound Gorilla” is “One that is dominating or uncontrollable because of its great size and power” or “An overbearing entity in a specific industry or sphere of activity”. An 800 Pound Gorilla is “A seemingly unbeatable presence always to be reckoned with, whose experience, influence, and skill threatens to defeat competitors with little effort.” As the number one home buying franchise in the country, you can see how HomeVestors^® definitely fits the description of an 800 Pound Gorilla Marketer. Read More→

Kim and I are teaching a financial calculator course later this month (February 23, 2013). Yesterday, an investor called to ask whether he really needed to take the course. I explained that a contractor’s most important tool is a hammer, a NASCAR driver’s most important tool is a racecar, and a real estate investor’s most important tool is a financial calculator.

After a bit of discussion, the investor said he’d pass on the course because it would be a waste of time. Out of curiosity, I asked how many real estate investing seminars he attended each year. His answer wasn’t surprising: NONE!

Here’s the funny thing: Even though I teach a financial calculator course, want to guess where Kim and I are this weekend? We’re in Vegas attending Gary Johnston’s Money Not Math seminar – it’s a three-day intensive financial calculator course.

I already can make a financial calculator sing and dance. For years, I’ve taught folks how to use them. So why do I “waste my time” taking financial calculator classes? Seriously, I want you to answer this question! Read More→

Throughout the late 1990s and early 2000s, we experienced an unprecedented housing boom. Easy credit flooded the marketplace and home ownership surged to unheard of levels. Along with inflating an unsustainable bubble, the housing boom created a rich climate for mortgage fraud.

The bust that followed changed the nature of the crime, but it has also provided continued opportunities for mortgage fraud. Fortunately for homeowners, there is a new wave of investigative agencies emerging that are trying to figure out just how widespread and insidious the mortgage fraud epidemic is. Investigators hope the increased awareness will help to educate the general public about the threat that these crimes present.

The scary fact is that fraud continues at astounding levels. The allure of mortgage fraud is clear – it can generate amazing profits with a relatively low risk of discovery. After all, there is a byzantine mess of laws and regulations that govern the finance industry and keep all but the most ardent investigators from figuring out exactly what fraudsters are doing and how they can be prosecuted. Read More→

To Deed…Or NOT To Deed? THAT Is the Question
(When Buying Real Estate)

Welcome back again! If you’ve been keeping up with my last 2 articles, you’ll remember that we’ve been discussing one of the best strategies for doing deals in 2013 & beyond – Wholesaling Pretty Houses!

This type of deal is most advantageous for you, the investor, to do when you’ve come across a house that’s overleveraged or has very little to no equity. Rather than walk away from the deal because you believe there’s no money to be made, you simply get an agreement from the seller to find a qualified tenant buyer to occupy the property on a rent-to-own basis (aka lease purchase) & have the tenant-buyer make the mortgage payments until such time as they’re able to buy the house outright with a new loan and there’s enough equity in the house to justify them doing so.  You would collect your money from the tenant buyer as an assignment fee for getting them in to this house buying opportunity that you’ve negotiated.  Make sense?

Naturally, you would then be completely OUT of the deal from that point on.  Why would you want to stay in? There’s no more money to be made, so it’s best that you collect your money (usually $5k+) and get out quickly.

So let’s take a moment to look at some types of deals where you WOULD want to stay in & why. Read More→

Making creative offers is one of the most lucrative skills a real estate entrepreneur can master. Creative offers lead to creative financing and creative financing leads to faster financial freedom. I have built a portfolio of almost 400 units and I have never walked into a bank, qualified for a loan and put money down. I have a lot of bank loans now, but I took control of each property with some form of creative financing and then refinanced at a bank.

I did this by understanding one simple concept- “Solving people’s problems pays well!”

The first step to making offers that get accepted is to create an offer that solves one or all of these three problems; the seller’s problems, the properties problems, your problems.

You will need to gather a bit of information to effectively make your offer. Start by asking about the seller’s motivation to sell. Don’t always assume that money is the only motivation for a sale. Sellers often have other reasons for selling such as dealing with bad management or need to retire. Whatever the motivation is, finding a way to solve that person’s problem is key to writing an offer that gets accepted. A master lease works well for these situations. Read More→

“The right tool for the job” ~ slogan for True Temper Tools

Congratulations – you made it through the winter and spring is on its way! I think spring is a perfect time to take an inventory of your real estate investment “tools.” And if you’ve been sitting on the sidelines, wondering if real estate investing is for you, spring is also a great time to dive in! Either way, it’s a good time to get back to basics. Today, let’s focus on one of my favorite investment techniques: “subject to” mortgages.

Most of you know that when you buy a house, you usually receive a warranty deed, which gives ownership of a piece of property. If you’re paying all cash for a property, you just exchange the cash for the warranty deed. So far so good.

But if you don’t have all the cash, you have to borrow the money. Most of you know how the typical mortgage loan works: Buddy Banker says, “Sure, just sign this promissory note that says you’ll pay it all back.” In return, you get a security instrument that says if you don’t pay the promissory note, the bank gets the property. In most states, that security instrument is the mortgage (In Georgia, we use security deeds). That mortgage, when it’s recorded, creates a lien on the property. In other words, the bank puts everyone on public notice that if the owner sells or transfers the property, the bank has to be paid off first.

A “subject-to” transaction is a little different. When you buy a house this way, you’ll take over payments on the original mortgage. You’ll bring the house up to date on the mortgage and back taxes and then continue to make mortgage payments, subject to the existing financing. The seller gives you a warranty deed, which conveys ownership to you. That means you get the tax benefits and the profits, but you also get the headaches and costs. Read More→

“The generous soul will be made rich, And he who waters will also be watered himself.” (Proverbs 11:25-26)

Have you ever asked yourself the question, “how much should I give to my church or synagogue?” This has always been a touchy subject, with many different views. Of course, the answer is always personal and depends on the person’s relation with God; as well as their involvement with the activities of their local church or religious organization. The responses and personal opinions of many successful business people are as varied as the individuals themselves.

However, the Bible has much to say about this subject. The reality of the matter is the same with all of our material possessions. God allows us to control, manage, and enjoy our earthly belongings for a finite period of time. After that, another person will get them and be given the opportunity to do the same. You see, every material or visible asset that we say… “I own ___”; will either be consumed, traded, given away, taken away, or left behind for someone else when we die. Consequently, since these assets are temporarily under our control, it is vitally important to consider to whom and to what cause we contribute them. Read More→