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A Real Estate IRA is a great opportunity. It’s freeing. It’s invigorating. It’s a thrilling way to potentially build up a major retirement nest egg so you can build wealth over the long term and enjoy the peace that comes with financial security. But that doesn’t mean it’s fool-proof, either. If you want to make the most out of a Self-Directed IRA in which you invest in real estate, you have to avoid some critical errors along the way. Here are four you need to be aware of:
Mistake #1: Not Hiring a Property Manager
Hiring a property manager is critical when you have a Real Estate IRA. Not only will it help take care of any problems with repairs, tenants, and other issues like that, but it will keep you from participating in a prohibited transaction since you are not allowed to provide services to your Real Estate IRA. Read More >>
If you plan to have multiple employees using QuickBooks, you can limit their access to specific areas.
Controlling access to your QuickBooks company file is easy when you’re a one-person accounting department. You simply use one password to protect your data.
But when you add new employees to the mix, do you want them to have access to absolutely everything in QuickBooks? Probably not. You have confidence in your employees or you wouldn’t have hired them. But this isn’t solely a matter of trust. It’s just good business practice to restrict individuals to specific areas and responsibilities, no matter what the application.
That’s why QuickBooks has built-in tools to help you limit activity. Here’s how it works. Read More >>
“What do YOU do for a living?”
Those words can strike fear and paralysis in the hearts & minds of the tragically unprepared. If you’re newly in business for yourself, or have just never really gotten your head properly wrapped around HOW you should respond to this powerful question, you’re sunk. Handle it the right way, and you’ll be rewarded with confidence, respect, and a fatter bank account.
And that’s exactly what we’re going to cover in this article. So shut off your Facebook & keep reading…
It never fails. You’re out at a social event, taking a flight somewhere, or maybe you just strike up a casual conversation with someone somewhere sometime. If you’re both adults over the age of 25 or so, the question eventually comes up, “What do you do?” Read More >>
When I am purchasing a property either for myself or with my student/partner, we determine which exit strategy is the best for both parties. Knowing whether you want to wholesale a property for a small profit or rehab/retail it for a big profit is important. Many investors start off with wholesaling the properties because they either don’t have a money lender or partner to help them rehab/retail the house and sell it for a bigger profit. If this is you, then I believe you really should find a partner or money lender so you have more than one exit strategy.
When you purchase a short sale, some of the lenders will put a hold time for the new buyer requiring them to hold the property for 30, 60 or 90 days before they can resell the property for a profit. In addition, they may tell you that you can only make a certain amount of money on the property if you sell it earlier than 90 days. Holding doesn’t bother my student/partners or myself because we normally choose to rehab the property and retail it for a higher profit. Read More >>
“I am thankful to all the souls, I meet in the journey of life.” ~ Lailah Gifty Akita
Touchnote App is a familiar app to many. It’s commonly used to create eCards for birthdays and holidays, as well as printing applications like greeting cards and framed photos. I have found a way to use this for my own needs that are unique to my business.
Using this app has freed up some of my time. How to gently and politely notify a homeowner that I have an interest in their home without knocking on the door and intruding on their routine. I’ve utilized the Touchnote App to reach out to these potential clients. I usually drive looking for vacant homes in particular. I just take a photo of the house and look up the homeowner’s address in the public tax records. I write a simple message explaining that I’m interested in buying the property. It’s so fast and takes the time and thought out of trying to reach out to these homeowners by phone or physically printing and paying postage on a postcard. The cost is $1.99, which is very reasonable. You can also reduce this price even more by buying in bulk, making the cost $1.50. Read More >>
In this article, I want to discuss a simple way to develop peace within, while in the midst of the chaos that many of us live.
We spend our lives thinking that there is some end goal, some place where we can be that will finally bring total happiness. Then to get there we set crazy goals that consume most if not all our time.
You know the saying, “live like no one else today, so you can live like no one else tomorrow” a popular Dave Ramsey quote that is interesting to ponder. There is nothing wrong with dreams, setting goals, and hard work but the illusion that there is some destination, or some sanctuary that will save you is what I’m addressing here. Read More >>
Implementing the right list and using the right letter when creating your direct mail campaigns to locate motivated sellers is crucial to your success as a Real Estate Investor. There are lots of different ways to find these lists and lots of different types of lists to choose from.
The easiest way I suggest to locate a list to use for mailings is to simply go to your property appraiser’s office or auditor’s office and have them create it for you. There are many different parameters you can use to create these lists.
Some of the lists you could create might be directed at out of town owners, deed transfers, zip codes ranges, sale dates, estates, evictions, delinquent taxes or pre-foreclosures. These can all be good lead sources for you to use to find motivated sellers and these are lists that I use in my business on a daily basis in addition to several others. Read More >>
Making money investing in real estate begins with determining the actual value of the property. This is the most important out of the many factors in real estate. The price of the property is determined with real estate comparables or comps. Being that this is the maximum amount a seller could expect to receive for a given property, it becomes the starting point for negotiations. This is where you, as a real estate investor, make your profit when you buy the property. Mess up here and it could become difficult to make money on the deal or at the very least the ideal profit you had hoped for.
When researching a property, you begin by comparing your target property with those in the surrounding area. Be sure you know the details of your property. The square footage, beds/baths, year built and location of your property are important criteria for determining how closely these other properties match or compare to your subject property. Read More >>
Wholesaling is probably one of the easiest, yet most deceiving aspects of Real Estate out there. There is no shortage of people sharing how to be a wholesaler from online courses to packages to free videos. When looking at all the information available on the subject, how does one know which information is correct (including this article)?
As someone who has run a wholesale group in our market now for over four years, I am going to share with you the qualities required to be in my opinion a successful wholesaler. Our team has the privilege of being well connected and knowing most of them in our market. Having wholesaled tons of properties and observed others doing the same, here are the qualities you will want to have to be a successful wholesaler. Read More >>
Over the years I have heard every excuse you can think of why real estate investors today aren’t busy buying houses. One thing I know for sure is that the biggest reasons why most real estate investors are struggling to buy real estate are:
Let’s talk about “Fear” first. Fear is probably the biggest reason many inexperienced real estate investors don’t have more success doing deals and why many walk away and give up and look for other ways to make money. I know for myself, when I started learning to buy real estate, I had no money and poor credit, plus I had no training. This caused me to be afraid to make any kind of offer to buy real estate. Read More >>
Had a good conversation with an investor friend about the financial collapse of Greece. The country is so broke that not only can it not repay its loans, it can’t make its note payments either. What’s Greece’s solution to this financial meltdown? They want to borrow even MORE money!
It’s crazy for anyone – including a country – to believe that the way to get yourself out of a financial hole is to dig it even deeper! Yet that’s exactly what Greece – and way too many American families…and America herself – is doing.
Jack Miller, my long-time teacher until he joined the other angels in heaven, taught us how to avoid the certainty of poverty. He also shared what he had learned from Warren Hardin: It’s inconvenient to be physically alive but financially dead! Read More >>
Chattanooga REIA's newest group The Haves, Wants & Exchangers Group (HWE) (Howie) is group of Real estate investors and exchangers who meet with the sole purpose of finding inventory and creating transactions that benefit everyone involved. In this type of setting, even the beginner can find a deal and make a creative transaction. It’s educational, informative, and a great experience for all investors. Everyone, no matter their skill level or situation, has the opportunity to be the catalyst in a transaction in this type of meeting. HWE meets every 2nd Thursday at 11:30AM ET for lunch and on the 4th Thursdays for dinner at Wally's Restaurant in East Ridge.
HWE is led by Shane Wilson, local real estate investor and Re/Max real estate agent. If you Have something you do not want any longer, Want something you do not have yet to help you in your real estate investing, or want to Exchange something you have to what you want, this is the group to tell others about it!
Here is our schedule which is subject to change from time to time, especially around the holidays. Be sure to check our calendar for the most update dates and times.
If you are a new or experienced investor looking looking to buy or sell houses, notes, vehicles, borrow or loan money for a deal, antiques, whatever of value, this group is for YOU! Be sure to bring your deals, property flyers, business cards, contracts and Let's Make a Deal or Trade!
Have you been a “real estate investor” for several months or even years without doing your first deal? What is holding you back? Fear? Lack of money? Credit Problems? Lack of Focus? Are you afraid you will screw it all up? If so, there is a new investor group for you… “BIG”, the Beginning Investor Group! This group focuses on the defeat of fears, or act in spite of them to do that very important first deal. We want to help you break through those mental barriers. Inspire you to act. Crystallize your focus.
Why make such a big deal about your first deal? Well, it’s the hardest deal you will do, but once you get through it, your belief in yourself and real estate investing will rise dramatically. You will be on your way to becoming a true real estate investor.
BIG will meet once a month, the third Wednesday of each month and our first meeting is on Wednesday, June 21st at 6:00 PM at Wally's Restaurant, 6521 Ringgold Rd in East Ridge. We will have experienced local and regional investors speaking on relevant topics to help unlock that mental block. We will also have mentors that can take you by the hand and can walk you through that first deal.
Our debut topic is "Your First 90 Days in Real Estate Investing” with Don DeRosa as our special guest speaker. If you are new to the game, or have been spinning your wheels for a while, Come join us! There will be plenty of "A-HA!!" moments, and perhaps you may walk away with the final piece of inspiration you may have needed and do that deal! If you haven’t passed over the first deal hump, you don’t want to miss this meeting and taking part in BIG. We will see you there!
The Chattanooga REIA Beginning Investors Group (BIG) is an educational and networking special interest group for new investors who are just getting started in real estate investing as well as “new again” real estate investors who’ve taken a few years off and are looking to get back in the game. BIG is hosted by Alan McDonald, who will be bringing in local and regional real estate experts to teach new investors how to survive and thrive in our ever changing economy and real estate market. The entire purpose of this group is to help new investors get their first deal and help new again investors get their next deal!
The Beginning Investors Group meets on the 3rd Wednesdays of each month from 6:00 PM to 8:15 PM at Wally's Restaurant located at 6521 Ringgold Rd, East Ridge, TN just off of I-75 at Exit 1. BIG is FREE for Chattanooga REIA Members. Guests and Not-Yet-Members will eventually pay a fee, but for now, there is no charge for anyone that attends. This is a “dinner” group and we kindly request that you buy dinner and/or drinks since Wally's allows us to meet there. There will be lots of learning and lots of networking. Bring your deals and your haves, wants and needs to the meeting for discussion.
When it comes to making money as a real estate investor, nothing is more important than the ability to generate high-quality buyer and seller leads. After all, if you have no buyers and sellers to talk to, your skills as a savvy real estate investor never even come into play.
If you are going to be a successful investor, you must be a successful marketer! The good news is, generating motivated buyer and seller leads is pretty easy with a little time, effort, creativity and a reasonable monthly marketing budget.
In this special one-of-a-kind workshop, Dustin Griffin and Don DeRosa will show you those proven, effective, affordable methods you can use for little to no cost to generate waves of valuable leads day after day and month after month to achieve your financial goals.
Learn Low Cost, Low Tech Marketing Tactics to Generate Leads such as:
You will also learn:
If you're at all disappointed with the amount of money you've been earning in your investing business and are fed up with all the time you've been spending trying to figure out how to get more leads and do more deals... then come Join us at the Guerilla Marketing Workshop Training Series. Here we will teach you how to dominate your local real estate market both offline and online to generate all the motivated buyer and seller leads you need to run a successful home buying business using many free or affordable marketing techniques.
Don't miss this opportunity to learn the marketing skills you need to know to start generating an endless stream of real estate buyer and seller leads for little effort and little expense. Register now before this event sells out!
Guerilla Marketing 1.0 takes place on Saturday, June 24th from 9AM to 6PM at 3125 Presidential Pkwy, Atlanta, GA. We would love to help you take your Real Estate Investing to the next level by generating all the motivated buyer and seller leads you can handle! Read More >>
If you’d like to invest in real estate, but you can’t afford to buy property – don’t despair! Think about renting from owners who are saddled with ‘inconvenient property’ and negotiating the right to sub-lease their property to others. This is Master Leasing - the leasing of a property from an owner and then sub-leasing that same property to a tenant. I believe Master Leasing is the most economical way to get started in the real estate business today. It is a way to produce an immediate income stream without large amounts of capital.
Master leasing is an incredible tool, which can benefit both owners and investors.
It will lose an owner less than he is losing with a vacant property and it will insulate him or her from dealing with sub-tenant occupants. Master tenants are not agents of the owners, but rather entrepreneurs who are professional landlords. This gives a master tenant the flexibility to tailor a lease to the specific needs of each owner. They do not offer a ‘one size fits all’ solution, as do most property management companies. Since they are not agents working for the owner, the owners cannot be held vicariously liable for any of the actions master tenants take with their sub-tenants. This alone can reduce the owner’s liability dramatically. Read More >>
I also like to use my personal Credibility Kit to find more private lenders for my Real Estate Investing Business. You already have all the information about yourself and your company and deals you have done in one place to show your potential lenders.
Looking through your Credibility Kit leaves no doubt in a lender’s mind that they will be making a good investment in you and your properties. Plus, you have references available if they would like to see them and follow up with any of them. I also give my potential lenders an abridged copy of my Credibility Kit in case they know of someone else interested in loaning me money for my deals. This is a great way to build this part of your real estate investing business! Read More >>
From 2013 through 2016, Kim and I have rarely been the high bidders on a property at the foreclosure auction. Why the dry spell? Because the cheese has moved! For example, from 2007 through 2009, the best deals were found buying short sales. From 2010 through 2012, the best deals were found buying at the foreclosure auction. From 2013 through 2016, the best deals have been found by buying pre-foreclosures. Remember, the cheese is always moving. To be successful, you can’t keep going back to where the cheese was – you must go to where it is today!
Here are the basic steps Kim and I follow when bidding at the foreclosure auction. (NOTE: Be aware that each state’s foreclosure laws are different.) First, in Georgia, before a property can be auctioned for foreclosure, it must be advertised in the county’s paper of record for four consecutive weeks before the auction. Call your county’s Clerk of Court’s office and they will tell you in which paper and on which day(s) the “legals” (including foreclosure notices) run.
On the day the foreclose notices first run for next month’s auction, we buy that paper and transfer the foreclosure info in the paper – which is difficult to read – onto our Foreclosure Sheet – which make it much easier to read! Read More >>
Many Investors avoid working with Sellers in pre-foreclosure or making offers on short sales. They all say the same thing, it takes too long! I strongly disagree with this decision. I have been working on short sales for years now and even though it does take a few months, it has been the best deal spread in profit that I have ever received on any type of deal. Let me tell you why you should consider working with Sellers in pre-foreclosure and making offers on short sales.
The Pre-foreclosure market will continue to flourish due to the adjustable rate mortgages, loan modifications and reverse mortgages that banks have provided to many Sellers. A lot of the Sellers in foreclosure will have second mortgages that can be discounted to pennies on the dollar. Sellers that are doing a HAFA short sale program requires the second lender to take a maximum of $8,500.00 on their second mortgage. Read More >>
It is about time that you are making your very first “get the money” presentation. I am not going to tell you much about my first presentation for money, since it was so long ago. I think I was 3 years old and wanted some candy. I am sure it did not turn out very well. I think I did the presentation in front of the wrong audience and I was not very professional. My ‘ask” presentations have gotten much better especially since I know how to effectively raise capital today and every day.
How can you get prepared to make your first professional “ask” presentation? The first thing you must do is place yourself in front of the right audience. If you are doing the presentation in front of a group of people without any resources, you might as well be talking to the wall. If you are talking to people who have shown interest and know something about what you are working to achieve then your chances soar! So, think of doing a presentation in which the potential investors in your project have a mix of people who know you and people who don’t have a clue as to your reputation, experience level, motives, or character. The great news is the people who know you will probably advocate for you. Read More >>
If you invest in residential rental property in your real estate IRA for any significant length of time, sooner or later you will probably need to consider evicting a tenant.
There are several possible reasons you may need to evict someone: The most common, by far, is the non-payment of rent. Other common reasons include drug or other criminal activity or material violation of lease terms. Sometimes you can resolve these issues painlessly, by giving the tenant a little extra time, or by sending a notice to cure or quit the premises. But when these measures don’t work, a real estate IRA owner will have to ‘landlord up’ and begin eviction proceedings to get the tenant out.
Before you begin evicting a tenant from your real estate IRA-owned property, read this first. Read More >>
In Part One of this article, we discussed YOU and why you do the things you do. Specifically, we talked about WHY people do or don’t do things for two primary reasons: To gain pleasure or to avoid pain. This is also known as the Carrot or the Stick - the carrot is something good that we want, while the stick represents the pain we don’t want.
We also mentioned a few common things that most people in this world want/desire, like love, money, and good health as well as a few things that most people don’t want/are afraid of, like fear of missing out, getting hurt, rejection, or clowns. ;)
Finally, we talked about some stuff that you might not like - why you may not be as successful as you’d like to be, or why you don’t always do some of the things you know you should be doing.
In other words, we started with YOU. Still stuck on that? Ok, go back and read the article again. But if you’re ready to move on, let’s go... Read More >>
I know last month’s article was a little depressing but it was important and here’s why: We take daily actions in pursuit of a better life, to move away from pain and towards happiness, while the underlying emotions of fear and greed drive us. It is within these actions that we should investigate and become aware of their effects. The “better life” has a price and that price is unknown. The “better life” is culturally conditioned.
I remember one time when I was a kid I was grounded for the day, and I sat at my window staring out with my nose pressed as close to the screen as possible to feel any fresh air and sunlight I could. Seeing and hearing the other kids playing brought feelings of anger, fear, jealousy, and envy. I wanted to be outside so bad. But I sat and endured.
The idea behind that story was that there was plenty to do in my room to keep me busy while grounded. But I wanted to be outside, I wanted to be with other people. Deeper within was the fear of missing out on life and the fear of being alone. Read More >>
Watch the Fix and Flip Wholesale Shows on Television Just Don’t Believe Their Numbers, Time Frames to Complete the Rehabs and Their Repair Costs
Recently while surfing channels on my television I came across two real estate fix and flip shows that caught my attention. I watched each of these shows and as I watched it took all of my strength to not turn the channel in disgust. I couldn’t believe the incompetence of the people doing the shows. One of the shows was filmed in Orlando Florida and the other was filmed in Las Vegas.
I love a good comedy show as much as the next person but these shows were just too ridiculous to watch without feeling compelled to warn every unsuspecting and untrained investor not to believe what they see on these shows. Shows that never show any real facts and details about the properties they fix and flip. If you watch these types of shows be sure to take their numbers with a grain of salt and don’t try to replicate what is being shown before you make an offer to purchase any property. Read More >>
There has never been a foreclosed house which didn’t have potential profit written all over it. Today, several indicators including the firm RealtyTrac have released 1st Quarter 2017 data which shows foreclosure filings and default notices, scheduled auctions and bank repossessions are down over 5% from the prior Qtr, over 2016 and are the lowest since 2007.
Knowing the true value of real estate is critical, try to do a deal without it and see. The guidance and data within REIAComps has consistently shown investors how to determine both solid acquisition value and after repair value to earn lasting profits.
Some of the most stubborn foreclosure cases are finally being flushed out of the foreclosure pipeline, and we all can expect to see more noise in the numbers over the next few months as national foreclosure activity makes its way back to more stable patterns by the end of this year. Thus, while foreclosures are down, they will always be with us. As investors, this s a good thing! Read More >>
Every time I mention a capitalization rate to a group of learning based, future investors, I get this blank deer in the headlights’ look (not that I have stared many deer in the face). So I decided to simplify the meaning and amplify the importance.
The capitalization rate(R) is the rate of return used to estimate the property’s value based on that property’s net operating income. Often called a Cap Rate (Rate), it is the method for determining the attractiveness of the investment for the potential purchaser.
First one needs to understand net operating income (NOI). The net operating income is the annual income minus all expenses. Expenses would include taxes, insurance, management fees, homeowner’s insurance, common area utilities and any other expenses that is paid toward running this particular piece of real estate. It does not include the mortgage… never. This rate of return assumes that the property was paid for with cash. Therefore, when you see income on this formula, we are talking about the net operating income, or, NOI which we will use the single letter I to designate. Read More >>