• Chattanooga Real Estate Investors Alliance
  • Chattanooga Real Estate Investors Alliance
  • Chattanooga Real Estate Investors Alliance
  • Chattanooga Real Estate Investors Alliance

Turning "No's" Into Dough… REACT!

Posted in The Profit March 2017 by Jon Iannotti

A little history. Back in 2007-2008, not only did the Real Estate market change, but so did our entire economy.  With the near total melt down of our economy, Real Estate took a huge hit. The Banking/Lending industry all but shut down making mortgage loans.

This made it very difficult for us to do business.  Up to this point we were doing just about every creative technique out there for they were all working.  We were doing Subject To, Lease/Options, Private Money, Rehabbing, REO’s, Wholesaling, Wholetaling, Commercial, Building Spec Homes, etc.

Lending was way too loose, but that was what was making it easy to sell properties.  In fact, it was so easy, some even crossed the line and put home owners into homes that they knew they could never afford, but were able to obtain these easy to get loans.  We of course could not do that. 

If a deal was not good for the Seller, the Buyer, and Us, we did not do the deal.  We could not put home owners in harm’s way.

If you are reading this article, you likely were somehow involved in some way with the mortgage and lending crash of 2007-2008, as loans literally all but dried up.  All of our exit strategies quit working.  Our Buying strategies stopped too.  Heck, private money disappeared.  You have to remember, this was just after the Bernie Madoff debacle and then here comes “The Great Recession”.  Private lenders puckered up so tight, it was impossible to get private money.

Now in 2009, our Government announced “The Recession is Over!”

Well, we have to agree with them for we feel this is when “The Greatest Depression Ever” began. 

Since then, people have been struggling with job loss, under-employment, loss of retirement/stock portfolios, foreclosures, using savings to live on, and the list goes on.

Where we used to get $20,000-$75,000 down payments, we now get $5,000 to maybe $15,000 down, with some bigger down payments up to $50,000 when we deal in the higher end properties.  Many people are dipping into their savings to live.  The economy has hurt everyone and continues to do so.  Not only lost funds, but credit.  Again, just about every person in America has had their credit ‘Damaged’ in some way during this down turn, even if it was a very slight blemish.

Now add into the equation that the Banks and Lending Institutions have tightened up their lending criteria with a tourniquet, and you can see why most Americans still today cannot qualify for a loan. So, if we cannot get our Buyers and Tenant/Buyers qualified to buy, we cannot sell our properties and we end up with Tenants.  We are landlords yes, but our business model is to sell our properties too and we basically had that part of our business shut down over night, which then pushed us to do more lease options to give people the time to get their credit repaired and allow them to save some money for a down payment to purchase. 

So what do we do?  Quit and go get a job?  Good luck, everyone is looking for jobs too!  No, we dug in and started thinking “How can we get back to making this work”?

We like to call what came next, “The Short Sale Era”.

Foreclosures were at record levels and everyone was overnight a ‘Short Sale Expert’.  We had been doing short sales for at least 10 years to this point, back when nobody even knew the term ‘short sale’.  Well, we kicked our short sale business in high gear and at any given point we had at least 150 short sales working.  The banks were giving good discounts and with the help of Real Estate Agents, we moved every Short Sale acceptance we received from them.

This worked well for about 4 years, then the market changed again. Now came the “ACT Era”.

ACT, or Agreeable Contract Terms, is a technique that we developed. ACT was a very simple technique of getting an agreement to buy or lease from a seller with discounted price, creative terms, or maybe the property was overleveraged but had a reasonable payment.  We then found a buyer or tenant/buyer and released our contract for a fee.

This worked well for coming out of the Short Sale Era where sellers would sign anything to get out of the foreclosure, they were still willing to give us a discount, or creative terms with ACT.  These deals were everywhere and today we still do them.

However, once again, the market changed in 2012.  It changed to more of a ‘Retail Market’. Most sellers started wanting ‘Cash, Full Retail, or more’.  Does that sound familiar?  Sellers were saying ‘NO’ to discounts and Creative Terms.

So enter ‘The REACT Era”.

So what do we do now?  Short sales were drying up, ACT deals were getting fewer and sellers want RETAIL or MORE!  The answer came to us and we created REACT.

REACT or Reverse Engineered Assignment of Contract Terms, is the latest technique that we have developed and is working great.  We started speaking and marketing REACT to get as many people involved as we can.  We are single handedly trying to correct the housing crisis ourselves!

REACT simply put is getting an agreement to buy with a seller and looking for the funding to do the deal.  Gurus and Private Money guys have said and will tell you all the time, “get the deal, the money will come”. If our funding fits within what we agreed to with the seller, we close.  If it does not, we renegotiate with the seller to see if they will accept our funding offer.  If they do, we close.  Some of these deals we close ourselves, and some we pass on to other people.  We would say that about 98% of all deals we do today are either ACT or REACT deals.  Keep in mind that we typically average about 100 deals per year.  If we can show you how to do this and make a minimum of $10,000 per deal, do you think this may be something to learn?  The best part is you can learn from the Iannotti’s, creators of both of these Industry Changing Techniques, ACT and REACT. 

With REACT along with any other technique, you need to have the proper training.  We highly recommend that the first step in building your Real Estate business is to secure an Attorney and Title/Closing Company that understands what you are doing and will make you legal and compliant in all you do.

Once your Attorney has made you ‘legal and compliant’, then you can crank up your buying and selling machines.  The beauty of REACT is that it will work in a down, up, sideways market.  We fully expect that this technique will be around a long, long time!

We apologize if this has started to sound like a sales pitch.  We truly do not want that to be the case.  We could easily charge students upwards of $50,000 like most of the Gurus on TV and radio for this information, but that is not us.  We want to make it affordable to as many as possible, and the training as pin point as possible.   

Real Estate is a very cyclical business.  We have seen several ups and downs in the market.  We have learned from every big-name Guru on the planet. We have taken bits and pieces of that training and along with creating our own ACT and REACT techniques, have created the most comprehensive and up to date, what is working today training on the planet.

We look forward to meeting each of you at the Meeting and then spending a great day of training with you at the 1 day Saturday workshop!   Wait until you hear our latest greatest techniques we use for marketing for FUNDERS!    It’s going to blow your mind!  

To your success!

Jon & Stephanie Iannotti

About Jon Iannotti

Jon Iannotti

Jon & Stephanie Iannotti have been business leaders since 2000. With over 30 years combined experience in Real Estate Investing/Teaching, and Mentoring and over 1900 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. 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.

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