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For the real estate investor, knowing how to capitalize on what others commonly overlook can be the key to success. And to that end, probate real estate has become a profitable investing niche for many successful investors.
Probate is the governing process for the distribution of a person's assets after they pass away. Many investors stay away from probates because of their lack of education. This breeds fear---a fear of the unknown. However, a fear of the unknown is the same as going into a dark house. If you turn the light on, the fear goes away.
Years of television, movies and the media have established the belief that if one goes to law school, that individual knows all there is to know about the law. But that isn't the case. If your neighbor is a brain surgeon and your child falls out of a tree and breaks his arm, would you take him to your neighbor or to the emergency room? Just like doctors have specialties so do lawyers. However, very few would specialize in probate. Instead, they specialize in personal injury, corporate law, tax law or something more traditional. Attorneys usually take one probate course in law school… estates and wills. As a result, the majority of the attorneys of record that are handling probate cases are doing so because they hand-led other matters for the deceased, such as, divorce, corporate matters, traffic tickets-etc. Probate is not their area of expertise. Read More >>
Existing Loan Stays In Place – No Liability To You!
“In order to carry a positive action we must develop here a positive vision.” ~ Dalai Lama
A Subject-To deal simply means that you get the deed/title to a property and take control over the property. The existing loans stay in place in the original homeowner’s name, negating the liability to the purchaser. The mortgage is not being paid off through a Subject-To contract transaction, just taken over by the purchaser. As long as the purchaser of a Subject-To deal makes the mortgage payment to the existing mortgage lender, there are no consequences to either party. However, if the purchaser stops making the payments on the mortgage, the seller’s credit will be damaged.
Most sellers are in a situation where they may have to relocate quickly, have no equity in the home and just “want out,” or are about to go into foreclosure and want to save their credit. These folks are motivated to sell on a Subject-To deal to get the payments caught up (or maintained) and stay on time to help their credit.
One reason you would purchase on Subject-To is to utilize a seller’s lower interest rate than that is on the market at the time. For instance, if the market rate is 7% and a seller has a 5% fixed rate, the 2% difference can make big difference in your monthly payment. You are able to purchase the home in a 7% market at 5% interest! For instance: Read More >>
Last month I talked about how I created a near disaster for my family because I got too big for my britches and thought I could buy 100 houses in one year when I truly was not prepared to undertake a monumental task that large that has so many tentacles I had no idea I had to deal with.
I now realize that every one of these people provide a service I desperately needed if I had any chance of buying anywhere near 100 houses in any year. Without the services of these people there would be no way I could have achieved my goal of buying 100 houses in any year
Each of the ten deals I did in that one-week period were good deals and bought at prices that would have given us a good profit. I had bought each of the ten properties with Hard Money loans from local private money lenders who knew and trusted me. Because I couldn’t get the repairs completed, I quickly ran out of the money I had borrowed in a very short period of time. To keep my name good with my lenders, I had to take out personal loans to make the individual monthly payments for each property that was sitting empty and not bringing in any money. I had to borrow money I needed quickly to make those monthly payments. It didn’t take long for me to realize I was out of money. I was scared to death I wouldn’t be able to continue to fund these empty houses and ruin my name and reputation with the lenders. Read More >>
As a Mentor, one of the biggest things I stress to my Students/Partners is that you can’t buy and flip houses in sloooow motion. As soon as a Seller calls you, you should fill out a Seller Information Sheet and schedule for the following day (within 24 Hours) an appointment to see the house. Most of the information that is needed on the Seller Information Sheet you can get directly from the Seller. I have been asked “How long do you talk to a Seller about their home?” Since this is your first communication with a Seller and you NEED to build rapport, you should be on the telephone for a long time. What does that mean to you?
I would suggest at least 30 minutes on the phone to talk to the Seller about their home, their life, where are they going…anything and everything you can think that you might have in common with the Seller. Sellers like to do business with people they like. So, if you are only on the telephone for 5 minutes, then did you build rapport or even completely ask all the questions that are on my Seller Information Sheet? Probably not. Call the Seller right back and ask ALL the questions on the Seller Information Sheet so that you will know what he/she wants for the house, why they are moving, where they are moving and when they want to leave. Read More >>
There I was standing on the side lines in one of the hottest housing markets scratching my head as to whether I should buy and get in the game. I was new to the real estate game. I had been buying for a few years. I had limited access to money. The year was 1991. I was wondering what I should do to get more money (that still has not changed I need access to more cash). I was wondering what I needed to do to get the great deals. I did not think about learning new tricks to buy houses. Then again there weren’t any seminars or real estate investment groups I could attend. So I missed it. Do I regret it? I got an important learning lesson. The lesson was easy to understand and hard to implement. I needed to get more people involved in my investing business. I put an ad in the newspaper. “I am looking for a few good partners who are looking to take advantage of this incredible market. People who are willing to take calculated risk to get a reward of money. Those individuals who want to earn wonderful rates of return on their money while enjoying a hands off approach have an opportunity to hit it big in this real estate market.”
The market is hot right now. There was a recent article in the Atlanta Journal Constitution that stated Atlanta was the hottest flipping market in the country. The bad news is a newspaper reporter picks up on the market when the market tends to be at the peak. I have wholesaled more houses this year. I have done more flipping this year than in past years. I wrote an article in 2012 that said the market had turned in Atlanta. So where are you? Read More >>
Since 1999, Kim and I have continually learned from Pete Fortunato how to creatively structure and fund our deals – without going to banks!
The BEST real estate investing meeting we attend is the weekly Real Estate Exchangers meeting in St. Petersburg, Florida. It's creative deal structuring and funding at its most pure.
Here's an example of a deal that was put together at yesterday's meeting.
Rich has a SUV that he’ll sell for $3,000 cash. Pretty straight up deal, right?
Pete offers to trade his Nissan truck for Rich's SUV. But Rich doesn't want a truck; he wants $3,000 cash! Does Pete have a hearing problem or what?
Here is a classic example of Use What You Have, To Get What You Need, To Get What You Want. Read More >>
As an agent for 35 years, I am that real estate agent that truly loves real estate. Yes, at the gym, or riding in a car on vacation, or, sunning on the beach, you will find me reading the Atlanta Journal-Constitution, Atlanta Business Chronicle, Neighbor Newspapers, Realtor Magazine, and the list goes on and on. I have this keen thirst for knowledge about what is happening and where and when in my home of over 50 years, Atlanta. Therefore, I decided local investors and rehabbers would really appreciate a synopsis of events affecting value in our city. I am breaking these events into area factors or areas of town for your convenience.
Several factors in Metro Atlanta are affecting area growth: Read More >>
If you own rental property or investment property within a real estate IRA, it’s important to be careful with the money you spend making improvements. While many people make improvements and upgrades to their own homes to increase their enjoyment of their homes, not every home improvement immediately adds to the dollar value of a home, net of costs.
But some do, depending on the property and the market. This is especially true if you are bringing a home up to the standard of the surrounding neighborhood.
Except in special circumstances, or when transforming an unlivable home to a livable one, most major renovations don’t add immediate resale value once you account for the costs of professional work, licensed contractors, etc.
However, there are a few projects that have proven themselves over time, when used in the right homes – chiefly things that improve the cosmetic appearances of a home and enhance curb appeal. Read More >>
In the world of real estate investing, knowing the key elements to make your current or next deal ready to sell fast can add huge profits to your pocket. After all, time is money.
I have to stress real estate investing using REIA comps to see all the transactions in your market area is key. Quickly looking up prior sales, reviewing the previous listing can give you keys to the types of finishing touches that are most desirable for your market area. Here are the Seven Touch Ups which produce fast sales. Read More >>
Since this scenario has arisen for me in the past on a couple of really good deals with a lot of income potential, I thought I would take the time to explain to you how to deal with this kind of problem.
Sometimes you will put a property under contract with a seller, get all the way through the closing process right up to the time of closing and for some reason the seller changes their mind and decides not to sell to you. While this is not a usual occurrence if you are following through correctly with your deals, it does arise occasionally and you need to be prepared.
There are a lot of reasons this situation can occur. One main reason is that the seller may have gotten a better offer on the property after putting it under contract with you. Or maybe a relative or friend tells them they didn’t sell for enough money or maybe they just get cold feet and decide not to sell. None of these are a good reason for them not to sell to you, especially when you have a valid contract with your seller and have followed through as you are required to within the confines of the contract. Read More >>
Cash flow and equity are the two main reasons for doing a master lease option (MLO) deal. Both can be had using this creative technique to close real estate deals. Proper management will create both and make your next deal a cash cow!
Business is not about making money, it’s about keeping it. It doesn’t matter how much money you bring into your business if you lose it all in the expenses of running that same business. When discussing real estate keep this simple formula in mind.
Income – Expenses = Net Operating Income (NOI).
NOI – Mortgage Payment = Cash Flow
If we cut the cost of operations then we will increase cash flow. The two main ways to do this with a MLO is to have the property create more income and less in expenses. In this article I will be focusing on managing the deal to cut down on operational expenses. Most people will hire a management company to take care of the daily operations of their real estate. If you are not managing the property yourself you will need to work closely with the manager/management company to achieve this. Read More >>
Picture this: a man purchases a house in 2007 with a loan from a major mortgage lender who then securitizes the loan. After 9 years of making payments, the homeowner loses his job and defaults on the loan. The lender sends a foreclosure notice to the homeowner, claiming the ability to foreclose on the loan. But does the lender actually have the right to foreclose? The answer is a bit complicated, and does not look good for the major banks. To understand why, let’s take a closer look at exactly what the banks did and what it means for homeowners and real estate investors.
When a loan was securitized it was lumped together with a massive pool of loans and then sold in parts to investors around the world. The investors were then paid from the principal and interest payments on the loans based on their percentage of ownership. It sounds simple enough. If it was that simple, why did mortgage lenders begin the process by selling each loan in the massive pool of loans through a sequence of sales? And why was the last sale almost invariably to a single-purpose entity, usually a trust with a major bank as the trustee? The point of this sequence of sales was to separate the pool of loans from the assets and liabilities of the originating lender. They did this in case the lender was to file for bankruptcy or go into receivership. If the loan had not been completely separated from the lender, the lender could then claim the loan by right of redemption, effectively leaving the investors with nothing. Read More >>
Fear… the word that has the ability to conjure up all sorts of emotions in a matter of milliseconds. A natural emotion we all experience. It is quite natural to assume you may have to deal with it when working with property. After all, we are talking about assets that can have several zeroes on the end of their price tag. Fear can be a healthy thing to keep us in check!
Arguably though, the majority of us will do almost anything to avoid being in a fearful state. Oh sure, some of us embrace it but usually it takes some maturing to reach that point to ‘confront’ fear.
So how does this relate to Sellers?
Usually we will take something like fear and make it a very, very big deal. New investors deal with this all the time but so do a lot of experienced ones. When talking with a Seller, there are all sorts of things we create in our minds to be afraid of. Some examples are as follows: Read More >>
I’ve partnered with many investors and the one thing that I continue to see over and over again is the fact that the investor falls in love with the house. What I mean by that is they become attached to the property itself instead of the financials, which is not the ideal situation.
You've heard many people say in the past it's just business and that's exactly what it should be, just business. When you purchase a property to renovate and sell or rent, you should only be interested in the numbers and location. I hear many newbie investors and some seasoned investors comment that they really love an area or they really love a house but that's not what they should be focused on.
As an investor you should first say I love these numbers, I like the ROI and/or I like the potential cash flow. If the numbers work then you can start deciding whether or not you like the area, feel comfortable going there to collect rent, or if you are flipping, would you consider keeping the home as a rental if it does not sell. More or less this should be your train of thought as an investor. If it is not, you may start getting into a little bit of trouble. Read More >>
Every week, I have the pleasure of mentoring some wonderful people who are in the process of mastering the art of real estate investing. We work on the basics of marketing, making offers, talking to sellers & buyers, deal structuring, how to write up contracts, etc.
Once the essential elements and techniques are understood, a game plan has been developed, and the student knows WHAT to do & HOW to do it, the only thing left to do at that point is to...TAKE ACTION!
And this is often where the problems occur. Taking action. Why is that part so hard for so many people?
Could it be that we’re afraid of the unknown? Or maybe because we think that we have to give up something we hold dear in order to be successful? Or perhaps it’s the fear of success itself that holds so many people back?
Whatever the case, I’ve noticed that it’s a real issue that truly stands in the way of potentially massive, life-changing experiences and success. Read More >>
Will multiple employees be working with your QuickBooks company file? You’ll need to define their permission levels.
If you ever did your bookkeeping manually, you probably didn’t allow every employee to see every sales form and account register and payroll stub. Most likely, you established a system that allowed staff to work only with information that related to their jobs. Even so, there may have been times when, for example, someone pulled the wrong file folder or was sent a report that he or she shouldn’t have seen.
QuickBooks helps prevent this by setting virtual boundaries. You can specify which features of the software can be accessed by employees who work with your accounting data. Each employee receives a unique user name and password that unlocks only the areas he or she should be visiting. Read More >>
No Charge to Attend Online for Members or Guests!
Register @ BIGOnline.SavannahREIA.com
Yes, it’s wonderful to have motivated sellers calling you and giving you all of the details about their situation. But do you know what to say to them? Do you know how to control the conversation? Do you know the right questions to ask to reveal their TRUE motivation? Do you know how to make them feel comfortable enough to open up to you and reveal their problems to you in hopes that you will have a solution?
You will learn:
Frank Iglesias is one of the Founders and Managing Partners of Working With Houses, LLC, an Atlanta area Real Estate Investment Company that primarily works in the residential renovation industry, repairing and updating properties to bring value back to neighborhoods that have been devalued by the recent housing crisis.
New Investors, DO NOT MISS THIS EVENT! Register now and join us on Wednesday, August 24th at 7:00 PM ET.
No Charge to Attend ONLINE for Members or Guests!
If you are really serious about upping your investing game, You should NOT MISS this webinar! Read More >>
On Saturday, August 20th from 9:00 AM to 5:00 PM (Registration starts at 8:30 AM) at the Atlanta REIA Office located at 1960 Skylar Hill Dr Suite D, Buford, GA, Don DeRosa will be conducting a special full day workshop with Atlanta REIA on “How To Do The New Subject To”. This class is all about how to buy and own real estate and make lots of money with little or no money down.
Learn how to buy houses…
Beginner or experienced real estate investors can find immediate success using Don’s simple formula. There are six easy steps to follow when buying “Subject To.”
Once you learn to follow these steps you can do this over and over again for an average profit of over $20,000 per property.
There are many ways to make money in real estate and there will be something for everyone at the event. Don will be teaching you his trade secrets, including little- known buying techniques that have made him a very successful investor.
You can learn how to get an owner to just hand you the deed to their property for the low price of $19.95 and you can bring up to 2 friends or loved ones as well!
PLEASE NOTE: SEATING IS EXTREMELY LIMITED! If you want to gain the cutting edge you need to succeed and bypass your competition, REGISTER NOW WHILE SEATS ARE AVAILABLE for the workshop and bring your iPad, tablet or smart phone and join us at the event!
As A Special Bonus:, Don will show you how he remains almost paperless in his real estate investing business by using Apps for your Ipad or smartphone. Read More >>
The August 2016 Edition of The Profit Newsletter is now available for download. There are 56 pages this month full of upcoming meetings, workshops, educational articles and other valuable information for your real estate investing pleasure and success. Download it and check it out!
The Profit is Atlanta REIA's digital, interactive newsletter for serious real estate investors delivered as an Adobe PDF file to read on your PC, Mac, Smart Phone, iPad or other mobile ready devices. Many of the articles and ads in The Profit contain many hyperlinks you can click to get more information online! The high res version of The Profit is "print ready" for those who want to print the newsletter on their home or business printer.Read More >>
Are you an active or passive real estate investor? This is the MAGIC question that all real estate investors should ask themselves on a regular basis, rather they know it or not. Let me explain.
Many beginning investors want to focus 100% on wholesaling and rehabbing so they can make the fast cash and big checks. They don’t want the headaches of toilets, trash and tenants. After all it feels good to take a rundown house and flip it to a rehabber and make a quick $5000 or $10,000 in a few hours or better yet tear it apart, fix it up and sell it to a first time buyer who will call it home for many years to come and you can make $25,000 or $30,000 plus in just a few short months.
Active investing can be addicting and a real adrenaline rush. Ask me how I know that. My nickname is the Rehab Queen and I have been rehabbing and flipping as an active income producing investor for over 17 years. I have done over 350 properties and those quick one time paydays have been great. But... Read More >>