~ For real
estate investors who don't have time or money to waste!
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In this issue:
Getting Started: Advice on owner carried terms.
Advanced Strategies: A free college degree!
Fixers Corner: Avoid the first timers' mistakes!
Creative Deal Structuring: Her new house is not ready.
Success Stories: Over $30,000 in less than 17 days!
What's new?: Foreclosure Fortunes Boot Camp.
Upcoming Events... Creative Financing in LA June 4-5
Editors: Bernard "Barney" Zick bernard@zick.com and Amy McIntee amy@emcii.com
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Getting Started: Advice on owner
carried terms. (back to top)
There is a rule
in creative financing which states:
"Do not pay any more for a property than the property can
afford." Notice that this doesn't say,
"any more than you can afford."
What does this mean? You know
that you have used the right Creative Financing Tools when the costs of
property ownership do not exceed the income (true with any rental property, be
it a house or an apartment complex). The
trend right now is to talk about how cheaply you got the property... that should
be your only concern if you plan to do a quick resale. But if you plan to own it long term as a
rental, maybe price and price alone is not a perfect guide. I am very happy with a full priced deal in my
target market if I can get great, no personal liability, long term
financing. If I buy for zero down and
have a slight positive cash flow on a good house, I feel I have a good deal. Not a great deal, but better than 15% below
market if I have to pay all cash and have a slight negative. Remember, before you buy any property, figure
out how it fits in your overall investment plan. Then negotiate accordingly.
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Advanced Strategy: A free college
degree! (back to top)
John Schaub, a bright investor and instructor that also
started investing right out of college, pointed out this great idea...
If your child is going to college away from home, buy a
house for them in their name. They can
rent out rooms to break even. But the
twist on this old idea is that when they sell, if they have lived there two out
of five years, they can sell and the profits on THEIR RESIDENCE are not taxed. If you get appreciation greater than tuition,
then the degree is FREE!
Here is another spin in this great idea. Set up an open second mortgage and as you
advance them money, it will be secured and will have to be paid back at the
time of sale. (You wouldn't want to
spoil them by gifting them the education, would you?) You can always forgive
the note if the property does not go up enough... then again, if you are helping
them buy it, shouldn't you get a good enough deal that there is some built in
profit from the beginning?
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Fixers Corner: Avoid the first
timers' mistakes! (back to top)
You are asking for problems if you take on major fix-up or renovation
projects when you know nothing about construction, carpentry or whatever skills
are necessary. The better plan is if you
can do it yourself or at least know enough to realize if you are being charged
the right price. Some people are so
naive as to buy problem properties and without an inkling as to who can solve
the problems or at what cost.
These novice investors get so excited about the
"bargain" that they often forget to take time to get written bids on repair
costs that are necessary to solve the problem.
Remember, not all problems are solvable.
Maybe the only market for the property you are looking at is somebody
who thinks that they have found a bargain!
The solution?
Hire a good property inspector you can trust. Have them inspect all your purchases before
you buy. And, be there when they do the
walk through. Yes, it costs a couple
hundred bucks, but you get an inspection AND a seminar! While your inspector is there, ask them to
recommend people to bid the work. Next,
join your local real estate investors association. (We will soon have a full
list of those available on our web site.
If you have one, email us and we will post it.) At the meeting, get referrals. And lastly, always get three bids. It will take more time but until you get the
correct prices in your head, don't toss out profits by either paying too much
or paying for it three times... once to do it wrong, once to tear it out, and
once to hire someone to do it right!
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Creative Deal Structuring: Her new
house is not ready. (back to top)
You get word that she is going to be selling her
house and building a new one. Initially, all goes well. The price is below market and it has a great
loan. However, she does not want to sign just now. "I can't sell you my house;
I'm afraid I'll have no place to go," Peggy says.
Peggy is reluctant to sell her house now because,
although the builder she is talking to is promising her a 3-month move-in date
for her new home, Peggy knows promises aren't always kept. She rejects you and plans to list the home
closer to the completion date of the house. As a Buyer, you know that when the house is
listed with Real Estate Agents, the price will increase, and in this case,
dramatically!
Solution:
Make Peggy the following offer -- If Peggy accepts the offer now,
and closes this month, you will lease
the home back to her for as long as she needs it, with the rent not more than
the present loan payment. This gives her
ideal flexibility and gives you the deal before she gets promoted into a high
priced listing.
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Success Stories: Over $30,000 in
less than 17 days! (back to top)
"Within one week of your seminar I
located a distressed seller and negotiated a Lease option with her. I sold it
on a 1-year lease option in about 10 days for $200,000 dollars. I took $10,000 down putting $9,000 in my
pocket after paying my $1,000 down.
After making a potential $30,540 on my first deal using the strategies
you taught me at a half-day seminar, my brother and I have signed up for your
next 2-day Lease Option Boot Camp. Thank you for sharing your lease
option strategy and inspiring me to jump out of my comfort zone. I would refer anyone to
your training that is interested in making money with real
estate. Thanks again."
~~ Rance Barclay, one year of investing
experience, Seattle, WA
PS
In less than a year Rance and Ryan Barclay have done
four more deals with
"tremendous"
profits on each. Congratulations guys!
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"Q & A" with BZ: (back to top)
QUESTION:
"Barney, What is a deed versus a title? Thanks,
Zack W."
ANSWER:
"Having
'title' to a property is a general term used to describe ownership that also
implies having the deed. I would bet it
either relates to the word 'entitled' or 'have a title' like a Duke or King. The deed is a legal term. The deed is the document used to pass
title. Your title can be via a Grant
Deed, or better yet, a Warranty Deed. In
a Warranty Deed you make lots of promises as to the validity of the title. A Quit Claim Deed is not worth much. It just says I give you whatever ownership I
have."
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NEW!!! FORECLOSURE
FORTUNES BOOT CAMP -- Learn all the ways to make
money in the field of foreclosures... from people behind in making payments, from
people who have received notice of default or from people at the courthouse
steps. Also included in this blockbuster
three day event will be how to buy tax sales properties. (Where is the best market for tax sales? --
Texas!) We will have pros as guest speakers who make their living doing
this. This Boot Camp will be "how
to" and "hands on." It will be
a two-year jump-start for anyone who has considered this area before. This is a one-time, don't-miss event!
JOIN US IN HOUSTON,
Reserve your
seat today! Call Renee at 800-677-3253
or send her e-mail at reitbootcamp@msn.com
for additional information.
This event is
$1995 per person but we have special pricing for Gold, Silver and Bronze
students and, of course, Platinum students attend at no charge.
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Upcoming
Events! (back to top)
The
Creative Financing Boot Camp is June 4th & 5th in Los
Angeles. Two days of nothing down and low payment strategies, "how to" advice,
negotiating tips, and much more! Don't
miss this last west coast offering for the year. Space is still available. Only $95 (a $1995 value) to current "Barney"
Zick students. Call 800-677-3253 to save
your place. Details at www.zick.com
(Sorry,
but the Options Boot Camp scheduled for May 31st & June 1st
in San Francisco is sold out.)
|
|
Phoenix, AZ |
Getting Started & Real Estate Options Seminar |
Holiday Inn Select, 4300 East
Washington St., Phoenix, AZ 85034,
602-273-7778 |
|
|
June 21 & 22, 2003 |
Seattle, WA |
Creative Financing Boot Camp |
Lake Washington Technical College,
11605 132nd Ave. NE, Kirkland, WA, 98034, 425-739-8100 |
|
|
July 8 & 9, 2003 |
Houston, TX |
Creative Financing Boot Camp |
Holiday Inn Houston -
Intercontinental Airport, 15222 John F. Kennedy Blvd., Houston, TX, 77032,
281-449-2311 |
|
|
|
Houston, TX |
Foreclosure Fortunes Boot Camp |
Holiday Inn Houston -
Intercontinental Airport, 15222 John F. Kennedy Blvd., Houston, TX, 77032,
281-449-2311 |
|
|
|
San
Francisco, CA (Foster City) |
"Help
Day" with Randy Sotka |
Crowne
Plaza Foster City, 1221 Chess Drive, Foster City, CA 94404, 650-570-5700 |
|
|
|
Orlando,
FL |
Central
Florida Real Estate Investors Association Meeting |
|
|
|
November
4, 2003 |
San
Antonio, TX |
SAREIA
(San Antonio Real Estate Investors Association) Meeting |
Omni
Hotel, 9821 Colonnade Blvd., San Antonio, TX
78230, 210-691-8888 |
|
November
15 & 16, 2003 |
Chicago,
IL |
Creative
Financing Boot Camp |
Holiday
Inn Glen Ellyn, 1250 Roosevelt, Glen Ellyn, IL 60137, 630-629-6000 |
|
Nov. 20,
2003 |
Northern
Virginia |
NoVA Cash
Flow, Inc. Meeting |
Doubletree
Hotel, 7801 Leesburg Pike, Falls Church, VA, 22043-2497 703-893-1340 |
Coming Up Next...
Join us in
Seattle, WA, June 21st & 22nd for our Creative
Financing Boot Camp!!!
Our intensive Creative Financing Boot Camp will teach you secret
strategies that could potentially be worth 100 times your cost to attend the
event! The class assignment will be
getting a contract signed on Saturday night of the two-day boot camp. REIT, Corp. may even advance you the money to
do the right deal! This is a must-attend
course for those beginning their investing careers and for pros that need to be
reminded of the great techniques they forgot and need to use. Reserve your seat today! Obtain pricing information and/or
pre-enroll by sending email to reitbootcamp@msn.com.
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The Fine Print... (back to top)
We will do one newsletter like this one (Advice
for Investors) and one called the REIT Report (containing Real
Estate Education Industry News and a lot of personal opinions), approximately
once a month. (However, keep in mind,
our newsletters are free so don't get upset if we skip one occasionally!)
Advice for the Impatient Investor has been
published for thirteen years (but not in a row). The next issue should be out about July 4th.
The REIT Report will go out on or about June 20th.
Folks smarter than us told us to say: We take no responsibility for the accuracy of
the postings. All contents of the
postings are the responsibility of the posting party.
We reserve the right to terminate the subscription
of anyone at any time.
Copyright note:
Submission of an email message or art work affirms that you are
authorized to and have given
Copyright 2003 by Real Estate Investors Training, Corporation. ISSN # 0272-8559
All Rights Reserved, no reprints to other email lists or websites
without
Check out our website: http://www.zick.com
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Our lists are NEVER sold.
Article submissions and questions are welcome and should be sent to amy@emcii.com.
Mail to:
P.O. Box 6339
Kingwood, TX 77325-6399
Phone: 281-358-0409
Fax: 281-358-6591
Email: amy@emcii.com
Website: www.zick.com
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