LIVE WEBINAR: Kansas City vs Dayton, Ohio

Dear Realty411 Reader,

You are invited to join Phil Alexander from Maverick Investor Group on a live webinar this Tuesday, where he will break down two of the hottest rental property markets this year:

Kansas City and Dayton, Ohio.

They are very different markets, so…how do you decide between the
two? What are the real differences, and…which one is best for your real estate investing criteria?

Listen to a market-comparison, where we break down these two markets side-by-side so you can understand the differences and determine which is the best fit for YOU.

LIVE WEBINAR: Kansas City vs. Dayton, Ohio: A Turnkey Real Estate Market Comparison Tuesday, August 27th at 6pm PT (9pm ET)
RESERVE YOUR SPOT

The webinar will include a private buying opportunity for cash-flowing rental properties in BOTH Kansas City and Dayton.

You will get access to off-market single-family rental properties that are fully renovated with tenants and local property management in place.

PS: This webinar is LIVE so you can get your personal questions answered at the end of the webinar!

All in a Day’s Work (shop)!

Crush It! – 2019 Learn The Secrets of Real Estate Success

In the first months of the year, the Bay Area Wealth Builders Association (BAWB) presents an all-day workshop called “Crush It! – 2019 Learn The Secrets of Real Estate Success”. This author attended last year’s Crush It class held in February, 2018, and another one is coming up on Saturday, March 23, 2019. Here is what to expect.

The Theme

At meetups, the author typically meets three categories of people:

  • “Newbies” who are aspiring to invest in real estate,
  • Investors who are doing one or two projects, typically “fix & flips” and,
  • Seasoned investors who are fairly well “set” with a portfolio to their liking, who are out for the evening socially as much as anything else.

“Crush It! -2019″ is designed to give “newbies” a “jump start” as well as a sound foundation all in one day, and to also provide season active investors some serious tools, skill sets and insights that might otherwise take them months or years to accumulate. Therefore, the concepts and content discussed and taught at this workshop are highly-concentrated, and the instruction is fast-paced. This equates to a tremendous high value versus the cost of the event in terms of time and money.

Instructor and Guest Presenter

Michael Morrongiello is an author, education, and long-time active real estate and real estate “paper” investor who specializes in “fix & flips” property rehabilitation projects primarily in the North Bay region, north of San Francisco, as well as investing in and trading real estate secured “paper” (i.e., notes, mortgages, trust deeds). Over his 35+ years in business, he has completed thousands of transactions, and he is an active investor who is “in the trenches” on a daily basis. Thus, the teaching and instruction given are extremely practical, real world, and immediately useful, unlike many so-called “guru” teachers who recite what that have copied in the past from others.

Michael teaches his CRUSH IT! Full day workshop only one time each year so it’s wise to catch it if you can. Many attendees come back year after year as he keeps the material relevant to the various market cycles we may find ourselves in. Also, unlike many seminar promoters, he has no hard “upsell” offerings to additional boot camps, coaching, mentoring, joint-venturing, education courses, and the like. The class is pure high-quality content! This is his contribution to the investing public, along with being the founder and organizer of the fantastic monthly meetup called the Bay Area Wealth Builders Association (BAWB) www.BAWB.info which is now in its 19th year of holding education meetings, and always has a large turnout at its meetings and workshop events.

At this year’s CRUST IT! -2019 event, there will be a guest presenter, who is with one of the largest national data providers and an expert in the area of “Data Mining”. The use of data to uncover probable and profitable property opportunities is of paramount importance to the savvy investor and their marketing. There are many companies offering various types of data or leads to real estate investors, but they often are resellers, essentially reselling data they acquire from his, one of the three largest data providers. They mark it up, and resell it. At CRUST IT! -2019 you will be able to listen and learn from the real source.

Evaluating Prospective Deals

One of the most important skills for a beginner or an experienced pro is learning how to distinguish a good deal from a marginal deal, from a bad deal. Market prices fluctuate and are declining to varying degrees around the country, so it is vital to know and understand local market conditions, as well as how to analyze the deal itself.
An essential part of evaluating a deal to wholesale or to rehab is estimating the necessary rehab costs. Part of the day will teach you how to prepare an inspection repair estimate in 20 minutes, or less.

Buying Right!

Once an investor buys a property THEY OWN IT, for better or for worse! It is important to construct “profit guaranteed” offers. You need to “buy right” all the time as this will keep you out of trouble. Michael’s teaching includes many tips and traps when negotiating with property sellers, and overcoming their concerns and objections.

Business Entities

Having the proper business entity for your operation is important from both privacy and taxation standpoints. It turns out that entities used often are different for buying and “flipping” properties rather than for “buy and hold” property purposes. This is an important topic to learn as the consequences can be very costly.

Residential Redevelopment

Fixing up a residential property for sale can be complicated. Not the least is hiring a contractor, or several trades, with the necessary bonding, insurance, license, bids, contracts, and so on.
Zoning and building codes often enter into the mix. And financing the project is another major consideration. So, it’s important to get your “residential redevelopment” projects up and running timely as costs can add up!

Getting Leads

The only way to stay in business is to generate consistent leads and “deal flow”. There are many sources of leads to discounted properties and distressed sellers. Some are more productive than others. It’s important to know which ones are most useful in terms of your cost and time expended. This is outlines during the day of teaching.

Additional Topics

There is a lot of ground covered during the day, but some additional topics covered are:

  1. Dealing with MLS-listed or bank-owned properties vs. private sellers
  2. How to attract and safely use private money
  3. “Tax-free” investing
  4. The 3m’s of marketing
  5. Creating y our own marketing campaigns geared to your budget and skill sets
  6. Doing the right paperwork (VERY important!)
  7. Marketing messages and semantics
  8. Boosting your response rates significantly in your marketing

Conclusion

This Crush It!-2019 Full-day workshop, and its modest cost is one of the best values around in the author’s opinion. Michael says that with the right education and knowledge real estate investing can be easy fun and profitable. I couldn’t agree more. More details, additional information or to register can be found at:


Bruce Kellogg’s Biography

Bruce Kellogg has been a Realtor® and investor for 36 years. He has transacted about 800 properties in 12 California counties. These include 1-4 units, 5+ apartments, offices, mixed-use buildings, land, lots, mobile homes, cabins, and churches.

Mr. Kellogg is a contributor and copy editor for two national real estate wealth-building magazines: Realty411, and REI Wealth Monthly.

He is available for listing, selling, consulting, mentoring, and partnering. Reach him at brucekellogg10@gmail.com, or (408) 489-0131.

Bradkay - Steve-055OR

The SKY is the LIMIT for Former Pilot Turned Houston Property Investor & Manager

After his job was threatened by the aftermath of 9/11, Steve Rozenberg, co-founder of Empire Industries, LLC realized that obtaining financial freedom through investing in property is a much surer way of building wealth than working for someone else.

“I’m an airline pilot by trade,” said Steve. “I fly for a commercial airline, and so after 9/11 hit, I was on the verge of being out of a job. That’s when I realized that I needed to do something else to earn money because that secure job didn’t look quite as secure as I’d thought.”

“So what I did, is I started learning everything I could about real estate. I started trying to understand it. I read a book a week on real estate and I devoured as much information as I could so I could figure out this new society…this new language that I was engulfed in.”

“Then I started buying some houses. I sold a few houses, then ended up buying an apartment complex. I sold the apartment complex and started buying a bunch of low income property, which is probably my biggest mistake.”

Steve met Pete in 2005 and the two began flipping houses together before switching to a buy and hold strategy. Then, after buying twenty low income houses within a year and a half, the two realized they’d made a mistake.

“We realized why we shouldn’t have done that. All of a sudden we had a huge waterfall of problems attacking us from all angles; so we did what any normal male would do, we turned around and bought another 15 properties to try to fix the problem, which really just ended up being like gasoline on the fire for us. It just ended up making our problems ten times worse!”

The solution they created for their problem became Empire Industries, LLC.

“So to solve the problem we’d gotten ourselves into, we had to create a management company of our own, just to manage our own properties.”

“This is how the management company got started. We started it out of necessity, from the result of making our own mistakes of buying the wrong properties, but also figuring solutions out for that.”

INVESTOR SOLUTION

Today, Empire Industries, LLC is the fastest growing single family management company in Texas. They manage about 750 properties in Houston and Dallas, and have a client base that spans the globe. Investors from California to Japan use Empire Industries for their property management needs.

“We’re the number one referred management company by REALTORS®” said Steve. “We give referral fees to our agents and we make them look good. At the end of the day, what an investor wants is a property that is going to make them money and not give them a headache.”

“Empire Industries is a full- service property management company. Our services run the gamut, from helping people find properties to managing their investments; we do it all from an investor’s perspective. Because we’re active investors ourselves, we’re looking at the market from that mindset. We are in the business of helping investors find properties that match their goals.”

“Often, beginning investors fail to see results because they don’t have policies, procedures and structures in place…they run it off of emotions, not a business model.”

“What I always tell people is that when it comes to owning a rental property, you own a business. Whether you have one or fifty properties, you run a business. Fair housing, discrimination…all of these laws that dictate what you do as a landlord say that you’re a business and the only one that does not realize they’re a business is the owner.”

Investors choose Empire Industries, LLC because they’re more than a property management company. As active investors, the founders are in “the heat of battle of owning properties.”

“We look at it from an investor’s perspective,” said Steve, “As a partner, not as just a customer/client relationship. This means our goal is to help them be successful and to reach their financial goals, whatever those goals may be.”

INVESTOR EDUCATION

From hundreds of free videos to free ebooks, investors have access to a huge resource of information…for free…from the team at Empire Industries, LLC.

Ask any savvy investor and they’ll tell you…learning as much as possible about investing in property is key to achieving success.

“Most importantly, have a plan,” said Steve. “If you don’t have a plan and you don’t have goals you need to talk to someone like myself and figure out what your goals are so that when you’re trying to find a deal you can know what that deal is, based on your goals.”

Steve Rozenberg owns a property management company based in Houston Texas. It is currently the fastest growing PM company across Texas. Because of his extensive knowledge and background being an international airline pilot flying Boeing aircraft such as the 737,757,767 and the famous Dreamliner 787 he has been able to take that knowledge of systems, structure and checklists to help create a company that while being an airline pilot went from 0 – 600 properties in under 4 years without buying a single rent roll, all through learning and mastering marketing and sale techniques. This knowledge won his company a National Award of Best Marketing in North America by ActionCOACH Business Excellence Award earning a 1435% return on their marketing dollars. Steve’s company Empire Industries has since partnered with the owner of ActionCOACH to help grow their company across the US. Steve is still currently an international airline pilot and is also stepping on stages as keynote speaking in areas such as motivation and drive, marketing, systemization and checklist mindset and methodology across the United States as well as other international cities.

Saving for education

Own Your Kid’s College Home: ONE PARENT’S STORY – $4,000 for 3 Years of Housing

By Kathy Fettke

If you’re challenged by the high cost of college housing, there are ways to offset your expenses. One California parent says her method is not only cutting college housing costs down to the bone, it’s also providing a valuable “life lesson” for her son.

Saving for education

Kaaren Hall of Irvine, California, is a single mom with two kids in college. Her business, uDirect IRA Services, helps people self-direct their IRA’s to invest in alternative assets, like real estate.

She’s seen many investors get creative with their investing, so she decided she would too.

Hall, who has 20 plus years of experience in mortgage banking, real estate and property management has two children: Lauren and Mitchell.

Her daughter Lauren is going to UC Berkeley outside of San Francisco, and her son Mitchell is going to Kansas State in Manhattan, Kansas.

While she couldn’t find a solution to the high cost of living in the San Francisco area where starter homes cost about a million dollars, she was able to help her son buy a home in Kansas for $144,000.

And because Kaaren was a former mortgage broker, she also knew how to get creative with loans. She and Mitchell only had to come $4,000 out-of-pocket.

Financial Solution to College Housing Expenses

The low home price is only a small part of this financially-elegant solution to her son’s housing needs. Their story begins two years ago in 2015. They bought the house with 3.5% down on an FHA owner-occupied loan. Mitchell was the primary borrower and Hall was the non-occupant co-borrower. They offered $147,000 on the home, got accepted, and put down $1,000 in earnest money. The additional $3,000 was used for closing costs. The total upfront cost was just $4,000.

Hall says this solution might not work for everyone, but it’s a good opportunity for some parents. She says: “It might be easier than people think. I don’t know if FHA still offers that program where you can be the co-borrower. But two years ago it did. Lending rules are always changing, but at that time you could do it, and we did.”

Their next strategic move was to turn the 3-bedroom home into a 4-bedroom home, with permits. Mitchell is now living in one room rent free and getting $500 for each of the other three rooms. That’s enough to pay the mortgage, and his truck payment! They also increased the equity on the home by increasing the number of bedrooms.

Basically, the home is now paying for itself, and they will benefit over the long-run from the equity, and appreciation. When you compare the situation to the one in Berkeley, Hall says: “It’s the tale of two cities. The amount it costs for my son’s mortgage payment, all in, principal, interest, taxes, and insurance, in a house that four people live in… is the same as my daughter renting a room with two other girls in Berkeley.”

Real Life Lesson for a Son in College

Kaaren’s son is also gaining some very important experience. By making good on the loan, she says her son will get out of college with “an incredibly decent credit rating.” He’s also learning how to be a landlord and how to deal with issues like an overflowing toilet that turns into a mold problem. She says it’s all fixed now, but he had to put on his “responsibility cap” and get it resolved.

Kaaren said, “It’s a big change from his former days when she had a hard time getting him to take out the garbage. Now he does it out of “pride of ownership.”

She doesn’t know what they will do yet when he graduates. They will probably continue to rent it out but it will be a whole different ball game. Her son is the on-site “landlord” right now, and he’s bringing in personally-screened tenants. When he graduates, they will have to hire a property manager and accept tenants they don’t know.

Kaaren says: “It’s a great option for a kid. Mitchell’s had to learn some things. He’s not just a roommate. He’s the boss of the house. So he’s learning how to be an authority figure.”

Finding the Right Deal on a College Home

Location matters in any real estate deal, so you will have to run the numbers on potential college districts. If there’s more than one college or university on a list of candidates, you might want to factor in the savings or revenue from home ownership as opposed to dorm or rental expenses before the choice is made. It could help sway a decision about where to go.

Mitchell received an athletic scholarship, which landed him in Kansas. With real estate in his Mom’s background, they checked out homes in the area, and found one three miles away.

Here’s some of Kaaren’s advice for parents: Find a home that’s as close as possible to the school. The closest ones may be more expensive, even if they are older and in need of more maintenance. She says her son’s home is further out, but close enough to campus, and is only about ten years old and in good shape.

Tax rules are also an important consideration. If the parent is the primary owner, it might be possible to designate the home as a second family home and deduct 100% of the mortgage interest and property taxes. You can also buy the home as an investment property and “rent” it back to your child. Tax deductions are even better on investment property, as repairs, taxes, insurance – and most expenses can be deducted. (This is not tax advice! Always speak with your CPA or tax advisor for your specific situation.)

Another option: A parent may be able to give a child up to $14,000 a year to pay that rent. Two parents can give a total of $28,000. As always, there are always rules on top of rules, and they change, so check with your tax accountant.

Other benefits of owning your child’s college digs include fixed housing expenses and housing stability. The child won’t have to go through the summer move-out and the rush to find a new place in the fall, and there will be no “surprises” about how much the next rental will cost – especially if the loan is on a fixed rate.

Hopefully, the ownership scenario will also provide a more productive environment for, let’s say, doing something like… homework. But with 4 roommates in the house, you shouldn’t count on that.

Author Kathy Fettke is the founder and co-CEO of Real Wealth Network. You can reach her at kathy@realwealthnetwork.com.

Co-author Donna Behrens is podcast producer and writer for Real Wealth Network.

 

2

A Q-&-A with KENT CLOTHIER

CEO | REAL ESTATE WORLDWIDE

In this Exclusive Interview, the Real Estate Mogul & Serial Entrepreneur Discusses Markets, Goals, Family, and his REI career.

Interview by Linda Pliagas

Recently our team had the opportunity to interview one of the most well-known and respected real estate entrepreneurs in the industry, Kent Clothier. We discussed everything from his most recent Find and Flip Summit to discovering who some of his greatest mentors are.

In this memorable interview, Kent also shares some touching personal photos and discussed how real estate investing can give individual investors the freedom needed to fully enjoy family life.

Realty411: Kent, you recently wrapped up the Find and Flip Summit with Grant Cardone. What was that all about?

KENT: The Find & Flip Summit was all about showing investors how to take the “next step” towards financial freedom. We had an amazing group of speakers and trainers from around the country coming – myself, Grant Cardone, Sean Terry, Pat Precourt, Justin Colby, Elena Cardone, Chris Clothier, Brett Tanner, and Frank McKinney are just a few of the big names joining us this year.

In fact, at last count, this outstanding lineup has bought and sold over 8,000 properties, sold over $1 Billion in 2017 alone, and manages or owns rental portfolios valued at over $1.3 Billion.

It truly was an incredible event showcasing the best-of-the-best, and it created massive impact to the hundreds of attendees who attended.

Realty411: What are some markets that your team is most interested in acquiring properties in?

KENT:Memphis, Phoenix, San Diego, Oklahoma City, Dallas/Ft. Worth, Houston, Las Vegas, and Little Rock are just a few of the markets that we are currently really focused on.

Realty411: Can you give our readers some advice on how they can get their investment career to the next level?

KENT: Pay close attention to who you are learning from. Do they have the scars? Do they have the experience and wisdom you desire? Are they living the life that you desire or are they just really good at marketing?

Your mentors should have bullet-proof systems, processes, online trainings, and lead-generation systems. We have worked really hard over the years at REWW and Memphis Invest to truly demonstrate what it takes at every level of the game and to be leaders in the market for anyone to follow.

Realty411: Who are some of your mentors or people who have impacted your way of thinking?

KENT:I have had mentors my entire life that have helped guide my career. My father played a critical role in early business and leadership development. He pushed my brothers and me harder than most people would think is normal, but it paid off. Outside of him, there have been a ton. Specifically, Sal Ricciardi, Roland Frasier, Frank Kern, my uncle – John Bloodworth.

Realty411: As a real estate entrepreneur, you are diversified by having an array of products such as 1-800-SELLNOW, Find Motivated Sellers Now, Find Cash Buyers NOW and Find Private Lenders NOW. Do you believe in diversifying in different markets as well for your real estate portfolio?

KENT:I do. I own properties or notes in Florida, Tennessee, Texas, Arizona, and California. To your point, I have business interests in many facets of real estate, digital marketing, online training, software as a service, an investment fund.

My partners and I are always looking for ways to expand our reach and add to our portfolio of companies and properties.

Realty411: Kent, what are some of your goals for 2018 and beyond?

Kent: I am very excited about 2018 and our road map. We have great outlook and game plan to continue to expand our reach through our Boardroom Mastermind program and our REWW Academy program.

We feel there is a real void in the market right now and an area that is undeserved.

That area is the “tweener” investor or agent. What I mean is: There is a huge swath of people that know how to do the transactions and are making some money, but it’s not even close to being a business. Equally, there are a lot of people out there that have a great circle of influence – like a Meetup group or REIA – but have no idea how to turn it into a business.

No one is talking to these people and certainly not providing them with real leverage points to help them turn the corner and FINALLY get what they want….financial freedom. We can do that for them.

We have a highly-acclaimed online training academy (REWW Academy) that we have spent an enormous amount of money to develop over the last two years with a team of Ph.Ds. We used a proven learning ISD format (just like they do with college courses) and brought in the best experts to teach these classes.

So now, here we are with this massive asset that literally anyone in the country can leverage and point their team members, new hires, local network, local meetup, or local REIA club right to it to get trained by the best in the business.

They can buy it for their own purposes or sell it as a service to their group and get paid a commission by us. Bottom line, it’s “plug and play” and is a complete “white glove” business in a box for them.

The same is true of our Boardroom Mastermind This has quickly become the premier real estate investing mastermind in the country with almost 200 members from around the country.

Again, it’s an easy place for people to get their teams trained by the best, rub shoulders with the brightest and most successful investor network in the country, and help to grow and monetize their own network if they desire.

In closing, I’d like to point out that we have invested in a lot of infrastructure, so others won’t have to. They simply need to step into our world and let us show them how to make it their own.

Realty411: How did you and your family turn your real estate passion into an empire? When did you decide to leave your previous occupations and focus only on real estate?

KENT:We all came into the business in the early 2000s in different cities and for different reasons. I was in South Florida, Chris was in Denver, and my father was in Memphis. It wasn’t until the mid 2000s that we really began to understand that we were doing something unique with our business model, our marketing, and our customer service. At that point, we turned the corner and went all in and decided we are going to become leaders in this industry because, quite frankly, there was just a sea of mediocrity out there, and we couldn’t stand it.

Realty411: What are some of your favorite ways to unwind and rejuvenate?

KENT:I love to hang with my wife and kids. Love to go to the beach here in San Diego, go paddle boarding, or just travel the world.

Realty411: Real estate is a relationship-based business, what are some ways investors can create rapport to enhance their careers?

KENT: Decide what your core values really are and only communicate from that place. What do you stand for? What do you stand against? Why are you doing what you’re doing? Why does your business matter? What impact are you trying to create in the market?

You see, people want to belong. We are all looking for our tribe and want to surround ourselves with people that inspire us or make us feel better about life. So, being clear on who you are first and then being very “out there’ with that information, allows people to quickly connect with you.

It also allows you to cut through all the noise and confusion and just surround yourself with people that are going to build you up, make you better, and make this business more successful. It will also allow you to easily run off the naysayers and time vampires. They won’t want anything to do with you. Best part, either way – you win.

Realty411: You’ve stepped back from speaking at many events, how can our readers learn from you if they cannot attend a live event?

Kent: We are not hard to find. We have hundreds of YouTube videos, Facebook posts, blog posts, articles, and a big social media presence. Go look up “Kent Clothier” or “Real Estate Worldwide” and you’ll find a ton of stuff out there.

But in the end, there’s nothing like one of our live events and getting that “raw-and-uncut” information straight from the horse’s mouth. Do whatever it takes to get there, but I’ll make it worth your time. Guaranteed. :)

 

Photographs courtesy of Kent Clothier. For Kent one of the best parts of being a real estate investor is the freedom to spend time with family. In these photos Seema, his wife, along with their daughters enjoy quality time with Kent.

holly

The ONLY BAY AREA Connection You’ll Ever Need – BAMF

Interview by Anita Cooper

Ms. Holly Lynn’s Bay Area Multifamily Meetup Group attracts networking mavens for hungry investors to connect, invest, and retire rich.

For most investors, it starts with the dream. You know the one… financial (and time) independence through investing in property?

While real estate is a fantastic wealth-creation vehicle, you’ll be spinning your wheels a lot if you don’t have the right connections in place to get things done.

Yes, in real estate, success often depends on who…not just what…you know!

Everyone tells you that it’s important to build a team when investing in property, and that’s true, definitely.

But wouldn’t it be easier if you simply had a single contact instead? Someone who could “connect the dots” between what you need and who can help meet that need?

Meet Holly Lynn of Bay Area Multi-Family Meetup. She’s that “someone” who can help you make the connections you need to build your wealth.

“My database is global. I know 20 people for every one subject, so when people contact me, I can connect them with the right person for their needs.”

Holly works with a variety of investors, everyone from individuals to groups of investors, helping them obtain the finance they need to get the results they want.

Specifically, investors can look to Holly for their private lending needs, and for opportunities to build their team by attending networking events such as at her famous mixers.

“The feedback I’ve been getting from investors is amazing,” says Holly. “We offer loads of information that helps investors grow their knowledge. I’ve also been able to connect investors with people who help them get fantastic results!”

YOUR NETWORK BEGINS HERE

Often, you’ll meet someone who is amazing in the real estate industry but is an average, or sometimes even less than average networker.

Holly, however, is one of those rare individuals who is a rockstar at networking, and a whiz at real estate…a powerful combination for any investor looking to grow their portfolio.

Why does she do what she does?

“I am passionate about helping people take back their time. Look, I haven’t worked a retail job since I was 19 — I want others to have the same opportunity.”

FACE TO FACE CONNECTIONS

Holly Lynn is all about making connections. But it’s not just what she does…it’s who she is, and when someone has that level of passion they love to share it with others every chance they get.

One of the most popular, and effective network-ing avenues is to face to face…even in this modern, social media age.

So to help investors, each month Holly offers a mixer where she serves as a bridge, helping investors connect with people they need for their investments and deals.

SOCIAL MEDIA CONNECTIONS

Holly’s social media accounts are ablaze with activity too; people share what they’ve been able to do, the goals they’ve reached and the connections they’ve made.

“Social influence is definitely me. That’s how I connect people. I make calls constantly to get to know people, then I connect the dots. I know who is looking for what, so I make the connection, get them together and enjoy watching the results!”

Her reputation is seen in the lives changed…

“Holly Lynn is a personable and well connected real estate investor and professional that brings deals together for a win/win outcome.”B. Sharma, Investor

“If you’ve been waiting for an opportunity, maybe this is it. As “The Real Estate Investor’s Lawyer” I have spoken in front of many real estate investor clubs. Holly’s investor club had some of the highest quality attendees I have ever seen.

They are engaged, experienced and actually doing deals and/or seriously interested in doing deals. I give her a lot of credit for attracting that high quality of real estate professional.

I have also had the privilege and pleasure of representing Holly and have been very impressed with her and her real estate investing activities.

They say that opportunity never knocks twice. There’s even a parable of how opportunity is a bald man with a long beard. You can only grab him when he’s in front of you and you can’t get him back once he passes you. If you’ve been waiting for an opportunity, maybe this is it.”

- J. Lerman, Litigator

‘As “The Real Estate Investor’s Lawyer” I have spoken in front of many real estate investor clubs. Holly’s investor club had some of the highest quality attendees I have ever seen. They are engaged, experienced and actually doing deals and/or seriously interested in doing deals. I give her a lot of credit for attracting that high quality of real estate professional.’ ~Jeffrey Lehrman, Esq.

JOIN THE CLUB

Find out more about Holly Lynn and her Meetup Group, BAMF, by connecting online at: https://www.meetup.com/MFinvestingMeetup/

 

 

finance of america commercial

Building the Future with FINANCE OF AMERICA COMMERCIAL

Constrained housing supply has been a theme for much of the past year, with land and labor shortages, expensive lumber and tight financing options all contributing to what has been a challenging year for both builders and buyers. Finance of America Commercials new construction product could be starting to change that.

Launched in February 2017, the product is available in all major markets to new and seasoned real estate investors who have experience building or who have partnered with builders to capture value in markets with a lack of new construction supply. Eligible brokers can also refer this product to their clients.

‘The real estate market recovery of prices and apparent lack of available housing supply improved the margins available for new construction properties. Both large renovation and new construction projects quickly evolved as additional opportunities for investors…’

~Andrew Hurd, VP of Credit (Finance of America Commercial)

New Construction Financing Fills a Gap

When asked about the development of this new financing option for investors and builders, Finance of America Commercial VP of Credit Andrew Hurd said that the company took notice of new construction demand continuing to outstrip supply in all major markets over the past year. This trend, coupled with feedback from many of the firm’s clients that they were feeling the pressure of declining inventory but still seeking growth opportunities, spurred creation of this product.

“The company saw a need in the market,” Hurd said. “After a decrease in foreclosure inventory previously sought after by institutional investors and local long-term hold and fix-and-flip operators, investors turned to new ways to achieve yields in their markets. The real estate market recovery of prices and apparent lack of available housing supply improved the margins available for new construction properties. Both large renovation and new construction projects quickly evolved as additional opportunities for investors, so we saw an opening to help our clients overcome a challenging market dynamic with new financing options.”

As part of the new construction loan program, the company offers loans from $150,000 to $2.5MM for the construction of non-owner occupied single-family residences, two- to four-family units, townhomes, and multi-family properties up to 20 units.

Additional features of the program include:

  • Lines of credit for multiple transactions and single loans for new investors
  • Funding up to 75% of land value, 95% of construction budget, 75% After Repair LTV
  • 12 month terms, with optional 3 month extensions
  • Rates from 6.99%

Despite being available for less than a year, Hurd said that investors and builders have been flocking to this new option.

“Clients using this product enjoy the simplicity of financing which allows for proceeds on land acquisition, including up to 95% financing for construction costs. This financing is supporting construction projects from the West Coast to Key West for builders working on starter homes from the $100s up to luxury builds over $5 million. We’re seeing this product fit a range of needs and project sizes and our borrowers have been vocal that this is filling a gap.”

Finance of America Commercial brokers are echoing Hurd’s sentiment.

“My client was looking for financing for a groundup build as well as the ability to purchase more investment properties,” said Ralph Taylor III, a broker in Irvine, CA. “The ability to turn the line multiple times and the flexibility of the qualifying threshold was exactly what he needed to continue building his real estate investment business.”

Finance of America is the Partner for the Builder Community

FACo’s new construction program sits alongside additional builder financing options from the Renovation and Construction Lending group within Finance of America Mortgage, another of Finance of America’s lending channels.

Options available from the Renovation and Construction Lending group include construction to perm financing and the FHA 203k program, which are both available to borrowers who intend to occupy the home after construction or renovation.

“With loan products available for homebuyers, builders and real estate investors, Finance of America has quickly established itself as a key partner for the builder community,” said William Brown, director of the Renovation and Construction Lending group at Finance of America Mortgage.

New Opportunities Emerge

While financing for builders and investors is getting a bit easier to come by, FACo’s Hurd thinks there are still opportunities to create new forms of financing.

“The market for build-to-rent is gaining traction,” Hurd said. “Investors are looking to build new construction rentals without the hassle of repairs and while capturing higher rents with new condition properties.”

Hurd said this push is informing the company’s latest development, a product designed for build- and flip-torent investors, which is due in early 2018.

 

crowdfundingmeetsamazon

Crowdfunding Meets Amazon

The Future of Investing is Here

Investing & Financing DEALS is Now as EASY as Shopping on Amazon!

By Lori Greymont

Here’s another big statement: InvestNestis about to completely disrupt investing as you know it…and not just real estate investing — investing across different classes of assets.

What do I mean when I say ‘disrupt’? Look at Uber — it completely disrupted the transportation market. When you take the middleman out of the supply channel or financial arena. Uber took out taxi companies and simply connected drivers with folks who need rides. The same thing is happening right now with investing…

High-yield investment opportunities just recently hit the market in a big way. Until the Jobs Act passed in 2012, sponsors weren’t able to advertise deals. Investors only found out about them via golf course meetings and backroom deals. You had to have an incredibly strong network, one that took years to build, to really get in on these opportunities. As a result, services have cropped up to help sponsors get the word out and to help investors find deals. Unfortunately, these services have been based on a middleman model. The middleman, who connects investors with sponsors, takes a cut. This drives costs for everyone and slows the whole process down.

Enter InvestNest. This marketplace ditches all the barriers to success in investing and financing by replacing them with a clean, simple platform that has one goal: facilitating deals. In the same way that you can go to a shopping mall looking for a suit, browse different stores, and even get measured right there to have the suit tailored, InvestNest has it all.

“We’ve created a technology that is really simple for the investor to get information, share information, stay in the app, and compare opportunities.“

Users can follow investment opportunities, follow builders, lenders, operators, and more. The app is user-centric and intuitive.

An investor finds a deal and says, “I really wish I could get my financial planner to look at this.” That’s easy. Click a button, shoot the planner an email and he gets to go right to the deal. Want your attorney to check out a deal? Again: hit a button.

For developers and sponsors, the shopping mall model also applies. InvestNest gives them all the benefits of opening a store in a place with lots of digital foot traffic instead of opening one off the beaten path that takes lots of time and marketing money in order to generate any real buzz.

So, what’s the backstory behind InvestNest? One name: Brian Barbuto. Brian’s 41 years of reinventing the real estate wheel and racking up successes have guided him to this moment in time: he’s poised to completely change the way we buy and find buyers.

A family man by heart and an inventive builder and entrepreneur by trade, Brian has developed everything from playgrounds to the first equestrian communities and single-attached family homes. And now, he’s developed the investment platform of the future.

Early in his career, he was known as a whiz kid. He completed his first development project by the age of 22; by age 27 he was awarded BIA Builder of the Year. From there, he went on to pioneer the first attached single family housing project in Southern California. He’s the guy who coined the phrase, ‘single attached family homes’. His career could be best defined by successfully, and continuously, finding demands and meeting them.

“Throughout my career, I’ve probably built everything that you can imagine building. I’ve built golf course communities, industrial parks, medical/professional centers, retail centers. The fun and theenthusiasm of building something that had never been built before was always more interesting to me than the cookie cutter concept of just building something over and over and over again.”

His work speaks for itself. He has developed more than one million square feet of commercial space, completed over 1,000 residential units, and worked through over $100MM in real estate project funding. Brian’s portfolio includes mixed-use, commercial, industrial, and resort communities, as well as innovative residential communities and world-class vineyard estate homes.

Now…Brian has merged all of this excellent experience with the right technology. The result? A state-of-the-art marketplace that’s going to change the way we find and fund deals.

Brian is a problem solver, “a lot of folks have teed up some really great projects, projects that are in great demand, that will be very successful, but the capital isn’t there.

At the same time, I was starting to see just how much our lives were becoming interwoven with tech — especially for millennials. They’re self-driven: they go to WebMD and self-diagnose, they go to LegalZoom for legal advice. They go online for pretty much everything today: Recreation, entertainment, work, and to create wealth.

What we’re looking at is seven million accredited investors in the Millennial bracket: they want to do everything on their own. We have a shortage of capital in the development and business world— statistically right now, as an example, there are over 3,700 development projects spanning across the U.S. that are teed up, entitled, ready to build, but are stagnant for a lack of capital and funding. And this cross section between developers who need financing and millennials who want to use technology for investing….that’s exactly where the big opportunity is.”

InvestNest is not crowdfunding. Brian explains, “We’re not a private equity firm operating on the Internet. The majority of crowd investing you see online today basically is putting a new spin on what private equity firms do or capital companies have been doing forever, but they’re using their technology to tell the story about an investment opportunity, instead of sending it by way of an email or placing a call.”

Brian continues, “We say, that’s great for them, but we want to get beyond that. Let’s do something better. Let’s educate and empower the investor. Let’s give the institutional investor a place to go, and let’s tee up sponsors with investment opportunities in all industries, in all asset classes, in a standardized fashion, so they can be seen and evaluated in a standardized fashion.”

InvestNest is the only place that investors can insure their principal investment. Capital Asset Protection (CAP) is an insurance product that was specifically designed for the InvestNest marketplace. Sponsors who want to offer this option to their investors must go through rigorous third party due diligence reviews, then pay for the protection.

It will insure the investor against several kinds of loss, possibly up to as much as 80% of their investment. As you and I both know, investing is not saving. With every investment, you have a chance to lose money.

Can you imagine the peace of mind investors will have knowing there is a backstop to their loss with this insurance?

InvestNest is a true market disruptor and it’s about time. For far too long, investing has been restricted to the Ol’ Boy’s Club. Now, anyone who’s an accredited investor or sponsor can start taking advantage of the deals and capital that’s out there with just a few clicks of a button.

I’m not impressed easily. I’ve been immersed in the high-tech world of Silicon Valley for decades.

I also head SJREI, an award-winning real estate investors association in San Jose. Because of this role, I’m cautious as to where I direct our members. InvestNest managed to not only impress me, but excite me. I’m excited about what the future holds for all of us investors and developers.

When I think about shopping 10 years ago vs. now, I can’t believe the difference. I wonder what we’ll all say about investing 10 years from now.

leadgeneration

How to Determine the Value of Good Probate Real Estate Leads

By Leon McKenzie, CEO, US Probate Leads

The real estate industry is full of potential for both REALTORS® and investors looking to cash in. One sector within the industry that will allow you to spread your wings and fly is the probate real estate sector. This sector has a value that runs in the trillions due to wealth left behind by aging and dying American homeowners. If you are interested in building a profitable realty or real estate investment business, then you definitely should pursue probate leads.

There is one question though: what constitutes a good probate real estate lead? What should you be on the lookout for when determining whether to spend your time and money investing in marketing to that lead?

After all, time is money and you do not want to pursue probate leads that are going nowhere. Not when you have to contend with competition.

Well, the secret is in having a list of criteria that you can use to find the right leads. Here are some of the factors that you can consider:

1 THE REPUTATION OF YOUR PROBATE LEADS SOURCE

Probate leads are only as good as their source. Do you have any idea of the reputation of your source? Now, you could go down to the county courthouse yourself and attempt to find a few leads that you could follow, but be prepared to spend a lot of time there.

You can rest assured however, that this is the most reliable way of getting good leads.

You could also use referrals to find leads but there is only so much you will get in the way of quantity of leads. How many people do you know who can tell you where the latest probate leads are?

You could also utilize online resources like social media, but there would be no way of you ascertaining whether the information you are getting is correct until you follow up. And this could waste a lot of your time.

For all the above reasons, you should consider using a probate leads company whose sole job is to find good probate leads for its clients. A company of this nature would do due diligence because its reputation depends on the quality of the product it provides.

Do note that not all probate real estate leads companies are worth your money. You want to get your information from a company that is reputable and reliable. A company that provides the latest leads is your best shot of getting access to good quality leads that have yet to be pursued. In addition, your leads source should provide a comprehensive list of leads from as many counties as possible from across the nation.

2 THE POTENTIAL VALUE FOR MONEY YOUR PROBATE LEADS CAN BRING

You have no way of knowing which probate leads will work out for your real estate business and which ones will not. However, you can determine based on the pricing package whether leads are worth buying in the first place.

Quantity is not always a good thing. Cheap is not always better. What you want is quality. Ten probate leads that will result in a sale or two are much better than 50 probate leads that will not work out at all.

So, what you are looking for is how many leads are on offer for sale, how much they will cost you, and their potential return on investment. You also need to consider just how many people will have access to the same set of probate leads at the same time you do.

The latter is very important because it determines the level of competition you will have with other REALTORS®and investors for the same leads. This in turn will determine your success rate when it comes to converting those leads into clients.

It would be prudent therefore for you to be on the lookout for a set of probate leads sold for a fixed affordable price. It would be even more profitable for you to hold out for leads that are offered to you exclusively for a set period so that you can have the first shot before your competitors get access to the same leads.

3 THE QUALITY/ COMPREHENSIVE NATURE OF THE LEADS

What is the nature of the leads that you have access to? We definitely are not talking about the name of the executor and nothing else.

A name alone will not help you if you want to launch a marketing campaign strategy to reach out to your potential clients. What you want are details; lots and lots of details. You are far better off getting a probate lead that constitutes of the mailing address of the probate property and the phone number of the person who can be reached as primary contact. This is much better than having a name only. You can always address an introductory letter to the title “the executor” until you are able to get the name of the contact you reach out to.

If a lead does not contain at least the mailing address, ignore it. That lead is not worth your time and energy. It will require you to waste a lot of resources just to find out if the lead is worth pursuing, which you could have spent wooing otherleads and trying to convert them.

4 RESPONSIVENESS OF THE LEAD

A lead remains so until you convert that person into a customer. For that reason, you need to gauge whether a lead is worth pursuing further based on how responsive that party is to your first attempt to communicate.

If you want to be the best REALTOR® or real estate investor in your locale, it is important for you to learn how to read into not only what people are saying, but also what they are not saying. When you choose to stick to probate real estate, be aware that you will be dealing with the grieving on a regular basis, and they are a bit more unpredictable than the ordinary potential seller. So, gauging how responsive they are is a skill that you need to learn, and learn very fast.

The fact of the matter is that most executors who act as the primary caretakers of probate properties are motivated sellers. It’s just that some of them need to grieve and get their act together first before they choose to part with the properties that they are in charge of.

As a REALTOR® or real estate investor, you need to keep two lists. One list should be for those leads that are very responsive, and the other should be for those leads that are worth revisiting several months in the future.

The moment a lead that you reached out to contacts you, pay very close attention to what that person wants. If the lead in question just wants to ask what it is that you do, that’s good enough. Even if that lead is not ready to be converted into a customer, the fact that he or she has reached out to your business means that what you are offering in the way of services has caught the lead’s attention. You should double down, and nurture that lead until you can get what you want.That is a very good quality lead.

Other very good quality leads consist of executors who live far away from the probate property they are in charge of, as well as those in charge of prime properties that beneficiaries are fighting over. Such executors are usually very motivated to sell and get rid of the troubling property just so that they can have peace of mind and steer clear of stress. Also be on the lookout for leads associated with properties that have pending bills. The bills indicate an overwhelmed executor who has no idea of how to go about managing an additional property. Leads of this nature can easily be converted to customers because they do not want to handle financial stress for long.

That said you should not completely ignore leads that show a reluctance to even contemplate selling a prime probate property. If the death of the lead’s loved one is still fresh, it makes sense that the executor will not be in a mood to part with that person’s property. But if you were to offer your services a few months down the line, that lead would be more amenable to being nurtured and converted into a customer.

It would be prudent therefore, for you to learn the useful skill of gauging the responsiveness of a probate lead on a case-by-case basis.

CONCLUSION

While the real estate industry as a whole is very competitive, a significant part of the probate real estate sector is still uncharted. You can be a pioneer in your locale, if only you take the time to invest in your realty or real estate investment business.

The quality of your probate leads is the foundation to building your real estate business into a successful company, so tread carefully when acquiring them. Start by scrutinizing the reputation of your probate

leads source, determining the ROI, selecting the highest quality of leads based on details provided, and then learning how to gauge the responsiveness of the leads you contact. By paying attention to the details, you will set yourself up for success. It will be much easier for you to laugh all the way to the bank thereafter.

FOR MORE INFORMATION

Leon co-founded US Probate Leads more than 12 years ago and has witnessed its growth during that period from a one city lead provider in the probate space to the only national provider of probate leads for virtually every county in the country.

Leon likes to point out that US Probate Leads is the only company providing Probate-related Real Estate-related leads to Investors and REALTORS® based on data collected directly from individual probate courts in virtually every state. This has been achieved by building a National Network of Researchers that visit each county one time each month. Leon’s team processes this incoming data and makes it available to individual subscribers for their use in reaching out to highly motivated property sellers.

 

shakehands

SELLER FINANCE 101

What Is It? HOW IT WORKS. How You Benefit.

By Bruce Kellogg

In a real estate transaction, seller financing takes place when the seller and the buyer agree that the seller will lend some of the purchase price to the buyer to facilitate the sale.

This is often labeled “owner will carry” (“owc”), and is a well-trodden path in residential, commercial, and land transactions.

HOW IS IT DONE?

As in any real estate transaction, buyer and the seller negotiate the terms of the loan, including the amount, due date, interest rate, and monthly payment. Other terms could include a late charge and a “due on sale” clause, and more.

The documents consist of a promissory note and a deed-of-trust or mortgage, depending upon the laws of the state for securing loans to real property. Depending upon the state, an attorney, escrow company, or title  company will prepare the documents for the parties, making the process very straightforward, though not necessarily simple.

NEGOTIATING THE TERMS

Down payments are usually between 10% and 30%, depending upon the buyer’s financial position, the buy-er’s creditworthiness, and the seller’s need for cash. A credit report on the buyer is essential.

It is possible to have a loan where the payments are interest-only, but some degree of amortization is preferable so the buyer is building up equity and can refinance more readily in the future. The interest rate should be a “market rate”, or less if lending to a friend or family member. Excessive interest rates do nobody any good, just making it harder for the buyer to succeed with the property.

The length (“term”) of the loan is negotiable based on the needs of the parties. The note could be written with one or more “options to extend” in case conditions for refinancing are not favorable when the loan matures. The idea is not to create a condition where the buyer cannot pay off the loan when it comes due.

WHAT ABOUT COLLECTING PAYMENTS, AND PROPERTY TAXES?

Sometimes with seller financing the buyer will neglect to pay the property taxes or keep the premises insured. The best way to prevent this is to hire a “loan servicing company”.

They will do everything, and even foreclose, if the need arises. The cost is reasonable, and the piece-of-mind is priceless!

WHAT IF THE BUYER DEFAULTS?

There are three alternatives. The obvious one is to hire an attorney or foreclosure company to legally recover the property. Then, it’ll be necessary to make repairs and re-sell the property, or rent it out. This should be chosen if the buyer’s default appears to be permanent, and cannot be corrected.

If the buyer’s default appears to be temporary, a job loss for example, then it’s best to suspend payments. Once the situation is resolved, modify the note to include the missed payments and proceed as before.

The third alternative is to sell the note at a discount and let someone else deal with the default.

Discounts on defaulted notes are typically 40 –  80%. This is a terrible idea! Don’t do it!!!

WHAT IF THE SELLER NEEDS MONEY LATER?

There are several alternatives here, also. The first is to sell the entire note at a discount. Since the note will be “performing” (i.e., not in default), the discount could be in the 20 – 30% range, which isn’t so bad if you need cash.

But maybe you don’t need to use the entire note. You could sell just part of the note, or just a certain portion of the payments. There are markets for notes across the country and over the internet. Notes can be very “liquid” nowadays.

Finally, you could borrow against the note. The legal term for this is “hypothecation”. Private parties, banks, credit unions, and “factoring companies” all do note hypothecations. Check the internet first.

BENEFITS TO THE BUYER

There are two primary benefits to the buyer. The first is that the buyer can negotiate a “customized” loan with the seller to accommodate the buyer’s circumstances. Banks and mortgage brokers usually sell their loans on Wall Street, so the loans are standardized. These don’t necessarily fit everyone!

In addition, commercial lenders charge “loan origination fees”, also known as “points”. Most sellers do not charge fees for lending, and in many states they cannot. This saves quite a bit for the buyer.

BENEFITS TO THE SELLER

There are two benefits to the seller. The first is that carrying some financing facilitates the sale. No doubt about it!

Secondly, the note that is carried back generates a regular monthly income stream that is secured directly by the property. This makes it a very good, long-term investment.

ABOUT THE WRITER:

Bruce Kellogg has been a Realtor® and investor for 35 years. He has transacted about 500 properties for clients, and about 300 properties for himself in 12 California counties. These include 1-4 units, 5+ apartments, offices, mixed-use buildings, land, lots, mobile homes, cabins, and churches. He is available for listing, selling, consulting, mentoring, and partnering. Readers can reach him directly at: brucekellogg10@gmail.com , or (408) 489-0131.