Hey, it’s Larry here.  One of the questions that I get more often than any other question about working with us is:

How do I submit a property to you?

What is your buying criteria?

Well, as many of you know – at least those who own my Ultimate Buying and Selling Machine, which is my course that teaches how to buy and sell houses the same day using the Internet, which is based on my book Getting Started in Real Estate Trading – I need to be able to sell my properties at 70% of the after repaired value. That 70% includes purchase price, repairs and closing costs.

In other words, whenever I buy a property, I need to be able to add my $5,000 to $10,000 to $15,000 to it, then include repairs, closing costs (which I generally figure around 4% of the 70%), taxes, insurance and attorney fees (which I usually figure around $2,500) – and that is the price that I need to be able to sell it for to another investor. I want another investor that buys this property from me to be able to buy it, pay all the closing costs, fix it up and then they have 30% instant equity built into property.

Is it easy to do that? No, not all the time. But if you will do this in buying your properties to resell to other investors, it will be an easy sell if you negotiate a deep enough discount or you can turn around and sell it to another investor at 70% including purchase, repairs and all closing costs.

Also, I get people that want to know about submitting a note to me, as far as Filthy Riches type note. By the way, I only buy Filthy Riches notes from Filthy Riches students. That way you know exactly what we are looking for and how to protect yourself and get the most amount of money from your notes.

Because these Filthy Riches notes are such small deals and because you are buying them at $4,000, $5,000 or $6,000 and then creating a note buy [xx 00:02:19] sell price of $30,000, there is not really a lot of equity – real, true equity – in the notes. So you have to be able to sell them at 25-35% yield.

But if you are buying a property for $5,000 and you sell it for $30,000 and they give you a couple thousand dollars down, even if you only get $15,000 for the note, you still made $10,000-12,000 on this deal, so it’s still a really good deal. In fact, if you buy it for $5,000 and you end up netting $12,000 or $15,000, then you sold it for 2-3 times of what you’ve paid for it. You can’t do it on $100,000 or $200,000 house – there’s absolutely no way.

I hope this helps in understanding how to submit a property and a note to me. For complete details on submitting a property or a note to me, just go to www.InvestorsRehab.com and click on a link Submit a Property. It will give you all details about submitting a property to me to buy and submitting a note as a Filthy Riches student to buy.

Thanks a lot and be sure to look for next month’s newsletter where we have some really special items included for you! So thanks a lot and have a great day!

Oh NO!  The Seller Accepted My Offer!

By Lester Watts

Oh NO!  The seller accepted my offer!  Well, wait a minute…isn’t that a good thing!?  Of course it is, but many new investors are finding that once they have an offer accepted, then what? Now it is real!  Time to get busy.  In this month’s article we are going to address just that.  What do you do AFTER the offer has been accepted?

If you read last month’s article you will know we talked about how making more offers is one of the basics to success in real estate.  You have to make offers in order to make deals.  Inevitably, you make enough offers; you are going to have some accepted.  Once that happens, take pause and pat yourself on the back! Congratulations!  You are one step closer to becoming a successful real estate investor!

Ok, now take a deep breath and let’s get started.  I am going to keep it simple here even though some of our readers are experienced investors.  This series is going to be about the basics and even those of you who are experienced can forget some of the basics.  So, the next thing we want to do is check and double check the Offer to Purchase that was just accepted.  Normally the seller is going to give you the conditions under which they have accepted your offer.  Be careful here.  More than once I have had an offer accepted and blindly assumed that they didn’t change anything.  WRONG!  Never assume anything.  Thoroughly read through the documents the seller sends you.  It can be as simple as you put in your offer with a 15 day inspection period.  They say they accepted but when you go to read the contract they send you (or one of the addendums many banks are using) they may have changed the inspection period to 5 days or maybe 10 days.  It is possible of course that nothing was changed but what I want you to be aware of is that it does happen.  If ever in doubt then simply take all your related documents to your attorney and have them reviewed.  That way you can sign in confidence that the deal you think you are getting is indeed that!

If you have read the manual in Larry’s Ultimate Buying and Selling Machine, you are familiar with the three contingencies that we ALWAYS put in our offers and in the Contracts.  Recently I have reviewed several deals submitted by students where the contingencies where in the Offer to Purchase, however, the final addendums negated those contingencies and in effect, made them useless.

Although it may seem like a “no-brainer”, reviewing your documents and making sure everything is in order is an often over-looked basic step when you get a deal accepted.  The excitement of making money on a deal can sometimes override our thought process and end up costing us money if we are not careful.

Next month we will look at the basics of finding a contractor and what we need the contractor to do for us.  That is the next step in the process.

Until next time, to your success!

Lester Watts

Dear Readers: This month I have been working with Larry and his team in his office buying and selling houses and in this article I am going to be talking about my experiences.

I started working there about a week after school finished. On my first day Larry showed me the manual about his new “Filthy Riches” program. We search for houses that are listed for $25,000 or less. We aim to buy the property at much lower than that and then sell it straight away, as is, with seller financing. This means that you hold the note and essentially become the bank. You can then either keep receiving the payments and earn a huge return on your investment or you can sell the note for cash at a discount for a huge immediate profit.

When you find a house you phone the broker and find out what work needs doing to the property. If a lot of work is required and a contractor is needed, this is not the house for you. You are looking for a property that you can fix up yourself, (that should only be paint, carpet, appliances, and maybe a broken window).

When I talk to the broker I tell them that I am an all cash buyer, I can put up a 100% deposit, I don’t need an inspection or appraisal and I can close in 10-15 days. If you like the house and you can do the work your self make a starting offer of about $4,500. Sometimes the broker is reluctant to submit this offer to the bank. It is up to you to persuade the broker that you are a serious buyer and that most banks will respond. You can always tell the broker that this is an opening bid and that you are willing to negotiate once the bank has responded. Once your offer is accepted you will get the contract from the broker. It is very important to include the following conditions which will allow you to withdraw your offer without penalty:

1.sellers agent to provide buyer + buyers approval of condition of property based on a minimum of 20 photos including each room, interior, any problem areas, mechanical systems, all sides of exterior and street view within 48 hours of acceptance.

2. Sellers agent to verify in writing that there are no existing code violations on the property.

3. Sellers agent to secure the house if needed + place sign in window and a combination lock on the door with key + provide buyer with pictures of the sign and lockbox at closing. (You will need to send the agent the sign and provide the agent with money to buy the lock box or send them a lockbox

The agent will do all of this for you free of charge.

Once you close on the property you don’t do any work on the property your buyers will be doing that. Just send the agent your “rent to own” sign and they will put it in the window for you. When someone phones you for info on the property, tell them how many bedrooms it has, how big the house is, how many bathrooms it has, and then let them know what work needs doing. If that puts them off, tell them that you are offering seller financing with just $1,000 down, that should get them interested again.

It didn’t take long before I got my first house under contract. That was a very exciting day! I got it under contract for about $5,500 in Jackson, TN. When I got the contract I put in my conditions and the agent then sent me the 20 pictures that I asked for, I looked at the interior pictures and saw that the walls in every room needed new dry wall. This is not a job that you can do by yourself, so I withdrew from that deal.

I then found a house in Kokomo IN that was listed for $24,900. My initial offer was $5,500, the bank countered at $16,000, I then countered back at $8,600 and they accepted. I received the contract and once again inserted the 3 conditions.

Now I am waiting for the photos to see if this deal goes through. I will let you know next month how it goes.

Be on the look out for Larry’s new course Filthy Riches which will teach exactly how we do this.

This has been the best summer vacation ever, working with Larry and the team has been a real education and I have loved every minute. Of course, by the time you read this I will be back in school again, just counting down to the next vacation. Happy investing.

If you have any questions please email me at  gregory@mglpropertysolutions.com

Till next month readers,

Gregory

How Newspaper Classifieds Can Deliver You Motivated Sellers

By Larry Goins

When you purchase my course, The Ultimate Buying and Selling Machine, you receive a whole bunch of bookmarks to help you build your real estate investing business.  One section is called newspapers and it provides you with valuable sources to find any local newspaper anywhere in the United States that has any sort of internet presence.  This saves you having to buy all those newspapers and lets you go straight to each newspaper directly online.  You can find them very quickly.   Newspapers are a fantastic research for located motivated sellers.

The bookmarks are exactly how I utilize the 10 or 11 different newspapers in my surrounding area to search the classifieds.  Once the bookmarks are installed from your Ultimate Buying and Selling Machine course, you can go directly into the newspaper sections.  I actually set my bookmarks directly the real estate section of the classifieds, to save even more time.  So now I sit down at my computer, click the bookmarks, and quickly scan the classifieds for each newspaper.

This way, I can search all the newspapers for real estate in areas that I am interested in just about fifteen minutes.  There is another section of the paper that you will want to look at, too.  “Businesses for sale” often will show commercial property available or real estate holdings available from companies that are for sale.  You will also want to look at the “For rent” section as that could lead you to landlords who are tired of trying to rent out their property or fed up dealing with tenants.

Using these tools, newspapers can provide you with a lot of great leads for motivated sellers.

Another way that the classifieds can be helpful to you is in running your own ads.  Some newspapers use a clearinghouse source such as www.abracat.com which is another great short cut for searching for properties.  I have also provided this short cut for you in your UBM bookmarks.

An online version of newspaper ads is www.craigslist.com  You can use the same keywords below to find motivated sellers on Craig’s List with property to sell.  And www.realestate.yahoo.com is another online source.

There are some specific keywords that you want to look for when searching the classified ads for motivated sellers.  Owner transferred, obo (or best offer), divorce, owner financing, no down or low down payment, owner flexible, below appraisal, investor special, handyman special, fixer upper, lease option, rent with option, take up payments, or owner desperate; are just a few of the words that can key you in to a sweet deal as a real estate investor.  Another good thing to search for is out of town phone numbers.   Out of town owners are often more than ready to unload a piece of property.

I recommend using Mozilla Firefox as your web browser, as it allows you to highlight the keywords that you are looking for.  In my DVD tutorial I show you exactly how to utilize this tool.

Another great trick when searching the classified ads is to check the paper on the day that is not the primary real estate day.  In our area, Saturday is the day most real estate ads run and Sunday is the day most car ads run.  But a lot of advertisers don’t know this – so be sure to check your classified ads on the off days as well.  You could very well find motivated sellers who don’t have their phone ringing off the hook.

If your newspaper also has a legal section, that is a great place to search for real estate.  Newly filed foreclosures or judgments are great leads for motivated sellers.  Also divorce listings can lead to properties available cheap.  In our area, properties that are under code enforcement – meaning that it has a code violation and doesn’t meet minimum housing standards – and the owner cannot be located will have a public notice published in hopes of finding the owner.  This can be another great source of cheap properties, because the owners don’t want to go to the expense of fixing the property up to meet the code requirements.

With a little bit of practice, newspaper classifieds can be a great source of motivated sellers.  Before you even run your own ad, the newspaper can be finding properties for you!

Following Up and Cashing in With Real Estate

By Larry Goins

 Client or lead follow up is necessary yet difficult for most of us to perform. Why?  Because we are busy with other more pressing aspects of our business on a day to day basis.  Busy with the activities that bring in consistent revenue; booking appointments, selling, and creating new opportunities through lead generation.  Not to mention finding real estate to buy and sell.  This leaves us with very little time for follow up.  However, successful business people know that when they do not stay in consistent contact with their customers they are literally throwing away thousands of dollars right out the front door.  Successful entrepreneurs know that the fortune is in the follow up.  Following up means letting no one fall through the cracks.

In real estate, like in most businesses, the fortune truly lies in the follow up.   One of the tools that I constantly encourage my real estate investing students to use is Auto Responders.  An auto responder is a software package that automatically replies to email that is sent to you or automatically sent out when someone is added to your database as a result of making an inquiry or searching for information on your website.  Auto responders do a tremendous amount of your online marketing work for you.  They make you look like the most attentive and customer-centric real estate investor around.

People like to do business with people that make them feel good.  When you inquire about people, when you show interest in the things that interest them, and when you respond to their needs with immediacy you make them feel good.  When they feel good, they want to stay in touch with you and do business with you.  How much money is that worth in your real estate investing business?

Auto responders can be a single one-time email or a series of multiple email responses delivered at pre-determined intervals.  The time saving power of auto responders is that once they are set up they run automatically.  You can set up a response to an inquiry from your website or set up a response to someone who sends you an email when you are out of town.  Auto responders provide consistent follow up without any extra man-hours required from you or your office staff.

You have probably already received an email from an auto responder.  If you have purchased a product on the internet and immediately received a “thank you” email or an email message with a link to download a digital product then you have received an auto responder.  If you have ever signed up for an email course and received pre-scheduled emails with the content you have received auto responders.

Auto responders are no-cost, round-the-clock working sales staff for your real estate business.  Imagine the power of an instant email reply to an inquiry on your web site about a property.  The person requesting information is instantly responded to.  How powerful is that?  Suddenly the follow-up that you provide to your leads is instantaneous and continual.  If the fortune is in the follow-up, then you are suddenly generating no-cost, round-the-clock income with your auto responders.

An auto responder coupled with sound and savvy marketing techniques, is the speediest way to immediately boost business.  Auto responders can store and send any electronic information that you want to drip market to your leads or release over time.  You can pre-write and store messages, newsletters, announcements, specials, open houses, etc.  Auto responders will carry your message to your leads over and over again.

Email auto responders save time and money while sending your power selling messages out automatically at standard intervals.  Auto responders can provide both instant responses to inquiries and long term, steady information to your leads.  Think about what online businesses you are most aware of, the one’s that you think of the minute their area of expertise is mentioned.  It’s the businesses that stay in touch consistently and automatically that you remember.  I promise you that the emails you receive round the clock from companies are not being written at the exact moment that they are being sent to you.  They come steadily over time through an auto responder system.

An auto responder saves you time.  Why answer the same question over and over again?  You can set up email accounts for specific inquiries and write auto responders that answer the inquiries.  For example, if you have three properties for sale you might want to set up an email address for each property and write auto responders for each one with the information relevant to the property.  At the same time, you can capture the email addresses of people who inquire about each property and segment them in your database.  So the next time a similar property or deal is available, you know exactly who to start marketing it to.

An auto responder works around the clock to turn your website visitors or prospects into buyers.  Imagine having a professional sales copy writer emailing marketing messages to your list over and over again.  That is exactly what you have with an auto responder.

Auto responders take you from working constantly for your real estate business to letting your real estate business work constantly for you.  Think about this.  The last time you went on vacation, or took a day off, or spent time with your family what happened to people who inquired about properties you had for sale or properties they were offering?  They probably had to wait for you to return to your office to get the information they needed.  Some of those people might have already found another property or real estate investor to work with, because to their perception you were unavailable when they needed your help.

The answer isn’t to work around the clock.  The answer is to put auto responders to work for you.

Auto responders can follow up with every realtor, investor, FSBO, and retail buyer every week without you sending a single email or making a single phone call.  When you use our Ultimate Buying and Selling Machine system, you get four pre-written auto responders to jump start your own buying and selling machine.  Using our system, we put together a lot of deals where we talk to the seller or realtor only once and then the rest of the negotiation is done via email.  How easy is that?

Here are the four basic auto responders that every real estate investor should be using because the fortune is in the follow up.

1. REALTORS: Whenever you talk to a realtor about a property, ask them if you can email them when you are looking for a property in a particular area or price range.  Then you can set up a simple series of emails to go to the realtor every week to ask them to keep looking for properties for you.  Let them know that you appreciate them taking the time to talk to you, and remind them who you are and what you are looking for.  Keeping in constant contact puts you in the forefront of their minds when they have a property that would suit an investor’s needs.
2. FSBO’s: Any time you talk to an owner of a property for sale, ask them for their email address as a standard part of capturing their information.  If they balk tell them how busy you stay in your real estate investing business and how hard you are to get on the phone.  Get them in your database and then set up a series of auto responder emails to keep in touch with them to see how their house selling is going.  Share with them tips on creating curb appeal, or market changes that might effect their property, etc.  Remind them that you are available if they need help selling their home.  Write a nice, friendly auto responder that encourages them in their FSBO endeavors yet offers to help them should they need it.
3. RETAIL BUYERS: Don’t forget about the gravy train of your list.  Retail buyers are people who have purchased from you, or who qualified for financing but couldn’t find a property they liked, or called about a property that you have already sold.  You want to keep in touch with your potential buyers via auto responders so that they are thinking about you when they are looking for a property.  I would encourage you to even send custom email auto responders to your tenant/buyers letting them know that you are always looking for referrals and have them searching out properties they like for you to buy and resell to them. 
4. INVESTORS: Whenever an investor calls you about a property you have or if you can an investor about a house they are holding you should be sure to add them to your database and set them up to receive an investor auto responder.  I have provided a series of auto responders to send out every week for three weeks and then once a month after that in my Ultimate Buying and Selling Machine course.  Investors are always looking for properties and you want to remind them regularly what you have available that might be of interest to them.

Auto responders are an easy way to keep your business in the minds of all your leads.  Don’t neglect this powerful tool in your real estate investing business.  The fortune still lies in the follow up.  But there is no law that says the follow up has to be terribly time consuming.  Let auto responders keep your investment income growing and growing.

While many analysts are predicting a slow recovery for housing, PMI Mortgage says the recovery may take years. They are projecting that prices will continue to fall until 2011. See the following article from HousingWire to learn why.

Home prices will be lower in two years compared to Q109 for much of the country’s metropolitan statistical areas, (MSAs) according to an economic trends report released by PMI Mortgage Insurance Co.

As many as 324 — just over 85% — of the country’s 381 MSAs are facing the risk of lower home prices in 2011. In addition, 28 of the top 50 MSAs are now in the report’s highest risk category.

Florida, California, Nevada and Arizona are home to 36 of the most risky MSAs, but other regions are not immune, according to PMI’s chief economist and strategist David Berson.

“Rapidly rising foreclosure and unemployment rates, continuing declines in house prices, and weakening consumer demand all worked to increase risk in the general economy, and the housing market specifically,” Berson says in a statement today. “As a result of the continued weakness in prices, and the relatively low level of interest rates, improvements in affordability across the nation’s MSAs will continue to incentivize repeat and first-time homebuyers back into the market.”

The MSAs most likely to see decreased prices are the Riverside-San Bernardino-Ontario, California, Miami-Miami Beach-Kendall, Florida, and Los Angeles-Long Beach-Glendale, CA regions.

Nashville-Davidson-Murfreesboro-Franklin, Tennessee, Charlotte-Gastonia-Concord, North Carolina/South Carolina and St. Louis, Missouri are the three MSAs least likely to see lower home prices.

The Economics and Real Estate Trends Report PMI releases every quarter is the only such report that forecasts home prices two years out. While the news from the second quarter edition may be bleak, there’s at least one silver lining – home affordability is up in 98% of the nation’s MSAs.

PMI’s affordability index reading was 133.3 in the first quarter of 2009, an increase from 120.6 in the fourth quarter of 2008. An index reading above 100 shows increased affordability, while anything below shows decreased.

This article has been republished from HousingWire. You can also view this article at HousingWire, a mortgage finance news website.

DIY Alternative Energy – Are You Green Enough?

Alternative energy, solar panels, wind turbines – what do
they mean to you? For some these are just aspects of the
modern world that other people are involved in but that
don’t really affect them. For others alternative technology
lies at the very heart of the way they want to lead their
lives – drawing as little form the earth’s resources as
possible. It’s a spectrum that encompasses all of us.

The spectrum runs all the way from not green to dark green.
Let’s work through them:

1. You’re not green at all: For you, the green movement and
the ideas around alternative energy don’t really do
anything for you. It’s not really for you. You put all your
clothes in the dryer iresepective of the weather outside
and you use your big thumping SUV at every opportunity.
You’re happy to buy a takeaway burger and drop a whole pile
of trash into the trashcan without thinking about what
happens to it. You want to save money though, especially on
utility bills.

2. You’re a light green: You’ve thought about buying your
electricity from a green utility but haven’t made the
switch yet. If the weather is dry then you dry your clothes
outdoors. You put all your paper, card, metal and plastic
in the recycling bin. But you still drive your car all over
the place and hop on a plane without a thought. If you
could save money on electricity you’d definitely go for it.

3. You’re a mid-green: You’d like to have solar panels and
wind turbines, but you’re worried about the cost of
commercially available products. You recycle your packaging
but still enjoy a burger with all its associated trash.
You’ve sold your gas-guzzler and bought a small town car to
save on gas.

4. You’re dark green: You’re strongly committed to the
green movement. You holiday at home, you get rid of your
dryer years ago, you use a wood burning stove and grow your
own vegetables. You recycle your waste water for the
garden. You’d love to have solar panels and windmills and
sell energy back to the utility, but they’re just too
expensive. You sold your car and bought a bike.

What’s is the common thread that links them all? They all
want to save money. Well, whether you are not green at all
or light or dark green, there is some good news waiting for
you. It’s possible to save a huge amount on your annual
utility bills by fitting a collection of solar panels
around your house. I don’t care what shade of green you
are, you can save money, you can have the satisfaction of
building something worthwhile, you can reduce your carbon
footprint and maybe even make a few dollars too, into the
bargain. A DIY solar panel is the simplest way to save
money on your utility bills. So whether you’re a non-green
or a dark green it makes sense to take a close look at DIY
solar panels and windmills.

About the Author:

Discover how to construct your own solar panel and get free
design instructions for a solar water heater at
http://www.diyalternativeenergy.org

By Cecelia Lewis

Greetings to you all! We just had our last boot camp April 22-24^th . If you missed it, you really missed out on a treat! Larry taught how you can buy multiple houses a month without ever looking at them or leaving your home/office.  Also, the Investors Rehab team gave a true presentation of what we do every day and even gave handouts on what questions to ask Realtors when analyzing a house as well as what to say when making an offer. The handouts are what we use every day!

To all of Larry’s students who made the extra effort to attend, congratulations. You now have the keys to the kingdom.  To those who thought about attending and chose not to, what can I say? You truly missed a fantastic opportunity to learn how to buy and sell properties while sitting at your computer. We even bought and sold a property right there at the boot camp! Larry finished signing the paperwork right there in front of the entire boot camp.  It doesn’t get much better than that.

Also, I would like to say “Way to Go” and I am truly proud of those who saw an opportunity and grabbed it with both hands.  The Investors Rehab team had a lunch question and answer period.  During lunch anyone was free to join our LONG table and ask questions until all questions were answered. We did this 2 days in a row. You cannot place a price tag on that. Because of their extra effort, they received valuable information for FREE!

The Investors Rehab team was still hard at work during the boot camp.  I closed a deal.  Another member got her final documents back on a property.  Those at the boot camp were the first to hear about it (and it is a GREAT deal). It is now on our website. Lastly, another member of our team got an offer accepted.  Larry has taught us well! He was teaching the same thing at the boot camp.

Remember, it is easy to be average.  It is difficult to be excellent.  Don’t be afraid to go the extra mile. You will be rewarded beyond your own understanding.

Be sure to keep an eye out for our next boot camp.  Also, please visit our website at www.investorsrehab.com. On the site you can see the properties we have available and you can also submit a property if you want to sell us your deal.

Until next time…….

Cecelia Lewis