3 Sure-Fire Methods to Make 2009 Your Best Year Ever!
2009 will be the greatest time in our history to amass a fortune that can set up our families for years to come. I believe this, do you?
Your attitude about the current market condition is the cornerstone of your success. You can’t build wealth with a mind full of fear that is influenced by every negative news article that is read. It’s paralyzing and unproductive! You must convince yourself that now is the time!
Once you have yourself convinced, it’s now time to take massive action. There are 2 ways I use to really go after something I want.
1. By reading everything I can get my hands on about the specific subject, I will buy every book I can on the subject, search every article online and ask as many successful people in the field as I can. I download every audio book I can find and listen to them constantly in my car. I rarely listen to music.
2. Dive in by just doing it, make offers on houses, look for properties, talk to realtors, talk to appraisers, get pre qualified for a loan. Just Do It, don’t hesitate or wait for #1 to be complete. You will learn the most by getting in the game, not sitting on the sidelines.
So here are my 3 sure-fire methods to making 2009 your best year ever
I’ve done or am doing each and every method I am about to share with you, this is not easy or a get rich quick scheme, this takes hard work and focus and a never give up attitude. If you have any questions please email me at: SeanTerry@cox.net.
Every investor is in a different position in there lives or careers, some investor have experience and others are just beginners. Some investor have good credit and cash and others do not. I was one of those investors that was a beginner and had terrible credit and no cash. There is a huge opportunity for an investor regardless of their situation. Every obstacle can be overcome, if you want it bad enough. Believe me, I’ve seen them all.
Lets get started, Here are the 3 Methods:
1. Flipping Distress Properties (even in this market)
2. Fix and Flip
3. Buy Cash Flow Properties and Hold
Flipping Distressed Properties
Here are the 2 best sources of properties to flip, of courses there are many more, but I prefer these.
2. Bank Owned Properties
This was how I got started in my full time real estate investing career. My credit was shot and I had little to no cash. (I will share my story in a later post, make sure you subscribe for free updates). Because of the current market, a lot of the distressed properties owe more on the mortgage than the property is worth. I don’t suggest the short sale route, it’s to much of a pain.
The fist step is to find buy and hold or fix and flip investors to sell the properties to, you do this by joining your local real estate investing club and network with local investors in your area. There are a lot of people looking for good wholesale deals. Also you can look in the local newspaper for investors that are buying houses. Just ask them what their criteria is for buying homes and they will tell you.
Now you need to determine the value after the property is fixed up. Learn how by reading this post – How To Value A Property. Make sure you know the investors criteria that your going to sell the property to, or just offer 50% of the projected value of the subject property.
1. Get a list of Pre-Forclosure/Notice of Trustee Sales in your area, you would be better off finding a local data company that delivers this type of information. I don’t like using the bigger online companies because the data is not fresh enough. We use Information Market here in Phoenix. Make sure the data comes in excel format.
2. Do a sort in excel using these criterias:
A. Column A: Deed Date 2000 and Below
B. Column B: Trustee Sale Date
3. Now, pull all the deed dates form 2000 and below. This will reduce the amount of data you have to work with and will also give you properties with potential equity. The sale dates will let you know what properties will be coming to sale in the next 30 days, these are the best deals because the clock is ticking and a solution hasn’t been found yet.
4. There hundreds of ways to market to these properties but I found that I like these two the best
A. Send a post card: Make sure you tell them what’s in it for them and list your benefits. Mail to the list 3 times per month.
B. Knock on Doors: This is by far the hardest, but extremely effective way to get great deals. I have made hundreds of thousands of dollars knocking on doors.
5. Once you have someone ready to go, you then want to write up a contract.
6. When you write your contract make sure you add in “subject to investors approval” this will allow you to cancel escrow if you can’t line up a buyer.
7. Now call or email your investors that you met at the real estate club and offer them the property at $15k+ higher than your contract price. Make sure you have a lot of pictures and details about the property.
8. Now that you have an interested investor in your property you need to execute purchase contract with the buyer and open escrow at the same title company or attorney that is handling the 1st escrow. Make sure you put in the contract “subject to marketable title”. This will allow you to back away from the contract if something goes wrong with the 1st escrow. Also ask for a $5K non-refund able earnest money deposit.
9. The title company or attorney will close your transaction and then your investors minutes after resulting in a nice profit. This is called a “Double Escrow”
Here is a check from a flip I did from on a house I knock on several years back.
Bank Owned Homes
Flipping bank owned homes is a little more difficult these days, the banks have stop allowing a “Double Escrow”. Now before you get started you need to line up a hard money lender, you can easily find several at the local real estate investment clubs, they are asset based lenders that don’t check credit, they strictly lend off the property. The terms are roughly 18% interest no points with a 6 month term. They most likely require 10%-15% down payment.
Flipping Bank Owned Homes
1. Search banks owned properties using MLS or have a realtor assist you. Look for the cheapest homes in the area you are focusing on.
2. Now you need to determine the value after the property is fixed up. Learn how by reading this post – How To Value A Property. Make sure you know the investors criteria that your going to sell the property to, or just bid 50% of the projected value.
3. Submit at lease 10 offers on 10 different homes. Using these terms:
A. $1K Earnest Money
B. Cash Offer
C. 10 Day inspection Period.
4. Once your offer is accepted, call or email your investors that you met at the real estate club and offer them the property at $15k+ higher than your accepted offer. Make sure you have a lot of pictures and details about the property. Most listing agents are using the lock boxes with the codes, ask the listing realtor for the code so you can have it available for an investor that would like to view the property.
5. Now that you have an interested investor in your property you need to execute purchase contract with the buyer and open escrow at the same title company or attorney that is handling the 1st escrow. Make sure you put on the contract “subject to marketable title”. This will allow you to back away from the contract if something goes wrong with your contract with the bank. Also ask for a $5K non-refund able earnest money deposit.
6. Since the banks will not allow a double escrow anymore, you will have to close on the property using your hard money contact. I know this is a little scary because you are banking on your investor buying the property, but if you get a $5k earnest money deposit that is non refundable it reduces that risk of him canceling escrow. Talk to your hard money lender and he will guide you through his process of closing the 1st escrow.
7. The title company or attorney will close your transaction and then your investors several hours later resulting in a nice profit.
I know this sounds complex but it’s really not, once you have successfully completed your first transaction than you will realize it’s not rocket science.
Remember this, Never Never Give Up!!! I hate when wimpy people come to me and say, “I tried this and it’s doesn’t work” That’s bull pucky, as my father in-law would say, of course it works. The questions is did THEY work. I have made allot of money using these methods and so can you. Just be relentless and don’t let excuses stop you from reaching your dreams!
Part II will be released shortly, stay tuned
- Flipping Your First Property For a HUGE Profit In this series we’re learning How to Go From $0...
- So – Who Is Making Money in Real Estate Now? Post written by Sean Terry. Follow me on Twitter. We...
- The Art of the Fix and Flip for 2009 Posted By: Sean Terry | January 5, 2009 How To...
- Locking in a $15K Profit on Your Very First Deal In this series we’re learning How to Go From $0...
- Advanced Real Estate Investing Strategies For 2009 An Investment Strategy That Will Make You $10K a Month and...