Archive for August, 2008

What Are You Really Afraid Of?

August 31, 2008 at 11:11 am · Filed under What Are You Really Afraid Of?

We all know that real estate investing is a great way to take control of your life. With “downsizings”, “rightsizings”, “off shoring” and layoffs at an all time high, job security is simply a thing of the past.

According to the Bureau of Labor Statistics millions of people lost their jobs in mass layoffs last year, and the same is expected this year. So why don’t more people actually embark to take control of their life? One common answer is a four-letter word, F-E-A-R. Fear is one of the biggest success killers there is. It not only stops people from becoming successful, it stops many people from even trying!
What is the Definition of Fear?
According to dictionary.com there are four definitions:

  • “A feeling of agitation and anxiety caused by the presence or imminence of danger, a state or condition marked by this feeling: living in fear”.
  • “A feeling of disquiet or apprehension: a fear of looking foolish”.
  • “Extreme reverence or awe, as toward a supreme power”.
  • “A reason for dread or apprehension: Being alone is my greatest fear”.

Let’s look at fear from a business prospective. The first definition really does not apply. There is no real imminent danger in real estate investing, and it’s certainly not life threatening. The last three definitions are where we usually run into problems getting starting.

Fear is really about unfamiliarity and apprehension. Fear is a real emotion, but you can conquer it. If you really think about it we’ve been doing so our entire lives. Didn’t you once have apprehension about riding a bike, or going on a roller coaster, or learning to drive? Yet most of us were able to overcome these fears. I know these are basic fears, but moving forward to take control of your life really is no different.
Let’s Analyze Fear
Let’s look at conquering fear analytically. We can break it down into four steps and apply these steps to our fears.

F Figure it out.
E Evaluate it.
A Action plan it.
R Repeat it.
Step 1 – Figuring out what we are really afraid of. Let’s use the common fear of public speaking as an example. Are you really afraid of speaking in public? Probably not, we do it all the time. The fear is more likely the act of speaking in front of a captive audience. To make it worse the audience is composed of strangers, so they are unfamiliar to us. Also we will most likely have to stand up and be on display during the speech. You have to think through the surface fear and figure out what is really causing the apprehension.

Step 2 – Evaluation. Why are we afraid of speaking to a captive audience? I know fear is an emotion, but try approaching it analytically. Are we afraid of misspeaking? Are we afraid of being embarrassed? Are we afraid of being asked a question? Are we afraid of what people will think? Are we afraid of our pants falling down? It’s probably a combination of all of these possibilities, plus some others.

Now we’re making some progress and getting to the root cause of our fear. When evaluating your fear ask yourself, “What’s the worst that could happen?” Make a list of these things and you have a good start on your evaluation. After reviewing your list you’ll probably see it’s really not so bad.

Step 3 is to action plan to overcome the fear. If we are afraid of misspeaking, being embarrassed, or being asked a question, then we can practice our speech over and over again, and even have notes available during the speech.

Will this guarantee that we won’t trip over a word do to nervousness? Of course not, but we also realize that all great speakers stumble over words do to nervousness or excitement. Do you really think any less of a person who corrects himself or herself while talking?

We need to practice in front of a live audience, but you should crawl before you walk. Let’s start by standing up and speaking in front of a few of our friends. There will be some initial nervousness and embarrassment, but it will soon pass. Then we might volunteer to give a presentation at a group we’re involved with, such as the homeowners association, the kid’s school, the office etc.

There will now be a combination of people we know and people we don’t know. Again there will be some initial nervousness, but it passes quickly. Now maybe we move up to the local toastmaster’s club and follow the same routine. Soon we realize that there is always some initial nervousness, but it always passes and we are able to complete the speech and answer questions.

Step 4 is to simply repeat the actions that you determined would help you overcome the fear. Repetition breeds familiarity, and once you become familiar with something there is no need to fear it.
Now, Put It All together
You can use the same plan to learn real estate investing. Eliminate the risk and apprehension by starting out as a real estate jobber. Learn first hand from established Investors. See how the process works in real life. This will help you become familiar and more comfortable with real estate investing. Eventually you’ll wonder why you were ever afraid!

So what are you really afraid of?

Learning something new?
Networking with people?
Looking for leads?
Talking with Investors?
Possible failure?

You’re probably not really afraid of any of these things. Figure out your fear and conquer it! There is no way to be successful without stepping outside of your comfort zone. Use real estate jobbing to help beat your fear of real estate investing. Don’t let fear stop you from succeeding.

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Are Real Estate Seminars Worth the Money?

August 29, 2008 at 4:03 am · Filed under Real Estate Seminars ·Tagged ,

If you read the news media, you’ll see that there’s a proliferation of new real estate gurus and seminars coming around to feed the endless demand for real estate these days. One event recently attracted over 30,000 people, with Donald Trump as the headliner (like he knows anything about buying a duplex?).

So, how do you tell the good from the bad? Well, first let me comment that I believe there is very little truly “bad” info out there. The difference is mainly price and quality of information.

Here’s some things you should consider when determining whether to invest in a real estate seminar:

1. PRICE — Be leery of very cheap or very expensive seminars. If the seminar is free, it’s because the promoter wants to sell you something. It costs the promoter thousands of dollars to get people into a room, so expect a hard sales pitch. If the event is more than $1,000/day, you should also be concerned, unless the admission price includes follow–up training or substantial materials. I’m not saying that $5,000 boot camps are all bad, just make sure you’re getting what you are paying for.

2. CLASS SIZE — If you are paying $5,000 for a boot camp, you should expect a small class size. If not, you are likely overpaying, since you won’t be able to ask questions in a large group format.

3. TEACHING ABILITY — Some gurus are knowledgeable, but are bad teachers. Make sure you have heard the speaker before or ask other people who have attended. There’s nothing worse than paying to listen to a boring speaker or one that can’t convey a topic in “plain English.”

4. VALUE — Let’s face it, some products are expensive because you believe they are worth more. Good marketing makes you believe “Bayer” is better than generic aspirin. Before you pay thousands of dollars for the “brand name” seminar, look into a cheaper version that isn’t being marketed on T.V.

5. THE “PITCH” — Although as a rule, the cheaper the seminar, the greater the pitch for other products, some promoters do nothing but pitch, even at $5,000 boot camps. Ask other people who have attended the seminar to determine the teaching to–product–to pitch ratio. There’s nothing wrong with a promoter offering products and services at the less expensive seminars, but it’s borderline insulting to have a non–stop sales pitch when you are paying $1,000 a day or more.

6. REFUND POLICY — Is there an open refund policy? This is VERY important. Ask up front. You should be VERY suspicious of any seminar that does not offer a refund policy.

7. ARE YOU SERIOUS ABOUT IT? — No matter how much or little you pay for a seminar, it’s all up to you. No diet works without exercise and discipline and no real estate investing technique works without your hard work. If you are just beginning, stay away from the expensive seminars until you are sure it is for you. Start with the $500 or less variety, let it sink in, then consider more advanced seminars when you have done a few deals. Once you start making money, you should continue investing in your education, since your return will be well worth it. If you are the type who has been to seventeen seminars and haven’t done a deal, consider this:

“The Fault Lies Not Within the Stars But Within Ourselves”

Real estate investing will make you a lot of money if you learn the techniques and apply yourself. The bottom line is that education will help you avoid mistakes and learn new ideas. Read books, go to seminars and learn from other investors. Your best investment is in yourself.

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Is Your Real Estate Investing Comfort Zone Being Threatened?

August 28, 2008 at 11:34 am · Filed under Real Estate Investing Comfort Zone

Have you ever imagined yourself putting through a multi-million dollar deal, going to closing and picking up a check with six zeros? It’s the ultimate dream for real estate investors. But why must it be a dream when it can just as easily be a reality. Every day there are real estate investors making offers on high end houses just as there are real estate investors making offers on median price range houses and below. There are just a lot fewer going after the big game.



High dollar houses naturally instill fear in real estate investors as they feel if they make a mistake they will be sued for hundreds of thousands. Real estate investors perceive they need perfect credit, a high net worth and millions of dollars already to buy million dollar houses, so they exclude themselves as buyers and don’t pursue high end deals. Most real estate investors feel they don’t deserve to buy a million dollar house or to be talking with the people that own them. They have a self image that equates themselves with lower price range houses and the people that own them, so those are the houses they pursue.



All of these reasons are fear in one form or another, and none of them are real. The beings that own high end houses are people, and they get divorced, lose their jobs, go out of business, make stupid mistakes, have bad financial management, and do all of the things that result in financial distress and necessitate a quick sale. The high dollar properties they own are real estate, just like the two bedroom one bath house in the median price range neighborhood, It can be put under contract, optioned, or creatively financed just like any other house in any other price range.



But real estate investors avoid them, and in doing so, prevent their most heartfelt dreams from coming true. The key point all real estate entrepreneurs and investors must understand is that owners of high end houses who are experiencing problems need the solutions that well trained investors can provide. And as with all real estate deals, when done properly, everybody wins. The seller gets the house sold and some cash to move, the bank gets their loans paid off, the new buyer gets a house they love, and the investor makes a profit.


A Six (or Seven) Figure Profit!



Going after high end houses is a choice. Real estate investors can attract these million dollar deals to them by setting up marketing systems that target high end houses only, and leave the lower price ranges alone. By making high end homeowners the only people you contact with your marketing, high end homeowners are the only ones that call in response. And when real estate investors have a steady stream of motivated sellers with high end houses calling them every day, their desks begin to fill up with million dollar deals. Just like a hunter going after big game, the real estate investor who sets their marketing sights on high end deals, and persists, the moment arrives when their real estate investing dreams come true.

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7 Big Reasons To Invest In Pre-Foreclosures

August 27, 2008 at 11:52 am · Filed under Invest In Pre-Foreclosures ·Tagged , ,

Looking for an “in” to real estate investing? Working a nine to five job swapping time for money can be incredibly dispiriting. After the futility of it all hits home, it’s all you can do to limit the number of home business opportunities you investigate to twenty per week. One of the more compelling home business opportunities is real estate investing. Real estate investing is the perennial wealth builder, and the transition from working a job to achieving wealth through real estate investing is becoming increasingly well documented. You’ve probably thought about investing in real state yourself but you’ve not gone for it because you thought you needed tens of thousands in savings for a down payment, and perfect credit along with strong banking relationships.



Well, you can get all that together if you want. It doesn’t hurt to have those resources. But it’s not necessary to have a huge pile of cash and perfect credit to buy a house cheap and resell it for a profit. It’s especially not necessary in the preforeclosure market. Preforeclosures are houses in the default phase of foreclosure; where the bank has filed initial foreclosure papers but the sheriff sale or trustee sale where the bank auctions off the property, or repossesses it if no-one buys at the auction, hasn’t occurred yet. Buying during the preforeclosure period is one of the best ways for anyone to get involved in real estate investing. With little more than a few hundred dollars and some specialized knowledge you can buy a house at a substantial discount and resell it retail picking up a five figure profit check in the process.


Don’t Believe It?



Well, let me give you seven reasons why it’s true:



1.) When people are in default on their mortgage they have stopped making payments to the bank. So when you are negotiating with the seller, and the bank, right up until the point where you buy, no-one is making the payments. For novice investors worried about holding costs this is a huge advantage.



2.) Preforeclosures are a very well defined niche market. One of the most deadly mistakes rookie investors make is trying to be a jack-of-all-trades, going after any and everything they can lay their eyes on. The result of this lack of focus is they are soon back at their jobs. By being a very defined market, preforeclosures allow you to develop focused marketing campaigns and standardized processes to get deals completed and closed.



3.) One of the fundamentals of real estate investing is contacting and talking “only” to motivated sellers, and avoiding all the rest. Sellers in preforeclosure are some of the most motivated sellers you will find. Their world has been turned upside-down, they are about to lose their house, and their motivation is such that they just want out of the house and the bank off their back. By buying houses from people in preforeclosure, creating 30%+ equity spreads on houses often in good condition is not a difficult thing to do.



4.) Buying houses in preforeclosure enables you to create unusually large equity spreads. Recent economic uncertainty has caused a lot of foreclosures, and rising rates will cause more in coming years. If banks had to take back all of the properties that went into foreclosure the FDIC would shut them down. They know this, so they try not to take properties back they don’t have to. By requesting the lender discount what is owed on their payoff, large spreads of equity can be created on houses that are totally “maxed out” with loans. This can’t be done on loans not in default.



5.) Because lenders are under pressure to liquidate bad loans rather than take the property back, large discounts can be negotiated. After becoming familiar with the issues that cause lenders to discount, larger and larger discounts can be achieved as you hone your negotiating skills.



6.) If your plan is to buy and hold the property, having good enough credit and financials to get bank financing excludes a great many people from getting into real estate. On top of that, if you do get a bank loan, your financial exposure is at it’s maximum when everything is in your own name and personally guaranteed. Buying houses in preforeclosure allows you to simply take over the existing financing already in place. No qualifying needed. You can take title to the property in a land trust, begin making payments on the existing mortgage(s), and still get all the tax advantages, appreciation, depreciation without any of the risk of being personally liable for the mortgage and the property.



7.) If you have ever bid at auction for property at the courthouse steps, you are only too aware of the competition breathing down your neck. Lots of mind games. The 40 thieves are talking trash to you trying to get you not to bid. If you are Larry Bird, no problem. Make sure you have $500K on your credit line though. However if you are not the ‘Bird’ and you don’t pack half a mil’ of credit, you can sneak in and avoid this NBA showdown by buying the house during the preforeclosure period… before the auction.



Make no mistake about it, there are many ways to make healthy profits in real estate investing. But when you look at how easy preforeclosure makes it to buy houses cheap and resell for five figure profit checks, all the while helping people out of agonizing life circumstances, it makes little sense to pursue real estate investing any other way.

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Being an agent, is this legal?

August 25, 2008 at 6:12 pm · Filed under Is it legal?

Would someone know if working as an agent, one can also work for a home builder of sorts?

The employement aspect would be entirely seperate from each other, however, if I obtained a customer from my agent office could I offer the other service as well, is this legal?

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