This action might not be possible to undo. Are you sure you want to continue?
Newsletter of Mid-America Association of Real Estate Investors July 2008
Local & National Property Marketing
Market your property and Build your Buyer’s List
Whether you inherit a home, buy a home, relocate, invest or work as an agent, we can all find ourselves needed to market a home For Sale or Rent. Even if you buy an investment property – to sell – you can end up renting because of unforeseen circumstances. The best marketing will not only target the typical audience but go far beyond. Good marketing is all about exposure, great marketing provides exposure with results, and great marketing provides the saturation to almost guarantee a rental or sale. The follow are some guidelines we use when marketing our property. First – This is not a sales pitch. These are great ideas you can use to market your own properties; however, massive marketing results can be overwhelming. Sometimes I receive 300 emails or more per day. Second – We provide two levels of marketing services; basic and featured. Our company creates and implements the ideas outlined in this article, FOR YOU and YOUR PROPERTY. Last – That’s all the sales pitch; now for the marketing ideas. Realtors - Most investors and property owners are familiar with the most common method of exposure; Realtors. This should be your first stop traveling up the marketing ladder. This will provide great exposure to people looking for property to buy or rent and someone to answer their questions. It provides someone to do your job. The Multiple Listing Service - MLS exposure can ONLY be provided by a Realtor. Some areas offer a “Flat Fee” Listing; however, this does not provide the extensive sales experience of a competent Realtor. Your MLS exposure should be provided by a licensed Realtor who is listing your property as a Listing Agent. This means they are working for you. Yard Signs - Signs are almost always provided by the Realtor you are working with and you should make sure your agent has a clean, readable sign to place in the yard or the home. Don’t allow an agent to place anything that doesn’t look good. It’s still your yard and a good looking sign will attract better buyers. The average marketing will provide what you need in a good real estate market, but sometimes the market can slow down and you need to be prepared to augment your Realtor with additional marketing. If you do what everyone else does, you’ll get the results everyone else gets. Instead you should stand out from the crowd and go beyond the norm. Besides the standard Real Estate sign, you need to contact your local sign company or Amy at Carolina Signs (980) 329-4414 (firstname.lastname@example.org). You need more than just a yard sign. Think about what stands out. When someone has a baby and there are multiple signs in the yard, you notice. When a neighbor has a yard sale, you notice. When a Realtor has an open house, you notice. You need to think “outside the box” and go beyond what everyone does. DO MORE!!! 1. Multiple Yard Signs – Square Footage, Bedrooms, Baths, Age, 24 Hrs Recorded Msg. #, Etc 2. Banner – Prominently placed over the door or window 3. Directions Signs – Places at every street corner for half a mile 4. Balloons – Tied to the signs and replaced every few days Photos - You can start with clear, well-lit, in focus photos of the property. You know your house better than anyone else. You know what the best features are. Photograph them and make the photos available. Many MLS services will only allow 6-12 photos, but you should take far more. You’ll need them for the other marketing. For example, don’t just get the front back and sides. Take a picture or your neighbor’s house and the house across the street. Stand in the road and take a couple photos of what the neighborhood looks like. Stand on your front and back porch and take a photo of the yards. Let buyers know what the “Home” looks like, not just the house. The “Home” includes the yard and the neighbors. A “House” is just four walls and a roof. Instead of a couple pictures of the inside, take a picture of every room from the door way. Then take a picture of the door way from across the room. Take a couple pictures of the kitchen and bath(s). Don’t stop there. Go beyond the boundaries of the property and the street. If there’s a clubhouse or golf course, get photos. If there’s a community center – public or private – take photos of it. If there’s a mall nearby or a shopping center, let your buyers know and show them what it looks like. Since this article will cover marketing NATIONALLY, your photos will be the only view some people get until after a contract has been signed. Make sure your pictures represent the house well. If you have a website, the photos can be uploaded for easy access. There are also hosting services which will store your photos for others to download 24 Hrs a day. USE THEM. Make sure the people looking at the property can see it any time. Get the photos on-line.
(Continued on page 12)
Mid-America Association Of Real Estate Investors
Mid-America Association of Real Estate Investors (MAREI) is one of the largest real estate investor associations in the mid-west. MAREI members consist of full and part-time investors, beginning investors, real estate brokers and agents, attorneys, contractors, accountants, property managers, renovation specialists, appraisers, bankers - people who want to enjoy the many benefits of real estate investing. MAREI was established in 2003 and promotes networking and educational opportunities to its membership. MAREI services members in Kansas, Missouri and Nebraska.
INVESTMENT NEWS © 2008 by Mid-America Association of Real Estate Investors (MAREI), a Real Estate Trade Association. Published monthly by MAREI and included as benefit for our members. Quotations and reprints are permitted with full credit given to author, plus “The Investment News: Newsletter of Mid-America Association of Real Estate Investors.” Subscriptions are $59 per year or are included with membership. MEMBERSHIP Twelve month individual membership is $99, 2 Person Membership is $149. Guest Fee is $25. Articles must be received by the 1st of the month two months prior to issue date to be considered for publication. To be considered for a specific issue, it is recommended you contact the Editor at least three months prior to issue date. All submissions are at the discretion of the editor and are subject to editing. Advertising space deadline is the 1st of the month one month prior to publication. All camera-ready artwork and materials for non-camera ready ads are due by that date. Please see www.MAREInet.com for more information.
CODE OF ETHICS MAREI members are expected to be civic minded and willing to operate with high standards of honesty and integrity. It is our duty to conduct ourselves with the highest principles of the free enterprise system. We strive for MAREI to be synonymous with competence and fairness. As MAREI members, we hereby bind ourselves to this code of ethics: 1. 2. 3. 4. 5. We shall not discriminate against any person with regard to race, color, religion, age, national origin, sex, handicap or familial status as defined by current Kansas, Missouri, or Nebraska law. We shall recognize that real estate is a service related industry. We shall refrain from engaging in any illegal practices, or defrauding any member, customer, or association, with the aim of always conducting business in a professional manner. We shall endeavor to stay informed and updated on matters affecting housing in our communities, and adhere to local, state and federal laws. We are individually responsible for our own due diligence and continuing education. Members are expected to verify any and all assumptions regarding business decisions to prevent falling victim to fraud, misrepresentations and illegal practices.
To provide education, discussion and networking opportunities to help real estate entrepreneurs & investors reach their financial goals using sound, honest business practices.
All members of Mid-America Association of Real Estate Investors and guests must wear a name badge to all General Meetings. There will be no exceptions.
Further, if any allegations of conduct considered detrimental to the purposes and interest of MAREI are received in written and signed communication to the management, we will consider the matter. Should a decision to take further action be made, a furnished copy of said allegation (s) to the accused, who shall be given adequate time to reply. Thereafter, management shall take such further action as it may deem property and in accordance to this code of ethics.
The information contained herein is believed to be accurate; however, it is not guaranteed or warranted in any manner and is subject to change without notice. Writers’ and speakers’ opinions are not necessarily those of MAREI. You are advised to seek professional advice.
Mid-America Association of Real Estate Investors PO BOX 8685 Prairie Village, KS 66208 Phone: 816-523-4400 Fax: 816-523-4448 www.MAREInet.com Info@MAREInet.com Mid-America Association of Real Estate Investors is a Member of the National Real Estate Investors Association And the National Association of Responsible Homebuilders & Remodelers
———— Investment News —————
Tax-Free Profits on All Your Real Estate Deals? Yes You Can!
By Edwin Kelly, Director of New Business Development for Equity Trust Company Harness the power of real estate and alternative asset investing in an IRA to make tax-free or tax-deferred profits for the rest of your life! After completing a successful real estate transaction, do you ever wish a chunk of the profits didn’t have to go back to the IRS for taxes? Do you ever dream about how many more real estate deals you could do or how many more properties you could buy if profits weren’t split with the government because of taxes? Well dream no more. Realizing tax-free or tax-deferred profits on real estate investing is a reality. Government sponsored retirement plans such as IRAs and 401(k) s allow you to invest in almost anything (including real estate), not just stocks, bonds and mutual funds. And all the benefits those plans provide, tax-deductions and tax-free profits, apply to whatever investment you choose, including real estate. The Power of Tax-Deferred and Tax-Free Profits "The most powerful force on Earth is compounding interest." - Albert Einstein One of an IRA's greatest features is that it allows Americans to enjoy the true power of tax-deferred compounding interest. Compound interest occurs when interest is earned on a principal sum along with any accumulated interest on that sum. In other words, you are earning interest not only on your original investment sum, but also on the interest earned from the original sum. Compound interest can occur with any investment you make, but the "true" power of compounding interest is obtained when you make an investment in a tax-deferred environment, like an IRA. By taking advantage of an IRA's tax-deferred status, you do not have to pay tax immediately on your earnings (like the sale of a property or rent collected). Thus, you are able to enjoy the power of compounding on ALL of your profit, not just what is left after taxes. Now apply those benefits to your real estate or alternative asset investing. Tax-deferred profits on your real estate transactions allows greater flexibility to make more investments, or to just sit back and watch your real estate investment grow in value, without worrying about taxes. Is This for Real? Most investors don't know this opportunity exists because most IRA custodians do not offer truly selfdirected IRAs that allow Americans to invest in real estate and other non-traditional investments. Join Edwin Kelly, the director of business development with Equity Trust Company to learn how you can purchase real estate with your Equity Trust Company self diOften, when you ask a custodian/trustee, "Can I invest rected IRA or other self directed retirement in real estate with an IRA?" they will say, "I've never account. Find out how you can do this both tax deferred or TAX heard of that" or, "No, you can't do that." What they FREE. Find out how you can acquire a $40,000/year tax deduction really mean is that you can't do this at their company because they only offer stocks, mutual funds, bonds, and invest the proceeds. Need more funding for your deals by creor CD products. ating your own private bank with unlimited funds for your real estate deals. Speaking at MAREI’s EXPO 2008 on Sunday October the Only a truly self-directed IRA custodian like Equity 12th. Visit www.MAREInet.com or page 6 for more info. Trust Company (www.trustetc.com) will allow you to invest in all forms of real estate or any other investments not prohibited by the Internal Revenue Service. Is This Legal? It sure is. Since 1974 Equity Trust and its affiliates have assisted clients in increasing their financial wealth by investing in a variety of opportunities from real estate and private placements to stocks and bonds in self-directed IRAs and small business retirement plans. IRS Publication 590 (dealing with IRAs) states what investments are prohibited; these investments include artwork, stamps, rugs, antiques, and gems. All other investments, including stocks, bonds, mutual funds, real estate, mortgages, and private placements, are perfectly acceptable as long as IRS rules governing retirement plans are followed. (To view IRS Publication 590, please visit www.trustetc.com/education/irs-pubs.html.) Getting Started “Is it hard to do?” is a common question about investing in real estate with a self-directed IRA. It is really simple and is very similar to the way you currently invest in real estate. In no time at all you can be investing in real estate and other alternative assets receiving tax-free or tax-deferred profits for the rest of your life. The main difference between self-directed investing and general investing is that you and your IRA are two separate entities, and as such, everything related to your investment (the property deed, property insurance, etc.) needs to be titled in the name of your IRA and not you personally. Also, all profits or expenses generated from the investment must come from and to the IRA, not your personal funds. If this opportunity sounds like the right fit for you, don’t delay in opening an account. Every day that passes is one less day your investment can benefit from the Earth’s most powerful force (at least according to Einstein), compounding interest. For more information about self-directed IRA investing, the plans and services available to you, and how to get started, please contact Equity Trust Company via www.trustetc.com or by phone at 1-888-ETC-IRAS.
Edwin Kelly "Self Directed IRAs"
———— Investment News —————
General Meeting ~ July 8th ~ 6pm Networking ~ 7pm Presentation ~ Overland Park Marriott
MAREI Presents: Host of “Real Estate Investing for the Regular Guy,” Dan Reedy
Local Investor Dan Reedy Hosts on online radio show "Real Estate Investing for the Regular Guy" at 10 am on Saturday Mornings. But on Tuesday July 8th, MAREI will be turning the tables on Dan and interviewing him to get the his story on investing right here in Kansas City. We often have vendors who provide services on stage or teaching investors from out of state telling us "How to do it!" But on Tuesday, we will find out the real story from a real investor who does it full time, right here in Kansas City! Join us on Tuesday the 8th to learn: • How Dan got started in real estate, what did he do to kick off his successful investing business. • All new business have mistakes, and we will ask Dan what his top mistakes where when he was getting started. • As well, we want to find out some of his successes. • What would he change if he could go back • Advice for new investors getting started • Dan's thoughts on the local market • And Dan's Niche, how does Dan invest here in Kansas City • And more. (please email questions to info@MAREInet.com) Every real estate investor needs a support group and the new people really need to hear from a live local person to find out how it is that real live people invest here in Kansas City. Experienced investors really need to hear the same so they can benchmark their business against others. And some times you just need to hear how other people work out their issues. This is your opportunity. Join us on Tuesday the 8th, bring your business cards for networking from 6 to 7:15, bring your flyers on deals you have and pitch them when you have the opportunity, be sure to visit with Dan and his staff before the meeting, and bring a notepad and pen because you will want to write a few things down.
Tuesday July 8th 6:00 pm Networking 7:30 pm Presentation Sponsor Meeting: $200 Reserve Networking Table: $35 for Member’s
Overland Park Marriott Located I435 & Metcalf at 110th Members Attend FREE $25 Guest fee at Door PreRegister for $15 on Web Site More info www.MAREInet.com
———— Investment News —————
Tips & Tricks: The Top Ten Reasons Why People Don’t Invest in Real Estate
By Robert Shemin, Esq Reason #1: I Have No Cash The Myth: "You need money to make money." The Truth: Find a good real estate deal, and the money will find you. A lack of funds is never an issue, but lack of good deals is. If you can negotiate a good price on a house, you'll find plenty of partners who are willing to put up the money. Reason #2: I Don't Have Any Time The Myth: "I've got a job, a spouse, kids and very little time." The Truth: Get rid of your television, and you'll have all the time you need. People spend an average of three hours per day in front of the tube. Want to do something fun this Saturday? Load the kids in the mini van and go driving around looking for ugly houses. Make a game out of it giving a dollar to each of your kids that spots an ugly house. Reason #3: Everyone Says This Stuff Doesn't work The Myth: "That late-night TV stuff doesn't work." The Truth: You can convince yourself that anything won't work. Henry Ford once said, "Whether you think you can or think you can't, you are right." Every real estate transaction has risks. Some risks are realistic, while others are remote. If you listen to the critics, naysayers, and other pessimists, you'll convince yourself it doesn't work. Make it a point of not taking financial advice from people who make less than you do. Learn the techniques, and then adapt them for your market. Reason #6: The Recession is Coming The Myth: "After the September 11th tragedy, the huge number of layoffs and the decline of the stock market will kill the economy, so anything I buy now will go down in value." The Truth: Sell cheaper or with attractive terms. When Dell wants to move computers, they drop the price. When GM wants to move cars they offer no interest financing. Be creative and do things that will make your houses sell and rent faster. If the prices are falling, buy way below market and sell just below market. If rental vacancies go up, offer free satellite TV. When everyone else is "dooming and glooming," it only clears out the competition. Reason #7: Realtors Won't Cooperate With Me The Myth: "Real estate agents don't want to cooperate with investors." The Truth: The right agent can be your best friend and #1 source of business. I have a one agent that brought me six deals in the past year. He knows exactly what I want and only calls me
(Continued on page 12)
Robert Shemin "Millionaire Real Estate Investor"
Attorney, Robert Shemin, is another favorite at MAREI events. He has high energy and has plenty of implementable ideas! Robert began in 1992 when he met a couple who drove an old beat up pick up, yet had a monthly net income of over $65,000 solely from real estate. Inspired, Robert Reason #4: There's Too Much Competition shifted his focus to real estate and personally The Myth: "Too many people are buying houses to bought more than 450 homes while documenting find a deal." his techniques. If you want an easy, low-risk way to attain financial freedom, then this The Truth: At any given time, there are hundreds of is it. If you want to quit your JOB, then discover solid, proven strateproperties for sale in your market for each investor gies for attaining financial independence through real estate. Find out looking for them. how to locate, evaluate and negotiate for properties in one of the naIn addition, several investors are just sitting on the tion's most dynamic markets and how to apply your new knowledge of sidelines waiting for someone to fall in their lap. Don't buying in your own back yard. Robert is an expert at systems and will be one of them—go out and make deals happen. be sharing several of his: • How to Find Great Deals Reason #5: It doesn't work in my market The Myth: "It doesn't work in my market." • How to Negotiate the Best Deals • How to be the Best Landlord The Truth: It works in every market. True, it may work Robert's course is an excellent beginner course to get you started differently in some markets than in others, but there are investors making money in every city, every day of and for the more experienced investor you will get a great refresher and still walk away with a few new items to implement in the next the week. month! Speaking at MAREI’s EXPO 2008 on Sunday the 12th. Visit
To set yourself apart from the competition, you have to learn your market: the rents, trends, local customs, bankers, and title companies. www.MAREInet.com or page 6 for more info.
———— Investment News —————
We will be joined by many local and national Vendors who have products and services to help make your business easier!
On October 11th & 12th, 2008 at the Overland Park Marriott Hotel in Overland Park, KS, EIGHT of the nation's sought after, successful, multi millionaire Real Estate Speakers who live what they teach will be front and center to reveal their secrets, strategies and systems directly to YOU! We have lined up this all-star cast to offer YOU an unique experience and exclusive content that will launch your investing career into outer space! These speakers travel the US speaking at Conventions, Expo's, and Boot Camps and we have persuaded them to come to the Kansas City Area to teach you the highly successful tactics that they use every day to make millions of dollars investing in Real Estate.
So consider this your invitation to come and discover the closely guarded secrets from the nation's ELITE Speakers, Trainers & Authors on such topics as:
How to get Started the RIGHT way in Real Estate How to buy low and sell high with REO properites. How to Make Big Profits in Apartment Buildings How to Get Those Properties Renovated Effectively so they Sell Fast! Exploring the Alternative Investment Strategy of Buying Notes How to Create Your Ultimate Internet Marketing Machine
and MUCH MORE!
WE ONLY HAVE SPACE FOR 200
With all the opportunities in today's Real Estate Market to buy up GREAT BARGAINS, this event will fill up fast. Don't wait until the last minute or you may miss out! Visit www.MAREInet.com and click on EXPO 2008 for more info and registration!
———— Investment News —————
Asset Protection Insurance Agency Investor Owned Insurance
• • • • • • •
Vacant or Occupied Properties Properties Being Rehabbed Hazard & Liability Insurance Entire Portfolio Under One Policy Monthly Premium Notice Fast Quotes Professional, Courteous & Knowledgeable Staff
This is a Business Card Sized Ad MAREI members place An ad for one month $25 Or included in Business Membership
APIA, Inc. 877-752-2742 www.reoins.com
Dedicated to Excellent Service
FREE LEGAL CONSULTATION*
Consult with an Attorney Experienced in
Tile and Stone Direct to the Public -- at Wholesale Prices! Call Randy Deutch www.TileandStoneWarehouse.com 9821 W 67th St : Merriam KS : 913-432-7900
Real Estate Law and Estate Planning
David R. Nachman
816-474-4114 * 15 minute consultation
Tucker One Properties, Inc.
Rehab ~ Wholesale ~ Foreclosures www.TuckerOneProperties.com
115 E. Gregory Kansas City, MO 64114 Phone: 816-523-4400 Fax: 816-523-4448
KC Family Home Buyers Joe Shojayi
Joe@kcfhb.com 913-851-4424 888-279-3058 www.kcfhb.com
Property Specialist Cell: 816.507.4203 Email: email@example.com
Kyle Bush Jeff Williams
We specialize in providing rehab loans to real estate investors. FAST Closings & No Junk Fees! Phone: 913-563-7170 Fax: 913-563-7179 Web Site: http://www.FortressLending.com/kc
John & Donna MacNeil
Originators of the Yellow Letter Marketing System
Yellow Letter Automated Mailings
Phone: (904) 880-2742 Fax: (904) 880-2741 Email: firstname.lastname@example.org Website: yellowletter.com
———— Investment News —————
GRACE REAL ESTATE COMPANY LLC
ONE STOP SHOP
REAL ESTATE SERVICES Full Service Real Estate Company FINANCING Hard Money & Rehab Loans No Seasoning on Title Refis LLC Loans RENOVATION SERVICES FULL SERVICE PROPERTY MANAGEMENT WE LOOK FORWARD TO HELPING YOU WITH YOUR FUTURE FINANCIAL SUCCESS 816-453-5532 OR 816-456-1843 email@example.com
Patrick and Marta Grace
GRACE REAL ESTATE COMPANY LLC 5545 NORTH OAK TRAFFICWAY #1
REHAB LOAN COMPANY
HELPING INVESTORS GET THE MONEY
√ √ √ √ √
Commercial & Blanket Loans Hard Money Loans Purchase Money Corporation / LLC Loans High LTV Investment Property Loans
√ √ √ √ √
Rehab / Short Term Loans End Loans Lines of Credit Rate and Term Refinance No Seasoning on Title Loans
Call With Your Scenarios and for Qualifications. Quick Closings, Good Service, Good Rates! Pat Grace 816.453.5532 or 816.456.1843
———— Investment News —————
Newsletter & Service Guide
Our monthly newsletter is the Investment News. All of our MAREI Business members receive a Business Card ad or a monthly $25 credit for a larger ad. The Investment News is currently mailed out in paper version to approximately 320 addresses and handed out at our monthly meetings. We also post our newsletter archives on our web site for any new members or guest to read past articles. Or write an article to be included in our newsletter that will showcase your expertise. We will include your contact information at the end of the article. Cost is currently just $50 for a one page article in the newsletter and posted on the web site for members.
JEFF BASLER PORTFOLIO MANAGER
INVESTMENT PROPERTY REHAB LOAN SPECIALIST
FLATIRONS FINANCIAL, INC
O: 816-474-0010 C: 913-568-9344 F: 816-474-0016 FOR TURN KEY RENTAL PROPERTIES CONSISTENT CASH FLOW & APPRECIATION WWW .JBFUNDINGLLC.COM
EMAIL: SALES@FLATIRONSFINANCIAL.NET PHONE: 913-393-2448 or 866-393-2448 www.FLATIRONS.LENDINGSTATION.COM Ask us about MAREI membership reimbursement with your loan!
Beth Langston Homefront LLC
Call me to review your portfolio! 200 NE Missouri Rd, Ste 200 Lee’s Summit, MO 64086 816-246-5999 cell Beth@homefrontcapital.com
Accurate Title Company, LLC Ron Kraft
Title, Closing, & Escrow Services
7011 W 121st St, Ste 100, Overland Park, KS 66209 Jackie White / 913-338-0100 / Fax 913-338-0107
A Area New Brokerage For Real Estate Investors By Real Estate Investors Now filling team player positions
♦ Office Located in Waldo 816-523-4400 Temporary Web Site RRKC.wordpress.com MO Broker: Don Tucker KS Broker: Kim Tucker ♦ ♦ ♦ ♦ ♦ ♦ ♦
Experienced REO Buyer’s Agent REO Listing Agent with Experience Residential Specialist First Time Home Buyer Specialist Short Sale Listing Specialist Area Regional Specialist Commercial Agents Investor Buyer / Agents Currently with 25 years experience
———— Investment News —————
Each of our General Meetings feature about an hour trade show before the presentation. Please arrive around 6 pm to visit with all of our vendors who have reserved tables. If you would like to have a table at the meeting or would be interested in sponsoring a meeting, please visit the calendar on the MAREI web site for more information. Vendor Tables are $35 for members and $75 for non members or sponsor the entire meeting. Reserve your table through the Calendar online or email us at info@MAREInet.com.
♦ ♦ ♦ ♦ ♦ Determine Target Market Determine Message Select Web Site Name, many available through www.GoDaddy.com for about $8 annually Create Web Site, and link to Web Site Name, great free web site source www.WordPress.com Build a database of potential clients and people who will refer you business, and send them a regular email with you Marketing Message. Add every person you meet or who sends you an email to your database. Create a signature to put on all your emails including your name, your phone, your message in a few words, and your web site. Submit your web site to ever search engine you can find: ♦ Google.com ♦ Yahoo.com ♦ Google Local ♦ Yahoo Local ♦ TrueLocal.com Note most will call you back to ask for paid advertising, skip at this time. Email out to your best clients who might also want to advertise, send them a link to your listing on the above web sites, ask them to write a recommendation for you, and tell them how to list their site as well. Figure out where your target market my frequent in person or online and join face to face and online social networking groups: MAREI meeting on 2nd Tuesday of the month and our yahoo group online for example. On the Online Social Networking Groups, share your expertise, answer questions, question other posts. Staying professional but injecting some controversy will get you more action on the sites. So if you hear of something related to the site, that might be controversial, post differing opinions on the subject and ask for responses. Figure out what your target market may read and advertise there. For example if you want to reach investors and people who work with investors, this newsletter would be excellent. Just remember that one ad is a waste of money. People need to see your ad at least 3 to 6 times before it will stick, and showing up to the meetings to put a face to an ad will get you more business.
MAREI’s Expo 2008 Sponsorships Available Market Your Business to our Attendees Call Kim 816-523-4400 Info@MAREInet.com
NEED TO FLIP A PROPERTY FAST?
T.O.T.L. (TOP OF THE LINE) RENOVATIONS
will complete all your rehab needs quickly, at a reasonable price.
We specialize in: • Make - ready • Siding and Windows • Carpentry & Roofing • Plumbing & Electrical • Painting & Flooring • Drywall & Doors • Fences and Decks • Kitchens and Baths
Call Anthony @ 816-606-0266 or Emily @ 816-252-0095 Page 10
———— Investment News —————
What do you mean ‘It hasn’t been Assigned yet?’!!
I get calls from investors telling me their nightmares about getting their Short Sale Packages noticed. I’ve even had one investor tell me it was enough to discourage them from even bothering with investing in Short Sales altogether! So what’s the deal? Why is it so hard to get the bank to do the simple task of reading and responding to my offer? I mean, don’t they want to do this? Aren’t they flooded with Foreclosures? Doesn’t it make sense for them to act QUICKLY? Don’t they lose even more money by waiting 60 days to before reviewing the deal? There are some easy fixes to the problems that most investors face when submitting a package to the bank. The trick is in understanding the context of the problem. That is the most important part of resolving this conflict. Once you understand the context of the issue, you will be better equipped to prevent any delays where possible. A side benefit, and to some investors, the most important benefit, is that you will learn how to get your deal moved to the top of the stack of offers that come into the banks each day. RULE #1 Control the things you can control…let the rest go. There are some institutions that are so overloaded that they will never review a package until after 60 days just because of their true inability to deal with their workload. They are processing files using the ‘TRIAGE’ method (those that need it most, get it). In other words, there are exceptions to every rule. Find the exception to the rule that fits your deal and apply it. Example – I am working with a Customer that is NOT in Foreclosure yet. We are processing a Short Sale (yes, you can do Short Sales when the account is NOT IN FORECLOSURE). The customer received a 60 Day Demand letter. The letter basically says, ‘pay up by 2/15/08 or else…’ The Short Sale was submitted to the bank on 2/10/08 and they advised that it would be 21 days before it was assigned. Here is the dilemma, if the file does not get assigned until 3/3/08, the bank may have already retained an attorney for Foreclosure (something that the homeowner does not want). How do we get them to review it before then? The answer is, ‘We don’t”…Really. The real issue is not getting the deal reviewed RIGHT NOW but rather, will they hold off on the ‘OR ELSE’ clause of the demand letter until the file gets reviewed. If yes, then we wait patiently. If not, then they WILL assign it to a Mitigator NOW. So what happened? They agreed (with the debtor on the phone via conference call to hear them say it) to ‘postpone all foreclosure and collection activity until the file was reviewed’. Can you apply this same policy to a file where in the Foreclosure Sale Auction is going to take place prior to the file being assigned? The answer is YES YOU CAN. Take a large felt tipped pen and handwrite the following message on the fax cover sheet; “Foreclosure sale date - ___/____/___ “ Then, fax the offer in. Once you have confirmed receipt of the fax, you can call them and give them the choice to make the decision to either assign it NOW or Postpone the Foreclosure Sale. ‘Yeah, but what if they won’t even read that part and still give you the company line, “we don’t review them for 60 days so whatever happens, happens…” In that case, turn around and fax the same offer to the Foreclosing Attorney and carbon copy the judge that authorized the Foreclosure Sale (in judicial states). RULE #2 Mitigators like the EASY MONEY
If you want your package to get moved to the top of the stack, then make it look like a deal that the Mitigator won’t have to work so hard on. Investors are the same way. Don’t you, as an investor, like the “low hanging fruit”? So how do you make your deal look like a slam dunk to the Mitigator? Well, let me give you a few pointers1) Always use a CLEAN fax cover sheet that contains; a. b. c. d. Your contact info The debtor’s name, loan number, and prop add The bank’s name, phone and fax number The reason for the fax
(Continued on page 12)
Steve Dillon “Former Loss Mitigator” Steve Dillon with 15 years of negotiations, has performed over 8000 short sales worth over $2,000,000,000.00. Steve spent over 12 years working for two huge mortgage companies training Loss Mitigators, developing Loss Mitigation Policies and Procedures, and coordinating with Fannie Mae, Freddie Mac, FHA, VA and various Private Mortgage Insurance companies before coming to the rescue of the people on the other side of those negotiations - THE INVESTOR. Steve wants you to know there are Secrets the Banks don't want You to know! Speaking with Curtis Brooks on Saturday, October 11th at MAREI EXPO 2008. Visit www.MAREInet.com or page 6 for more information.
———— Investment News —————
Video - A walkthrough of the property can be invaluable, especially with executive-type homes. Most modern camcorders plug into your computer for easy transfer. Just like the photos, this should be uploaded and made available 24 Hrs a day. Also like the photos, make sure the video is well lit and thorough. Walk around the outside of the house. Drive down the street. Narrate the video and talk about the area. Tell buyers what you like. When walking through, make sure you show closets, attic storage and other items you like about the house. Talk about the property and experiences you’ve had in the house; rehabbing, living, renting. Make the video personal. Appraisals - A costly part of selling can be determining the true value of a property. This can be costly from two aspects; the money spent on the appraisal and a lower value than expected. But, the sooner you find out the real value, the quicker you sell. You agent can also provide a CMA (Comparative Market Analysis) or BPO (Broker’s Price Opinion). Most real estate companies don’t charge for this service if they are listing your property. This is another advantage of using a qualified Realtor. Like the Photos and Video Walkthrough, the Appraisal should be accessible any time of the day. People interested in the property shouldn’t have to call you or the agent to find out what the property is worth. You should be proud of the value – you should be selling for LESS THAN THE VALUE. The Photos, Video and Appraisal or BPO will need to be available to 24 Hr download. This is crucial to additional marketing we’re getting ready to talk about. Make sure you have a reliable service for hosting your information. Godaddy.com provides a reliable data-storage-service which is great. I have used this service in the past. Repairs - If the property needs and repairs, these should be listed and priced by a licensed General Contractor. This provides someone for the perspective buyers to call about the property. This is someone you need to spend some time with and explain that you will try to get them the job, if the price is right. You should require them estimate to be in writing and include photos of any proposed work. This accomplishes two things; additional photos and a reliable quote – maybe. If the repairs are small (carpet and minor paint) one estimate will be enough. But, if the repairs are extensive, you should always get at lease two quotes and make sure the contractor emails the estimates. This will make it easy to post the Repair List with the Photos, Video and Appraisal. As you can see, we are developing a resource of data which should substantiate our asking price for sale or rental of the property. By provide more than just a few photos, the buyer or resident has been given a complete view of the property, value and condition. Property Description - A written Property Description Sheet should be filled out for every property you work with. We have created a sheet that goes beyond the beds and baths. You should list all the features of the property; rooms, size, appliances included, type of cabinets and countertops, lot size, construction type, storage areas, schools, utilities (include contact numbers), furniture included, fixtures, Realtor’s name and contact information, and anything else you can think of. Read the full article by Greg Gardner & Michelle Wilson on our web site. Go to www.MAREInet.com and click on Articles.
(Continued from page 11)
2) 3) 4) 5)
Send a Completed Contract (Purchase and Sale) Send an Estimated HUD1 or Net Sheet Send an Authorization to Release DON’T send anything they did not ask for
Yes, I know that in order to get your deal approved, you will need to send in a whole bunch more. Your right, but in the beginning, it needs to be clean and simple. The real secret is using these seemingly ordinary documents to paint a picture of “HEY LOSS MITIGATOR, THIS IS A SLAM DUNK DEAL…LOW FRUIT THAT IS ABOUT TO FALL OFF THE TREE!!!”
(Continued from page 5)
when there's a deal. You need to educate a few agents and let them know exactly what you want. Few agents have repeat customers—help them understand that you will give them business over and over again. Reason #8: I Have Bad Credit The Myth: "I need good credit to buy houses." The Truth: Good credit helps, but you don't need it to make money in real estate. Lease options, owner financing, flipping properties, and other creative techniques will allow you to buy real estate without good credit. In addition, you can always use a partner who has good credit. Or, you can borrow "hard money" without having good credit. In the meantime, you can work on fixing your bad credit so you can use it as an asset in the future. Reason #9: I Might Lose Money The Myth: "Real estate is very risky." The Reality: Real estate is one of the safest investments you can buy. Savings, CDs, and money market funds won't give your enough return to make money. You have to be willing to take a calculated risk to make money. The more you educate yourself, the less risky real estate becomes. However, don't think you need to know everything before taking any action. Reason #10: I Don't Know What To Do The Myth: I need to learn more before I start The Reality: You probably know more than enough to get started in real estate. It takes years to learn a lot. You can never learn everything there is to know about real estate. Success is an ongoing learning process. Read some books, take some seminars, and go take action. Then, learn some more and take a lot more action. If you're really impatient, enlist the help of others.
———— Investment News —————
Three Faces of Foreclosure
By Andy Heller and Scott Frank
So you want to invest in residential foreclosures? Not sure quite where to start? It is helpful to understand first that there are three faces to “foreclosures”, each with very different characteristics. The first face of foreclosure investing is the “preforeclosure”. The pre-foreclosure period begins when a homeowner gets behind on his or her loan, and ends with the foreclosure sale. The pre-foreclosure phase itself is divided into two stages. The first stage covers the period of time beginning when the homeowner misses their first mortgage payment, and ends in the final month preceding the impending foreclosure sale. During this time if a homeowner is not already marketing their home, it will be up to the investor to reach out to and find these distressed homeowners through ads (“We buy homes fast” and “We have CASH for homes”) and networking.
On the plus side pre-foreclosures can be very, very lucrative. A typical pre-foreclosure might have an investor paying off a distressed homeowners $220,000 loan, giving the distressed homeowner $25,000 in cash to restart their lives, and taking over the $350,000 property. The primary negative associated with pre-foreclosures is the taxing emotional element associated with constantly dealing with homeowners involved in a downward spiral. Simply put, this will not be feasible for every investor. Almost twenty years ago we were one of those investors fresh out of one of those “get rich quick” seminars. Our model was to focus on pre-foreclosures, and we went to one and only one home. The family we visited was the most likeable family. The husband was a veteran, and both he and his wife lost their jobs within a short time of each other. When visiting the home their little girl took my hand and showed me the “doggie window”, the hole in the kitchen door for their family dog to go in and out of the house. I left this visit emotionally drained and with a sour
(Continued on page 14) The second stage occurs during the final month leading up to foreclosure. The precise laws differ from state to state, but most states require some form of public notiAndy Heller fication of a pending foreclosure. Investors can "The Original Notebuyer" seek out these notifications, and many have ample contact information for the investors to apWhen it comes to a sensible approach to buildproach the distressed homeowner. Many larger ing long lasting wealth in any market, Andy has communities have a number of online and subgo it down. Already a successful investor and scription services which compile the pending Fortune magazine recommended author, Andy foreclosures in a specific geographic range. You has put together an all inclusive system to show can also network within your local real estate how everyday investors with day jobs can build investors association and/or do an internet large amounts of wealth in real estate. search (e.g. “foreclosure listings in order to find these publications and services). Listen in as Andy shares an invaluable update The pre-foreclosure face offers wonderful wealth on the current foreclosure market throughout the US. The last 16 months have been a whirlwind of activity in every city in the US and it generating potential to investors. They can apis time to be a part of it. Andy shared an hour of his time to explain proach distressed homeowners, and give them the post-foreclosure process and how to cash in on it for long term some quick cash when there is ample equity in the homes. There are also opportunities to work wealth building. with some of the foreclosing lenders directly Are you dying to know more about the post foreclosure and lease op(with the distressed homeowner’s approval of tion process? Andy shared in his most recent interview how the percourse), as it is in the lenders interest to avoid fect storm is brewing for buying post-foreclosures and providing these costly foreclosures. homes under a lease-option program. It is more and more difficult for Pre-foreclosures may be arguably the most writ- people with hiccups in their credit to get a mortgage. Lease-options ten about method of finding discount property. It are becoming the perfect solution for them to get a home and for you is amazing how many distressed homeowners to build long term wealth without many of the issues that come with wait to the last minute with their properties, albeing a general landlord. Make sure you take the time to invest in ways thinking they would be able to bail themyour education and listen in to this interview for the first time or review selves out. It is then, with little time left on the it again. clock, that some of these distressed homeowners realize that the only viable remaining option Speaking at MAREI’s EXPO 2008 on Sunday the 12th. is an investor in a position to move quickly. Visit www.MAREInet.com or page 6 for more info.
———— Investment News —————
(Continued from page 13)
feeling in my stomach. This was the last pre-foreclosure we ever visited. The second face of foreclosures is the “foreclosure sale”. This occurs when the loan on the home is not brought current by the distressed seller or the home is not sold. Again, the procedures and process have slight differences from state to state, and prospective investors will need to educate themselves as to the foreclosure sale process in their respective state. For many states, the sale of the property takes the form of an old fashioned auction on the courthouse steps (in many states this occurs on the first Tuesday of every month). Like pre-foreclosures, this also can be quite lucrative. However, unlike pre-foreclosures, there is no emotion element other than controlling your adrenalin at the foreclosure sale. The main drawbacks are that often investors are bidding on property they have not been able to access (this makes assessing repairs and improvements quite challenging), an investor may need to quickly assess the title and any liens quickly (this can lead to mistakes and can be costly), and many states require certified funds at sale or within a very short time frame (such as 24 hours). While investors can make a lot of money with foreclosure sales, having access to large sums of cash or fast financing limits these to a subset of experienced and well-financed investors. If you’re interested in this face, we suggest you go to a foreclosure sale and see how one works firsthand. The third face of the foreclosure process is the “postforeclosure”. If the property is not sold in pre-foreclosure and not purchased by an investor at the foreclosure sale, then it goes back to the bank or other lien holder who secured the loan. With interest only, 100% financing, and other loans offered today requiring little down payment, record numbers of properties are going through the foreclosure process without attracting investor interest in the preforeclosure or foreclosure stage. These properties eventually land on the desk of someone within a financial institution (bank, mortgage company, etc) that has the responsibility of disposing of these properties. Many institutional lenders dispose of so many properties that they have entire departments dedicated to this task. Oftentimes, these departments are referred to as REO (real estate owned) or Post-Foreclosure Departments. When contacted by investors, institutional sellers will generally fall into one of three categories There are many ways to find these institutional sellers. We offer teleseminars specifically designed to deal with the “how to” find and approach institutional and other sellers. The first category is those institutional sellers that will be happy to work with an investor directly, bypassing listing the property with a real estate agent. The second category is institutional sellers that will at first indicate plans to
list their REO property, but can be persuaded by the skillful investor to delay the listing until the investor has a chance to see property and make an offer. The third category is those institutional sellers that will not consider working with an investor directly, but will instead list their properties with selected real estate agents. One of the key benefits of purchasing post-foreclosures is that the sellers have no emotional tie to the property. For financial institutions, this is a simple business transaction. Further, investors seeking post-foreclosures should remind themselves that institutional sellers are in the business of lending money, not managing real estate. At some point, if a bank or lender has too many properties on their books, the number of REO properties will need to be reduced, sometimes quickly, and oftentimes at a discount to investors. It is not as common to acquire post-foreclosures at 30%+ investor discounts as is possible with some preforeclosures (and even some foreclosures), but the available pool of properties at investor discounts of 10-20% is plentiful. If the investor’s sale or rental model minimizes the marketing time and holding costs associated with each purchase, the investor will find post-foreclosures to be a good source of discount real estate. Many predict this source will increase significantly in the coming years due to record numbers of new loans today offered with little or no down payment required. Our model allows us to minimize holding costs and marketing time, so we have elected to focus on post-foreclosures as our primary source of finding discount real estate. “Foreclosures” is a buzz word that attracts the interest of many new real estate investors. It is helpful to understand from the start that there are actually three very different and unique “faces” to the foreclosure process. Most established investors that buy foreclosures are actually focusing primarily on one of these three “faces”. Therefore, for new investors who are just getting started, take a look at the characteristics (time, money, risk, emotion element, potential profits) of each of these “faces” of the foreclosure process and select the one that is the best fit for you. Whichever one you select, implemented properly, the three faces of the foreclosure process all have the potential of putting a smile on the face of the investor. That is the one common denominator of the three very different faces of the foreclosure process. Andy Heller and Scott Frank are co-authors of the Fortune Magazine recommended book “Buy Low, Rent Smart, Sell High”. Combined, they have been investing in residential real estate for over forty years and have purchased and sold approximately 100 residential properties on a part – time basis. See Andy at MAREI’s Expo 2008
———— Investment News —————
How to make a fortune investing in multi-family real estate
We’ve all heard the dictum about the dangers and risks associated with putting all our eggs in one basket so many times that you would think when it came to real estate investment few sane people would want to place all their investment in a single-Family property. Yet many of the people I meet in the courses I run have exactly this kind of approach which shows, perhaps, just how powerful market conditioning can be. Most of the real estate moguls we get to hear about tend to be singleFamily property types (with the exception perhaps of Donald Trump who has taken the eggs in the basket dictum very much into account in everything he has done) and this tends to brainwash us into thinking that either this is the only type of real estate investment available to us or that this is the only type of real estate investment there is. The truth is that investing in multi-family properties spreads the risk of your investment without drastically increasing the costs and, in addition, allows you to create a built-in buffer against an apartment or two going vacant at some point (which is always a risk you need to be prepared for). With a single-family property should the tenant’s personal circumstances change you may well find yourself missing out on a couple of months of income which is enough to wipe out your profit from that property for the year. The risk of this is spread thin with a multi-family property however where a tenant or two moving out does not affect your monthly income from the building enough to seriously jeopardise your annual profit and that is one of the beauties of investing in multi-family properties. quickly so you can invest in an apartment block you should never overlook the possibilities offered by the single-family property, much as you leverage multi-family ones in order to build up a portfolio that will guarantee you never have to work to someone else’s schedule ever again. David Lindahl, also known as the “Apartment King” has been successfully investing in single-family homes and apartments for the last eight years. He is the author of four popular, money making home study courses “Apartment House Riches”, “How To Estimate And Renovate House For Huge Profits” “Managing For Maximum Profits” and “The Real Estate Investors Marketing Tool Kit.
Dave Lindahl "Apartment House Riches"
In a very short, life-changing 18 months, David was able to go from being the broke owner of a struggling landscape company, working night and day just to pay his bills, to creating a monthly positive cash flow of $9700 that comes in month after month like clockwork, whether or not he decides to mow any lawns, rake any leaves or even get out of bed! David will share with us how for the same amount of time it takes to do a single-family deal, you could have done an apartment complex (small or large) and made up to 20 times the profit! Find out Dave's techniques for: • • Buying Apartments with No Money Down (you know OPM) Understanding Real Estate Market Cycles so you know what areas to buy, and when to sell to make the best profits. How to Manage Properties Without Ever Dealing With Tenants! How to find the Apartment "Gems" in Your own Back Yard that Others Miss. The Truth about Tough Neighborhoods and Dealing with Tenants with Drugs on in Gangs!
• Couple it to the fact that thanks to popular misconception you are competing with fewer other • real estate investors for the choicest properties than if you were active in the single-family home • market. This is not to say that you should develop a mindset which specifically looks at multi• family properties to the exclusion of everything This is an excellent opportunity for you to expand your portfolio to else. include multifamily and for those who want to start big and bypass the small stuff, Dave's information will put you way ahead of your compeFar from it. Good business is where you find it tition! and as a real estate investor who has bought single-family homes to flip (indeed I started out Speaking at MAREI’s EXPO 2008. Visit www.MAREInet.com my career in real estate investing with a singleor page 6 for more info. family home) I can tell you that if you come across a good deal or need to buy a property to flip
———— Investment News —————
Mid-America Association Of Real Estate Investors
Building Networks for Success!
PO Box 8685 Prairie Village, KS 66208 Info Line: 816-374-5885 Business Office: 816-523-4400 Email: info@MAREInet.com
PRESORT STANDARD US POSTAGE PAID SHAWNEE MISSION KS PERMIT NO. 185
Overland Park Marriott 10800 Metcalf Just south of I435 Tuesday July 8th, 2008 Dan Reedy Host of “Real Estate Investing for the Regular Guy “ Registration, Networking, and Vendor Trade Show open at 6 p.m. See page 4 for more information.
♦ ♦ ♦ ♦ ♦ ♦
Do you have a real estate related question? Looking for Contractor Recommendations? Have a House to Sell? Looking for a House to Buy? Want to see if some scheme sounds illegal? Need to connect with Kansas City Metro Investors?
Join our yahoo group: KCREI sponsored by Mid-America Association of Real Estate Investors. We have about 800 members, with a large percentage of them very active every week. And many members are from out of state. Go to www.MAREInet.com and look for the “Yahoo! Groups Join Now!” Button at the top—similar to the one above, click and join. You will need a yahoo email and password and it make take a day or two for your membership to be approved. We do moderate to keep postings on topic. You can choose to set up your membership to receive every message post individually, or once daily, or never. For the never choice, you must log in
For more information www.MAREInet.com
This action might not be possible to undo. Are you sure you want to continue?
We've moved you to where you read on your other device.
Get the full title to continue listening from where you left off, or restart the preview.