Simple Simon Met a Pieman

Zeke selling pies

A thing that really annoys me is seeing a bum at a busy street corner with a beat-up cardboard sign that reads: Will work for food! Many times, I’ve stopped and offered a day’s pay for a day’s work. Thus far, none have accepted my offer – this is why I use the word “bum.” A bum wants something for nothing.

Last week, I was in Charlotte, North Carolina. On the street corner next to where I was getting gas stood a sixteen-year-old boy holding a sign seeking money. But he and his sign were like nothing I’ve ever seen! His sign combined work with lots of style.

Zeke was his name. He was selling $7 pies – sweet potato or bean. He had a large cooler on wheels next to the sidewalk filled with his pies. And here comes the style part: He was wearing a black tuxedo, white tux shirt, red bow tie and patent leather shoes. He was one sharply dressed dude! I was totally impressed! (NOTE: On our website, you can see a picture of Zeke selling pies.)

Unable to stop myself, I walked over to Zeke, handed him a ten-dollar bill, bought a pie, told him to keep the change, and walked back to my car to top off my gas tank. While filling up, I watched Zeke sell eight more pies in only ten minutes – with each person handing him a $10 bill and telling him to keep the change.

Do the math: Zeke grossed…

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May’s North Georgia REIA Meeting

WHAT IS MAY’S MEETING ABOUT?

Dorsie Boddiford is completing her fourth year of real estate investing. Without a doubt, the girl is a Rock Star! In addition to doing over 50 deals, she also regularly loans and partners with other investors on deals!

This month Dorsie will discuss why an investor should flip – and whether an investor should only flip. She’ll also answer the question: What does flipping have to do with attaining financial freedom?

Here’s an overview of the flipping questions Dorsie will answer:

How do you find flips?

How do you fund flips?

How do you structure flips?

Who do you need on your flipping team?

What exit strategies can you use when flipping?

Then comes the good part. Dorsie will show you…

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Need a Real Estate Investing Coach?

Pete, Jack and Dyches!

Do you need a real estate investing coach or mentor? Do you know the difference between the two? I didn’t until I researched this column.

A coach is an expert who trains someone learning or improving a skill – it’s very hands-on. On the other hand, a mentor is a wise and trusted advisor – not nearly as hands-on as is a coach!

Why am I writing this column? Several times a week I get calls from investors asking to be coached or asking how to handle their high-dollar coach who isn’t doing what he/she promised. Bottom line: I’m writing this to help you know what to look for in a coach because there are coaches and then there are coaches!

In 1995, when Kim and I got into real estate investing, coaching wasn’t popular. Instead, we had an old fashion thing called teachers. Our three primary teachers were Jack Miller (God rest his wise soul), Pete Fortunato and Dyches Boddiford. As we got to know them, these three wise men also became our mentors who we could call for deal-structuring advice.

Back to the question: Do you need a real estate investing coach? I think a good coach will help you learn about investing much quicker than if you went at it on your own. More importantly, an experienced coach will keep you out of the pitfalls that swallow up most…

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How Do We Fund Our Deals?

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Since we don’t use banks, how do we fund our deals?

Do banks have money to lend? Think carefully – this could be a trick question! Don’t banks “borrow” the money they lend from their depositors? And why do depositors keep their money in the bank? Because it’s the safest place to keep it, right? But is it really?

What interest rate is your bank paying on savings these days – 0.3%? And what is the current rate of inflation…something like 4%?

Here’s a broad-brush picture to help you understand what’s really happening. You put $10,000 in the bank earning 0.3% interest. One year later, your nest egg has grown to a whopping $10,030. But let’s not forget about inflation. In reality, after you factor in inflation, the actual buying power of your $10,000 dropped by 3.7% to $9,630! What – you LOST money?

Inflation is called the “invisible tax.” You can’t see it, but you sure can feel it every time you walk in a store!

Sure, the days of banditos like John Dillinger, Baby Face Nelson and Pretty Boy Floyd are long gone, but they were replaced by something far more sinister:…

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When Deal Making, Don’t Rely on Email

Emails can shock you!

This has been a very painful, lesson-filled week! Because of a single misunderstood email, I lost a nine-year friendship with a couple that I love very much. In addition, I was booted out of a real estate investing mastermind group that I had been a part of for nine years. Ouch!

I “said” one thing in my email but they “heard” something completely different.

What does this have to do with investing? Everything!

These days, too many real estate investors rely far too heavily on websites, emails and text messages when they’re constructing deals or working through tenant problems. Listen up: Real estate investing is a face-to-face people business – not a computer business! Nothing takes the place of meeting with a seller and asking Pete Fortunato’s famous question: Why are you selling such a nice house like this? Hearing and seeing how a seller answers this question is everything – itis the backbone of deal making!

If you rely on emails, here’s a demonstration of how easily a potential deal can…

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Surprise In-home Inspections

One nasty bedroom!

About 35% of Americans – for a wide variety of reasons – don’t own their home. Instead, they rent.

With millions of citizens willing to fork over money to live in a clean, affordable home, in a nice, quiet neighborhood, why aren’t more people real estate investors? And by real estate investors, I mean LANDLORDS! (Remember: flippers and wholesalers are business people and speculators, not investors! If they stopped flipping, their income would immediately drop to zero. Plus, the government taxes the tar out of their profits!)

You gotta admit, the title landlord sounds pretty cool. And getting monthly mailbox money is really neat. And least we not forget, the government doesn’t steal what a landlord earns like it does from W-2 and 1099 wage slaves.

So why aren’t more Americans landlords? Easy answer: Tenants! Have you ever heard a landlord-tenant story that had a happy ending?

Want the stone-cold truth? Can you handle the truth? Kim and I have owned and managed rental property for more than twenty years. In all this time, we’ve…

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How to Make a Written Offer

Took 13 investors out door-knocking and we made 4 written offers!

Last Saturday, I took thirteen real estate investors from the Chattanooga Real Estate Investors Association out door-knocking. Before heading out, we discussed how to make a written offer to a seller.

The group had a number of concerns: 1) How do I find a property’s fair market value? 2) How do I discover market rents in the area? 3) How do I make a written offer right there on the spot?

Took 13 investors out door-knocking and we made 4 written offers!
Took 13 investors out door-knocking and we made 4 written offers!

The first thing to remember is that an offer is different from a purchase contract. A purchase contract is often a formal document written in legalese that no one – especially the buyer and seller – understands. On the other hand, an offer can be written in plain English on a Post-it note that makes sense to everyone! (NOTE: On North Georgia REIA’s Facebook page, you’ll see three of the written offers I made in Chattanooga.)

Randy Shelley is an investor who lives in that area. We spent the day knocking doors in his subdivision. Though he already knew the fair market values and approximate rents for his neighborhood, I asked him to not share this information with us.

Instead, we talked to ten homeowners. From them, we learned that most properties in the subdivision sold for between $175,000 and $185,000, and houses rented for around $1,200 per month. When we compared these numbers to Randy’s, we discovered our numbers were…

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April 9th North Georgia REIA

WHAT IS APRIL’S MEETING ABOUT?

You’ve seen the foreclosure ads that run in the newspaper. If you’re like most folks, you wonder what in the heck all that legal jargon means. You may also speculate about the steps you need to follow in order to go from reading a legal notice to being the high bidder on the courthouse steps at the foreclosure auction.

At April’s meeting, we’ll pull all the mystery away. We’ll answer the question: How do you buy foreclosures and pre-foreclosures?

Here are a few of the questions we’ll answer:

When and where do you first learn which properties will be sold at the monthly foreclosure auction?

How does a foreclosure auction work?

What should you do before you bid on a foreclosure property?

How do you buy a property at the foreclosure auction?

Where do you get the money to buy a foreclosure?

If you are the high bidder, what do you do next?

If someone is facing foreclosure, what do you say when you knock on his door?

Is there money to be made buying foreclosures and pre-foreclosures?

Why is it better to buy a property pre-foreclosure instead of at the foreclosure auction?

Is there BIG money to be made buying foreclosures? We’ll show you…

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Prepping For The Foreclosure Auction

While door-knocking, met a guy with a pet squirrel!

This week, Kim and I have been knocking on the doors of homeowners who face losing their homes at April’s monthly foreclosure auction.

Many folks are shocked to learn that we actually knock on an owner’s door. I’m often asked, “Aren’t you worried about getting shot?” After 20 years and thousands of foreclosure doors, no, I’m not worried about getting shot. Fact is, experience has taught us that most people facing foreclosure couldn’t be nicer and really appreciate the what’s-gonna-happen-next information we’re able to offer.

How many houses do we plan to bid on at Tuesday’s auction? None. So why are we out working foreclosures? Because the cheese has moved, and the best deals are now found buying properties pre-foreclosure, not at the auction.

With real estate investing, the cheese is always moving! For example, from 2003 to 2006, the best deals were found buying properties pre-foreclosure. Successfully bidding on the steps was difficult because of the…

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Said No One, Ever!

Knocking on doors

“I love to knock on sellers’ doors,” said no one, ever! (Thanks for the great line, Dorsie Boddiford.)

Over the years, I’ve shown hundreds of real estate investors how to knock on sellers’ doors. Many times I’ve said the alpha and omega of real estate investing is getting face-to-face with lots of sellers and making tons of written offers. Experience has taught me that the fastest, cheapest and most effective way to get face-to-face with sellers is to simply knock on their doors.

One key reason door-knocking is so effective is because you virtually have no competition from other real estate investors. For example, yesterday, I was out with Donn Myers. By days end, we’d been to thirty or forty houses that had a For Sale sign in the yard. How many other real estate investors’ cards did we find at those houses? Just one.

Don’t get the wrong idea; door-knocking is not all…

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