Category Archive: Articles

Be 100% There!

How important is it, when meeting with a seller, buyer, renter, realtor or contractor, to be totally focused on that person? If you’re not paying complete attention to what that person says and how he or she says it (tone of voice, hand gestures, body position, eye movement), isn’t there a good chance you’ll miss critical information that’s being shared with you?

The number of people who are not 100% there during a meeting has become epidemic – and is a major pet peeve of mine! If you’re over fifty years old, you already know what I’m talking about. Baby Boomers grew up without cell phones, emails, and text messages. Heck, we didn’t even have phone answering machines!

Here’s an example of this epidemic at work. A real estate investor needed help structuring a deal and asked for an hour of my time. He drove up from Atlanta and met me at the Adairsville Waffle House.

As we discussed his deal, every two or three minutes he looked down at his lap and typed something on his cell phone. He wasn’t typing meeting notes; his writing pad was on the table. I finally asked him what he was doing. He was answering emails and text messages as they came in. What?!?

I said, “Hang on, I need to take care of a problem.” I got up from the table, walked out the door, got in my car and drove back to the ranch. A few minutes later, this guy called and asked…

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How to Work Pre-Foreclosures

This is what the Bartow County foreclosure auction looked like in 2013

Going to the foreclosure auction was the best place to find real estate investing deals from 2009 through 2012. Talk about lots of low-hanging fruit. It was common to buy a nice three-bedroom, two-bath home in a solid neighborhood for $35 a square foot. Then in 2013, the cheese moved. Buying on the steps was no longer the best place to get deals.

Let me explain: In April 2012, there were close to two hundred properties advertised for foreclosure. At the auction, there were only five investors bidding on those two hundred properties. Talk about shooting fish in a barrel. One year later – April 2013 – there were less than eighty properties advertised with more than fifty – that’s 50 – investors and hedge funds bidding on that handful of properties. Suddenly, because of the increased competition, winning bidders found themselves paying $80 to $110 a square foot for a house. This was a huge year-over-year price increase!

Did this mean that all the great deals had disappeared? No, it simply meant that to find great deals, investors had to look somewhere else – like buying properties pre-foreclosure.

What is buying pre-foreclosure? In Georgia, the foreclosure auction is held on…

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Avoid the Certainty of Poverty

Had a good conversation with an investor friend about the financial collapse of Greece. The country is so broke that not only can it not repay its loans, it can’t make its note payments either. What’s Greece’s solution to this financial meltdown? They want to borrow even MORE money!

It’s crazy for anyone – including a country – to believe that the way to get yourself out of a financial hole is to dig it even deeper! Yet that’s exactly what Greece – and way too many American families…and America herself – is doing.

Jack Miller, my long-time teacher until he joined the other angels in heaven, taught us how to avoid the certainty of poverty. He also shared what he had learned from Warren Hardin: It’s inconvenient to be physically alive but financially dead.

Pete Fortunato, another of my long-time teachers, said that to avoid poverty, an investor/businessman must play both offense and defense. You play offense by building income, creating a surplus between what you bring in and what you spend, and by acquiring and controlling assets. You play defense by avoiding, limiting and eliminating expenses.

I know, it’s hard to save and even harder to…

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No Seller Wants Cash – EVER!

No seller wants cash - EVER!

Just got a call from a realtor. She represents a homeowner who needs a quick sale. The realtor said, “Bill, my client will only consider an all-cash offer. We’re not interested in any of your creative razzle-dazzle deal structures, understand?”

Kim and I get a lot of calls like this. I’ve learned not to say, “No seller wants cash – EVER – ya dingbat!” Saying such would ruin the relationship and destroy the possibility of meeting face-to-face with the seller.

So what do you think? Do sellers really want cash or could I possibly be right?

In this situation, what if I immediately agreed to pay the seller’s $80,000 asking price – in cash? There’s only one condition: The seller must put the $80,000 on her kitchen table, cover it with plastic wrap, and once a month the seller, realtor and I will get together and marvel at the big stack of money.

Sure, this is a silly stipulation that no seller would agree to. But why – since the seller is getting exactly what she wants – wouldn’t she…

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If It’s Stupid and Works, Then It’s Not Stupid!

Bill out door-knocking

Dan has been investing in real estate for six years. He’s frustrated because he’s not able to find deals the way he could a few years back when there was plenty of low-hanging fruit on the market. Dan said his marketing no longer works. He’s one frustrated investor!

Desperate, Dan called and asked to go door-knocking with me. He’d heard that Kim and I had built our real estate investing business square on the back of knocking on homeowners’ doors. Problem was, the thought of knocking on a stranger’s door nearly makes Dan vomit. Isn’t it funny what folks will try when their sinking ship is about to go under?

A few days later, as Dan and I headed to the first subdivision, he nervously mumbled, “Knocking on someone’s door is plain stupid!” I smiled. Dan had himself convinced that he knew exactly what would happen at the first door – we’d get yelled at and the door would be slammed in our faces.

We soon saw a house with a For Sale sign in the yard. We pulled to the curb. I honestly thought Dan would pass out before we made it to the seller’s door. After knocking, I backed up twenty feet into the yard. When the seller answered I said…

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The Power of a Refusal Option

Captain Nimrod!

I hate being an idiot, but when you screw up like I just did, it qualifies me to be the biggest nimrod in the land!

The most powerful document in real estate investing is the option agreement. Sadly, the least used and most misunderstood document in real estate also happens to be the option agreement. Why don’t more folks know how to effectively use options to control property? Probably because there are so few investors who have experience using options.

Most folks have heard of Lease Options, but what about Purchase Options, Performance Options and First Right of Refusal Options to name but a few?

An option is a right, but it’s not an obligation. Let me explain: If you’re selling your house and we sign a Purchase and Sale contract, I’m contractually obligated to buy your property and you’re contractually obligated to sell me your property. If either one of us refuses to perform, there’s a good chance attorneys will get hired – cha-ching!

On the other hand, if I buy a Purchase Option from you, then I have the right to buy your property for the agreed to price and terms…but you can’t force me to perform! However, you ARE obligated to sell me your…

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Never Take Orders From Paint

Jack Miller

Jack Miller was one of my primary real estate investing teachers. He was a wonderful man and an incredible educator and mentor. It’s hard to believe that he went to heaven almost six years ago. Not a day goes by that he and I don’t have a conversation in my head.

Jack was the type of guy who very much marched to his own drummer. One of his best quotes was: Never take orders from paint.

Let me explain: Have you ever turned onto a street, saw the One Way sign and realized that you were going the wrong way? What did you do – an immediate U-turn, right? That’s what most of us would do. But not Jack! Jack would keep going the way he was going and say, “Never take orders from paint!”

Spend a minute thinking about this. Was Jack right or wrong? Now add this to the equation: Jack spent his whole life not taking orders from paint – both figuratively and literally – and he was a very successful businessman!

On the other hand, I spent most of my life doing exactly what was…

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What Makes the Best Rental Property?

Single-family Ranch

Over the past twenty years, Kim and I have bought a wide variety of investment homes – everything from a one-bedroom, one-bath duplex to a six-bedroom, four-bath McMansion. Experience has taught us what makes the best – and worst – rental property!

Jack Miller said: Everything else in real estate is harder than a house. With that said, Kim and I stay away from townhomes, condos, duplexes and apartment buildings. We’re not saying these are bad investments; it’s just that they require a lot of hands-on attention, and our goal is freedom, not a j-o-b.

When it comes to single-family homes, the most in-demand property is a three-bedroom, two-bath home…with a garage…without steps…on a level lot…in a nice, convenient neighborhood. We call these Walmart houses.

Think of a Walmart house this way: Go to a checkout register at Walmart that has ten people in line. You hold up a picture of your investment property and ask, “Who would like to live in this home?” You want eight out of ten hands to go up. Next – and this is the most important question of all – you ask, “Who can…

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What’s the Better Investment – Gold or Trailers?

A guy called trying to sell me gold. He said that I was a fool if I didn’t use every dime I had to buy his bullion. Knowing that real estate and mobile homes almost always out performed gold, I chuckled.

In total disbelief, you’re probably asking, “As an investment, you’re saying that it’s better to own a mobile home (i.e. trailer) rather than gold?” Yes, if by “better investment” you mean one with a much higher yield!

In 1900, gold sold for about $20 an ounce. This would buy you a tailored suit, a nice pair of shoes and a wonderful dinner out. Today, gold sells for about $1,200 and ounce. This will buy you a tailored suit, a nice pair of shoes and a wonderful dinner out. In other words, gold, over the past 115 years, has held its buying power.

Sure, all the TV and radio commercials claim that gold is an incredible investment, but the truth is gold preserves wealth – it tracks inflation, and inflation is nothing more than an invisible tax! If you seek growth, then you must invest your capital in something like…

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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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