Category Archive: Articles

Nine Written Offers In One Day

Offers don't have to be written on a contract

Bob called and asked to go out door-knocking. He had doubts – as everyone does – about whether knocking on sellers’ doors really works.

On the big day, before we got started, I asked Bob about his experience level. He began investing in real estate a year-and-a-half prior, and had been a full-time investor for the past six months.

Next, I asked Bob the three questions I ask every investor who calls me wanting to learn more about real estate investing. First: “How many sellers have you gotten face-to-face with this month?” Answer: Three. Second: “How many sellers have you gotten face-to-face with in the past year?” Answer: Four. Third: “How many written offers have you made in the last year?” Answer: None!

Now a question for you: If an investor is having trouble finding deals, and he has only met with four sellers and hasn’t made any written offers in the past year, what is the investor’s main problem? Not seeing enough…

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A Day of Door Knocking

Made written offer to seller while sitting on his mower

Folks regularly ask me what it’s like to be a real estate investor who goes out and knocks on sellers’ doors on a regular basis. To help you get a feel for it, let’s talk about last Saturday.

Glenn and Paula Lathem are experienced real estate investors. They own a HomeVestors franchise – you know, the We Buy Ugly Houses folks. You’ve seen their signs around town.

Anyway, Glenn and Paula spend a fortune on advertising – billboards aren’t cheap! In addition to high advertising costs, another problem is the size of the area they work. Because there’s little control over where their leads come from, they regularly work an area the size of Montana.

Because door-knocking is VERY targeted marketing – and fast and cheap to do – they asked to spend the day with me to learn how it’s done.

We got started at 9:30 a.m. In the first hour, we went into several houses off Center Road in Cartersville that were under construction. We also knocked on a number of doors that had realtors’ For Sale signs in the yard. No one was home, so I left my canvass card in the doors.

My canvass card – it’s the size of a postcard – is pretty basic. The front simply reads:

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Evicting a Tenant

Had to Evict Tenant!

For only the fifth time in 19 years, I was forced to take a tenant to court in order to get our property back. In other words, I had to do an eviction.

I hate doing evictions. It’s a lose-lose situation for both parties. The tenants are forced to move, plus they get a black mark on their records that stays with them for years. The landlord must spend time and money getting the house ready for rent. Then there’s the joy of finding new tenants and getting them installed.

We require four things from our tenants – in this order: 1) Take good care of the property. 2) Pay on time. 3) Be comfortable to work with. 4) Be a good neighbor. Failure to do any one of these four things means the tenant needs to find a new place to live.

Most of the time, if the tenants can’t live up to their end of the bargain and they’re asked to move, they do without much fuss. But sometimes, like in this case, the tenants refused to move. So what, as a landlord, do you…

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$1 Million in the Bank and Starving to Death

Can't afford a house

Just met with a guy who has a very interesting story that you’re not going to believe: He has $1 million in the bank, but doesn’t have enough money to buy food! He’s practically starving to death.

This guy worked hard, saved hard and invested wisely his entire life. When he retired, he had $1 million in liquid capital. To keep his money safe – the volatility of the stock market scares him – he invested his money in bank CD’s paying 3.6% interest. Last year, when the CD’s matured, he was forced to roll his retirement money into new CD’s with a dismal 0.6% interest rate.

Here’s the thing: These days, this guy’s investment doesn’t earn him enough to live on – he’s forced to exist like a pauper. He said, “Once I became a millionaire, I thought I’d never want for anything. I couldn’t have been more wrong!”

Before your dumbfounded look affixes to your face forever, fully understand this man’s predicament. He and his wife have $1 million cash, but they don’t want to spend any of this principal. Their retirement goal is to live off the interest the $1 million generates.

So here’s the question: How much is their sizable nest egg making them? You’d think big bucks, right? Believe it or not, it’s only…

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IT’S PETE FORTUNATO’S BIRTHDAY!!!

Pete getting his Birthday kisses - he really liked one of them!

Why is March 15th such a big, important day for real estate investors? Because it’s “Uncle” Pete Fortunato’s BIRTHDAY!!!!

That’s right, this is Uncle Pete’s day of days!

Boy, are we lucky that Uncle Pete entered this world! Think of all the lives Pete has “interfered” in…think of all the people he’s helped over the years. We are all better, wiser, more successful real estate investors because of the things we’ve learned from Uncle Pete!

There’s only 1 Pete Fortunato. Be sure to send him a Happy Birthday message. He just LOVES Happy Birthday messages!

Pete’s email address is: Peter@PeterForunato.com

Love you, Pete. Thanks for all that you’ve given us!!!

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Insulting Offers – Really?

Out knocking doors

Last week, Kim and I made a written offer to a seller. To help newer real estate investors learn how to do this, we posted a video on our Facebook page (North Georgia REIA) describing what we did. All of the feedback was positive – except for one guy who wondered whether the seller was insulted by our offer.

One of the things that concerns investors most is the fear of having the seller get angry at their offer. Let’s take a closer look and settle this fear.

Our seller was asking $118,000 for a three-bedroom, two-bath ranch. It had been his mom’s house, and the house was built in the 1970’s on a busy road. It needed updating – about $14,000 worth, and had been on the market for ten months. All of the offers were for well below the seller’s $118,000 asking price. By the way – what does this tell you about his asking price?

There are two parts to a written offer: price and…

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Fat Girls Can’t Jump!

Houston is a marketing genius!

As Kim and I were out looking at foreclosures yesterday, we got behind a jacked-up pickup truck. You know the kind: a truck that’s 15 feet off the ground and has no problem going off-road. The back window of the truck read: Jack ‘em up boys – fat girls can’t jump! Kim and I laughed ourselves silly. Well said, dude!

Before you bombard me with a lot of “That’s politically incorrect!” nonsense, please know three things: 1) I have a fat gut. 2) This column is not about how high fat girls can jump. 3) Fact it, we can do something about being fat: eat smarter and exercise more.

This truck guy is a marketing genius. He’s doing an incredible job of advertising to the world exactly what…

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Why Are the Number of Foreclosures Plummeting?

There’s no doubt that the number of properties being advertised for foreclosure has been plummeting for the past year and a half. The question is, why?

In 2009, when foreclosure numbers began to skyrocket, the only way a bank could deal with borrowers who were behind on their mortgages was to foreclose. The fact that banks – actually it was loan servicers like the infamous MERS – didn’t have possession of the borrower’s note, nor the legal right to foreclose on the property, is a topic for judges and attorneys.

At the same time, you had thousands of borrowers who, because they couldn’t/wouldn’t make their mortgage payments, simply “gave the house back” and walked away. (It didn’t matter to the borrowers that the bank didn’t give them a house; it gave them money…and the bank – rightfully so – wanted their money back, not a house.) A bank’s only tool to deal with this situation was to foreclose on the property, and then sell it in hopes of recouping some of their loss.

Fast-forward five years. These days, lenders have many more…

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What Will Real Estate Do In 2014?

There are two schools of thought about real estate in 2014. One is that home values will continue shooting up; the phrase “rapid appreciation” is thrown around excitedly by those in the know. The other is that because the “recovery” has been built on a foundation of quicksand by out-of-state hedge funds, home values are in for a tumble in 2014. Let’s take a look at both points of view, and then you decide which way you think values are likely to go.

There’s no doubt that real estate prices shot up in 2013. In the Atlanta Metro area, homes increased in value by a whopping 15.6%. Many economists predict that values will increase by another…

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Increase Your Cash Flow $100 a Month

IMG_1750

Jimmy Napier will be our guest speaker at March’s real estate investors meeting. So who is Jimmy Napier? In the world of real estate investing, Jimmy is a man among men.

Jimmy has been one of the country’s premier creative deal structurers since 1971. He literally wrote the books on the subject. When it comes to buying, selling, trading and holding real estate and notes, Jimmy is at the top of the list of been-there-and-done-that guys.

Kim and I first met Jimmy in 1999. We were at a Jack Miller seminar – Jack is another man among men – when Jack got to talking about how important it was for real estate investors to master the financial calculator. He said that Jimmy’s little book, Invest in Debt, was a must-read if you wanted to succeed. We bought Jimmy’s book and quickly learned how to use a financial calculator.

Looking back, I can safely say that the four tools that a real estate investor must have are…

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