Said No One, Ever!

“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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Learn Real Estate Investing

What’s the best way to learn how to successfully invest in real estate? Easy answer: Get around experienced, been-there-and-done-that investors. They are your best source of real-world information.

Sure, lots of “gurus” are coming through town these days offering their free, no-work-required, just-push-the-easy-button system. A couple of questions: Do you believe success takes little or no work? Do you really think that success has an easy button?

If you want to run a marathon, it would be wise to regularly hang out with marathoners – plus you gotta run a lot. If you want to learn to fly, hang out with pilots – plus you gotta fly a lot. And if you want to be a successful real estate investor, hang out with investors – plus you gotta get face-to-face with a lot of sellers and make a lot of written offers.

Kim and I just got back from a weeklong Caribbean cruise with 100 real estate investors. Every year, we, along with Dyches Boddiford, Dorsie Boddiford and Pete Fortunato, host the Captains of the Deal cruise. Was there a lot of real estate investing experience on the ship? Between the five hosts, we have over 129 years of investing experience. More importantly, the 100 investors aboard owned a total of 3,509 properties, 304 notes and 93 options!

Imagine, if you’re seeking financial freedom and believe real estate is the best investment vehicle to use to achieve your goal, how much solid information would you have gotten having breakfast, lunch and dinner for eight days with…

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Motivated Sellers Say Yes!

A common mistake made by real estate investors is failing to recognize the difference between a seller and a motivated seller. A seller wants to sell; a motivated seller needs to sell! Another mistake often made is failing to realize that in time, most sellers become motivated sellers.

Here’s an example: A few weeks ago, I took Wendell Strickland, and Rodney and Debbie Palmer out door-knocking. We met with four sellers and made five written offers. It was a very productive day!

When we were done, one of the investors asked, “Of the five offers we made today, how many will be accepted?” Easy answer: “None!” Stunned, the investor asked, “Why don’t you think any of the sellers will accept your offers?” I explained, “None of the sellers were motivated. All of the sellers wanted to sell, but none needed to sell.”

It was quiet in the car as Wendell, Rodney and Debbie contemplated my reply. Finally, one asked, “How could you tell they didn’t need to sell?” I answered, “A motivated seller is willing to chew off his arm to make the house go away. Were any of the sellers we met with today willing to do that?” As a group they answered…

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Would You Break Into A Vacant House?

You’re out working foreclosures and see an obviously vacant house. There is a sign in the window saying the home has been abandon and winterized. You look through the window and confirm that it is vacant. Do you open the door with your “investor key” (a credit card) and go inside to look around?

Over the years, real estate investors have hotly debated this topic. Some investors would never go in the home, while others think nothing of slipping the lock so they can inspect the interior before bidding on the property.

I know investors who regularly go into vacant homes. The popular thought is that there’s nothing wrong with that. The investor is not there to steal or vandalize anything, he’s there to estimate the rehab cost so he can accurately determine his maximum purchase price. What can possibly be wrong with this?

There are a lot of funny stories told by seasoned investors about things they found in abandoned properties; things you can’t believe a homeowner would leave behind – like artificial limbs, stuffed (taxidermy) animals, porno magazines, etc. After hearing these stories, many new investors come away thinking that it’s OK to break into vacant homes. But I’m here to tell you…

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Mom’s Best Life Lessons

This week, Dorothy, my mom, turns eighty! My best life lessons have come from her, and the reason why she was such a great teacher and powerful influence on me, Sam and Jolie (my brother and sister) was that she showed us how to succeed rather than just tell us. Anyone can talk the talk, but walking the walk requires a very determined person!

Dorothy taught us that everyone can succeed – you just have to be willing to work at it, sacrifice for it, and never, ever quit! Too often folks point at things in their past as reasons for their failure. Failure has one father: Quitting!

Dorothy had every reason to fail. She was born dirt poor in Raleigh, Mississippi during the Great Depression. She spent summers at her grandmother’s in White Oak, Mississippi, where there was no indoor plumbing or outdoor well; water was carried in buckets from a nearby creek. There was no electricity…there wasn’t even an outhouse! Her father was a raging, hateful alcoholic who lost his leg in a drunk-driving accident.

Talk about reasons to fail! But she didn’t let these things stop her. She went through college at Mississippi Southern on a music scholarship, and worked three part-time jobs to pay for food.

The second biggest lesson mom taught us is that you can be…

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What is Door-knocking Like?

You’re driving through a subdivision and see a home for sale that you like. You’re curious about the price, the number of bedrooms and bathrooms, and why the seller is selling. What do you do? Do you stay in your car? Do you call the number on the sign and talk to voicemail? Or – gulp – do you knock on the seller’s door?

If you choose to knock on the seller’s door, what do YOU think will happen? Bet the vision in your head goes something like this: The owner throws open the door and screams, “Get out of my yard!” Then, “Sic ‘em Brutus! Honey, get my gun – there’s a varmint on our porch that needs shootin’!”

The truth is, folks are nothing like what you imagine – they couldn’t be nicer! You don’t believe me? After all, what do I know about door-knocking? I’ve only made a living at it for forty-three years!

To help you see what door-knocking is like, let me tell you about yesterday. I took Wendell Strickland and Rodney and Debbie Palmer out with me, and here’s what happened…

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Subject-to Deals: Creative Funding at it’s Best

Let’s say you find a deal that, as a flip, would produce an immediate $200,000 net profit, or $500 in monthly cash flow if you keep it as a rental. The seller is very motivated and wants to sell yesterday! Only one problem: funding. No bank will loan to you, and you don’t have any private-money lenders lined up. Do you walk away from this big-profit deal? Not if you know how to structure a Subject-to Deal!

What’s a Subject-to Deal? Normally, when real estate is sold, the title (Warranty Deed) is transferred into the buyer’s name and the seller’s mortgage is paid off at the closing table. With a Subject-to Deal, the property is still transferred into the buyer’s name, but – and this is a VERY BIG but – instead of the seller’s mortgage being paid off, it remains in place. You (the buyer) agree to make the seller’s mortgage payments on the seller’s mortgage for the seller. In other words, you’re buying the property “subject-to” the seller’s mortgage.

Right about now you’re probably saying, “No seller would ever agree to this!” You sure about that? Willing to bet the ranch that I’m wrong, are you?

The deal described in the first paragraph is a real deal that Kim and I did in 1999 – and we still own this property today. If the seller hadn’t agreed to a Subject-to Deal, there’s no way we could have…

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Buying at the Foreclosure Auction

Kim and I have not been the high bidders on a property at the foreclosure auction since the end of 2012. Why the dry spell? The cheese moved. For example, from 2007 through 2009, the best deals were found buying short sales. From 2010 through 2012, the best deals were found buying at the foreclosure auction. From 2013 until now, the best deals have been found by buying pre-foreclosures. Remember, the cheese is always moving. To be successful, you can’t keep going back to where the cheese was. You must go to where it is today!

Here are the basic steps Kim and I follow when bidding at the foreclosure auction. First, before a property can be auctioned for foreclosure, it must be advertised in your county’s paper of record for four consecutive weeks before the auction. Call your county’s Clerk of Court’s office and they will tell you in which paper and on which day(s) the “legals” (this includes the foreclosure notices) run.

On the day the foreclose notices first run for next month’s auction, we buy that paper and transfer the foreclosure info in the paper – which is difficult to read – onto our Foreclosure Sheet – which make it much easier to read!

Second, using a foldout county map, we mark the location of each property that’s advertised for…

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How to Work Foreclosures

Kim and I have been buying foreclosures since 1995. Over time, we’ve built a unique system that’s very effective. It has allowed us to buy tons of properties pre-foreclosure, at the auction and from banks after the auction. Today, I’ll explain how we work the pre-foreclosure market. Next week, we’ll discuss how to buy at the foreclosure auction.

When it comes to foreclosures, our best deals come from buying pre-foreclosure! At the foreclosure auction, there are always investors willing to work on much thinner margins than which we’re comfortable.

On the other hand, when buying pre-foreclosure – that is, before the auction – there’s very little competition. Why? If a homeowner is facing foreclosure, because of unfounded fear, few investors will knock on a homeowner’s door.

There’s another BIG benefit to buying pre-foreclosure. Since you’re buying from the owner, there are many more creative deal-structuring tools you can use to construct a win-win deal. If you buy at the foreclosure auction, there’s only one tool – a big dang hammer…CASH! There’s no creativity, beauty or…

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Sue Stanley’s Barbershop: How to Run a Successful Business

What can you learn about running a successful business from Sue Stanley and her Ye Old Barbershop in Adairsville, Georgia? In a word: Everything!

There are two ways to learn how to run a business: You can go to college and major in business, or you can spend time with someone who’s been running a successful business for decades. I believe the latter is a better, faster, more effective way to learn.

For a business to succeed, the owner must keep his/her net profit as close as possible to his/her gross profit. In other words, don’t let your expenses eat up all your profit. There are thousands of failed business owners who were bringing in money hand over fist, but their bills were flooding in even faster! The result? Because there wasn’t enough profit left after the bills were paid, these businesses went Tango Uniform (a.k.a. toes up)!

Sue is an example of a person who knows how to run a business right. She operates the oldest, continuously-run-by-the-same-person business in Adairsville. This means she has longevity and is a very smart businesswoman to boot!

Want to know some of Sue’s secrets?

When Sue took over the…

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