Real Estate Investor Stories

Sell Your Rochester House Fast

2007-08-13T14:33:00.000-05:00

If you have a house in Rochester, New York or Monroe County you need to sell fast, visit http://instantcashbuyer.com.

Three Secrets For Talking To Sellers On The Telephone

2007-05-17T17:10:00.000-05:00

In this short article, I want to highlight three tips for fielding seller’s phone calls in response to your marketing efforts.

When your phone rings, realize that the seller has overcome a lot just to pick up the phone and call. He has chosen to call you from among all of the other investor’s who have ads out there right now. That’s good news – your marketing is working!

The first rule is… ANSWER YOUR PHONE! Too many investors spend their hard earned money on marketing and then let the calls go to voice mail. Trust me, when a motivated seller calls, the last thing they want is your recorded voice asking them to leave a message. Many callers will simply hang up. A real, live person makes all the difference. Just following this one tip alone will put money in your pocket.

Second, don’t start out by grilling the seller. If they don’t say much at first, a few simple, non-threatening questions about the property will get them talking. Let them go on for a few minutes, and often you will find them telling you their story without being asked.

If they have talked a long time, and you still aren’t sure about their level of motivation, simply ask, “Why are you selling?” This is usually enough to get them to tell you everything you need to know. Most people WANT to tell their story – believe me, it’s true!

Finally, if the information you have gathered indicates that there is a deal there, don’t let the call end without securing a commitment from the caller. In other words, in the parlance of all good salesmen everywhere, ASK FOR THE ORDER!

That doesn’t mean negotiate the sale of the house on the phone. That you want to do in person. What I mean is, get an appointment with the seller before you hang up. If at all possible, make the appointment NOW. Say, “Mr. Seller, I’m free for the next couple of hours. Would it work for you if I came over right now to see if we can work this out for you?”

Believe me, very few other investors are going to offer this kind of speed, and if the seller is truly motivated speed is what they’re after.

To recap, when a seller calls answer your phone, let them tell you their story, and get a commitment before hanging up.

Tom Dunn is a successful real estate investor and author. For more on beginning real estate investing, visit DealFiles.com.

Looking For Private Money For Real Estate Investing On The Internet

2007-04-06T05:52:00.000-05:00

One of my readers, Jim, posted the following comment to the post below:

[begin quoted text]
Hi Tom,

Finding Private Money is something we are definitely trying to get because we have more properties than we have money for and we are tired of paying all the points for HM.

We have done some marketing to our subscriber base from our website (www.thegooddealguys.com) and have gotten a few bites but nothing solid yet.

My question is what type of information are these sites you searched on actually giving you. I need to find the people that can be Private Lenders and I have not found any site that can put me in contact with those kinds of people. Yes, people selling courses but that is not what I am looking for.

Any ideas?

Thanks,
Jim
[end quoted text]

Here's my response, which I also emailed to Jim:

Hi Jim.

Thanks for your excellent comment and question.

To answer your question, I need to start out by telling you something you probably already know- the internet is extremely long on information, but extremely short on relationships and person-to-person contact.

The reason that's important is because borrowing private money for real estate investing, or for any other reason for that matter, is almost always going to be based on personal relationship, and personal relationships are best established and built locally.

The internet is a great place - probably the BEST place - to learn how to obtain private money, the mechanics of setting up a lender network, and a system for managing that network. The internet is not a very good SOURCE of private money. For that, you will need to think locally rather than globally.

The best source of private lenders for you and your business is right in your own town, city, or community.

My suggestion... use the internet to learn and implement a system for locating private money, even if you have to pay a few bucks for a GOOD system, then implement that system right there at home. As I'm sure you have already discovered, real estate investing is a people business, and the private money facet of it is no exception.

I believe it's nearly impossible to establish the level of trust required in private lending without face-to-face contact, which is essential to creating the right kind of relationship. Every Private Money course or kit I'm aware of that's worth it's salt will teach that, as well as showing you exactly HOW to build a private lender system right there at home.

Jim, it's important to point out that HARD MONEY is different. You can find hard money on the internet, because hard money lenders don't really care about you- it's just about the numbers. If the numbers work, they know they'll get their money no matter what. You pay big bucks for that privilege, as I'm sure you're aware.

Building a successful, local private money network takes a little time and effort, but the rewards are well worth it.

Hope that helps, Jim.

All the best.

Tom

Private Money For Real Estate Investing Best Sites

2007-04-05T05:54:00.000-05:00

Searching for private money for real estate investing? Well then, you’re already in the right place… the internet! If you have spent much time online, browsing or doing concentrated searches, you have probably already found several websites that focus on using private money to fund your real estate deals.

One search you should do immediately is “private money for real estate investing.” The number of sites returned will blow you away. One recent search on Google yielded 6,150,000 results. Of course, not all of them are tightly focused on the topic – in fact, MOST probably aren’t – but the top 20-30 were very relevant. A few also turned out to have good information.

You could also try the shorter versions like “private money real estate” or just “private money”. I tried “private money” on MSN and got 36,543,981 results. Wow… try surfing those in an evening!

The great thing is, you really only need the first page or two of results to gather some top-notch information, much of it free or low-cost.

Don’t get confused by the term “hard money lender”. Hard money and private money are definitely two very different things. Hard money is a much higher cost option for higher-risk transactions.

Don’t be fooled by hard money sites masquerading as private money lenders. They’re NOT the same.

There is a place you can go for advice and information about developing a private money network of your own. Called simply private money for real estate investing, you can find it at http://www.private-money-real-estate-investing.com.

There is also a page of private money for real estate investing best sites.

Can't Sell Your Home – Start Investing In Real Estate!

2007-03-31T07:50:00.000-05:00

So you’ve been trying to sell your home for quite a while, with no success. Oh, sure, you’ve had a few people through, maybe even a lot of people, and every time your life was disrupted… all for nothing. No offers, not even a nibble. It’s getting frustrating. Since life has given you some lemons, why not make lemonade and use this as a springboard to start investing in real estate?

You may be wondering, “How can this be an opportunity for me to start investing in real estate?” Glad you asked.

Since you’re having trouble selling your house through conventional means, maybe now’s the time to go a bit unconventional, and learn a creative real estate investing technique in the process… a technique that you can use over and over again to create wealth for you and your family.

If you use this technique to sell your home, you will be following in the footsteps of thousands of other homeowners who have followed this same strategy to start investing in real estate.

I’m talking about the lease / option method of selling your home.

What is a lease option? Simple… instead of selling your home outright, you’re going to lease it to someone, and at the same time give them the option to purchase it at a fixed price within a fixed period of time.

Why does this work? How can this allow you to sell your home faster and easier? The answer has to do with the type of people that will respond to your “lease with the option to buy” or “rent to own” ad. They will be people with bruised or damaged credit, but don’t let that scare you. Often these are good people who are back on track after a tough period in their life.

They’re not deadbeats… at least not the ones you’ll be putting in your home, because you’ll be carefully screening them. You’ll want to check their story, and verify employment and income. Trust your gut, but verify everything. Select carefully, and realize that it may take two or three tries before you get to the end result you’re looking for- a tenant who becomes a buyer.

The other great reason to use the lease/option technique is price- you can often sell for full market value… even more! What a great way to start investing in real estate.

There are three important terms you will need to negotiate with your tenant/buyer in order to enter into a lease/option agreement with them… price, option term, and monthly rent. Once you’ve learned to do that, you’ll be well down the path many others have followed to start investing in real estate.

Price is the price you will sell them the house for when and if they exercise their option. The option term is the length of time the option to buy is open to your tenant buyer. This is often one year, but could be longer. It’s up to you. I’ve seen option terms as long as five years, but in my mind that’s too long, unless you just want to be a landlord.

Finally, the monthly rent should be enough to cover your mortgage, taxes, and insurance, plus something left over to give you a positive cash flow every month. After all, there is a little hassle involved, so you should get something for your trouble.

Now, here’s the icing on the cake. You can and should collect a non-refundable option fee from your tenant/buyers, and you should get it upfront. The amount is negotiable, but generally about three percent of the value of the home is appropriate. So, on a $150,000 property, the option fee would be between $4,000 and $5,000. This shows good faith and commitment on their part.

Hopefully by now you can see that this is a great way to both get your home sold and start investing in real estate. You make money three ways… when you collect your option fee, when you sell the house, and every month in the form of positive cash flow. Plus, the home remains in your name until they exercise their option, so you still get all the tax breaks associated with homeownership.

Listen, I know there’s a lot more to say on the subject of lease option, and there’s certainly a great deal more on how to start investing in real estate. This is just a primer, but hey… we’ve all got to start somewhere, right?

A New Site To Check Out

2007-03-27T13:25:00.000-05:00

I wanted to ask you a question... "Are You Milkin' It?"

You may wonder what in heck I'm talking about. Visit www.CashFlowCows.com and you'll see for yourself.

If you're looking for real estate investment opportunities, you owe yourself a visit right now.

All the best,

Tom

No Money Down Investment Mortgages

2007-03-20T08:14:00.000-05:00

In any meeting of real estate investors the topic of no money down investment mortgages almost always comes up. I’m a firm believer in putting as little cash as possible into my real estate deals, and if you’re going to succeed in the long term, you should learn to think the same way.

This is really just Real Estate Investing 101… as simple and basic as you can get, yet vital for you to understand. No money down investment mortgages are a topic you should seek to understand and here’s why.

Your supply of cash is limited, and always will be.

There it is. I don’t care how much cash you have now, or ever will have. I don’t care who you are, or where your bank account stands. You’re cash supply is finite, not infinite, and cash is a valuable resource that gives your real estate investing flexibility and leverage. Using no money down investment mortgages allows you to preserve cash, one of your most valuable resources.

Having ready cash allows you the flexibility of moving quickly when others can’t. It also gives you confidence and leverage when making your offers. That doesn’t mean you need to actually use your cash… merely having it is often enough.

Using no money down investment mortgages and other types of low or no down financing should be undertaken with great care, however. Make sure you’re not paying full price for your properties and financing them at full market value. The way to employ no money down investment mortgages is to buy value. In other words, buy at 80% of market or less, preferably much less.

That one strategy alone will ensure your long-term real estate investing success. If you just go out and pay market, finance the full value, and thus hang on to your cash, don’t make the mistake of thinking you’ve accomplished anything worthwhile. A chimp could do that.

Learn to recognize and buy value. Finance as much as you can to leverage your limited cash, and repeat the process. Over and over. Use creative financing and no money down investment mortgages to accomplish your goals.

Now, go make more offers!

For more information on creative real estate and no money down investment mortgages try http://www.dealfiles.com/investmentpropertymortgages.html.

If you would like to learn about beginning real estate investing try http://www.dealfiles.com.

Private Money For Real Estate Investing – Get Confident - Get Flexible!

2007-03-11T08:20:00.000-05:00

What’s so great about having private money for real estate investing? Have you ever looked a fantastic deal square in the eye and had to walk away because you weren’t in a position to move on it? If so, ready access to private money could have made the difference.

Having a reliable supply of private money for real estate investing gives you two things you need to be super-successful… confidence and flexibility. Let’s see why…

First, imagine that your marketing is working like it should, and you’re getting calls from highly motivated sellers anxious to get out from under their property. Further, let’s assume you’re already in the middle of a deal or two, and you have, say, a quarter of a million dollars tied up for the next few months.

You get a call from Mr. Gotta Getoutnow, who has already moved and is shouldering two huge house payments. His vacant house, valued conservatively at $190,000, is costing him a cool $1200 each month… and he hasn’t lived in it for 6 months! He’s willing – even anxious - to let it go, if you’ll just cash him out of his mortgage to the tune of $132,000.

Unfortunately, your marginal credit rating won’t permit another loan, your cash is tapped, and your house is already mortgaged to the hilt for those other deals you’ve got working. How much confidence do you have on the phone with Mr. Getoutnow? My guess… not much! But how much could you have if you knew you had access to a half million or so in private money for real estate investing?

See the difference? I thought so!

Now, when you get his call, instead of hemming and hawing about some nebulous ‘creative acquisition techniques’ you’ve used successfully in the past, trying to impress him with your vast knowledge and experience, you simply tell Mr. Getoutnow, “I’ll be right over,” and off you go to get the house under contract. You have the confidence to do this because you know, comfortably resting in your hip pocket, is all the private money for real estate investing you could possibly need!

What about flexibility? How does private money for real estate investing give you that?

The answer is in the options private money for real estate investing gives you. Let’s face it, the number one stress inducer in real estate – other than tenants – has got to be obtaining financing and working with lenders. Why? Because they want so much freakin’ information, that’s why.

If you’re like me, you can’t stand filling out all those forms banks ask you to fill out. What could they possibly need all that information for anyway? I mean, come on. It’s a loan, here’s the property, it’s worth $150k, I need a loan for $100K, what’s the problem? When you have private money for real estate investing, you don’t fill out forms!

Not only that, but what’s up with those lenders having to hammer my credit report every time I get a loan? First there’s an inquiry, then they add the loan to my list of debts, so the whole world knows my business. I’m definitely NOT down with that. Now that I have all the private money for real estate investing I could possibly need, there’s no hits on my credit report, and nobody ever sees the debt listed. I don’t have to worry the next time I go to apply for a car loan that I’m going to have to answer a whole bunch of stupid, embarrassing questions. I’m a happy guy!

Heck, I’m just about the most confident, flexible guy in town, thanks to my ability to raise private money for real estate investing! I can’t say this strongly enough…

You’ve got to figure out how to get some of your own!

Thankfully, it’s easy enough to do, and you don’t have to pay a small fortune for some guy’s overpriced course. There are tools that can help you, and eliminate a lot of the hard work you would otherwise have to do upfront, but these tools don’t need to be expensive.

For more information, and a more in-depth article, visit Private Money For Real Estate Investing on the DealFiles website.

Now, go make more offers!

Tom Dunn
www.DealFiles.com

Real Estate Investing Mentors – Maximum Mentoring

2007-03-07T07:00:00.000-05:00

If you have looked for and found one or more real estate investing mentors, you may be wondering, “What next? How can I get the most from this real estate mentoring relationship?”

The answer is, quite simply, give the most!

It’s strange but true, the relationships we typically get the most out of in life are those we put the most effort into, and your relationship with your real estate investing mentors will be no different.

Be prepared to go out of your way to be helpful to your real estate investing mentors, and you will be amazed at what happens. Whenever I have mentored someone, it has been my experience that the more they put in, the more they got back. If they were especially helpful and generous with their time, they not only learned more quickly, but they also achieved their goals much faster.

Let me give you an example. Close acquaintances of mine, a couple, had been looking for real estate investing mentors for quite some time before they asked me. I gladly agreed, and we decided to work on a rehab project together. Using my expertise, I would buy a house that needed rehab. Using their expertise, they would rehab the house. We would then rent it out, holding it in an LLC.

That’s exactly what happened. They did everything I asked of them, and then some. Not only did they complete the rehab in a timely manner, they did a fantastic job. They learned by watching closely how I acquired the house for far below market value. They learned, because that’s why they were looking for real estate investing mentors in the first place.

They also watched and learned how to get the house rented, and how to properly manage the rental. They can now do all of this on their own, and I’m sure they will. They learned because they started out looking for real estate investing mentors with the right mindset- they had the will to work hard!

If you would like to know more – such as exactly how to go about finding real estate investing mentors – check out Real Estate Investing Mentors.

Now, go make more offers!

Tom Dunn
DealFiles.com

Beginning Real Estate Investing - "Subject To…" Investing

2007-02-26T15:36:00.000-05:00

This is another in a continuing series of articles on beginning real estate investing. Today, we’ll tackle the basics of “subject to…” investing. There are a lot of questions those who are just beginning real estate investing often have about “subject to…” investing, and this article should answer many of your fundamental questions.

First of all, it’s important for those who are beginning real estate investing to know what “Subject To…” investing is. “Subject to…” means that you buy a property “subject to…” the existing financing staying in place in the seller’s name.

Say that you get a call from a motivated seller. He tells you he must sell his house immediately. He also says he owes around $100,000 on his mortgage, his payments are around $900 per month, including principal, interest, and taxes. Even though you are only just beginning real estate investing, you know the estimated market value of his home is about $130,000.

You head on over to his home. It doesn’t matter in the least that you are just beginning real estate investing. After all, he needs to sell now. You tell him that you will take over his mortgage payments, and keep on making them until you get the house sold. You don’t know how long it will take, but the mortgage will stay in his name until you get it sold.

He asks if you can give him some cash to help him move. Even someone who is beginning real estate investing can negotiate an item like this. After going back and forth a couple of times, the two of you agree on $3,000, which you will pay to him the day he moves out.

Now, what have you got? A house with an estimated value of $130,000 that you will wind up paying about $103,000 for, and a payment of $900 per month. Since you are just beginning real estate investing, there is something you must do right away… market for a tenant buyer.

So, you place an ad in your local paper, and put up a few signs in Mr. Seller’s neighborhood: “Lease to Own – Bruised Credit OK.” Your phone starts ringing and you find a young couple with good jobs and good income who went through a brief period of financial trouble a year or two ago. You explain to them that even though you are just beginning real estate investing, you think you can help them.

You offer to lease them the home with a 12 month option to buy it. Their monthly lease payment to you will be $1,200, and their purchase price will be $135,000. They will also give you a non-refundable option fee of $5,000. It doesn’t matter that you are only beginning real estate investing- you can certainly see what you have just accomplished.

You’ve got monthly positive cash flow of $300 - the difference between the $900 you are paying and the $1,200 the young couple is paying you. You have also put $2,000 cash into your pocket right now – the difference between the $3,000 cash you gave the seller and the $5,000 cash the young couple gave you. When the young couple exercises their option to buy, you will also pocket $32,000 - the difference between your purchase price of $103,000 and the price they pay you, $135,000. Not too bad for someone beginning real estate investing!

We’ve barely scratched the surface of “subject to…” investing, but I think you’ve got the idea. I’ve got more great ideas for you at Beginning Real Estate Investing.

Now, go make more offers!

Short Sale Real Estate Investing

2007-02-24T08:52:00.000-05:00

Short sale real estate investing is defined as purchasing a property from a lender for less than the balance owed on the mortgage. Many books and courses have been written about it, but can short sale real estate investing be simplified? It can!

There really are only two types of short sale real estate investing. First, when you purchase a property that a lender has foreclosed on and listed with a Realtor, you can offer less than the balance that was due on the foreclosure. This type of short sale real estate investing requires that you have a good relationship with the right Realtor.

Look for the Realty office in your town that handles the majority of foreclosures, and look for the agent in that office who works with investors and short sale real estate investing. When you find that agent, you’ll want to impress upon them that you intend to follow through on all your offers. Then, do exactly what you say you will. That’s your ticket to the short sale real estate investing gravy train!

The second type of short sale real estate investing involves you negotiating directly with a motivated seller’s lender. You’ll need to be determined in your negotiating, first of all to reach the right person at the lender’s REO (Real Estate Owned) department, and then to get the price you want.

Stick with it, and take lots of notes. Once you’ve worked with a few lenders that allow short sale real estate investing, you’ll have the tactics you need to enjoy on-going success.

Would you like more information? How about a more in-depth article? You can get both at Short Sale Real Estate Investing.

Now, go make more offers!

Beginning Real Estate Investing – Understanding Market Values

2007-02-19T10:52:00.000-05:00

Another in a series of articles on beginning real estate investing. A crucial step to becoming a wise real estate investor is getting to know your local market, and learning to put a value on the properties within your target neighborhoods.

Beginning real estate investing involves learning a new set of skills, one of the most important of which is valuing property. For the limited scope of this article, we’ll limit our discussion to residential single-family and duplex homes.

When you are just beginning real estate investing, it’s helpful to set a goal for yourself to become the market value expert in one or two select neighborhoods. When choosing these neighborhoods, look for locations close to your home with a good selection of homes in the lower-middle to middle price range for your market. This is where you’ll find the best combination of working-class homeowners and what I call “aspirational” renters- those renters who aspire to homeownership. These will become your best customers.

Once you’ve found one or two of these neighborhoods, start driving through at least twice a week, looking for all real estate activity, including listed sales, For Sale By Owner, auctions, estate sales, vacant property, even moving van activity. As someone who is beginning real estate investing you should get tuned in to the pulse of the neighborhood.

Look for and get to know the local Realtors. Stop in to the Realty offices and introduce yourself. Find out who the most active listing agents are, who sells the most houses, who deals with the most foreclosures, and who works with the investors. These are the best Realtors to work with as you are beginning real estate investing.

Also, beginning real estate investing means getting to know local service people, especially contractors. Talk to as many of these as you can, and find the ones that do a lot of work in your target neighborhood, especially plumbers. Ask them what kinds of recurring problems they see. They will provide you a wealth of information.

Give yourself a timetable to learn property values in your target neighborhood. Three to six months is probably realistic. When you are just beginning real estate investing you will need to work closely with a Realtor. Ask for all the listings in your target neighborhood, and try to see them all. Ask also for the listings of comparable sales (Comps) so you can see what similar properties have sold for recently.

Build a spreadsheet, database, or even just a handwritten notebook so you can refer back to it from time to time. This will become a valuable resource for you as you progress beyond beginning real estate investing. Slowly but surely you will become an expert on property values in your target neighborhoods. You will be able to look at most any property and know, within a few hundred dollars, exactly what it’s market value is. This knowledge will serve you very well as you progress in your real estate investing activities.

For more in-depth information, visit my website and read more about beginning real estate investing.

Now, go make more offers!

Socially Responsible Real Estate Investing

2007-02-14T14:24:00.001-05:00

There are many ways to practice socially responsible real estate investing. In this article I will outline what I believe to be the best way to invest in real estate in a socially responsible manner.

I run into all kinds of people, many of whom are less than charitable when they find out I own rental property, and that I also flip houses and mobile homes. I frequently find myself disagreeing with those same people about just what socially responsible real estate investing means. For some strange reason, many people are predisposed to look down on those who engage in such capitalistic endeavors. Often, these are the same people who benefit from one or more of the many government programs that my tax dollars support.

Here’s what I mean when I talk about socially responsible real estate investing.

I am a man of my word, so when I say I’m going to do something, I make every effort to do it. This applies to offers I make on properties, promises I make to tenants, and agreements I make with contractors and service providers. In my mind, there is no more powerful way to engage in socially responsible real estate investing.

Being a landlord and property investor makes me a productive member of my local economic community. I strongly support and add to the tax base, and help provide a healthy living to several Realtors, contractors, and service providers. I also bank locally, and contribute to my local Real Estate Investor club. These are all great ways to pursue socially responsible real estate investing.

In addition, I provide clean, safe, affordable housing to several tenants, including children and senior citizens. I also provide housing to those in the lower income brackets through HUD’s Housing Choice Voucher Program, also known as Section 8. Providing this type of housing is another powerful way to practice socially responsible real estate investing.

There are those who believe that in order to practice socially responsible real estate investing, one needs to provide free housing to the deserving poor. I do not agree with that assessment. The Bible says, “The laborer is worthy of his hire,” and certainly that applies to property owners. I commend those who choose to be charitable, but I do not believe it should be legislated. It needs to come from the heart, and be supported by a consistent practice of sound business principles.

That attitude, and the underlying economic practices, are reasons why the United States of America has been, and continues to be, the most charitable nation on the face of the earth. Practicing socially responsible real estate investing isn’t the result of some feel good nonsense, but rather the application of wise investing habits and moral consistency.

Now, go make more offers!

Tom
DealFiles.com

Top Real Estate Investing Sites

2007-02-12T07:05:00.000-05:00

There are literally thousands of real estate investing websites on the internet today, with dozens more being added each and every month. How can you possibly weed through them all, and determine which have real value, and which are a waste of your limited time? In other words, how can you discover the top real estate investing sites?

The answer to those questions can be summed up with one word- content. When you search the internet you’re looking for information, right? Information is another word for content, so it’s reasonable to assume that the top real estate investing sites are the ones with the most high-value content.

As you begin your search for the top real estate investing sites, you can start by weeding out those that are simply link farms. You’ll recognize a link farm right away- it’s just a page filled up with links to other websites and pages, with no other content or information to be found anywhere. Link farms are there only to serve the purposes of the site owner. They provide you with nothing worthwhile.

Next are those sites that are just a rehash of other people’s content. The only thing you’ll find on these sites are reprinted articles and reports that someone else wrote. While a few reprinted articles don’t necessarily mean a site is useless, if that’s all the website has to offer you should look elsewhere for original and useful content. When looking for the top real estate investing sites you should bypass those that only provide reprinted content.

The next type of site are the sales page sites. Those are the web pages that are only trying to sell a product. Now please don’t misunderstand me- everyone has to make a living, and webmasters are no exception. There is a legitimate use of the sales page, as long as the site is also providing plenty of useful information. But far too many sites offer only sales pages, without giving you anything you can sink your teeth into. These will never be among the top real estate investing sites.

Finally, there are those websites that offer unique, engaging, and helpful real estate investing information. They tend to have resources for investors, articles, reports, forums, blogs, and useful product offerings. In a word, they have content. When you find a site like that, you know you’ve found one of the top real estate investing sites. You should bookmark it or add it to your favorites, because you’ll want to return time and time again.

For a page of links to the top real estate investing sites, visit the DealFiles Links Page.

Now, go make more offers!

Tom
DealFiles.com

Deedless Real Estate Investing - An Overview

2007-02-10T10:25:00.000-05:00

Are you looking to increase the number of real estate deals you can do without significantly increasing your risk and without increasing the amount of cash or credit you need? If so, then deedless real estate investing may be just the strategy you’re looking for.

Deedless real estate investing is a collective term used to describe a group of tactics that do not involve an immediate transfer of ownership of a piece of property. Among these tactics are straight lease option, sandwich lease option, and subject to.

The first of these, the straight lease option, describes an agreement between you the investor and the seller in which you lease (or rent) their property for a monthly payment, and you have a guaranteed option to buy the property at a predetermined price within a fixed period of time. Ownership does not change hands unless and until you exercise your purchase option, making this the first type of deedless real estate investing.

The second type of deedless real estate investing, the sandwich lease option, starts out as a straight lease option. You then, as the tenant buyer, would find a second tenant/buyer to assign your interest in the property to. They would lease the property from you, with the option to buy it from you. When and if they exercise their option, you would in turn exercise your option to buy from the original seller. This puts you in the middle of the sandwich, where you stand to profit with little or none of your own money at risk!

Finally, the third tactic for deedless real estate investing is the subject to, which means you buy the property subject to the existing mortgage or deed of trust remaining in place in the seller’s name- you simply start making the payments. Some investors actually do insist that they get the deed when doing a subject to deal, but they don’t record the deed until they resell the property and cash out the seller’s loan.

Other subject to investors don’t get the deed, waiting instead until they find a buyer who exercises their option and cashes them out of the seller’s loan. Doing it this way makes this a true deedless real estate investing tactic, but significantly increases the risk. I don’t recommend it!

We have barely scratched the surface of what could be said about these three tactics for deedless real estate investing, but now you have an overview. Add these tactics to your real estate investing toolkit, and more deals will be available to you.

Now, go make more offers!

Tom
DealFiles.com

401K and Real Estate Investing – An Overview

2007-02-09T09:26:00.000-05:00

Is it possible to combine your 401k and real estate investing? Wouldn’t it be great to invest in real estate with a maximum amount of pre-tax dollars, realize the huge gains possible only with real estate investing, and then re-invest those dollars in your tax-free 401k?

Of course it would, and there are ways for the savvy investor to combine their 401k and real estate investing.

First, you could borrow funds from your 401k. This is not necessarily the best way to combine your 401k and real estate investing, but it might be worth looking into if you have no other available funds for investing. Realize that there are limits on the amount you can borrow, and the interest you pay won’t be deductible, as it would with a typical mortgage. Choose this option only after doing your homework.

The second method of combining your 401k and real estate investing is the IRA roll-over. If your 401k allows you the benefit of rolling over into an Individual Retirement Account, this may be the best way for you to go. Select a specific type of IRA- called a “Self-Directed IRA” to roll your funds into.

The Self-Directed IRA is a very powerful investment vehicle that allows you to direct exactly how your money is invested, within certain limits. For instance, you could direct that the money be invested in a REIT (real estate investment trust), an apartment complex, or a strip mall. When you sell and realize a profit, the increase in the IRA is tax-deferred. This is a huge benefit, and you should really consider this method of combining your 401k and real estate investing.

One downside to the roll-over - you would be giving up the employer contribution portion of your 401K deposits, if any. Another reason why you should weigh this option carefully before deciding to use it to combine your 401k and real estate investing.

Finally, and the simplest method of combining your 401k and real estate investing, is to ask your 401k account manager if they allow the funds to be invested in REIT’s directly. Some do, and this is a low risk, high return strategy for a lot of investors.

Whatever you do, don’t make a hasty decision to combine your 401k and real estate investing. Each of the above methods has a different risk/reward ratio, and you should familiarize yourself with them first, before risking your hard-earned money.

Now, go make more offers!

Tom
DealFiles.com

Real estate investors MUST choose "better" over "bitter"

2007-02-01T11:00:00.000-05:00

I got an email from a subscriber the other day.

Here it is, slightly edited for readability:

Tom,

This is a great business especially if you have great credit or large amounts of money, or better yet a good friend at the bank. I have none of the above.

So I keep trudging along looking for deals to wholesale. "Investors" in my area think you're rude to ask for a "birddog fee" for a good contract. Finding money is the most exciting adventure. The last hard money lender I talked to wanted me to show up to closing with 18k in hand. I told them if I had 18k "why would NEED THEM!"

So I keep trudging along, one small deal after another, trying to make ends meet. Thanks for DealFiles- talking about people with money making more money- where's the challenge.

Thanks again.

And here's my reply:

Thanks for your letter.

Was I wrong, or did I sense a tone of bitterness?

I'm glad you're reading DealFiles, and I'm thankful for your email. Your words tell me a lot about you, and you're not so far from the attitude I used to have toward those who were successful.

I always felt like if I just had the same kind of breaks they had, if I had the same resources available to me, then I could be successful too.

I agree with your opening statement. This IS a great business. Not only if you have gobs of cash or great credit or a good friend at the bank. When I started out in 1999 I had NO CASH, BAD CREDIT, and NO FRIEND AT THE BANK. My wife and I prayed and scraped up $1000 or $1500 and bought a mobile home, which we screwed up on and sold to the wrong people and lost our shirt on. Then we bought a mobile for $200 which needed so much work we couldn't afford to fix it up.

We wound up paying somebody $1000 to haul it away. So the end result after our first two deals was a net loss of over $3000. We were broke and struggling to pay the monthly bills and feed our three young kids. We could have become bitter because we were poor and others had so much more experience and so many more resources than we had.

But we were learning, and we bought one more mobile home, applied the knowledge we had gained from our mistakes, and made a nice little profit. So we did it again, and then again, and then again after that!

I could go on all day, but I don't want to bore you. I think MOST people's success stories are like ours. A series of three steps forward, two steps back,until they get over the hump. Your story will be like that, too, if you stick with it long enough to find out. Or you could just quit in bitterness. Lots of people do.

My advice? Keep moving forward, one positive step at a time! Don't give up- those little deals you're struggling to do today are building the foundation of the larger deals you will be able to do tomorrow. Every mistake you make becomes your teacher if you let it.

Read, read, read and learn, learn, learn. The information is readily available to you. Never before in the history of the planet has it been it so easy to find out
ANYTHING you want to know. Instead of feeling sorry for yourself, pity the poor folks who lived BEFORE the internet age. How do you think they learned about how to invest in real estate? If they couldn't get a local mentor, they were sunk. You've got it all over them.

You're going to make it. I can sense it. You've got a tenacious, bull-dog spirit that won't let you quit. Find it within yourself to take the energy that's being wasted on bitterness and envy, and channel it into moving yourself forward, one positive step each day, in the direction of your goals. I'm praying for you!

Blessings,

Tom Dunn
DealFiles.com

Having any fun in your real estate investing?

2007-01-29T13:18:00.000-05:00

The question would seem inappropriate, wouldn’t it? After all, investing in real estate is a business, isn’t it? What does “fun” have to do with it?

Quite a bit, actually, and if you think about it, you’ll understand why.

The Gloves Come Off

Let’s take the gloves off and be brutally honest. How is your real estate investing career progressing? Are you accomplishing your goals and objectives? Are you getting the number and kind of deals you want? Are you making all the money you ...

Click here to read the rest of this article.

Now, go make more offers!

Tom Dunn

Real estate investors need to know strategy AND tactics.

2007-01-12T13:35:00.000-05:00

I've been hearing from a lot of investors lately on the subject of FOCUS and it's importance to real estate investing. Briefly, there seems to be a split between those who feel it's better to concentrate on one or two areas of investing (I'm in this camp), and those who believe an investor should do whatever kind of deal happens to come along.

A little clarity might help the situation.

Read the rest of this article at DealFiles.com

Blessings,

Tom Dunn
DealFiles.com

Step out, real estate investing waits for no one.

2007-01-02T06:43:00.000-05:00

Happy New Year! And away we go...

There are so many ways to make money with Real Estate that not one of us has any excuse for NOT doing deals. Yesterday I was thinking about the opportunities I have watched somebody else take advantage of, thinking to myself, "Oh, I couldn't do that..."

Why not? What did they have that I didn't?

Money? There's at least a half dozen techniques for buying real estate without money.

Time? I can buy real estate using somebody else's time- it's called partnering, and I wrote an article about it here.

Knowledge? Nonsense- all the knowledge you'll ever need is available to you- mostly for free- if you'll just make a little effort to look it up.

Guts? Maybe. Better think about that one.

I think that's what it boils down to, don't you? You read about others doing it, you watch others doing it, you know someone who did it, and still you sit there. There's literally dozens of ways to put a deal together, flip, wholesale, bird-dog, lease option, sandwich lease option, subject2, buy and hold, rehab, section 8 rental, the list goes on and on.

What are you waiting for? Guts? Yes, guts. Courage.

You need to overcome the fear that holds you back. How will you do it? Think about it. How will you do it? After all, it's been keeping you from your goals for an awfully long time now, hasn't it? So what are you gonna do?

Take a step, for crying out loud! That's right, I said take a step. Do it today- one little step in the direction of your goals.

One Positive Step. Take one today, then take another one tomorrow, and the day after that take another. Do that for long enough, and you'll be where you want to be in no time.

You know one step, don't you? You can take one step today, right? What are you waiting for?

Taken your step today?

Tom Dunn
DealFiles.com

There's magic in little real estate deals!

2006-12-27T20:42:00.000-05:00

Here's a great little investment.

There are two single family foreclosure listings in a city neighborhood near me. One home is listed at $30,000 and the other at $27,000. Both have After Repaired Values of approximately $50,000, and both require about $2,000 to $3,000 in repairs.

Market rents for these homes will be about $700, so here's what I suggested to a young man I know. Offer $25,000 each, for a total of about $55,000 invested after repairs. $7,500 cash out of pocket leaves a mortgage of $47,500 and PITIVR (principle, interest, taxes, insurance, vacancy, and repair) of about $850 per month.

Positive monthly cash flow on these two little deals of about $650, or live in one and rent the other out to basically cover your housing costs.

There's probably a deal out there like this for you.

Now, go make more offers!

Tom
DealFiles.com

Let Christmas change you a little.

2006-12-22T16:13:00.000-05:00

Merry Christmas!

Enjoy this Holiday with those you love. Give and be gracious with your time. Be patient with those who need a little extra understanding.

Let peace reign in your heart. Read a Psalm. Read the Christmas story from Luke. Pray and ask God to reveal Himself to you. Thank God for every breath you take and every blessing you have.

Blessings,

Tom Dunn

Real estate investing- how to DOUBLE your conversion rate!

2006-12-18T06:39:00.000-05:00

When a phone call comes in from a seller, how effective are you at converting it into a deal?

There are many factors involved in your conversion rate that have nothing to do with what you say or do when they call. For instance, what type of marketing are you using that's getting them to call in the first place? The sellers who call you after reading an ad that says "I buy houses for cash or take over payments" may have a different level of motivation than those who call you from a postcard you mailed to foreclosure listings.

Understand that out of every 100 callers, at least 90 of them aren't motivated enough, so there's no deal there even if you hypnotize them with your melodious voice. Six more have circumstances that prevent you from putting a deal together, leaving about four where a deal might be possible. If you're converting two of those, your conversion rate is fifty percent, excellent in my opinion.

Here's a thought for you. If there are six out of the hundred that have circumstances preventing you from putting a deal together, maybe you could learn one new investing technique, like a lease option or subject2, that would allow you to make a deal where there was none before.

Another tool in your bag is the most effective way to improve your conversion rate. Think of it this way- if you are converting fifty percent of your possible deals as I outlined above, and you increase the number of possible deals from four to eight, you've just doubled your conversion rate.

I can't think of any power words or phrases that can accompish THAT!

Now, go make more offers!

Tom Dunn
DealFiles.com

How to find positive cash flow markets

2006-12-15T16:04:00.000-05:00

On December 9th I posted on the idea of investing in markets other than your own home market, especially if your market is overinflated and you want to find properties that will give you an immediate positive cash flow. Now I want to help you locate those kinds of markets.

Use the internet. You can use the search tools available online to find markets where median family home values are under $180,000. Many of those areas are located in small to medium sized cities in the northeast and midwest. Places like upstate New York, Western Pennsylvania, and Eastern Michigan come to mind, but there are others.

Look for Realtors websites in those areas. Some Realtors in positive cash flow markets are even specializing in finding, packaging, and managing rental properties for out-of-town, out-of-state, and even out-of-country investors. Their sites are easy to find.

Once you find a couple of markets, and a Realtor who specializes in positive cash flow income property, do some research on the area to determine what neighborhoods to avoid, and which ones to target. Ask a lot of questions about the economy and property values in the area. Because you'll be holding the properties for a long time, it's not so important that the property values be increasing at a fast pace, but they shouldn't be tanking either. Slow and steady growth is what you're after.

Next, ask about management options and costs. As an absentee landlord, you'll want to make sure you can hire competent management at a reasonable cost. Under 10% of gross collected rents is a good target.

You should find out as much about the city and it's environs as you can before you invest. You may even want to visit. Let the Realtor know when you'll be coming, and they will have a bunch of properties for you to look at. Make your trip efficient and productive- plan to buy at least one and preferably several properties all at once.

These markets are out there. You just need to hunt for them, find them, and take action.

Now, go make more offers!

Tom Dunn
DealFiles.com

Real estate investing financing- are you able, are you willing?

2006-12-14T12:17:00.000-05:00

I've been talking to a couple of new investors about financing, and I thought it might be good to explain some of the basics of lending.

First, what exactly are lenders looking for? The answer, surprisingly, is quite simple. Lenders are really only looking for two things: ABILITY to pay and WILLINGNESS to pay.

Ability to pay is basically the answer to this question: After you meet all of your monthly obligations, is there enough left over to meet this new debt you're asking for? This is a matter of comparing your provable income with your actual expenses. Of course, the bank doesn't usually know your actual expenses, so they apply some formulas and educated guesswork. The income part they get from your paystubs, W2's, and tax returns.

Willingness to pay is usually determined by looking at your credit history. If you have a history of paying your bills and credit obligations on time, most lenders usually asume that you will continue to do so.

Credit scores and algorithms have made the process more complicated than it used to be, but it still boils down to these basic factors. If you understand this, and can view yourself dispassionately through the eyes of the lender, you will know how best to improve your credit standing and get the loans you need to grow your business.

Now, go make more offers.

Tom Dunn
DealFiles.com

Stuck in an overinflated real estate investing market? Spread your wings!

2006-12-09T13:44:00.000-05:00

Are you trying to invest in a real estate market that's overinflated relative to the market rents in the area? What I mean is, if you buy a home that will rent out for $1000 a month, how much do you have to pay for it? $90,000? $110,000? $150,000 or more?

Market values obviously vary by area, and can swing as much as 50% to 100%, sometimes even within the same county. That means that in one market you may be able to purchase a $1000 per month rental for well under $100,000, giving you a nice little positive cash flow right out of the chute.

On the other hand, in many markets that same property might cost you $150,000, $200,000, even much more, meaning that there's no way you'll realize any kind of cash flow until your mortgage is fully paid. In those markets rents just haven't kept pace with values.

The solution? Find a different market to invest in. Is there some reason you're locked in to investing in a high-priced market? Of course not. The only thing stopping you from going outside your market area is your own fear and comfort, and those can and should be overcome. Read my article on Eliminating Fear.

There are plenty of markets all across the country, indeed around the world, where rents have kept up with property values. Those are the areas you should be looking for.

How you can find them is the subject for next time.

Now, go make more offers!

Tom Dunn
DealFiles.com

In real estate investing is service the name of your game?

2006-12-05T17:39:00.000-05:00

What kind of a service do you provide?

It's a valid question, don't you think? The problem is, most real estate investors don't think in terms of the service they offer, they think only in terms of the properties they buy. But behind those properties are sellers, normally highly motivated sellers.

The reason they are motivated to begin with is they are in distress over some issue or combination of issues they are faced with right now. They need a fast resolution. Maybe they lost their job and can't handle the payments anymore, maybe they're getting divorced, or they might have to move immediately. They need a solution. That's why they call an investor, rather than a Realtor.

The same holds true if the seller is a bank and the property is a foreclosure. Just because the seller is not an individual doesn't mean they're not motivated. The bank doesn't want that property on it's books, so they look to foreclosure investors to help them with their problem.

So the question becomes one of service. Do you view your investing activities as providing a service to the sellers of your properties? If not, you should. The investor who consistently provides the best solutions will get the contract, the property, and the deed more often than not.

Dealing with sellers becomes much easier when you are deeply concerned about their problem, and about helping them find a solution. They will quickly grow to trust you, and if there's a deal there you will most likely get it. Think about that the next time you're talking to a seller, and try to figure out what they need.

Zig Ziglar put it best. He said, "You can get everything in life you want if you will just help enough other people get what they want."

Now, go make more offers, and read DealFiles!

Tom
DealFiles.com

Real estate investing- the foolproof broken toilet repair system

2006-12-03T07:42:00.000-05:00

I was thinking about Whitey this morning. Whitey's an investor from Texas that I interviewed for one of my DealFiles. You can read his story here.

Whitey talked about perspective, and choosing what you focus on. It seems that the things he chooses to focus on are what help keep him moving forward in the investing game. For instance, as a landlord Whitey chooses to focus on the fact that his tenants are paying his mortgage down every month, rather than on the toilets and repair calls he might get.

Let's face it, getting calls from tenants on a Saturday night asking for help with a leaky toilet or broken appliance are no fun at all. But doesn't every business have certain things about it that are no fun? Of course. The key is in choosing what you're going to focus on, and in implementing systems to handle the unpleasant things.

If you don't like getting trouble calls from tenants, don't let that stop you from being involved in the great business of rental real estate. Just put in a system so YOU don't have to be the one handling those calls. Hire an on-call handyman, or a property management service. With just a little tenacity, you'll find the right solution for you, and you'll go on collecting those monthly checks.

Now, go make more offers!

Tom
DealFiles.com
Here's my FREE articles page!

Find what you need for real estate investing- look for a partner

2006-11-29T00:00:00.000-05:00

More on real estate partnering.

Let me ask you a question. What do you bring to the real estate investing table? Do you bring a lot of cash?

No? Then perhaps you bring a particular skill, like construction, financing, or negotiating?

None of those? Maybe you have a lot of time on your hands and can spend it looking for deals.

My point is that no matter who you are or where you came from, you bring SOMETHING to the real estate investing table. You most likely don't have all of the abilities or resources above- no one does- but you can find someone who has what you lack and partner with them to do a deal, or two, or twenty!

Even if all you can do is spend time learning the market and looking for deals, you need to find someone with cash and ability but little or no time. By working with a partner, you can accomplish far more than either of you could alone.

My post from four days ago on partnering gives examples. In each case I brought something different to the table than my parner did, and we were able to do a deal that neither of us could have done alone.

Look for partners, and leverage what you DO have.

Now, go make more offers!

Tom Dunn
DealFiles.com

Cash is King in real estate investing

2006-11-27T23:17:00.000-05:00

Here's the last of my 3 part series on a great little mobile home deal we did. Hope you're enjoying it.

We had some interest at the open house, but everybody there wanted to know what terms we were offering, and how much down payment they would need. In my mind cash is king, so we called Mary back at the end of the day and congratulated her on her new home.

Mary’s friend came right over with a deposit, and we finalized the deal that day. In our minds, this deal was definitely “Good Enough!" This is just one example of the deals we’ve been able to do since buying “Deals on Wheels” and "Making Money with Mobile Homes” by Lonnie Scruggs.

The techniques in those books have worked for us just like Lonnie says, with one exception. Instead of having to hold the notes on the homes we’ve sold, our last three deals have all sold for CASH, and we’ve at least doubled our investment on every home we’ve sold! Darn it, I’m going to have to re-read those books and see what we’re doing wrong!

Now, go make more offers!

Tom Dunn
DealFiles.com

In real estate investing happiness is when your buyer says "Oh, I hope I get it!"

2006-11-26T23:38:00.000-05:00

Here's part 2 of my 3 part mobile home story. We told the Realtor to go ahead and submit our $3000 offer, and then...

It turned out we were right. Our offer was accepted as is the next day, and we became owners of a bouncing baby mobile home at $3000. Our exit strategy was to fix the home up and offer it for sale with owner financing and flexible terms at $11900.

Over the next three weeks we invested another $2200 for repairs, paint, all new carpet, general cleanup, one month's lot rent, and a Pennysaver ad. We scheduled an open house, and worked furiously to get the house ready to go.

Two nights before the open house, we received a phone call from a woman in the park who asked if her friend could view the home before the open house. She said her friend, Mary, was disabled and on oxygen and needed to move out of her home in the country, and would like to be in the same park. I said of course they could come over early.

The two women showed up on time, two hours before our open house was scheduled. They toured the home, and they were both obviously pleased with what they saw. Mary asked if we would accept $10,000 cash for the home. I thought for a moment and replied, “I really don’t think I can go that low, since we haven’t even had our open house yet. Is that the best you can do?”

She said she would have to think about paying more, and I said I didn’t think the home would still be available after the open house because we had gotten a lot of phone calls. Mary said she understood, and with that, the women left and my wife and I went to get some lunch before the open house.

While we were at lunch, my cell phone rang. It was Mary calling back, and she asked if we’d be willing to take $11,000 cash! Remembering that pigs get fed and hogs get slaughtered, I said, “That sounds good to me, Mary, but to be fair, we have to at least let the open house run it’s course and see if anyone wants to make a higher offer. If no one offers more before the open house ends, the house is yours.”

She replied, “Oh, I hope I get it!”

My wife and I did, too.

See how the story ends tomorrow.

Now, go make more offers!

Tom Dunn
DealFiles.com

Here's a picture I really like

2006-11-25T22:02:00.000-05:00

by fivedunns1

Happiness in real estate investing sometimes means riding the speedbumps

2006-11-25T21:38:00.000-05:00

Today I start a three part series- a success story from my early days doing mobile homes. This story is about the last of four homes we bought and sold in an eight month period. Enjoy, and remember- if we can do it, anyone can!

My wife and I were out riding the speed bumps when we spotted a 14x70 1986 2 bedroom / 1 bath mobile home in our favorite park. Listed by a realtor we were familiar with, we called and found out the asking price was $8900. The vacant home had belonged to a recently deceased man, and was being sold by his estate.

We arranged to tour the home with the realtor and found that it needed some minor trim and woodwork repairs, paint, carpeting, and a general cleanup. Otherwise, the home was in good condition with new washer & dryer, nice island kitchen, peaked shingled roof, new furnace, and excellent vinyl siding and skirting.

Based on our experiences and knowledge of values in that park, we decided to offer $3000 cash on the spot. The Realtor said, "They'll never accept this- they already turned down a higher offer."

It turned out that the "they" he was referring to were the owner's three surviving sons. They had received a higher offer than ours when they first listed the home three months earlier, but had turned it down.

Our thinking was they (the three sons) probably wished by now, after paying three more month's lot rent, that they had accepted the earlier offer. We figured at least one of the brothers, and maybe all three, would be properly motivated by now.

We told the realtor to just go ahead and present our $3000 offer.

(to be continued...)

Now, go make more offers!

Tom
DealFiles.com

Technorati Post

2006-11-24T11:00:00.000-05:00

Technorati Profile

What can a real estate investing partner do for you?

2006-11-24T10:30:00.000-05:00

OK, have you had enough turkey yet?

I was thinking last night about buying houses and partnering on deals. So far I've done four or five deals with partners, and I think it's a great way to use the time and cash that I have available. Right now, I have more cash than time, so I partner with people who have more time than cash, and we complement each other.

I partnered with my sister on a flip in the state she lived in at the time, North Carolina. I put up the cash to get into a single family foreclosure, and she put in the time and talent to get a minimal rehab done in about four months. We flipped the house and split about $20,000. Not too bad, considering I had almost zero time invested, and only about $10,000 cash at risk for four months.

I partnered with another couple on a foreclosure that we are going to hold for rent. I put $40,000 cash out for three months, they put about two months time and about $3500 materials into the rehab. We pulled our cash out in a refi, and the house is now nicely rented out at a $300 positive monthly cash flow.

I partnered with my son on a mobile home flip. I paid $2000 for the home, another $1000 for lot rent and materials, and he put in a couple weeks time to paint and carpet. We split about $5500 profit. Nice little deal.

I can tell you how easy it is to do any of these types of deals. Keep reading this blog, check out DealFiles.com, and you'll see!

Now, go make more offers!

Tom
DealFiles.com

A Thankful Thanksgiving To You

2006-11-22T16:51:00.000-05:00

THANKSGIVING- what exactly are we celebrating, anyway? It seems to me that Thanksgiving comes and goes with barely a mention in the media, and the reason we all take a day off and gorge ourselves on turkey and mashed potatoes is largely forgotten.

Of course I understand why- Thanksgiving has little or no commercial value. Noboby buys presents, or trees, or giftwrap. No one decorates or sends greeting cards. All we do is get together with family and friends, cook, eat, drink, and watch football.

Do we even stop for a moment to be thankful? Sadly, many do not. Few families will take time this Thanksgiving to say a prayer of thanks for our brothers and sisters serving around the world in the military. Few will thank God for the blessings He has showered upon them over the past year. Most will simply take what He has so richly given and pay little attention to where they might be without His provision.

I hope you are not one of the many. Choose this Thanksgiving to join together with those who are thankful for blessings, great and small.

May God Richly Bless You,

Tom Dunn

The "Don't-Wanter" syndrome applied to real estate investing.

2006-11-20T18:43:00.000-05:00

Ever tried to sell something to someone who didn't care much about the product? If so, you know just how frustrating it can be. Here's a case in point.

A woman came into the car dealership where I work and said she was interested in a particular model. The salesperson showed her a brand new 2007 and a used 2005 in the same model. She looked at both, sat in both, even drove both. Then she said, "OK, let's talk numbers."

The salesperson asked, "On which car?"

"Both," she replied.

Uh-oh. I told the salesperson he had a problem, but he already knew that. Do you know what his problem was?

The customer had no emotional attachment to either car. When there's no selection, and consequently no attachment, the numbers aren't going to look good no matter what. And that's exactly what happened. She walked out without buying, without even making an offer. She hadn't selected a car.

The same dynamic applies to real estate. If you have a buyer who doesn't like the house you're selling, or just doesn't care one way or another, your negotiations with that buyer are going to be very frustrating.

I just had that experience selling a foreclosure I had bought and rehabbed, and believe me, it was no fun. The buyer didn't give an inch, and he was prepared to walk away from the deal at every turn. We finally came to terms, but I wasn't happy, and I don't think he was happy either. Why not? Because he didn't love the house.

The moral? If it's at all possible, deal with people who really want your product. If you find yourself dealing with someone who doesn't care, move on to the next buyer, or find a way to create an emotional attachment in your buyer. You'll be glad, and most likely so will they.

Now, go make more offers!

Tom Dunn
DealFiles.com

Are you feeling like a lonely real estate investor?

2006-11-19T20:42:00.000-05:00

I was thinking today about the first investment real estate I ever bought. It was a mobile home in a little park not far from my house. My wife and I had been cruising through the local parks, getting to know the park managers, talking to people with homes to sell, and basically just building our confidence. Finally we got up enough nerve to make an offer.

It was accepted.

Oh my goodness, what are we going to do now?

Well, we closed on that home, sold it for a profit, and bought another, and it turns out we survived just fine. We have since graduated from mobile homes to flipping houses, and holding some for long-term rental. But it all started with that first little mobile home deal, which I think we paid something like $1800.00 for.

My advice to you if you have wanted to invest in real estate, but just haven't had the nerve to actually start, is to... start. Right where you are. Nothing at all wrong with starting small. But start. Your confidence will grow, but you have to exercise it. Come on, you can do it!

I'll even help. E-mail me and tell me exactly what's holding you back. I'll help you work through it if I can. If I can't, I'll try to point you to someone more qualified than me. Either way, I'll encourage you. You're not in this alone.

Lots of encouragement here: DealFiles.com

Now, go make more offers!

Buyer's market, seller's market, or something else?

2006-11-18T15:04:00.000-05:00

The question hangs in the air like thick smoke- are we in a buyer's market, a seller's market, or something in between?

The answer is...

Oh, no you don't! You're not going ot get me on that one. I know better than to get involved in an argument that can't be resolved, because the answer is, "There is no answer."

Or rather, the answer depends on who's asking and who's answering. You see, for me, right now (in fact, always) it's a buyer's market AND a seller's market. What I mean by that is, if my marketing is working properly, I find the right motivated seller, and voila', I've got me a genuine buyer's market.

If I have the right house, in the right neighborhood, at the right price, I've just created my very own seller's market.

It's all about the deal, and the deal is all about finding the right level of motivation, creating the right terms, turning the property around quickly in the right way, and marketing to the right audience.

So don't get caught up in crazy questions that can't be answered, because that will give you a bad attitude. Decide for yourself how you're going to overcome whatever condition the market is in, develop a detailed buisness plan, and start accomplishing it one step at a time- one POSITIVE step each day. You'll get there.

Now, go make more offers!

Tom
DealFiles.com

In real estate investing is it better to be Lucky or Good?

2006-11-17T14:56:00.000-05:00

Have you ever heard the term "driving for dollars"? Essentially this means cruising your target market area looking for opportunity. Opportunity, as I'm sure you know, can take many forms.

You might see "For Sale" signs you hadn't noticed before, vacant houses evidenced by overgrown grass or snow accumulations, fire damaged properties, moving trucks being loaded, etc., etc..

The point here is that unless you're out and about, how can you know what's going on. It's your target market right? You want to be THE market expert, right? You want to be the first in line for the best deals, right? Of course you do, or you wouldn't be reading this blog.

Take a drive today, this weekend, anytime soon, and take a pocket recorder or notebook to record what you see. Get out of your car and talk to people in the street, neighbors of vacant or for sale houses. Be alert to changes in the neighborhoods. Learn all you can from what you see and hear.

Don't bite off too big an area at first. Focus on a target market area you honestly have a chance to REALLY become an expert in. Soon, people will be coming to you as the go-to person, and the deals will start falling into your lap.

People watching will assume you're lucky, but you'll know better.

Read more in my article Become The Market Value Expert.

Now, go make more offers.

Tom
DealFiles.com

What do real estate investors and movie producers have in common?

2006-11-15T16:23:00.000-05:00

I met a young guy today who's in the movie business- he's not a real estate investor, he's a producer. He lives in my city in upstate New York, where he was born. He went to school for film production, graduated 3 years ago, and promptly set about trying to make a name and a career for himself.

He went nowhere.

Then he moved to New York City, rented an apartment in Manhatten just off Times Square, and started making contacts in the fertile New York city film industry. He schmoozed, partied, and hobnobbed with people who were either in the film business themselves, or knew people who were.

After three years of effective networking, during which he made highly targeted and valuable contacts that will last a lifetime, he moved back upstate and set himself up a successful and profitable production company. Now he flies to New York City when he needs to, but lives here where his expenses are MUCH lower.

The moral of this story? The most valuable resources in ANY business are the contacts you make, and real estate investing is no exception. Start now, wherever you are, to cutivate and develop the right kinds of contacts, and you will turbo-charge you're success. It's virtually guaranteed.

Join your local Real Estate Investor's Association (REIA) group- there's one in virtually every large market in the country. If you can't find one, start one. It's that important.

Get out and meet the people in your market- realtors, investors, property managers, contractors, etc.- who are DOING the business. Let them know you're interested in the same things they are. Take them out for lunch or coffee- whatever, as long as you spend time getting to know them. These relationships have a way of coming back around when you least expect it.

For more on this topic read my article- Real Estate Investing- Building Your Team.

Now, go make more offers.

Blessings,

Tom

Do you know why you should get a home inspection on all your real estate deals?

2006-11-14T14:21:00.000-05:00

A buddy of mine just bought a house and wrote a contingency into his offer for a satisfactory home inspection. That was the one and only contingency in the offer, and today he met the home inspector at the property. The process took a lot longer than he was expecting.

“I thought maybe an hour, hour and a half,” he told me after it was all over, “but we went through that house for almost three hours.”

The cost for his inspection was $300, about a hundred an hour for the inspector’s time, but what he was really paying for is the inspector's expertise. Was it worth it? Let’s examine that.

What did my buddy’s inspector find? Not much- just a few outlets that don’t have grounded receptacles, a few floor joists that were cut out to make room for some heating ductwork, and a sagging roof that the inspector said is “not a structural issue.”

The verdict? “Finalize the deal,” the inspector said.

That’s exactly what my friend plans to do, but not before a little more bargaining.

You see, even though the inspection didn’t dig up any grave or insurmountable issues, it did provide a little negotiating room, which I’m sure my buddy will use to knock anywhere from $100 to $500 more off the price of the house. He’ll ask for a buyer’s credit to make the needed repairs to the house.

Will the sellers balk? I doubt it. In fact, they'll most likely expect my friend to ask for at least a few bucks repair money. They know their house isn't perfect, and probably needs at least some mechanical fix-up. Which brings me to my point.

Most home inspections will at least pay for themselves because of the negotiating points they raise about the property, and they just might reveal something more severe that you really need to know. That’s why I always recommend getting a professional home inspection.

Be smart. Protect your investment, and buy yourself some peace of mind about the houses you buy. Write an inspection contingency into ALL your purchase offers.

Now, go make more offers!

Tom Dunn
www.dealfiles.com

Hunting season is open on vacant property- get stalking!

2006-11-13T22:45:00.000-05:00

So what's a sign of a good real estate deal, anyway?

First and foremost, look for vacant houses. Vacancy is the number one signal that the house- and the owner- are probably in distress of some sort. My best deals, in fact most of my deals, have been vacant properties.

Whether it's a bank-owned foreclosure property, a house owned by an absentee owner, or a house abandoned due to divorce or death, vacancy usually spells trouble, and trouble means motivation, and motivation means a bargain price.

There's only a few things that can happen to a vacant house, and none of them are good.

All of this is to say that if you're looking primarily at houses that have someone living in them, you're probably looking at the wrong houses, as a general rule. There's always exceptions, but the vacant house is the one you should be looking at nine times out of ten.

Vacany has a way of announcing itself. Foreclosures are easy- they're listed with a Realtor, or with HUD. Abandonment takes a little more digging. Look for evidence like overgrown lawns and shrubbery, newspapers piling up on the front porch or in the box, no curtains in the windows, snow not being removed- you get the picture.

If you think you've stumbled on an abandoned property, stop in and talk to the neighbors. Usually they'll be happy to tell you the whole sordid story of their neighbor's misfortune. You'll get lots more information from the neighbor than from the county, town, or city.

Hunt the owner down and...

Wait a minute! That's for next time!

Now, go make more offers!

Tom
www.dealfiles.com

Real estate investor's ask, "Could we have saved a few thousand more?"

2006-11-12T07:42:00.000-05:00

We helped my sister and parents move into a new house yesterday. Whew! I'm sure you all know what a job that can be.

We helped them pick the house out and negotiate the purchase. My sister reminded me of that yesterday when she said, "I think we could have gotten this house for five thousand less." Maybe so.

You see, the sellers were pretty motivated- they had already relocated from upstate New York to Tennessee, and the house had been vacant for several weeks. That's how I knew we'd be able to negotiate a good price.

We started significantly below their asking price, and well below fair market value. They accepted my sister's first offer, which always leaves you feeling like you should have offered less. I have a different way of looking at that situation than most people. I always ask myself a couple of questions before I start feeling like I paid too much.

First, did I get the price I wanted? In this case, the answer was a definite yes.

Second, was it a good deal? In other words, did you get it for well under the fair market value? Again, the answer here was yes.

If those two things happen for you, then why beat yourself up about the POSSIBLE few extra thousand you MIGHT have been able to save by offering lower? After all, isn't it also true that if you had offered lower the sellers might have been insulted and not even bothered to counter your ridiculously low offer? Then you would have lost out on a very good deal.

Trust your instincts, trust the process, and be thankful to God for the good deals you get. You'll be a happier investor. Tomorrow, more on why this was a good deal.

Now, go make more offers!

Tom
DealFiles.com

When a real estate investor says "Trust me" you better listen!

2006-11-10T14:32:00.000-05:00

Here you go:

Hilley from Boston writes:"I bought a new house in the suburbs 8 months ago. Up until that time I had rented apartments in and around Boston. Just after moving in I inherited a little money from my Mom, and I needed a place to put it. I have a friend who owns a couple of small apartment buildings, and he had been trying to talk me into buying one, too."

With his help, 6 months ago I bought a building in a small town about 70 miles from Boston. It was built in 1978 and has 8 units. The previous owner was a very tired landlord who really wanted out, and I got a great price and terms. I used very little cash, and even with nearly 100% financing I have a small monthly positive cash flow after ALL expenses, even management, vacancy and repair."

So, in the space of 8 months, I have gone from renter to landlord. Trust me, if I can do it ANYONE can. Thanks for your encouragement!"

Hilley's right. Anyone can do this, or something like it. What one positive step can you take today in the direction of your goals?

Now, go make more offers!

Tom Dunn
DealFiles.com

Cold-hearted or warm-blooded- which kind of real estate investor are you?

2006-11-08T17:54:00.000-05:00

If you're coldhearted, you'll keep reading these posts without giving me any comments or feedback.

If, on the other hand, you're warm-blooded (like I think you all are) you'll comment early and often.

Seriously folks, let me know if you're enjoying this stuff, and what you might like to see me write about.

If you have done a few deals, tell me about one of them. If you would be willing, you might become the subject of my next DealFile.

Now, go make more offers!

Savvy real estate investor averts cataclysmic screwup!

2006-11-08T17:45:00.000-05:00

Catchy title, huh. Here's the story.

I bought a foreclosure a few months ago. Like most foreclosures, all of the utilities were turned off, so I had to assume things would need to be repaired or replaced, like the heating system, water heater, etc.. When I can't check something out, I always assume it's NOT working. Many real estate investors do exactly the opposite and assume it IS working. Why?

Hard to say. Maybe it's the overall condition or age of the house, which is clearly visible to anyone. They might think, "This house is only 10 years old, and everything is so new, it must be working." Regardless of the reason, that assumption is often wrong.

What about the foreclosure I bought? It was less than 15 years old. The heating system was fine. Likewise the water heater. But the well pump was shot and had to be replaced, to the tune of about $400. I came out fine, because I had figured plenty into my repair estimate when I made my offer. That's what savvy investors do. You are a savvy investor, right?

OK, so it wasn't exactly a cataclysmic screw-up, but the principle matters. Under the right set of circumstances it could have been cataclysmic.

Now, go make more offers!

Tom
www.dealfiles.com

Should landlords and other rental real estate investors use websites to add value for their tenants?

2006-11-07T17:24:00.000-05:00

Yesterday we started talking about websites, and I said for pre-foreclosure investors, rehabbers, and flippers they can be great, if done right. What about other kinds of investors?

Lease-option investors can use websites to market their properties to potential home lessees/buyers. What other media allows you to post unlimited text and pictures describing your properties? Take advantage of the strengths of the internet by devoting a whole page to each property you offer. Don’t be skimpy- information helps sell, as long as it’s presented in a way that your buyers can make sense out of. Simple-simple–simple is the rule!

Landlord’s can make excellent use of a website also, for purposes ranging from filling vacancies to communicating with their tenants. Why not have a web based newsletter informing your tenants of issues they would find important or interesting? How about offering tenants a web based way to pay their rent? Talk about streamlining a tedious process!

If you buy commercial real estate, your use of a website is limited only by your imagination. Your tenants, too, might be interested in reading what you write in a web based newsletter, and that would give you a way to add value to their tenancy. Write about areas of interest to them, depending on the nature of their businesses. Ongoing communication helps keep tenants happy, and a happy tenant is most often a long-term tenant. With a website, communicating with them regularly is easy.

Any way you slice it, websites can be great tools for nearly any type of real estate investor. Get creative and think about how a website could help leverage your time and talents.

Now, go make more offers!

Tom Dunn

Can a real estate investor use a website to attract raging hordes of motivated sellers?

2006-11-06T19:43:00.000-05:00

What about websites? Do they work for Real Estate investors?

Websites have all sorts of uses, depending on the type of investing you’re doing. If you're like my wife and me, buying single family houses in pre-foreclosure, a website can be a very effective tool to both locate and sell properties. If you subscribe to DealFiles (www.DealFiles.com) you'll soon read about how we use our website to attract motivated sellers. Meanwhile here are a few targeted suggestions to get you started.

If you advertise for properties using either “I Buy Houses” ads or “Bandit Signs”, or both, you can reference your website and your phone number in the ad for people to contact you. The beauty of a website is it allows you to present a whole lot more information than any other medium.

If a potential seller visits your website, they can learn about you and how you work before they ever call. This gives them a chance to get comfortable with “you” before they ever pick up the phone. Just make sure your website does an excellent job of presenting “you” and what you do, otherwise it’s worse than a waste of money. It will actually cost you business.

If you doubt your ability to design and write a site with excellent content, hire somebody to help you. Your strength may not lie in that area, and that’s OK. You can’t do it all anyway. Find a designer you trust with your message, and have them design a simple site that says what you want it to.

Keep the navigation and color scheme simple. People want information, not flash and glitz. Save that for the giants who can afford “image” and brand advertising. The important thing is your message. Make sure it comes through loud and clear, with no fluff to confuse the issue. Write it out ahead of time so you know exactly what you want to say.

A website can be a powerful tool when used properly. When it’s good, it’s really good, but when it’s bad… you get the picture.

More on websites tomorrow.

Now, go make more offers!

Tom

Real estate deals don't fall into your lap- you have to talk them down!

2006-11-06T07:18:00.000-05:00

I promised yesterday to tell you the questions you should be asking when you call a seller about their property for sale ad. Here are a few tips.

First, be friendly. Don’t grill the seller right out of the gate. Make it your goal, by the end of the call, to establish some kind of rapport with the seller. Relationship matters in everything, and buying property is no different. People want to deal with people they like, so learn to see the seller as more than a voice on the phone- see them a real live person, and let them see you the same way.

Second, begin with questions that are simple and non-threatening to answer, ideally about the property itself. Don’t ask personal or financial questions early in the conversation. The seller doesn’t know you yet, and may resent those kinds of questions, or feel threatened by them. So start by asking things like type of building, size of rooms, vacant or occupied, size of lot, number of bedrooms, and the list goes on. Let the seller get used to talking to you by asking questions that are easy for them to answer.

Third, the questions you need to ask that will tell you what kind of a deal you’re really looking at are those that reveal two things- money and motivation. The money questions will let you know if there is enough equity in the deal, and the two main ones are, “How much are you looking to sell for?” and “How much do you owe?” Unless you’re pursuing a short sale, there needs to be enough equity to make the deal worth your time. If there is minimal or no equity, politely end the call and move to the next ad.

Fourth, the last and most important type of question will reveal the seller’s motivation, and the best of these is, “Why are you selling?” You will want to get to the point in the discussion where you feel very comfortable asking this, and most distressed sellers are really anxious to tell you- once you’ve developed rapport with them. If they are reluctant to talk, or reticent about telling you why they are selling, in my experience they probably aren’t motivated enough and you should move on to another ad.

What you’re looking for here is the seller who, in response to “Why are you selling?” spends the next fifteen minutes telling you EXACTLY why, and basically giving you their entire life story. Remember, truly motivated sellers are DISTRESSED- they want somebody to talk to. If you’re calling on an ad they placed, you represent a possible lifeline to them, a way out of the terrible situation they’re in. So listen to them, and be the attentive ear they need. It may just lead to a great deal.

Finally, once you’ve determined that the money and motivation are right, start exploring possibilities. Ask probing questions to determine how flexible they are, such as, “If I could pay you all cash and close quickly, what is the lowest price you would consider?” If you’re looking to take the house subject to the existing mortgage try, “If I agreed to begin making your mortgage payments, and keep on making them until I get the house sold, would that work for you?” These questions will let you know if they are going to be flexible enough for you to create a deal together.

There’s a lot more that could be said on this, but if you follow these tips you’ll know how to talk to sellers when you call them on a classified ad, or when they call you on any in-bound marketing you may be doing.

Now, go make more offers!

Tom

You just missed out on the real estate deal of a lifetime! How not to miss the next one.

2006-11-05T08:56:00.000-05:00

Another real estate investor in your town just picked up the sweetest deal of his life, and he’s about to turn a monster profit from it. He beat you, and every other investor in town, to this awesome deal for one very simple reason. He knew where to look.

Recently I interviewed Whitey from East Texas for an upcoming DealFile (www.DealFiles.com), and I was shocked when he told me his number one source for finding good deals. Most gurus I’ve read talk about the sophisticated marketing methods they use, and the money they spend on classifieds, bandit signs, billboards, hats, t-shirts, magnets, blah, blah, blah.

Sure, you could spend tons of money and time on a program like that. I’d rather do what Whitey does.

“First thing I do every morning," Whitey says, "is go online and read at least six local newspapers from the little towns in my turf that I like. I read the real estate section under investment properties or income properties or whatever the classification is for them. The number one source for me is newspaper ads."

Think about it- if you’re a motivated seller with a distressed property, what’s your best way of finding a buyer? You’re not going to a Realtor, because there’s most likely some problem with the property that prohibits that. You’re not putting up a sign, because you don’t want people just stopping by, either because the property’s vacant or you just don’t want to be disturbed. What’s left? A classified ad. Relatively cheap and likely to reach the greatest number of willing buyers, a classified is a distressed, motivated seller’s best bet.

For the same reasons, it’s also a deal hunter’s best bet. Open up your major local newspaper, or the smaller local papers from the areas you want to invest in, and turn to the “Real Estate For Sale” section of the classifieds. In most areas there is one day a week when this section mushrooms with tons of listings (in my town, that’s Saturday). If you’re seriously interested in finding motivated sellers, and great deals, make it your habit to read this section every week or, like Whitey, every day.

Look for the headings that list For Sale By Owner, Investment Property, Rental Property, Multi-Units, and anything else you can think of. If single family homes are your investment vehicle of choice, look at all the ads, keeping an eye out for phrases like “must sell, motivated seller, make offer, owner relocating, estate sale, handyman special, needs repairs, or needs TLC.” There are many more, but you get the idea. All of these may be indicators of real distress.

Next, call the numbers in the ads and ask lots of questions. This is where you start to determine if you’re dealing with a truly motivated seller or not. Most won’t be, and you’ll have to kiss a lot of frogs before you find your prince or princess- the one seller in a hundred who really does need to SELL RIGHT NOW! But every non-motivated seller you talk to gets you one step closer, and you’ll learn a great deal from every conversation you have and every question you ask.

What kinds of questions should you be asking? More on that next time. For now, just start calling and asking whatever comes to mind regarding the property and the numbers. That should get you going.

So, you could spend your money on all sorts of advertising gimmicks and avenues that may or may not work, or you could do what Whitey does- what many wanna-be investors routinely overlook. Open up your newspaper and go dialing for deals!

Now, go make more offers!

Who am I - and why should you care?

2006-11-04T12:30:00.000-05:00

My name is Tom Dunn, and I am a regular guy- 47 years old, married, three kids, job, taxes, etc., etc..

I have enjoyed success as a part time Real Estate Investor.

I have learned a lot along the way, and I have met many others like me. We all have valuable stories to tell.

Now I motivate and encourage individual real estate investors by writing and publishing stories of real people's real deals.

Through stories I share what I, and others like me, have learned.

Read the stories and you will learn things you can apply to your own Real Estate Investing experience.

You will also enjoy them.

I promise. Those are the only two promises I can make.

Refreshing, huh?

To read DealFiles, or find out more about me and how I got started investing in real estate, click here and read DealFile #1.

Now, go make more offers!

Who do you have to be to invest in real estate, anyway?

2006-11-03T21:18:00.000-05:00

I’m sitting in an airport ready to fly home from a conference I attended in Delray Beach, Florida, a gorgeous small beach community just north of Miami. The conference was on Internet Marketing, but I was also keeping my eyes open for fellow real estate investors.

Boy, did I find ‘em!

Even though I met folks from around the country, even around the world, and from every imaginable walk of life, I was amazed how many of them had some kind of investment in real estate. I met doctors, a farmer, Bed and Breakfast owners, mortgage brokers, a sheet metal mechanic, even a government engineer. The single thing we all had in common, other than being just regular people, was an interest in investment real estate.

Proves once again my whole purpose for this Blog, and my website, http://www.dealfiles.com/. You don’t have to be a guru, or have a late-night infomercial to succeed at whatever level you like in real estate. Heck, you don’t have to be anything at all- except tenacious and hardworking. It’s about what you know- and how you apply it- not who you are or where you came from.

One couple I met, Brad and Lisa from Missouri, just completed a no-money-down deal on a multi-unit property that’s going to wind up putting over $3000 positive cash flow into their pockets each and every month. Any reason you can’t go out and do that?

You’ll probably be reading more about Brad and Lisa in an upcoming DealFile. They’ll be the first to tell you, who they are had nothing to do with their ability to do this deal, or any of the others they’ve done. They just took a little bit of specialized knowledge- available to anyone- and took action on it. Go and do thou likewise.

Now, go make more offers!