Real Estate WEALTH by REALTY411

Wealth Real Estate

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Vol. 1 • No. 2 • 2011

Chris Gleason of

MMG Capital

Offers His Investors High Yields, Low Risk

LEVERAGE When Do You Grow? When Do You Hold?

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Cash-Flowing Rentals From Around the Nation with Tenants in Place!

Tips for Success in Business & Real Estate

Photograph by Sam Green

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Fully Rehabbed, Currently Rented and Cashflowing Start with a major metropolitan area like Indianapolis, Indiana which Forbes named #3 in their “America’s Best Bang for Buck Cities.” Add a thriving corps of businesses and universities whose workers need affordable housing and you have a climate ripe for generating substantial returns on rental properties. We acquire the home, complete necessary rehab to yield top rents, then use our over 15 years of property management experience and branded community positioning to keep it rented and in good repair providing positive cash flow. • Complete turn-key solution: property acquisition, rehab, management, and property disposal. • Over 15 years property management experience. • Indianapolis is the State Capital and home to companies like State Farm and Eli Lilly, the Indy 500 and Superbowl 2012. • Gross rents 13-15% consistently. Our clients experience positive cashflow using 15 year mortgages and use as college tuition solution. • Specializing in IRA/Roth IRA cash flowing properties producing monthly income for investors. • We are looking for like-minded entrepreneurial investors. • #1 Provider for ‘Turn-Key & Tax-Free’ Income by RothIraRealEstate.com

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on’t understand. much wealth has the past decade. e to go it alone, experts. Network brings rienced investors hare information each other. articles, videos, s and downloads by Kathy Fettke e our members to t’s no secret vesting decisions that banks nce-in-a-lifetime

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w o u l d rather buy on, visit: Treasuries althNetwork.com today than lend to homeowners or investors. Why not? They can borrow interest-free from the government and then turn around and “lend” back to the government for a profit. It sounds like another illegal scam that will ultimately hit the American taxpayer — a pretty common story these days. We can get mad or we can get even. Either way, if we want to protect ourselves and our children, we have to learn to play their game. Since financing availability is tighter than ever, that leaves us a huge opportunity to get great deals. The sweet spot right now is with properties that are out of the average investor’s reach but too small for hedge fund investors. There is just not a market for $1 million to $10 million deals. Distressed properties in this range are heavily discounted, giving huge returns for those who can manage to acquire them. At Real Wealth Network, we have over 6,000 members so deals come across our desk all day long. This gives us the ability to cherry-pick the best ones. For example, we were told about 27 almost-finished waterfront townhouse in Portland in the highly desirable Pearl District. The construction bank failed so the developer couldn’t finish the work. The FDIC took over the $12.8 million note. We Realty411Guide.com

first offered $8 million but were denied. Six months later we offered $3 million and it was accepted. We syndicated this project into 60 shares of $50,000 each and were able to purchase the property at auction — which eliminated liens and liability. Profits are expected to be quite astounding since the town homes only need finishing work and contracts are already in place for end-buyers. While we’re still finding incredible deals in single-family homes around the country, we’re seeing the steepest discounts in the larger units that most individual investors can’t afford. Apartment buildings in Texas are another sweet spot that we are aggressively targeting now. If you’re tired of making multiple offers and competing with hundreds of other investors, consider joining our network (it’s free) and team up with us on the big stuff that has higher discounts and less competition. You can also download your free report on “7 Steps for New Real Estate Investors” on our main page: www.RealWealthNetwork.com Kathy Fettke is the host of the Real Wealth Show, Saturday mornings at 10 to 11 on 1220 AM KDOW. For information, contact: 925-280-2830 or 888RWNETWORK (796-3896) or Kathy@RealWealthNetwork. com DRE License # 01509755 Real Wealth Network has expanded with offices now in Malibu & Walnut Creek, CA.

PAGE 5 • 2011

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here is a common belief that only few people that have the desired attributes can be entrepreneurs, but this is not true. Entrepreneurship is for everyone and there are numerous reasons for supporting this statement. The first and the foremost reason in this regard is that everyone has a dream which

Published for Investors by Investors Realty411 and Real Estate Wealth magazines are published in Los Angeles by Manifest Media Partners (mailing address: 4221 Neosho Ave., Los Angeles, CA 90066). Publishers are not responsible for unsolicited manuscripts, photographs and/or other materials. ÂŠCopyright 2010. All Rights Reserved. Reproduction without permission is strictly prohibited. The opinions expressed by writers are not endorsed by the publishers and/or editorial staff. Before investing in real estate, seek the advisement of a trusted financial adviser, attorney or tax consultant. Real estate investing is risky and may result in loss of capital. Please invest responsibly. PRINTED IN THE USA. GOD BLESS AMERICA

they want to fulfill or at least have a desire to improve their quality of living. This perception of human beings leads to encouragement for working hard and getting what they want, this perception is commonly known as intuition. It is a kind of potential in human beings that leads to creative imagination. Human beings are the best creation of God that is given the power of creative thinking and through this thinking they are able to do a lot of creative tasks. This creative thinking can be from the past, present and future and can relate to anything which

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the person dreams about. For instance this thinking can be about what is the purpose of coming to this world? What can I give to this world and what best can I do for people? And questions like these can help you drive your vision or dream which you want to fulfill.

Having a positive approach for the future and thinking optimistically is the right way for achieving your dreams...

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by Dave Lindahl

PAGE 7 â&#x20AC;˘ 2011

One could learn about its strength and weaknesses by searching his personal history in the past in which he has a number of experiences that caused him difficulties and obstacles in his way of success. From these past experiences the person could learn not to repeat his mistakes in the future and to use his weaknesses as his strength. This is the common thinking of every person that looks into his past and gets out his mistakes, but one thing that differentiates an entrepreneur is that he Continued on pg. 46

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NOTICE

Take Advantage of

NOTICE

Your Your time time to to qualify qualify for for one one of of the the largest real estate tax incentives in largest estate in Your timereal to qualify fortax oneincentives of the largest U.S. is almost If you would U.S. history history almost up. up. you would real estate taxisincentives in If U.S. history is like to turn federal income taxes that like to turn federal income taxes that almost up. If you would like to turn federal you’ve already the last 55 you’ve taxes already paid over over the last income that paid you’ve already paid over years equity in top years into equity in the theinnations nations top the lastinto 5 years into equity the nation’s emerging market, us immeemerging market, contact usimmediimmetop emerging market,contact contact us diately. for The deadline deadline for incentives incentives diately. ately. The The deadline for incentives is quickis 12/31/2010. Inventory is limited. isapproaching. 12/31/2010.Inventory Inventory is limited. ly is limited.

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INVESTMENT INVESTMENT GOALS AND TAX LIABILITIES DIFFER FOR EVERYONE. GO ZONE ININVESTMENT GOALS GOALS AND AND TAX TAX LIABILITIES LIABILITIES DIFFER DIFFER FOR FOR EVERYONE. EVERYONE. GO GO ZONE ZONE ININCENTIVES CENTIVES AND DEDUCTIONS MAY DIFFER IN TERMS OF GO ZONE QUALIFICACENTIVES AND AND DEDUCTIONS DEDUCTIONS MAY MAY DIFFER DIFFER IN IN TERMS TERMS OF OF GO GO ZONE ZONE QUALIFICAQUALIFICATIONS. WE MAKE NO REPRESENTATION AS TO AN INDIVIDUAL OR PROPERTIES ELITIONS. TIONS. WE WE MAKE MAKE NO NO REPRESENTATION REPRESENTATION AS AS TO TO AN AN INDIVIDUAL INDIVIDUAL OR OR PROPERTIES PROPERTIES ELIELIGIBILITY GIBILITY TO RECEIVE GO ZONE BONUS DEPRECIATION AND/OR INCENTIVES. YOU GIBILITY TO TO RECEIVE RECEIVE GO GO ZONE ZONE BONUS BONUS DEPRECIATION DEPRECIATION AND/OR AND/OR INCENTIVES. INCENTIVES. YOU YOU MUST MUST CONSULT A TAX PROFESSIONAL TO ENSURE YOUR ELIGIBILITY FOR GO MUST CONSULT CONSULT A A TAX TAX PROFESSIONAL PROFESSIONAL TO TO ENSURE ENSURE YOUR YOUR ELIGIBILITY ELIGIBILITY FOR FOR GO GO ZONE ZONE BONUS TAX DEDUCTIONS OR OTHER INCENTIVES. ZONE BONUS BONUS TAX TAX DEDUCTIONS DEDUCTIONS OR OR OTHER OTHER INCENTIVES. INCENTIVES.

INVESTMENT GOALS AND TAX LIABILITIES DIFFER FOR EVERYONE. GO ZONE INCENTIVES AND DEDUCTIONS MAY DIFFER. IN TERMS OF GO ZONE QUALIFICATIONS, WE MAKE NO REPRESENTATION AS TO AN INDIVIDUAL’S OR PROPERTIES’ ELIGIBILITY TO RECEIVE GO ZONE BONUS DEPRECIATION AND/OR INCENTIVES. YOU MUST CONSULT A TAX PROFESSIONAL TO ENSURE YOUR ELIGIBILITY FOR GO ZONE BONUS TAX DEDUCTIONS OR OTHER INCENTIVES. Realty411Guide.com

Massive Tax Deductions Invest in the Go Zone, Before It’s to Late...

fter six years of Go Zone initiatives sanctioned by the federal government, the opportunity to turn taxes into cash-flowing equities will soon come to an end. Individuals seeking tax relief and an opportunity to increase their real estate portfolios will need to hurry as one of the greatest tax-saving programs of all time will be expiring this year. To make sure we provide readers with the latest news on the Go Zone, we recently interviewed Brett T. Immel, a partner with Hanover Companies LLC, the leader in Go Zone opportunities. Since 1969, the principals of Hanover have been assisting clients in creating wealth through real estate as investors, fund advisors, property managers and developers. Read on to learn how to take advantage of the Go Zone, before it’s to late.

number of reasons: (i) Timing; Go Zone tax incentives end December 31, 2011, so there is a short window to take advantage of this tax opportunity, (ii) The general economy of the greater Biloxi (Go Zone) area is growing quickly because of the Go Zone incentives and the real estate market are strong because of the area’s growth. Q: They say, “Time is of the essence,” but the Go Zone Opportunity really is time sensitive, please explain. Immel: The Go Zone ends December 31, 2011, therefore property that is Go Zone eligible, new construction/first use, has to be placed in service and closed by the investor before the end of the year. Most clients are utilizing bank financing and turn times with lenders are on average 45 plus days. Because of the time limitation, it’s important to make a quick decision and not delay the process.

Question: Why is Hanover concentrating all their efforts in the Go Zone right now? Immel: The Go Zone is actually the Gulf Opportunity Zone and was created by legislation, to provide certain tax advantages to companies and individuals willing to invest in the rebuilding of the qualified tri-state area most affected by Hurricane Katrina. Mississippi is the last state in which this special tax incentive is available. The incentive itself (including Mississippi) will end soon. Hanover has been concentrating in the Go Zone for a

PAGE 8 • 2011

Q: Besides the tax benefits available, this area in Mississippi is experiencing considerable growth. What factors have contributed to its surge in population? Immel: Biloxi, Mississippi, has seen considerable growth and many sectors of the market have contributed. Jobs, jobs, jobs is all that we see and it has a direct affect on real estate. When Hurricane Katrina hit in 2005, it wiped out about 20 percent of the housing sector when other markets saw overbuilding and excessive supply. Markets like

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Miami and New York City currently have so much existing supply that absorption levels are five years plus, meaning it will take over five years for this inventory to be sold. This is not the case in Biloxi. Thirty-five percent of the market is made up of government-related jobs, mainly because of Keesler Air Force Base. Keesler had a $1.1 billion economic impact on Biloxi’s population of 250,000. Buying real estate close to a military base is never a bad idea because as log as the base is active, there will always be consistent government funding and jobs being created. Tourism provides another thirty

National Real Estate Insurance Group & Affinity Group Management Combine Forces

percent of the market, mainly because of the casinos. Biloxi is the second largest casino market with over fifteen land-based casinos (including the Hard Rock and Beau Rivage) and more planned for the future. Casino revenue is up for 2010 and the occupancy of the casinos has been very high. In addition to these two driving forces, there are many corporations in the area that contribute to job growth, including Norththrop Grumman, Seaman Composites, Rolls Royce and many others. Lastly, in July 2009 Biloxi-Gulfport received approval for expansion of the box and container port to essentially make it the largest box and container port in the U.S. This is because of Biloxi-Gulfport’s central location in the U.S. and the expansion of the Panama Canal (set to be complete in 2014). Bloomberg recently released a report that Mississippi would see housing prices increase 16% by 2014 and BiloxiGulfport would be the market with the highest increase in prices. The bottom line is that the market is strong and stable. Low unemployment and a consistent need for housing will continue to grow this market for many years to come. — by Brianna Bertrand For more information about the Go Zone, please contact Hanover Companies, LLC: 877-373-2805. Realty411Guide.com

ational Real Estate Insurance Group/Affinity Group Management has had a unique approach to meeting their clients’ insurance needs since 1999, and it’s paying off for them. Their program allows people to pay month-to-month for the coverage they need, giving them the ability to change their plan to meet unique insurance needs as they come up. “We have the right coverage at the right time with a one-minute email to us to change, as needed,” says owner Mike Wrenn. NREIG/AGM currently represents over 1,500 people and is adding approximately 80 more a month; by 2012 they will have over 2,500 clients. The company considers their rates competitive and claims the stability of their program over the last ten years to be one of their greatest strengths. Investors can choose different deductibles and plans utilizing actual cash value or replacement cost, depending on their needs. “The method we use to manage the inventories for our insureds, their payment terms and the right coverages account for our success today,” Wrenn explains. NREIG/AGM insures in all 50 states and can easily follow their customers if they move. The company has IT systems that track each location and can account for escrowed payments by mortgage companies during the year. Clients can pay through credit cards and are not charged for coverage the month a property may be deleted; NREIG/AGM is therefore ideal for larger PAGE 9 • 2011

buy-and-hold investors and fix-and-flip investors. NREIG/AGM is perhaps so uniquely designed and suited to meet their customers’ needs because Wrenn and another of the company’s owners, Tim Norris, are property investors themselves. “We know the market countrywide because we have professionals we insure who make their living off of their local investments. We can access information about various areas of most urban cities today through local knowledge,” Wrenn says. He adds: “As an example, there are unique features to the Kansas City and Memphis markets that only locals know as it pertains to crime and safety of the property in more inner-city locations. When we need help understanding local conditions from street to street in certain cities, we know where to get it.” Besides relying on their local contacts, NREIG/AGM is actively involved with many real estate groups around the country. “We attend over twenty Real Estate Investment Association (REIA) chapter meetings,” Wrenn says. To that end, NREIG/AGM is planning to incorporate video correspondence with their clients late next year. Soon customers will also be able to manage accounts online so that they will not be dependent on communicating with representatives during business hours. — by Brianna Bertrand For additional information, please visit: www.nreinsurance.com

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Our Real Estate Crystal Ball

by Richard Barrett

hat would you pay to know where property values will grow in the next decade? How much would a real estate “crystal ball” be worth to you? What if you had the “secret formula” to find areas of growth? Well, you are in luck today, I am giving away this secret formula for free! The secret formula for growth in real estate values is…(drum roll, please…)

jobs > people > property That’s right, the secret formula is surprisingly simple. Jobs attract people, and people need places to live. A growing job market brings more people, and people drive rental prices and real estate values. It’s so simple that many experts will deny this formula, arguing for special circumstances of their particular investing location. But, for the vast middle market of real estate, this simple relationship drives long-term growth in rental prices and real estate values. Let’s explore this relationship in detail. Jobs Attract People Jobs attract people. As a simple statement, that seems pretty obvious. But, let’s test that statement, using the major metro area of Houston, Texas, as one example. The unemployment rate of the Houston metro area is 7.4%, almost 25% below the national average. In the past ten years, Houston has seen growth of 270,000 new jobs. By comparison, each of Los Angeles, San Francisco, and Chicago have lost 100,000 jobs in the past ten years. In Houston unemployment is down and job growth is up. Over the past five years (June 2005 - June 2010) Houston has ranked #1 in job growth, adding 129,000 jobs. In contrast, over the same period, Los Angeles lost 376,000 jobs, Detroit lost 329,000 jobs and Chicago lost 253,000 jobs. Houston is the sixth largest city in the country, with a population in the metro area of 5.8 million people. Over the past ten years its population has grown by 24%, the third fastest growth in the top ten cities, behind only Dallas-Ft. Worth and Atlanta. Realty411Guide.com

So, it appears that job growth encourages population growth. People Drive Real Estate Values The purpose of residential property is to provide places for people to live. More people need more places to live. Growth in Houston property values has been 19%, 48%, and 106% for the past five, ten, and twenty years respectively. The decline from the all-time high—the bubble drop— has been only 0.73% in Houston. Compare this to drops of 20-50% for properties in Phoenix, Los Angeles, Las Vegas, Miami, and other metro areas that suffered from the boom/bust of the recent bubble. Demand for residential property depends upon not only the number of people in the area, but also upon the housing supply. Vacancy rates measures the demand for housing—the relative balance between people and housing. Inflation rates drive the housing price, as does the cost of local government. Also, the property type— single family, 1 to 4 multiple unit, or large apartment—significantly affects the property value curve. So be careful in using these metrics.

Sixty years later, the job market has collapsed with the demise of the auto industry, over 50% of the people have moved away, out migration continues at a rate of 3,000 per month. Entire city blocks of houses stand empty and the city plans to bulldoze square miles of houses. The long-term, growth prospects for real estate in Detroit are weak until the city can restart job growth and reduce its housing stock to something nearer actual demand.

The RBS Investor Index To identify good metro areas for its investors, RBS Homes has developed the RBS Investor Index. This index combines over thirty economic and demographic metrics to identify metro areas which will generate strong, long-term growth over the next decade. For each of the top 500 major metropolitan areas (MSA’s), the RBS Investor Index tracks changes in job formation, unemployment, population, average income, housing prices and housing stock. I’d be delighted to discuss housing price trends with you and to explore the trends Losing Population & Real Estate Value Detroit is perhaps the poster child of how for your own favorite metro area. You can reach me at: the jobs > people > property formula 925-858-9017 or works in reverse. Sixty years ago, RBS or t s Richard@RBSHomes.com Detroit was known as Motor City, e v In dex In all king of the auto world and even B l ta s alue Cr ys The Estate V eal Happy Investing, king of the MoTown sound. The for R ett Barr ichard Richard Barrett Detroit metro area had a population by R S Homes RB RBS Homes of 1.8 million in 1950, a strong job http://www.rbshomes.com market, and a strong housing market. ��

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www.realty411guide.com | Vol. 3 • No. 3 • 2011

DAN REEDY

Welcomes You to America’s Heartland The Owner of MOREKC.com Helps Investors from Around the World Grow their Portfolio in Kansas City, Missouri !

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On Location in Memphis

by Linda Pliagas

hey came from Kansas City, Baton Rouge, Los Angeles and Indianapolis to Memphis, Tenn. Investors from a distance mingled with local wholesalers, agents and brokers. All were there to spend three days learning from one of the most successful families in the real estate industry, the Clothiers. “We’re going to pull back the curtains and reveal all of our secrets,” Kent Clothier Sr. said — that was enough to prompt me to return to Memphis only one month after my initial visit. The Cash Flow Pros’ “REI Edge” threeday event, hosted by Kent Sr. and his sons Chris, Brett and Kent, covered every gamut of the real estate industry imaginable. From property management, customer service, private money and marketing, no stone was left unturned. Kent Sr. revealed that they were in the process of developing educational products and the event offered a perfect opportunity for them to fine tune their programs. The room of about 50 real estate investors and industry professional was initially led by Kent Sr. who has purchased, renovated and sold thousands of properties around the country. It was his idea to round his sons together in Memphis to take advantage of the phenomenal buyer’s market in Tennessee. Together the Clothiers have been involved in diverse real estate markets, including Texas, Colorado and Florida. What drove them to the Memphis market is exactly what drives Californians to buy 2,000 miles away from home: Cash flow. REI Edge: The Cash Flow Pros Reveal Their Secrets

At the Cash Flow Pros event, which was videotaped to be the blueprint for their new educational company REI Edge, each Clothier spoke about the unique talents they bring to the company. Kent Sr. taught the group his secrets in property management, customer service and rehabbing. Chris revealed tons of marketing secrets and tips for acquiring private lending. Kent, who lives in Florida, motivated the audience and sprung them into action. The event was opened up to anyone who was interested. Friendly competitors from other markets eagerly attended. In the room Realty411Guide.com

the Cash Flow Pros share their Secrets at their REI EDGE Event

The Clothiers, from left to right: Brett, Kent, Chris and Kent Sr.

was one of their own local competitors who also caters to long-distance landlords. One of the most helpful tips given to us by Chris Clothier for dealing with today’s tough lending industry was the compilation of “The Bank Book.” This Clothier secret weapon provides an organized and effective way of presenting their company’s information to a banker when trying to procure a loan. “The Bank Book puts me in front of the pack,” Chris said, adding: “I have used this as a great ice breaker.” Chris said his book contains a mission statement, an executive summary and an introduction to his professional team, even before the financials are presented. The key is to present your organization as the best company in town, one that they should want to be doing business with. Another key issue touched upon during this informative weekend was sales, something the Clothiers know a lot about. In fact, they consistently sell over 200 properties annually. PAGE 13 • 2011

Chris says that in order to remain successful, they focus 80% of their time on building a buyer’s list. Some of their other secrets for their incredible sales volumes are creating “call-to-action” marketing pieces, which ignite prospects to reach out. “You are always marketing yourself, it never stops,” Chris admits. Once an investor becomes a client, the Clothiers say they will be repeat customers and refer others as well because of their philosophy of “over performing and giving clients more than what they expect.” Eric Hobbs and his wife listened intently while the Clothiers spoke. Normally they are employed by the Clothiers as leasing agents, but today they consider themselves their students. “The information they are giving is great,” he enthusiastically said. When questioned about why he took three days away from his tenant placement business, the novice wholesaler replied with a smile, “I want to learn from the best in the business and that’s why I am here.” >

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Property Management & Customer Service: The Foundation for Success Although MemphisInvest.com now consistently sell 20 homes on a monthly basis, mostly through referrals, it took years of learning tough lessons for them to attain that level of volume. “We were not successful at property management at first,” admits Kent Sr. He adds: “We lost a lot of money on this side of the business, but we’ve come a long way in six years.” When the Clothiers started assisting out-of-state investors years back they only sold the rental homes, they did not have contact with the investors afterwards. Kent Sr. is the first to admit that it didn’t go so well. Customers were not happy, repairs were costly, the management was in chaos. One of the ways that the Clothiers created an improved system of management is by bringing that aspect of the business in-house so they have control over the properties that their investors purchase. The mindset of MemphisInvest.com from simply selling rentals was transformed into one where “the house is just merely a bi-product.” Kent Sr. explains: “It’s all about the investors. It’s all about the client. Our character, our integrity and our honesty are on the line.” Since they zeroed in on property management and on “exceptional customer service” their sales have skyrocketed. In fact, most of their existing business is generated by repeat customers (the average investor buys four rentals) and referrals from current investors. Kent Sr. realized a tough lesson early on: “Without the investors being happy, there are no jobs in our company.” Now MemphisInvest.com takes a proactive approach. “Our goal is that the investor will never have to call our office.” To make sure the investors are kept up-to-date, their management staff call about sixty investors per week with a report on their property. Again Kent Sr. reiterated that they turned a chaotic situation into a positive one by merely shifting their focus from properties to people. “If you don’t have outstanding customer service, then you won’t have a business for long.”

Take Action Now

MemphisInvest.com’s Spring Schedule 2011 Join the Clothier family at their property buying events around the country. Come learn how to cash flow in one of the hottest markets in the country, Memphis, TN. Jan 13, 2011 - St. Louis, MO Marriott St. Louis West 660 Maryville Centre Drive 5:30 pm to 9 pm Jan 29, 2011 San Jose, CA Doubletree 2050 Gateway Pl. 8 am to 5 pm Feb 17, 2011 Santa Ana, CA Doubletree 201 E. McArthur Blvd. 8 am to 5 pm Feb 19, 2011 Los Angeles, CA Embassy Suites 9801 Airport Blvd. 8 am to 5 pm March 12, 2011 Orlando, FL Orlando Peabody April 29 & 30, 2011 - Memphis, TN Memphis Hilton 939 Ridge Lake Blvd., Memphis, TN 38120

For more information, please contact: (901) 751-7191 or MemphisInvest.com

After hearing three days of fantastic tips and information from one of the nation’s top brokerages that services out-of-state investors, the participants were ready to return home and implement their newfound knowledge. To make sure that our mindset was right, the Clothiers asked audience members to volunteer and address the room. They wanted to know how we would implement the information into new goals and ideas. One gentleman from Louisiana addressed the room. He admitted that he wasn’t doing enough networking in his farm area of Baton Rouge. Another investor also took home a tip or two. “The biggest lesson I learned at this event is the amount of offers I need to make every month,” said Andy Ono, an investor and wholesaler from Kansas City. Ono was also very pleased with all the information he learned on property management. While it’s easy for investors to make a list of goals while at an event, the difficult part is transferring that positive energy into action. Kent Clothier knows this all to well. The developer of the 1-800SELL NOW vanity number and the FindCashBuyersNow.com marketing system, didn’t pretend to have a magic formula for success. No pill or spell can take the place of good ol’ fashion hard work. “If you want big things to happen, you have to do big things. This ain’t practice, this is the game,” he said in a matter-of-fact tone. “While you are sitting around thinking, someone else is already doing it. Either you act on it or get out the way.” The audience was quiet, the pressure was on as Kent continued his closing. “Ninety percent of the people will not act, I challenge you to not be one of them.” It was time for students of the Clothier real estate academy to create their own success stories. Sensing that the students were feeling a little overwhelmed and skittish, Kent Clothier lessened the intensity by smiling and giving us one last piece of friendly advice to chew on: “Don’t set out to build that wall all at once, just lay one brick at a time.”

MONOPOLY on Baltic Avenue

by Lori Greymont

emember playing Monopoly and anxiously waiting to get that third property of the same color so you could double your rent? What if you had the opportunity in real life to purchase three, six, twelve properties at a time and start collecting on all of them? The phenomenon of massive numbers of bankowned properties hitting the market means you can make

erties ready to be turned into cash-flowing, wealth-building engines. The first premise of this strategy is that there still is a market for homeownership that is underserved: working class people who make enough to cover rent, but can’t get a bank loan. Working class people are willing to buy houses and are willing to make repairs — at

By investing in bulk REOs, an individual can quickly acquire a portfolio of properties that will produce cash flow for years to come. just this kind of bulk purchase (bulk REOs in real estate parlance). Bulk REO packages provide 10 to 15 homes (nationwide) sold together for bargain basement prices. By investing in bulk REOs, an individual can quickly acquire a portfolio of properties that will produce cash flow for years to come. These homes are not in the high rent Park Places of the world, but in the working class Baltic Avenue-type neighborhoods— one reason there is a low cost of entry. How low? You can get in the game for as little as $100,000 for a small portfolio of cashflowing properties or as little as $200,000 for 20 plus prop-

the right price. That price is equivalent to rent. It makes sense. Let’s say the average rent in an area is $450. Offer a working person a privately financed home for $450 or less per month and they’ll take the deal. And they’ll make the payments because they already have a history of making rental payments. These loans are designed to succeed, not doomed to fail. The second premise of this strategy for investors is that a right-sized, cash-flowing loan at 9.5% over 15 years is a good investment. Purchasing a cashflowing loan at a discount is an even better deal. Bulk REO purchases put these premises into action. An active investor will purchase 10 plus houses and then resell them to owner-occupants with Continued on pg. 35

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How’s Life?

by Sam Sadat, founder of Los Angeles Real Estate Investors Club

e are always asking each other, “How’s life?” The same person might reply that life is great on one day and then complain that life is terrible on the next. Is this variation really a reflection of the changing nature of existence or is it a function of human interpretation? I believe it’s the latter and here’s why. Life simply does what it’s supposed to. It flows with no judgment, vendetta or favoritism. It’s neither good nor bad; it is impersonal. Life simply serves up the events you manifest. So don’t blame “life” for the bad things that happen to you. Existence doesn’t create the events in your life, YOU DO. If you don’t like what you’re getting, change your thoughts, words and deeds. Take responsibility, existence will respond. Many people make the mistake of approaching life as if it is the enemy. They drive themselves crazy resisting what life brings and learning nothing. You can curse life all you want, but life is innocent of all charges. Life doesn’t even register your complaints! Life is, after all, profoundly neutral and just, which is good. You want a better life? Begin by changing your perspective. Try to see things differently. What are you ignoring or assuming that is limiting your vision? Take a moment to think about that. Are you belligerently skeptical and hopeless? Or are you open and clear, ready to assess situations without prejudice? Often we don’t really see what’s unfolding before us, instead we see it all through the lenses of our previous conditioning. And then our responses are programmed. We become like robots. When you choose to change your point of view, a problematic situation is revealed in a new light. Suddenly new solutions present themselves. They seem so obvious! You wonder how you could have missed them. With this clear vision and with these new solutions, you become a more powerful and capable manifestor. All the great sages in human history have basically said the same thing in different words: Learn to look at events in a way that makes you stronger. Avoid subscribing to interpretations that draw you down into weak energy patterns. Seek interpretations that strengthen you, that give you a choice.

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This is the essential shift that makes the difference between manifesting success rather than failure and abundance rather than scarcity. Never be a victim! To help you in your quest to shift your paradigm and make a quantum leap, I have developed a quick technique called, “pause and ponder.” By practicing this easy technique, you can become a more potent observer. When something “unpleasant” happens in your life, just pause. Pausing is surprisingly powerful. Usually we try to protect ourselves from uncomfortable circumstances in a reactive, unthinking way. We immediately shut down, lash out or hide away. We don’t think about what we will do, we just do it. Or rather, it “just happens.” Unfortunately, this reactive behavior is out of control. It tends to make the situation worse than it really is, which in turn causes more reactive behavior. This results in a negative downward spiral, and the self-fulfilling prophesy of victimhood. You become the victim you think you are. So remember to pause. Just stop. Sometimes no action is required. Sometimes it’s best to sit back and let things play out a little — give a little space for the natural course of events. By being still and acting only when necessary, many of life’s problems magically solve themselves. Learning to be still is the beginning of real wisdom. But don’t just pause, that’s not the whole technique. You have to pause and ponder. Ask yourself: How shall I choose to see and process what’s just happened? What light will I see this in? This will prevent you once and for all from blindly reacting to the situation. But most importantly this will give you a chance to gain some perspective and make a smart, positive choice. It will give you the power to change things. It is a mysterious, mystical truth that seeing things differently actually changes them. No one really understands how this works, but it does. I’m not saying that if you see your Volkswagen as a BMW it will magically become a BMW, you don’t get to choose the exact nature of the change. Rather, through the power of resonance, PAGE 16 • 2011

events will shift to fit your attitude, your perspective. In the immortal words of John Milton, “The mind can make a heaven out of hell or a hell out of heaven.” Is this starting to sound a little too “out there” for you? Perhaps this is a good time to mention an unusual discovery that was made in the field of quantum mechanics when the science was in its infancy. It was discovered during the observation of atomic particles that the act of observation was itself changing the outcome of the experiment. If they changed the method of their observation they observed something different. Change the perspective, change the perceived. To put it mildly, this was quite the mystery. Scientists have carefully confirmed and described this phenomenon, but they still can’t explain it. Each of us is a powerful, manifesting being, but it is important to remember that we cannot explain everything. This helps us to remain humble and joyous in the face of the great mystery. William Blake said it best in his famous poem, “Auguries of Innocence”: To see a World in a Grain of Sand And a Heaven in a Wild Flower, Hold Infinity in the palm of your hand And Eternity in an hour. We must not try to control the world, only our perspective in it. This way our manifesting becomes like a dance with existence. So now let me ask you: How’s life? Best Regards, Sam Sadat PS: I encourage you to associate with positive, creative people and stay away from those who lower your energy or hinder your morale. For this reason we encourage you to come to our monthly real estate meetings. When you come to the LAREIC’s monthly meetings, you will not only learn the nuts and bolts of the real estate from the best in business but also get a chance for personal development and self improvement, all in one incredible evening. For more information about us, call (800) 998-9930 or visit our websites: www.samREclub.com www.investorfundingresources.com.

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All Aboard for The Elite Extraordinaire Cruise

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he Elite Extraordinaire Cruise is celebrating luxury living and self improvement in the high sees. The cruise departs on March 17 from Miami, Fla., and docks March 31 in Los Angeles, Calif. Guests will be sailing to the Panama Canal on the newly refurbished Six Star Symphony of Crystal Cruises. T h e â&#x20AC;&#x2026; c r u i s e s â&#x20AC;&#x2122;â&#x20AC;&#x2026; overall theme â&#x20AC;&#x2020;is â&#x20AC;&#x153; Aâ&#x20AC;&#x2026; C e l e b r a t i o n ofâ&#x20AC;&#x2026;Wealth:â&#x20AC;&#x2026;Whereâ&#x20AC;&#x2026;business meets luxury.â&#x20AC;? An atmosphere will be created where business networking can take place in a luxurious setting. Guests will have the opportunity to listen to and meet renowned author and columnist Louis Rene Beres, Ph.D., a professor of

international law at Purdue University.â&#x20AC;&#x2030; Dr. Beres will lecture on topics concerning present day world affairs. There will also be an innovative series of complimentary interactive classes created to enhance knowledge in the areas of arts and entertainment, businessâ&#x20AC;&#x2026;and t e c h n o l o g y, lifestyle, wellness,â&#x20AC;&#x2026;wine and food. â&#x20AC;&#x160;Certificates of completion will be distributed at the end of the curriculum. Liveâ&#x20AC;&#x2026;entertainmentâ&#x20AC;&#x2026;and multiple off-shore excursions will also be offered to guests of The Elite Extraordinaire Cruise. -by Brianna Bertrand For more information, visit: www.eliteextraordinaire.com

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LEVERAGE is a Double-Edged Sword by Crystal Han from 360 Investments®

everage is defined as “the use of an initial investment, credit, or borrowed funds to gain a very high return in relation to one’s investment, to control a much larger invest-

es”, which, like a double-edged sword, can help you or hurt you. Therefore, although highest returns on investments can be most desirable, an investor must weigh the risk and rewards carefully. Your goal should be to maximize leveraging power while minimizing risk.

requirements, loan to value ratios (LTV), pre-payment penalties, and qualifications), approximate closing costs (loan fees, transaction fees, title, escrow, attorney, transfer tax, document fee), rehab/renovation costs, holding costs (taxes, insurance, payments), income, expenses (property taxes, insurance, management fees, and maintenance/ repairs) and vacancy factors.

“Leverage magnifies both gains and losses,” which, like a double-edged sword, can help you or hurt you. ment, or to reduce one’s own liability for any loss.” Leverage is a powerful tool investors use in real estate transactions. Investopedia.com states, “Leverage magnifies both gains and loss-

Realty411Guide.com

When evaluating and analyzing a property, it is important to plug in all figures, including current appraised value (as-is), after repair value (fixed up), average days on market, purchase price, financing options and terms (interest rate, down payment

PAGE 18 • 2011

Net operating income (NOI) is calculated by total income minus total expenses. Cash flow is calculated by NOI minus debt service (mortgage payment). Please note that debt service, also known as the mortgage Continued on pg. 22

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Cash Flow with Dan in

AMERICA’S HEARTLAND Missouri Real Estate Exchange Helps Investors from Around the World Invest in Kansas City

by Brianna Bertrand

ive years ago in September, Dan and Nancy Reedy opened Missouri Real Estate Exchange (MOREKC.com) for business in a 10 x 20 foot

office space with only two phones. Today their office in Grandview, Mo., spans 4,000 square feet, they employ 10 people and another 30 to 50 subcontractors at any given time. Together, Dan and Nancy own a handful of properties and rentals that they’ve acquired over time. They have a long history in the real estate investing business. Nancy, for example, grew up with a father who bought distressed farms and land and would rehabilitate and resell them for a living. She bought her first investment property at 19. She went on to acquire one of her dad’s farms and subdivide it into estate lots to create her own high-end subdivision in Foristel, MO. She is both a Missouri and Kansas real estate broker and owner of MORE Homes LLC and MORE Property Management LLC. >

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are benefiting from the returns they’re seeing My dad always said, “Don’t in the U.S., as opposed to the lower amounts wait to buy real estate. Buy real they’d see in their own countries. People in estate and wait.” New Zealand and Asia have also expressed inOwning real estate has always terest in doing business with MOREKC.com. been the foundation of Nancy’s “The big draw to Kansas City is not just endeavors. She explains: “Real lower prices, [it is] due largely in part to the estate gave me the opportunity stability of the market and a higher quality of to quietly build wealth while tenant. The biggest reason investors from all also receiving income, depreciover the globe come to Kansas City now is due ation and tax benefits. I realized to the 100% turn-key product that we provide at an early age I had a passion and the depth and scope of our power team,” for design and started doing specialty painting for myself and friends.” “No matter where you invest, property management is the Soon, Nancy says the word started to spread. “I eventually key to the kingdom to insure that the investment performs started my own interior design and gives you the profitability necessary to stay in the game.” company called Distinctly Yours. It was a great match as I was already involved in real Dan explains. “Right now 70% to 80% of their estate and now could put my business are repeats and referrals. “We have touch on people’s homes.” always kept the long-term vision in regards to Nancy says that people our investors’ properties,” Dan says and exdon’t realize just how much a plains: “We tend to rehab our rental properties little design work and specialty to a retail status with new windows, HVAC, painting can improve the desirceramic tile, and most recently, we have been ability of a property. Within putting granite counter tops in a large number a few years, Nancy ended up of our rental homes.” taking on the consulting and Dan and Nancy have made some fantastic design work for a high-end deals with suppliers and it doesn’t cost them builder in Kansas City. “They much more to go high-end as it does to go were building new lake front Nancy and Dan Reedy cheap. They say the biggest benefit to the homes from $1 million and up higher-end rehab is that properties rent much and we were doing the exposed timbers, faster, stay occupied longer and draw a better distressing the hardwoods with hammers Investing for the Regular Guy.” The Reedys’ main focus with clientele. This makes for a much more profitand chains and creating really bold color MOREKC.com, however, is keeping able investment for the investor enabling them designs. It was a blast.” The last big project she was involved in enough properties available for inves- to purchase more properties with confidence. MOREKC.com’s average rehabbed cash before the couple’s start of Missouri Real tors. Their primary clients are investors Estate Exchange was a $1 million-dollar from all over the country interested in flow properties are $30,000 to $40,000, which rehab on a huge estate at a country club. Kansas City because of low property bring in rents of $600 to $900 per month. The company does offer conventional financing The property featured suspended with down payments of 20% to 30%, although staircases, a wine cellar and it even it’s tough to attain in today’s climate. had a secret door in the library leadRecently, MOREKC.com has announced ing to a master bedroom and exercise that they are now able to finance some of their room. cashflow properties. The company’s private “Now I concentrate on the properlender has agreed to do shorter term full amorties that we sell to investors, making tization loans on properties with a larger-thansure they stand out and appeal to tenusual down payment. ants or our retail buyers,” she says. The up-front cash flow will be less than a One of the ways this is done is by conventional loan, but the properties will be incorporating popular colors with a fully paid off in five to 15 years and there are light staging to give the homes a little no limits on the number of properties purmore warmth and desirability. chased. With these shorter term and larger Dan is a life-long resident of Kansas City and knows the local market inside prices and the higher-than-usual cash down payment requirements, the underwriting requirements are substantially less rigorous. and out. In less than five years, Dan has flow the market offers. The Reedys started working with “The mortgage industry has all but said, ‘No been involved with over 1,000 real estate transactions and 400 rehab projects. Dan people from Canada and Australia ear- thanks,’ when it comes to investor financing,” also hosts his own radio show, “Real Estate lier this year as well. Foreign investors Dan explains. “I have never been a big fan of Realty411Guide.com

PAGE 20 • 2011

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A Reedy Rehab

From Ugly to Elegant

avvy investors always want to buy the ugliest house in the best neighborhood possible and the Reedys are no different. They scour their market for the best deals in the best of areas for their investors around the world. After hundreds of rehabs under their belt, the Reedys are experts at turning run down, ugly houses into elegant homes worthy of exceptional tenants. Would you like to turn a blighted home into a beautiful masterpiece that can consistently cash flow? Please visit MOREKC.com to see the latest opportunities available. Seller financing is now being offered!

Nancy Reedy inspects a new acquisition that needs a lot of work. This project is not for the novice.

Dan Reedy plays Santa

investor and tenant base. We just recently hired a fantastic accountant dedicated solely to property management,” he explains and adds: “Our staff consists of five full-time leasing agents who are responsible for fielding rental calls,

showing properties and getting leases signed, a sales manager who is in charge of marketing the properties, keeping track of appointments and section 8 inspections. Plus, our maintenance department has three full-time maintenance men that keep our 400 plus units functioning 24/7.” The Reedys have also started a mentoring and training program for people wanting to learn how to profit in real estate without spending thousands on seminars, tapes and books. Their goal is to educate as many people as possible about the current phenomenal buyer’s market. “We have always stressed to our local and national buyers that this is a small window of time that’s not going to last forever. If you are not actively pursuing real estate investing as a way to build long-term wealth then SHAME ON YOU!” Dan exclaims. For more information, please visit: www.morekc.com

Dan & Nancy’s partner Jeffrey Lund

Experienced investors like the Reedys know that when a house is renovated just right, it won’t sit vacant long.

Realty411Guide.com

hard money loans as they are so expensive. I finally was able to strike a deal with my private lenders where they will loan up to 70% of acquisition for up to 15 years non-recourse at competitive interest rates.” MOREKC.com’s new program has very few restrictions and it’s taken off like wildfire. They currently have over 50 properties that qualify for this financing program. The Reedys are also firm believers that property management is key to the success of their company. “We have had investors find better deals on paper, but when their property management company could not perform their duties, the properties sat vacant and there was no cash flow, those better deals turned into financial nightmares,” Dan says. “No matter where you invest, property management is the key to the kingdom to insure that the investment performs and gives you the profitability necessary to stay in the game.”

MOREKC.com continues to grow and expand all the time, and the Reedys are constantly looking for ways to improve their company. “The only way we can accomplish this is with good people and processes and the sense to know that we need to constantly grow, improve and stay current with the market,” Dan says. “We are always tweaking our processes and looking for ways to improve service to our PAGE 21 • 2011

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Leverage is a Double-Edged Sword, pg. 18

payment is NOT considered an expense and is not included in the NOI calculation. Cash on Cash return (COC) is calculated by cash flow multiplied by 12 (always annually) divided by total investment (down payment, out of pocket expenses, and closing costs, if not financed). Return on Investment (ROI) is COC but also includes the tax benefits of depreciation (paper loss) and principle mortgage reduction. The higher the ROI could well mean the higher leveraged you are. A high Loan to Value ratio (LTV) could also mean high

Leverage can be an investorâ&#x20AC;&#x2122;s best friend or worst foe so please be careful! leverage. For example, getting financing at 80% LTV is being more leveraged than at 50%. Therefore, when leveraging, make sure you have a comfortable cushion of POSITIVE cash flow to allow for vacancy, repairs, maintenance and turn over costs. Also, make sure you have enough equity in case you ever need to liquidate your asset. 360 Investmentsâ&#x201E;˘ has created a FREE useful calculation tool, the â&#x20AC;&#x153;Deal Analyzer,â&#x20AC;? which quickly calculates net operating income, cash flow, total invested amount,

f o r C r e at R e a ive l E s S olu t at e t i o n I nv s esto rs no credit score required no-money-down investor programs transactional financing guidance & support for investors

and return on investment. It also gives you the option to select whether closing costs are financed or not financed, which will change the cash flow, total invested amount and return on investment. Quickly analyze your next investment opportunity by visiting our website at: www.360investments.net. Online there are other software programs available that provide more extensive analysis, like return on equity based on future projected appreciation rates. Investors should monitor their investment figures monthly and keep tabs on market appreciation/depreciation, rental vacancies, rental rates, population growth, mortgage interest rates, job growth, unemployment rates, number of foreclosures, and other key economic factors. Leverage can be lowered by increased property values, principle mortgage reductions and additional principle payments. Leverage can be an investorâ&#x20AC;&#x2122;s best friend or worst foe so please be careful! For more information, please visit online: www.360investments.net

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Are You Profiting from

the Credit Crunch? SPECIAL REPORT INSIDE!

s ’ y a d o T n i K N A B e h t ” . e t B n e n a m n o r i v “YOU c n E g n i d n e TIGHT L SPECIAL REPORT INSIDE BY:

Ron Black, Investor, Texas Real Estate Broker and President of Texas Investor Homes

Texas is the #1 Growth Market Investors are Needed to Fund Housing Projects

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Provide Short-Term Financing to Builders for High Potential Returns and Cash Flow

f you’ve been looking for an easier way to invest in real estate then you may find the answer in this report. Many years of experience in real estate has taken me from the traditional “buy a fixer upper and rent it” to foreclosure and REO buying and rehabbing. I have dabbled in short sales and then finally in new construction opportunities before I discovered the severe need for alternative builder construction financing. Although I had great success with most forms of investing in

By Ron Black

cation!” Well I have a new one that is just as important in today’s real estate investing market:“Change, Change, Change!” Are you still trying to get 5% down or no money down for your investment property purchases? What about getting an 80/10/10 loan as an investor? Are you endlessly bidding on foreclosures with no success? What about short sales? How many have you bought? The challenge for most real estate entrepreneurs is to recognize when it is time for change. That time is

when it came time to refinance, the lender guidelines had already tightened and the price appreciation had reversed and they were stuck “upside down” or “unqualified” to refinance any longer. I can see many of you reading this shaking your head because this actually happened to you or someone you know. The Glory Days of double-digit, year over year appreciation are gone with a few rare market exceptions. Low single digit appreciation is most probable for the next 10-year cycle. In other words, if you are going to make any money in this NEW market investing in real estate you better make it on cash flow because significant appreciation is unlikely in the foreseeable future. A Better Option to “Buying” Real Estate. So what are the options for potential high yielding returns on our real estate investment dollar if price appreciation is very limited and we are tired of the landlord game? What many frustrated investors are doing because of these lending changes is looking almost strictly for “Cash Flow” opportunities versus the long shot of price appreciation. One way many investors are achieving high cash flow is simply by “loaning” rather than “owning”. The opportunities are endless because builders are having an extremely difficult time finding traditional bank financing.

yesterday’s market, I found that creative and unique new construction real estate investments were the most trouble-free and profitable in today’s NEW real estate investment market. Yes, the market has changed dramatically since 2008 and what builders need from investors has changed as well. Are you positioning yourself for this change? Net cash flow is the name of this new game NOT appreciation. Change: More Important than Location? Savvy investors always have their ear to the ground and their nose to the wind seeking new opportunities. Savvy investors are also not scared to change. We’ve all heard the real estate axiom: “Location, Location, Lo-

NOW. Right now the new construction real estate market is SCREAMING that it needs alternative builder financing. Are you listening? What Happened to the Real Estate Party? The devaluation of many real estate markets across the country coupled with incredibly tight lender financing guidelines has depreciated many markets back to where they were eight to 10 years ago. That rapid price depreciation in itself hastened the downfall of many seasoned real estate investors, not to mention banks and lending institutions, etc. Since many investors were already using very short-term financing,

Why are Builders Willing to Pay High Interest Now? The real estate market is screaming right now for alternative financing, especially in higher demand areas like Texas. Builders in particular are hurting right now because many banks absolutely will not loan to builders regardless of the demand. Why? “Real estate” is a dirty word to banks right now. Banks that do loan to builders do so at much lower levels than before even if their builder/client has been performing well on their loans for years. Listen to the news every night and you will hear a story about banks “not lending”. Builders and many other small businesses are begging banks for loans. The sad part is that some of the very banks we as taxpayers “bailed

out” have now turned their backs on us and quality builders who were their best clients for years! The lending restrictions for builders has more to do with the banks reducing their exposure to real estate loans “overall” than it has to do with the credit worthiness of the builder. Builders did not need us as private lenders two years ago because banks were shoving money at them for 7% to 9% APR. Now builders need small private investors in order to keep building and will pay them more interest … for now. When you think about it, what are the other options if banks do not lend to builders? There aren’t many. Some of the builder’s homes are sold even before they are built. This is the opportunity that many investors are seizing on. There is a huge funding niche in today’s market ripe for the picking if you know how to tap it. Lending vs. Buying as an Investment There are many flavors of new construction investing but the one I will cover here is my personal favorite, Interim Construction Loans to Builders for High Net Cash Flow. Depending on your background and experience level in real estate investing, you may find this topic to be a rather strange approach to traditional real estate investing since we are talking about lending rather than buying. The main reason I considered this lending approach for my real estate investing was that the old approach was not working any longer in today’s market. The typical “buy and hold” approach most real estate investors were raised to believe in has disappointed many investors over the past few years. The same thing can be said for the stock market. The market correction, volatility and the current government taxation and regulation uncertainty has made many real estate and stock market investors

best news is that you do not need to go through a rigorous qualification process to be “qualified”. Almost anyone can become a private interim lender, if they have access to cash.

look suspiciously at their “buy and hold” approach. There must be a better way to invest rather than the unpredictable stock market! Who is Eligible to Invest? Most anyone can invest as a lender regardless of their credit score as long as they have access to cash. You can even invest with your IRA and 401(k) through a “selfdirected” structure. You can invest personally or with an LLC or most any type of entity structure you choose. Many investors who have low credit scores choose to invest in this program because they can no longer get a real estate loan to buy property. Many foreign nationals invest in this program because of the almost impossible lending guidelines that prevent them from owing investment real estate. The

Be an Investor, Not a Landlord. Making the mental leap from the “Landlord” frame of mind to an “Investor” mentality also requires a change. Many investors entered into real estate like I did initially, as a landlord. They may think they are “investing” but over time they become a slave to the property and the tenants and it becomes a second job. Even if you hire a property manager you still have to “manage the manager”. I hear about how landlords who put very little down are always struggling with poor cash flow or even negative cash flow. One tenant turnover can wipe one year’s total cash flow. Remember this: It’s not the monthly cash flow you make that’s important, it’s the yearly cash flow you keep that counts. How Much $ Do I Need? Rather than placing a 20% down payment or more on buying real estate, you can place that same amount into an interim construction loan. It might require a little more than the typical down payment on an investment property, but because lenders now require 20% down payment or more for investors, many homes you would buy would not be far from the current minimum interim construction loan amount anyway. It’s getting even more expensive as many lenders are now requiring a 25% investor down payment to get the best rates and terms. And dare we predict that it will not be long before a 30-35% down payment or more will be required even for high credit worthy investors? It may already be here by the time you read this report. Opportunities are available from as little as $77,000! >

Sources of Funds You May Already Have. Do you have an IRA or 401(K)? Are they growing securely? Many investors are converting their stagnant IRAs and 401(K)s to “SelfDirected IRAs”. They then take those IRA or 401(K) funds and place them to work in interim construction loan opportunities at 14-18% APR! IRA conversions are easier and more affordable than ever to set up or transfer if you know the right companies to use. The best companies we work with do a “checkbook” style IRA account giving you direct access to your funds for investment. The reward is that you can conceivably achieve much higher returns for your retirement funds and have the ability to use a source of funds that have been sitting idle in most cases to continue your real estate investments. What Type Homes are Being Built? Most investors I work with prefer single family homes for their interim construction loans. Exit strategy is easier in a worst case scenario, plus the demand in Texas is found in single family homes and townhomes. Valuations can vary but typically we try to focus on homes that sell between

About Ron Black

Investment Opportunities in Dallas-Ft Worth . Austin . San Antonio . Houston

on Black is a licensed Texas BROKER and President of Texas Investor Homes. He is known as one of the leading Creative New Construction Investors in the country. Ron develops advanced investment strategies for smaller, passive investors using NEW Construction as his model. He creatively applies these high cash flow strategies to single family and multifamily home investment opportunities and makes these turn-key opportunities available to small investors all over the country. His specialty programs are Lending Private funds to Builders such as Interim Construction loans potentially yielding 18% APR and New Construction sales to small Investors. Most of Ron’s experience was derived from developing real estate investment programs for his per-

sonal use and he invests alongside his investors in many opportunities. Ron’s goal is to provide stable income and cash flow with little involvement from the Investor. Ron’s superb relationship with builders provides his Investors unique and fresh opportunities in all major markets across Texas and in other select parts of the country. Ron’s motto is: Let’s be Investors Not Landlords! You can reach Ron at 972-897-6190 TexasInvestorHomes@ GMail.com Website: www.Texas InvestorHomes.com

available in some of the top growth cities. Texas has four of the top 10 cities in America predicted for growth over the next few years.

$100,000 and $200,000. Our loan to the builder is usually 60% to 70% of the value of the home being built. Our pipeline of builders is growing in this price range and we remain very strict in sticking to our funding niche on price and market location. There are many of these opportunities

Risk vs. Reward Let’s talk about risk. If you invest $100,000 in the stock market is it risky? Can you lose it all? With single family home interim construction lending it would be extremely rare for you to lose it all. And if done correctly, I can safely say that you can likely NEVER lose all your investment. Yes, there is some risk but let’s talk about two of the reasons this is a reasonably secure opportunity. First, we are always a first position lien holder of the property. We don’t usually invest in a second position loan because of the higher risk. Second, we don’t usually invest all the funds at once. In many cases

the funds are disbursed in stages or “draws” as each phase of the home is completed, foundation, roof, sheetrock, etc. If something should happen to the builder you would have enough left in escrow to complete the home and sell it or rent it to get your investment back. In some markets we escrow the loan funds and employ private inspectors to check each phase and verify the work is being done correctly. Long distance investors have pictures emailed to them at various stages of construction. Many long distance investors find the interim construction loans much easier to invest in than owning real estate. And many investors tell me they make more money loaning and with less stress than they ever did owning real estate. Considering the high return potential available, many investors say that investing in this type of lending can be much more secure, profitable and less risky than the stock market or even owning real estate if structured correctly.

NOW is the time to Loan, not Own! If you are stuck in an investing rut and are looking for a positive change in your real estate investing, you should seriously consider the interim construction loan investment option. If you have never invested in real estate this is an easy way to get started in today’s new real estate market. I would encourage you to focus on being an Investor and not a Landlord with all your new real estate investment opportunities. Change the way you invest to reflect today’s NEW market conditions and you will prosper!

Further Information and Comments: To learn more about interim construction lending in today’s NEW real estate market and creative real estate investing, contact: Ron Black, Texas Investor Homes, 972897-6190, TexasInvestorHomes@GMail. com, www.TexasInvestorHomes.com

Home Replay’s Property Analyzer by Anita Woods

Don’t buy your next property without it!

here’s no doubt the real estate market has taken a hit in recent years; however, it’s still a viable way to increase your investment portfolio. One area that is expected to grow is the rehab market. Gary Geist, rehabber and owner of Home Replay, LLC believes that it will continue to see growth over the next few years. And with the advantage of more than 80 years experience in the real estate investment arena, he just might know a thing or two about it! Whether you’re a novice or a professional real estate investor, you’re already aware of the time involved in choosing those properties that offer the greatest return on your investment (ROI). You get a list of available proper-

ties, visit each of them to see what needs to be done, then sit down and review the data to determine which ones will be the most profitable. This process takes quite a bit of time, but as you know it is also a task that’s necessary to determine your profit margin. One factor involved in purchasing a home that investors often overlook or discount is the emotional factor, but no matter how professional you may be, it can sometimes be difficult to rule out the emotional appeal of a home. This appeal can interfere with the objectivity that’s necessary when investing in real estate. If you let your emotions weigh in too heavily on your decision to purchase, you just might end up with a

money pit rather than an investment vehicle. The best solution for this problem is to make all of your purchasing decisions based on the same set of criteria. This is how you remove the emotional factor and deal with just the numbers. Home Replay LLC, has created a powerful tool that will help you do just this. The Property Analyzer is an easy-to-use software program that will drastically reduce the time involved in deciding which properties to invest in. Using well-defined criteria, established by experienced rehabbers, the Property Analyzer will help you choose the homes that will produce the greatest return on your investment. Here’s how it works: The Property Analyzer program establishes a baseline analysis of nine sectors of the home: ●curb appeal ●windows and doors Continued on pg. 37

• All local business networking events and groups on one calendar. • 12,000+ local entrepreneurs, business owners and professional members. Find your next great connection today! • Get your Networking Passport and attend many fee-based events for FREE!

Gelie, CEO and Founder

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MMG Capital Finds Opportunity

Within the Financial Storm While investment bankers hold on tight to funds, savvy investors enjoy double-digit returns backed by prime real estate.

by Matt Malouf | edited by Anita Cooper photography by Sam Green

fter a few years of managing rentals, many real estate investors decide to take a step back from actively managing tenants. Instead, they begin to work their capital by lending it to others for their purchases of real property. Experienced investors know that managing rentals can be a chore. They also know that owning real estate in a down market offers more potential risk than at other times, so it’s no surprise that after a while, real estate enthusiasts seek alternative investments for their portfolio. This is where Chris Gleason steps in. As partner and co-founder of MMG Capital, Gleason’s job is to match investors with conservative investment opportunities that can withstand the risks associated with today’s volatile environment. “If you understand what’s happening to our country, you can actually capitalize on the opportunities that are being presented,” he explains. Robert Marlin, a mentor and advisor to MMG Capital, recently explained to Gleason that the real estate rule of “location, location, location” is not as important today. Now, it’s all about timing, Realty411Guide.com

timing, timing. And in Gleason’s opinion, the time to be actively purchasing real estate has passed; now it is time to move on to a passive strategy, one more fitting for these turbulent times. Investors are invited to come alongside MMG Capital as a private money lender. The opportunity to earn double-digit returns with little to no risk is an investor’s dream. That dream can be realized through working with the creative finance team at MMG Capital. MMG Capital was created to leverage the numerous opportunities available in today’s market as a result of the global credit crunch in the financial world. The creative real estate and asset-based finance company is fueled by the creativity to mesh win/win economic strategies for both investors and borrowers. For those seeking funding solutions, MMG Capital gives borrowers flexibility. Because they are an asset-based lender, MMG Capital can fund deals quickly and without concern for credit score, financial reserves or income verification. One of the problems for those heavily involved in real estate or for those who are self employed is lack of income verification. >

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Another issue for many investors is Gleason, who obtained his bachelor’s in the years to come.” This investment liquidity. Gleason lends to high-net worth degree in finance from the University philosophy reveals just how conservatively individuals, those who already have of Southern California and an MBA MMG Capital values their assets in order significant equity in real estate or other in Financial Planning from California to properly secure their investor’s money Lutheran University, has direct experience from danger. assets. MMG offers a lifeline to deserving with several alternative investing strategies. “An important part of investing is individuals in today’s hostile financial He has owned dozens of properties planning for the worst-case scenario,” throughout the country and is well versed Gleason explains. “In the case of lending, climate. One noteworthy aspect of MMG in multiple real estate scenarios. assuming you’ve made a good loan, the Capital’s approach towards investors is His flagship office, located in Florida worst case scenario is that you could wind their focus on collaboration. Using a one- and operated by a partner, allows MMG up having to foreclose on your borrower.” on-one approach, investors are encouraged Capital the ability to do something very Foreclosure may drive fears into the to participate, learn and grow with MMG few hard-money lenders can do: fund deals mind’s of investors, but Gleason explains across the nation. Capital. that foreclosure is merely your legal Investors can hand-pick those Although the company’s wide area of right as a lender to force liquidation of investments they wish to be a part of. This operation seems risky, the company is your collateral in order to recoup your provides individuals with the benefit of conservative in its investing approach. investment because your borrower failed to having a direct impact on their investment “Now isn’t the time to be taking risks,” uphold their obligation to repay. portfolio, rather than simply giving MMG Gleason says, adding, “Now is the time For an investor, a foreclosure on an Capital their money and then wondering to be guarding your capital and taking asset with lots of equity is not viewed as a conservative approach. Nobody really a catastrophe, instead it is merely seen as a how it’s being managed. Most of the investments, which I knows how bad things are going to get temporary cycle in the life of an investment reviewed with Gleason in his asset. The real estate is still Southern California office, there, it has not vanished averaged less than a 40% loaninto thin air like paper assets to-value ratio and spewed 12% do in a turbulent market to 14% returns, the loan was turn. secured, in some cases, by Perhaps the most multiple properties. unique benefit to working Following are some key aspects that make MMG “We leave at least a 60% with MMG Capital is equity cushion in there, we their investors actually Capital so unique in the marketplace. want the borrower taking more review potential deals risk than we are,” Gleason and give them a thumbs • MMG Capital employs their decades of frontline explains. While he admits up or thumbs down. This experience with investors and professionals on the that no investment firm in the allows individuals to world can guarantee a return, invest the amount they are ground to research the market and find only the MMG’s conservative approach comfortable with, in the very best investments. ensures an extremely low risk time frame that suits them, • When comparing investments made by similar to investors and offers “one with an investment they can of the best risk-return ratios be proud to place in their lenders, MMG Capital is the most conservative available in the marketplace.” portfolio. company of its kind. “Safety, security and • Investors call the shots when it comes to their Here is an example of consistency are three words a typical MMG Capital that we use around our money. They decide how much and where they want investment transaction: office all the time,” Gleason to place their hard-earned investment capital by says. “Our investors sleep choosing the specific deals they want to be involved A borrower owns a $1 well at night because they million property and needs know that they aren’t going in. some cash to purchase to wake up in the morning • MMG Capital offers some liquidity in an illiquid inventory for their business. to find out that their environment where investors have the ability to get MMG Capital will make investment is in trouble,” a $200,000 loan to them Gleason says. their capital back when they need access to it. and secure it with their $1 MMG Capital offers • No required minimum investment — the comfort million property. Even if an investment vehicle level MMG Capital provides is second to none. the property loses half of its unlike any other in the • A nationwide network of mortgage brokers value over the next 12 to 24 marketplace. It is one that months, the $200,000 MMG will pay an investor a ensures that there is never a shortage of opportunities Capital loan is still secured consistent return and offer for analysis by MMG Capital, of which only the best by $500,000 of equity. them the protection of a deals are brought to their investors. As an investor himself, well-secured loan.

MMG Capital Provides Investors with Options

Discover MMG Capital’s Liquidity Program

re you aware that with as little as a few thousand dollars an investor can own a share of a loan that is secured by luxury or commercial real estate generating up to doubledigit returns? Yes. If you are an investor fed up with dismal returns at your lending institution, it’s time to introduce you to MMG Capital’s Liquidity Program. This program, automatically extended to every MMG Capital investor, ensures that if liquidity is needed, the investor can get their cash back; even in the middle of the term of the loan. For example, let’s say an investor has money trapped in a CD, or a money market account bringing in the standard 0 . 7 5 % , i t ’s b a s i c a l l y just sitting there losing purchasing power every day. The investor wants to put the money to work in a safe, secure investment, but they are a busy professional: They have a company to run, family to relax with, vacations to plan and a life to live. What can investors do? They can lend their money out to other high-net worth individuals who qualify for the MMG Capital’s funding program. They, along with other investors, can participate in assisting other individuals who have substantial wealth and assets, but who may not qualify for traditional funding. One of the best and most unique aspects of this program is that investors can withdraw their principal investment at any Realty411Guide.com

time with only a few month’s notice. MMG’s Capital Liquidity Program offers flexible options for investors who seek shorter-term exit strategies, but realize that real estate is still the best place to store their money. If you are an investor facing dismal returns on your hard-earned money, all that really stands between your current situation PAGE 31 • 2011

and one where you’re making double digit returns, month after month, is a simple phone call to MMG Capital. Contact us today and see what double-digit returns can do for you. For additional information about Chris Gleason or MMG Capital, please contact: 310.295.1121

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Market Spotlight: BIRMINGHAM LOCATION: Birmingham, Ala. COMPANY: Premier Equity Group CONTACT: Chris Donaldson ph: (205) 201-6663 Question: How is your market handling the economic slowdown? Chris: Birmingham is not a “peak and valley” market. We are slow but steady in appreciation as well as decline. We average about 2.5% per year. We also have a huge workforce to keep our economy stable. The largest employer, the University of Alabama at Birmingham, has 53,000 students and employees. It was also named in the top five hospitals in the nation. Many professional athletes and entertainers come to Birmingham to be seen by Dr. James Andrews, who was named the “Most Valuable Person in Sports” by CNBC. We also have several large auto plants, Honda, Mercedes and Hyundai, all contributing to our labor markets. Birmingham’s charm, low cost of living and being on the cutting-edge of technology is positioning us to compete on a global scale. Q: What kind of opportunities are you

seeing right now in Birmingham? Chris: We are acquiring homes from asset managers, banks, foreclosure sources, short sales and general listings. Since we pay cash and have a good reputation for closing quick, we get excellent deals. This allows us to pass on the savings to our clients. For example, we are able to sell all-brick 4 bedroom, 2 bath homes that are about 1,500 square feet and recently r e m o d e l e d f o r a r o u n d $65,000. These homes are already under management and cash flowing with rents at $850 to $900. These houses have had past retail sales in the low $100,000s and are incredible deals. We have been able to narrow our searches down to the most desirable neighborhoods and in the best school systems. In fact, our main area of focus is where I personally grew up through elementary and high school. Q: What is the best part about being an investor in your market?

Chris: Our products work, plus we always try to under promise and over deliver. If you are one of our investors, you are on our team and you have a complete crew on the ground. This is so important since we all know that property management can be the difference between a good and bad investThe Donaldson family

ment. We always invite our clients to town to see our operation and get to know us on a more personal level. We like to think that our Southern Hospitality does us good service. Also, many people have no idea how beautiful Alabama and Birmingham are. It’s a great place to live and raise a family.

LARGE EQUITY AND POSITIVE CA$H FLOW

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Q Why should investors from afar invest in Birmingham? Chris: For the last four years we have been selling turn-key homes to out-of-state and outof-country investors. It is our main area of focus and basically our entire client base. We have learned and adapted to the needs of someone who may have never stood in front of their property. We do our best to provide pictures, video, Google Earth snapshots, anything to give the clients the best information available for their due diligence. We are with the home from beginning to end. We purchase it, we remodel, we place the tenant, we put it under management. So, we really know the house and occupants better than anyone. Q: What makes your company unique? Chris: We are normal people trying to stand out in a sometimes very difficult and overcrowded business. I think many people can relate to this statement. This industry has been ravaged by unscrupulous sales, bad foreclosures, market declines, mortgage changes and even federal law. Despite all that, we have been able to weather these storms and continue to provide excellent products. When you meet us, you’ll see we are not living the rich life, driving fancy cars. We are just family men trying to be good fathers and husbands. Q: What kind of programs do you currently offer? Chris: Right now, we have a cash purchase discount and we also offer very generous referral fees. The buy-and-refi days seem to be over, but we are still talking to mortgage companies to try and find the best programs for our buyers. Q: Do you have your own inhouse management? Chris: Yes, Impact Realty AdviRealty411Guide.com

sors. We use a web-based management software called Property Ware. It allows the owners to see all of their statements, work orders and leases in their own password protected portal. It also has allowed us to move to direct deposit systems and many other great improvements to help our growth. Also, our leasing team is about as good as you will find. We operate at near 100% occupancy unless there is a house undergoing repairs or waiting on an inspection. Q: What investing tips do you have for our readers? A: Get out there and visit the area you are going to invest in. Make sure your property management team is in place and are willing to help. Never be nervous to ask questions and inquire about school systems, crime, taxes and other important issues. Many people will buy on an impulse, don’t do it. In the world of investing in single family homes, you need to take the “get rich slow” route. Take it one step at a time and get with someone you trust or have built a relationship with. Q: What is your real estate or management philosophy? Chris: I read as a young man that 80% of the world’s millionaires were in real estate. I think that day I became a real estate investor, at least in mind. It was always a goal, something that I knew would be in my future. Now that it is my job, I’ve learned to love the business. I truly believe in our market, I buy homes next to the ones we sell, I own apartments in our areas of focus. It is a good feeling to drive down a street where we remodeled two or three houses and know that we were partly responsible for the renewed interest in the neighborhood. If I can do all that and give my family a comfortable retirement, I think I will have won.

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(796-3896)

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LOCATION: Cleveland, Ohio COMPANY: BH&R Properties RichFromRentals.com CONTACT: Sean Whalen, CEO ph: (216) 240-7363

Question: How is your market handling the economic slowdown? Sean: The slowdown has actually been great for business. It is a catch-22 in that you have to have cash in order to take advantage of the market. We are fortunate to be in a positive position and are able to take advantage of the down market and low prices. In turn we are able to then pass these savings on to our investors. Q: What kind of opportunities are you seeing right now? Sean: Due to the foreclosure crisis, we are seeing prices from 30 years ago. The housing stock, like the rest of the nation is plentiful. Due to the strict lending standards, we are finding a large demand by renters who are unable to finance a home purchase and therefore must rent. Q. What is the best part of being an investor in Cleveland, Ohio? Sean: The best part is seeing all the growth taking place. I think Cleveland is the only

Market Spotlight: CLEVELAND market in the nation with this much construction going on. We have a new lakefront development, The Lakefront West Project, a new billion dollar casino, as well as a new shoreway project. Plus, there is a new convention center being built and additions to the Cleveland clinic hospital as well as a new university health campus. Q: Why should investors from afar invest in your area? Sean: Cleveland is growing and it has a rich history. It has one of the oldest and most established arts culture in the nation. The Cleveland museum of art is undergoing a $150 million dollar addition and renovation. Also, Playhouse Square is the second largest live theater district in the nation. Cleveland is located on the shores of Lake Erie and it has the largest metropolitan lakefront in the world. We also have the third most visited park system in the country, Cuyahoga Valley, a national park with over 22,000 acres. Our city is both affordable and family friendly. Q: What makes your company unique?

Sean: The owners have over 100 years of combined experience in real estate and have a large portfolio with homes ranging from $35,000 to apartment complexes worth millions. We also have 40 years of combined experience with new retail commercial construction and management. Our deals are priced below market value with great cash flow and appreciation. Q. Do you have your own in-house management? Sean: I think management is the most important key to success. Your investment is only as good as the management behind it. We have our own in-house management staff, which is overseen by our company Q: What is your real estate or management philosophy? Sean: Well, we only buy in GOOD areas. This can’t be stressed enough. By buying in solid and safe areas, it makes management that much easier. You can then attract the type of clientele you want to rent your units. We also stress buying in predominantly owner-occupied areas. For more information, visit: www.RichFromRentals.com or www.BuyHoldRent.com

Monopoly on Baltic... pg. 15

seller financing (also called land contracts, contracts for deed, or installment contracts). The investor’s name remains on the deed for the term of the agreement while the owneroccupant makes monthly payments. The owner-occupant also has full responsibility for taxes, repairs, and upkeep of the property. At the end of the term (15 to 20 years) the deed is transferred to the owner-occupant. Meanwhile the investor makes a significant return on the initial investment. For Example: Bulk purchase price: $12,000 (one house) Sale price: $37,000 Down payment: $1,000 Financed price: $36,000 (15-year, 9.5% interest) Amortized over 15 years: $67,500 Less purchase price: -12,000 Return on investment: $55,500 Passive investors who want access to the great returns, but don’t want to set up a business to sell houses to individuals, can buy into the business. They purchase the land contracts and the underlying properties from active investors who are looking for cash. These contracts are sold at a discount, which offers even more upside for the passive investor. For example, a 15-year, 9.5% interest contract with a face value of $36,000, bringing in $375/month, can be had for $26,500. Over its term, the contract will bring in $67,500; that is a 40% return on investment. Buyer Beware Bulk REO is an exciting and fastpaced business, but as with any potentially high return investment, there are many charlaRealty411Guide.com

tans. The internet is full of web sites purporting to sell bulk REO lists; however, some of these lists are fraudulent, and others contain truly unsellable properties — burned out shells, vacant lots and uninhabitable mobile homes. In order to navigate this challenging marketplace, trusted mentorship from a reputable list broker is imperative. Do your diligence. Ask for references. A reputable company will happily provide more than five references from non-relatives! Find out about after sale support and get it in writing. Ask about fees. Some companies hide their fees, others offer full disclosure, but all companies charge fees. Finally, take the plunge. The market for severely undervalued homes will dry up. Will you be the person with an income producing portfolio to see you through your golden years? Or will you be the person saying, “If only….” Why Good Folks Can’t Get Loans 1. Banks don’t make loans for less than $60,000. The value of most of the bank-owned homes are $50,000 or less. Without private financing, these houses will continue to sit vacant. 2. Many low-income families struggle to keep a good credit score. Banks don’t like this. The savvy private investor knows that credit scores do not predict the ability of a person to pay a mortgage. The monthly payment is the predictor, right-priced loans get repaid. Lori Greymont is CEO of Summit Assets Group. She offers educational presentations around the U.S. plus trains and mentors people new to bulk REOs. Her company sells bulk lists and seasoned land contracts. For more information, call 1-888-440-6826.

Investment Tools Proven to Work! Rental Property Analyzer is a great piece of software designed to eliminate the guess work out of purchasing property

www.SmartInvestorTool.com Developed by the founders of HomeReplay.com, this software tool: •Takes the guess work out of buying •Compares multiple properties at once for quick best-buy decisions •Accounts for hidden costs to prevent costly rehab surprises at the end of the job •Provides estimate of current property value based on the condition of property •Provides solid repair cost estimates for renovation projects •Supports up to 20 financial options for comparison purposes •Has charts, graphs, and tables for cash flow analysis and future profit projections •Projects the After Repair Value of a property based on size, location, and rehab work

Invest In Your Business, Invest in Your Future,

Invest in the Rental Property Analyzer

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Market Spotlight: INDIANAPOLIS

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�� LOCATION: Indianapolis, Ind. COMPANY: RealEstateDone4You.com CONTACT: Michael Drew �� ph: (614) 323-3739

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�� Question: How is your mar�� ket handling the economic �� slowdown? �� Michael: We have felt a �� steady rebound for the latter �� Our �� part of 2010. prices are �� remaining low, taxes are low � �� and demand is increasing. I �� think people will still strug�� gle to qualify for new homes, �� so our company decided to �� build new homes for them to �� live in. �� Each �� property gets �� close to�� 100 inquires so the �� rental market remains ex�� tremely strong. �� Q: What �� kind of opportunities are you �� seeing in this market? �� Michael: Indianapolis remains the place for �� cash flow. The place to own and not worry ��

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Q: What the best �� is�� part of being an investor in your �� market? �� Michael: The best part of be�� investor ing an Indianapolis �� is the confidence we have in �� our market and company. Our �� family-owned and operated �� team has 15�� years�� property �� with management experience �� style a�� hands-on management �� and a 90% repeat business rate. We are �� here to build relationships with our inves�� tors and when they fly into town and see �� the $1.1�� billion-dollar new �� airport and vari�� ous other city improvements, it all makes sense.

Q: What makes your company unique? Our company is a third generation familyowned and operated business. Our experience ranges from deeply discounted acquisitions to millions of dollars in completed rehabs, to over 15 years of property management service. Q:. How long have you been personally investing in real estate? My partner, Quenton Adkin, and I have been investing for 15 years.

�� Matt’s ��

��

Q: Why should investors buy in Indianapolis? Michael: It’s the perfect storm. Indy has the three keys for rental real estate: It’s a capital city, it has nearby universities and a diverse economic base. On top of that, our company has spent the time and money to develop the proven systems needed to make it all work. The rental market is strong, the performance is consistent and we also own in the same areas you do!

about fires, hurricanes or natural disasters. Our clients come from New Hampshire to Marina Del Rey, CA, as they have found consistent income with their Indianapolis properties. Opportunities abound for investors who want to leverage their retirements without stock market exposure, or for those �� seeking positive cash flow on �� 15 or 30-year mortgages.

��

Q: Is there any special financing available or programs available?

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PAGE 36 • 2011

Matt Malouf, SFR, RSPS, GREEN Lic # 01811908

reWEALTHmag.com

Michael: We have a mortgage team that can assist investors and can get almost any deal done. With that said, our business is typically 70% cash. The properties are too easy to acquire for cash at these prices. Also, we encourage our clients to check out rolling over their IRA to a Roth and investing with that, that way, their monthly rental income is tax-free. For more information on that, check out our free ebook: www.RothIRARealEstate.com.

The Property Analyzer program is easily customized to suit each real estate market and can help you quickly determine how changes such as the offer price or financing terms will affect your investment options. If you’re a REALTOR® or listing agent, the Property Analyzer can help you find those homes, which will suit the investment needs of your clients — making your phone ring off the hook with investors who want to hire you! What the Property Analyzer program does is simply prevent you from buying the wrong property. And in the current economic climate, making informed financial decisions can make all the difference between keeping and losing your investment capital. The Property Analyzer in excel version is available on www.HomeReplay.com. A web version is also available and can be obtained at www.SmartInvestorTool.com For more information on how the Property Analyzer can increase your profits, contact Gary Geist at 202-841-1821.

Home Replay’s Property Analyzer, pg. 27

●roof and foundation ●plumbing and electric ●HVAC (heating, ventilation, air conditioning) ●walls and ceilings ●floor ●kitchen ●bath As you walk through a home, you will rate each of the nine areas from zero to five, with zero stipulating that no repairs are needed in that area. Then, when you’re ready to use the software, you simply enter a small amount of information on each property (up to eight homes can be compared), stipulate the financing options and establish a few investment rules and fixed expenses. The software will use the data you’ve entered, which includes information such as where the house is located, the ratings you’ve given each home, square footage, etc., to calculate the costs involved and potential profits derived from the deal. The final calculations are then displayed in an easy-to-read and understand format, making your buying decision that much easier.

Q: What tips do you have for us? Michael: It’s all about relationships. We urge readers to contact us, have a conversation, come out and take a visit and see if there is a match. Much of our business comes from our clients in California, so I’m out there often. Investors can set up a meeting with me while I’m there. Q: What is your real estate or management philosophy? Michael: Respect. It is necessary, but often uncommon in our business, specifically when dealing with tenants. Our investors want performance and as a property management company we treat our clients with respect as it is essential to keep a property maintained and performing.

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by Mike Woo

rom today’s date until 2014, we are predicting the start of the downfall of commercial notes. For residential real estate, we are also predicting a downfall, which will start in 2012. We can predict this based upon the number of notes that are set to mature. The whole sub-prime mess was created by zero down financing, so be very wary of seller finance in your transactions during this period. There is a highly probable scenario of both a commercial and residential real estate decline in value over the next five years. The good news is that with any down market there is extreme opportunity to grow and succeed. For the next four years we have the opportunity to create the best commercial system for ourselves. In 2012, we are going to see the largest number of foreclosures to date when prime

Many investors love multi-family and I do too, when it makes sense for cash flow positive investments. Feel free to take a look at my last article in this publication to

complexes and also in 4 plus star hotels as well. They have high demand for areas such as New York City, California and other capital appreciation sub-markets like

Commercial Trends Lead Savvy Investors toward Success mortgages are going to reset for resisee our views on cash flow. dential home owners. This will severely Longfin Investment Solutions helps drop housing prices in the foreclosure numerous investors in locating the best and shorts sales markets and make life a properties nationally. Our commercial fowhole lot harder for residential flippers cus is on apartment complexes and hotels. in California. It’s another potential for Over the last three months there has been disaster for both investors, speculators and a strong movement in the hospitality busithe American people. ness from both the buyers and So many investors are sellers. Due to the increase of very much involved the stock market from last year, with short sales and the which is a rebound from the foreclosure markets, decline of 2008, hedge funds its a very popular place and retirement fund managers to be right now. But have been infused with cash being popular is not and are purchasing underalways going to lead valued assets that require little to success. Many of maintenance or work. Since us in today’s economy these hedge funds, private should strive do less equity funds, REITs and penpopular applications sion fund managers are not and look for the upinvestors and are not inclined coming trends. Warren to manage a serious reposition Mike Woo Buffet says, “Be fearful or solve a human problem, they when people are greedy prefer to purchase properties and greedy when people are fearful.” that are performing, have high demand Longfin Investments has identified a and have current occupancy. They have trend in the commercial marketplace. been very active in A/B grade apartment Realty411Guide.com

PAGE 39 • 2011

Arizona and Florida. Longfin Investment Solutions provides these type of opportunities for clients. Depending upon location, we can often provide properties at $0.50 of replacement cost or previous value. Our system enables the buyer to purchase at a discount and not have to manage a chain of referrals or sign an MFA for a bunch of strangers. They deal directly with us as the principal. For those readers who may have connections with buyers who are looking for apartment complexes and hotels, let us know. Longfin Investment Solutions is seeking marketing partners who are interested in making six-digit profit shares on a single transaction. Please visit our website and get connected to our classes at: www.longfinivestments.com. In closing, I would like to share our company motto: “We are measured by the lives that we touch and the influence and leadership that we can bring to the people who want to learn more and desire to unlock their true potential.” To reach Mike Woo, please email him at: mike@longfininvestments.com

reWEALTHmag.com

by Linda Pliagas

t was a beautiful sunny morning in Arizona on the day the Ultimate Investor’s Tour was planned. Dozens of eager investors met up in Tempe and loaded a sleek black bus in search of discounted properties in Phoenix, Meza, Gilbert and Queen Creek. The team at Black Belt Investors, led by Sensei Gilliland and his charming wife, Annamaria, organized an educational event that drew investors from California, Nevada, Michigan, Utah and Indiana. The first stop on the tour early Sunday morning was a trip to meet Sensei’s local

Investors from 4 States Hit AZ for Black Belt’s Property Tour “power team”. Inside his luxurious modern office in Mesa, Sensei introduced his contractor, listing agent, property manager and insurance specialist. Because Black Belt Investors specializes in buying locally at the county’s court house steps, the properties are at absolute “cash only” discounts. What makes Sensei’s real estate investing program unique is the fix-and-flip system he has personally developed to help his investors generate cash today, which can then be transferred into creating wealth tomorrow. This Remote Rehabbing system is ideal for those investors who may not have the time or experience to buy, fix and flip properties. They are seeking the help of Black Belt Investors to quickly earn substantial sums of cash without having to do any of the leg work. It’s also perfect for the buyand-hold strategist who desires massive cash flow through very inexpensive newer houses. Sensei’s Remote Rehabbing program can be activated with a simple phone call. Either Sensei or one of his Success Managers will spend time with you to help accomplish your real estate goals. With prices startRealty411Guide.com

ing at just $37,000 it’s no wonder that the team has transacted over 900 deals this year alone! Investors from around the nation, as well as abroad, are attracted to the Phoenix market because they are able to secure practically brand new homes for approximately 50% below builder’s cost. Next, Black Belt Investors will take care of the entire rehab process after the property is purchased at auction. Their goal is not to sink a lot of money into the rehab but merely to bring the property up to standards to entice an owner-occupant to purchase the property from the investor at market value. “We want to get in and get out,” Sensei admits of the rehab process. Often the property will only require cosmetic repairs: new paint, new carpet and minor landscaping. Speed is important in the fix-and-flip business, every day the property sits, it eats into the investors’ pockets. Black Belt Investors knows how important time is, therefore the period between acquisition and deposition takes approximately 97 days with typical profits ranging anywhere from $8,000 to $25,000 per transaction. For the buy-and-hold strategist, the rental market is treating them PAGE 40 • 2011

very well. On average the time to get a house occupied is between three to six weeks. “Focusing our sights on new houses in desirable subdivisions attract better renters, which give the investor more stability,” Sensei explained during his tour.

If you’re ready for a new way of profiting from real estate, be sure to attend the next Investor’s Tour to learn if Remote Rehabbing is the right way for you. Black Belt Investors is hosting another Investor’s Tour in March. The event will consist of a one day educational conference. The next day, investors will spend time evaluating properties and discussing the best way to generate cash and build wealth in today’s Phoenix market. For more information, please call Black Belt Investors: 951-280-1900

reWEALTHmag.com

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Are We Forgetting ��

How to Communicate?

��

recommending a plan or action. Those were

ing. You send an email and wait for a re-

good news,” well I want to tell you it’s not true. When you don’t make the call then the

in imagining the “good old days” as being more honest, more truthful and more de-

the hard calls but the most necessary. �� The sponse. Someone tells you they will call �� easy calls were you back tomorrow and they don’t. �� by Charles Salisbury �� the ones to affirm People make commitments and then �� ometimes I am critical of different�� some profitable forget them. Advertisements for prod�� sales and marketing people because�� transaction so I ucts on radio and TV are not truthful �� I really believe that they’ve lost the �� could gloat a little and you know it. It seems like dishon�� ability to communicate, which results in�� about my�� talent to �� est communication is worse than no �� or �� poor service no service at all. select good investcommunication at all. �� I admit that I am biased because I was�� ments. But, both There are those who will lie to �� raised in the Midwest and have retained�� good and bad news you with no remorse. Students are no �� the values that are associated with the older must be communilonger concerned about the penalty �� generation. I know there are a different set cated quickly as for cheating in school or business. �� of values, and that fact has been validated it is important to clients and demonstrates We have to screen those who communicate �� by many associates of mine over a period good service. with us to be sure are honest. �� they �� It didn’t of 40 years. You’ve heard the saying “no news�� is use to be that way. Or, am I just caught up ��

S�

Some of the differences I see are the result of the meaning of “responsibility”

�� Despite the new technology, my original concern remains the same: The failure to communicate is growing and it is frustrating.

�� that �� versus “irresponsibility.” I admit there�� client thinks that something is wrong �� and pendable? Who can you trust is more than �� is�� an age bias in addition to a training and�� they worry. Answering calls and emails a slogan now. It is a normal defense for do�� upbringing bias. takes little time. Failure to return them �� cre- ing business. �� Let me share some of my pet peeves and ates a lot more work as they have a tenOne way to measure honesty is respon�� see if your age and attitude lets you relate dency to build and increase in volume �� and siveness. Honest people return phone calls �� to some of my biases. Let’s start with a may create stress as you worry about the promptly and answer emails quickly. After �� simple thing like returning phone calls or�� calls you don’t return. all, they have nothing to hide and they re�� the�� new �� communication entry: emails. “Maybe they are mad at me, maybe they ally want your business and they want to �� During my tenure in the securities induswant to close their account, maybe they answer all your questions. At least that’s �� try, I followed the lead�� of the most success-�� want to sue me, maybe it’s a creditor, etc...” how I see it. �� ful brokers and learned how important Worry makes it worse. Call immediately I guess I am old fashion but I don’t like �� it is�� to�� return ALL calls on the same day that �� and find out the reason for the call. It might to be put on hold, I want to speak to a real �� they are received. So if a client or a pros-�� even be good news. person on the phone, and I want to be able �� pect called me and busy with another�� Remember how we used write letters to talk to people when I call them or have �� to �� I was �� friends �� I�� was always quick to return calls. The�� to family, and clients? Then you �� had them return the call the same day. �� reasons is simple: I didn’t know what they�� to wait for days for a response. We used to �� How about you? Do�� you�� think we are �� wanted until I did return the call. Maybe�� do mail campaigns with response cards�� en- getting better or worse at communication? �� they wanted to place an order to buy�� or sell�� closed and wait for the postage paid cards Let me know your opinion, email me at: �� something. Maybe they just had questions�� to be returned to see if the mailing was suc- Chuck@tenpercentdown.com �� that�� needed to be answered. cessful. Yes, I will respond the same day. �� It is good service to communicate prom-�� Today, we do an email blast to thousands �� PS: My new book is now at the publish�� ptly and sometimes to assure the customer of clients and prospects adding the simple ers�� and will be in the bookstores soon. If ��

that you are there for them. The hardest calls to make, as well as return, are those �� made after a sudden decline in the market. I remember making calls to clients telling them about losses in their investments and Realty411Guide.com

instruction “click here to register.” That’s communication in a new and faster way. Despite the new technology, my original concern remains the same: The failure to communicate is growing and it is frustratPAGE 42 • 2011

anyone would like to have an advance copy of “Living a Balanced Life, Body, Mind �� and Spirit,” just email or phone me at 949-910-6028 and I will provide you with the content for free.

reWEALTHmag.com

Success & Natural Law A MAN LOOKED HEAVENWARD AND SPOKE UNTO THE UNIVERSE, CRYING: “I EXIST!” WHEREUPON, THE UNIVERSE (AFTER A WHILE) REPLIED: “SIR, I WILL ACKNOWLEDGE THAT STATEMENT; BUT DON’T PRESUME THAT I POSSESS ANY SENSE OF RESPONSIBILITY IN THAT REGARD.” — Stephen Crane (circa 1810)

by Bill Gatten

Let’s take a look at the eternal and i n f l e x i b l e r u l e s that control every aspect of our role and circumstances within the order of the cosmos, along with the crucial part of our beingness that the Universe plays in getting you and me exactly what we need out of Life. Although fully accessible twenty-four houses a day, bear in mind that Universal Law lies totally beyond our realm of reality…just beyond the quantum physical realm in what is known as the extra-local or implicate realty, and is absolute, nonmalleable and directly pertinent to the tiniest aspect of our physical existence. A far too often disregarded fact is that Universal Law, irrespective of its source, controls not only matter (the stuff we can see and touch), but also sound waves, light waves, radio waves and human thought, as generated by the written and spoken human word. In other words, if we but ‘want’ something we can just say so and hope for the best: but if we truly ‘need’ something (big difference), we merely have to say so, and it is given to us. No one can ever have a true need that is not fulfilled. This phenomenon is the result of the unerring ‘functional objective’ of the Cosmos

itself: i.e., an uncaring obligation to fulfill every need on every level without regard to you or me or past prophets as individuals. The Universe (‘God,’ if you wish) simply will not and cannot allow a true necessity to go unfilled. And neither will it honor every idle hope, prayer, wish or desire to be uttered by those who are unconvinced that what they’re asking for is truly ‘needed.’ It’s only when something cannot be lived without that it is absolutely guaranteed to be given to us. Nature Abhors a Vacuum Here’s a relevant but admittedly corny analogy: Did you ever squeeze more toothpaste out of the tube than you meant to,

uncaring and perfect as the Universe, that our hopes and prayers remain ineffective and unanswered. Note carefully that despite the fact that we don’t always get exactly what we want, the vacuums we create are ALWAYS refilled (albeit, too often with little of anything of significant value or importance due to improper planning). It is imperative that when making demands of the Universe that we — 1) know in advance exactly what we need, 2) why we need it, 3) what we’re going to do with it when it arrives, and 4) that we have a place for it. That’s it! Nothing more is required. One must come to grips with the simple fact that, no matter how many rain dances

“No one can ever have a true need that is not fulfilled.” and then feel a bit of a twinge at having wasted something? If so, were you aware that when that happened, you could have positioned the tube’s opening against the wastefully extruded goop and sucked it right back into the tube? In order to do so, all you needed was to gently, and (very) patiently, apply pressure to the sides of the flattened part of the tube, creating a negative pressure at the tube’s opening. If we don’t rush the process and we trust in natural law, the accidental spurt is drawn back to where it came from. This natural phenomenon quite obviously occurs because our squeezing creates a vacuum, thus allowing Nature to do its job by filling that vacuum with whatever is closest at hand. Given the right preparation (i.e., moving the opening adjacent to the spill), time (patience) and expectation (knowing how natural law works), any vacuum we create within this sub-quantum physical existence of ours — anywhere in the universe — will inevitably be filled with whatever we introduce it to. It’s only when we attempt to short-circuit the “Law” and force our will upon something as massive,

we do, or how many gourds we shake at the sky, how many virgins we toss down a volcano neck, we simply cannot control the Universe, we can only seek to understand more about it, and to develop an absolute faith in it. For example, no matter how hard he might try, a ship’s captain cannot control the sea; but by understanding it, yielding to its power and working with it without questioning it or attempting to change it, he can remain in perfect control of his use of it and allow it to provide all of life’s necessities. It’s only when the good captain would deign to challenge the power of Nature that it would turn against him and fail to assist him in his bidding, even to the point of killing him. As they say: “A red sky at morning means, ‘Sailor take warning.’ A red sky at night is a ‘Sailor’s delight’ — and the ones wearing blue-blocker sun shades won’t alter any of it.” When we mortals insist on trying to control and direct Natural Law (i.e., deciding how soon, how much, what color, what size, etc.), the voids we create can only be

re-filled with whatever may be at hand at that moment. In our toothpaste analogy above, it’s only positioning and applying the proper negative pressure that fulfills our desire to undo our mistake. Anything else can only result in the vacuum being filled with plain old air. That’s the Law! The Universe can only hear our pleas when we need something… never when we simply want or desire the otherwise seemingly impossible. Whatever we might be asking for, when we ask for a “red one with a white stripe down its side” and the only one available is a red one with a gold stripe, the Universe merely replies: “Sorry pal, but your request cannot be fulfilled at this time.” It doesn’t tell us (because it can’t and couldn’t care less) why. It just fails to yield what we didn’t think clearly enough about before we asked…it doesn’t offer substitutes. On the other hand, if we are too non-specific in our commands, we may indeed end up with more of what we asked for than we bargained for or can properly steward, leading to excess allowing us to give as much of it away as possible… thereby creating another void to be filled with something else of even greater value. “Why is that?” one might ask. Well (as your father would say, when you were 7), that’s just the way it works! Understand it and use it! It’s here for you every single second of every single day of your life. Idle prayers, wishes, hopes, day dreams and even prayers don’t do a thing until they are converted to necessity…and doing so is often the most difficult part. Persuading ourselves that what we need and honestly deserve is our birth right, is often beyond our capability due to our having been inculcated from birth that if it’s not on the table…don’t ask for it. Realty411Guide.com

The fact is, however, that if it’s not on the table and you know with certainty that it’s in the cupboard or in the refrigerator just a few steps away, and you need it… you have to reach for it… it will not come to you until you do! It all sounds too simple I know, but the secret to unlocking the process and making it work for you is merely — 1) identifying a deficiency in your life that you know with certainty must be eradicated (i.e. lack of wealth, prestige, power, position, love, self-esteem, etc.); then 2) simultaneously relinquishing a corresponding self-serving desire that is relying on that very deficiency for its own existence and fulfillment…letting it go! For example, if one’s deficiency is the ill health and social impact of obesity, then the obvious selfserving need is overeating… once that self-serving need is relinquished the deficiency no longer has nourishment and it dies (i.e., the weight is lost). Other examples of some debilitating self-serving needs might be: sleeping-in too often; not getting enough sleep, watching too much TV; not reading; not keeping up with the news; procrastination; not studying; complaining and whining; blaming others for your own inadequacies; delegating your primary obligations to others; smoking; over indulgence in tobacco, nicotine, alcohol, pharmaceuticals, etc... (i.e., consider the guy who complains about never winning the lottery, who has a moral need to abstain from gambling…then the guy who complains about his poverty, but who can’t resist heading for the casinos every weekend). All-in-all, the fact is that one must always plan in advance for what has to be done, and where the abundance will be housed when in manifests… and know with certainty that it will.

PAGE 45 • 2011

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“Take Care, Keep Smiling” Hi, I’m Sam Sadat, founder and president of LAREIC. I would like to invite you to our monthly meetings on the 4th Wednesday of each month at the Beverly Hills Country Club. There’s never been a better time to buy real estate than the present. I have removed all obstacles from your path to financial independence. You show me your commitment and I will show you how you can make money now even if you don’t have any. To learn about our upcoming speakers, visit www.samsREclub.com

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www.realty411guide.com | Vol. 3 • No. 2 • 2010

one can shake it from his words or it cannot be affected by the past experiences of the person. Having a positive approach for the future and thinking optimistically is the right way for achieving your dreams and it opens up more opportunities for you. Thus, it is now very clear that our past, present and future are all very interlinked and it can be controlled in the manner we want. If we take our past experiences in a positive way, then it will definitely lead to a positive future. Whereas, on the other hand, if we make our past experiences have an impact on our present and future life, then you cannot achieve your dreams. Entrepreneurship is the same thing as how you deal with difficult issues positively.

accepts his past mistakes positively and continues with his present and future in the right direction so that his past shadows do not affect his dreams of the future. Moreover accepting the reality of the present situation of what you are, what you have, what you do not have, what you enjoy and what you cannot enjoy. Thinking about your duties and responsibilities and for the purpose you came to this world all leads to the attributes of becoming an entrepreneur and these attributes are not the ones which are only present in people who are highly intelligent or intellectual. These qualities are inborn in every human being all you need is to polish them in an appropriate manner. It should be kept in mind that only those people succeed who have belief in their dreams and this belief is so strong that no

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Since May 2003, we’ve helped thousands of investors learn, network and prosper. LAREIC, also known as Sam’s RE Club, is dedicated to providing you with the most up-to-date information on market conditions and how you can take advantage of this historic opportunity. Join us to hear our great national speakers and our “Power Panels.” There’s nothing like it anywhere in Los Angeles!

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Cash Flow with Vacation Rentals By Hector Padilla, Entrepreneur, Broker & Investor

ould you like to know, how I bought a multi-million dollar property with NONE of my own money and how at the closing of escrow I received a check for $140,000 BIG ONES? Back in late 2005 a sharp young real estate entrepreneur by the name of Andy Story brought me a property located in the Hollywood Hills. A few weeks prior, Andy sent the listing agent an LOI (Letter of Intent) and the listing agent literally laughed and rejected what she described as “a ridiculously low offer.” A valuable lesson I have learned is that time and circumstances always motivate sellers. Long story short the unmotivated

action and used it to pay for some of the remodel. Once the rehab was done the property looked gorgeous and appraised for $4,000,0000. At that point I put the property on the market for a few months but when I could not get my price I decided to keep it and move into it. I was living like a Rock Star in the World Famous Hollywood Hills. What a glamorous life!!! Then the recession hit and my real estate business was affected. But I simply could not part from my sexy home. I recalled the old saying, “... it’s not what happens to you, but what you do with what happens and how you react to it...”. I have always told my students “Create More Opportunity Than You Find”. So instead of selling my Sexy Rock Star home I decided to convert it to a “Hotel Alternative for The Affluent” and make it a “Money Making Machine. I decided to offer affluent people my property as an alternative to staying in a boring hotel. One night I simply sat down and wrote a mini business plan. 1. Hire a professional photographer 2. Hire sexy models to portray the Glamorous Hollywood Hills life. 3. Build an elegant website 4. Create value by offering VIP Services 5. Hire a professional to Market the Property 6. Complete all tasks within 21 days 7. Take bookings and EARN some Honey Money At www.PresidentialResidence.com I offer my VIP Clients everything from a chauffeured Rolls Royce, Armed Body Guards, Candle Light Dinner, Executive Services, Daily Housekeeping, Breakfast in Bed and anything else our clients desire. Our client’s pay $1,749 to $2,499 per

It’s T to Th ime Outsi ink the B de ox!

seller unexpectedly lost her husband in an accident and immediately became highly motivated. Remember this, “People will never give away their equity or money BUT they will trade it for peace of mind”. Lo and behold the listing agent called Andy and said her client would accept his offer. Andy then assigned his contract to me and I paid him $40,000 at the closing as his “finder’s fee”. You see why I called Andy a sharp entrepreneur? I opened escrow and agreed to pay $2,000,000. I raised $500,000 in cash from a private investor and took out a 1st Mortgage. I kept $140,000 from the trans-

night. We have even had guests pay up to $4,000 per night for special events. I have had the opportunity to meet some amazing people. This year we have been booked with back to back clients. At times we have clients check out at 12:00 and new clients checking in at 3pm. Since this has been such a great experience I now own a $1,200,000 Ocean Front Luxury Condo in Cabo San Lucas, Mexico and a 3 bedroom home with pool in Palm Desert and my Hollywood Hills Baby = www.PresidentialResidence.com. These 3 vacation properties offer some great benefits: 1. Cash Flow 2. Tax write offs 3. Networking Opportunities 4. I trade my properties with other vacation home owners at NO COST. I can trade time in one of my properties with someone who owns a property in Hawaii or Europe, etc. 5. Build equity via real estate appreciation 6. Meet affluent people 7. Own a business that requires very little time and management. 8. Build a business that I can sell in the future. 9. Have FUN Remember there are 3 necessities in life. #1. Food. #2. Water. #3. Shelter (i.e. real estate). People will always need a place to live, play and work (AKA real estate). This is why real estate has always been the #1 Investment. But you do need to know how to buy right and invest wisely. Hector Padilla is the President of HP Capital Investments, Inc. (a real estate acquisition firm) and the Principal Broker of SWI Realty (a boutique real estate company). Because of his limited time Mr. Padilla only consults via “1-on-1 Coaching Phone Sessions”. To be placed on his waiting list, please call his office at (310) 204-8971 or email Hector@Hpcinvestments.com

r Look foeal More RTrips Estate 11 in 20 ��

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