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![by Isaac Newkirk III
D
on’t be deceived by Terica Kin- Terica: Yes, I grew up in
dred’s youth, inside lies an expe- a real estate family, so I
rienced investor with millions of always knew I was going
dollars worth of deals under her belt. Her to end up in real estate.
first transaction, at age 19, was based in At- I was looking at a triplex
lanta, GA. By the time Terica turned 24, she [in my original deal] and
was a self-made real estate millionaire. all I had was an ‘offer
A native of Southern California, Terica letter’ from Deloitte, the
understands the needs of long-distance in- company I worked for
vestors who choose to do deals far away due before I went out on my
to economics. She started purchasing out of own. They wouldn’t take
state and managing long-distance flips her- my ‘offer letter,’ but at
self while still living in Los Angeles. Terica Sun Trust they would,
has purchased, renovated and sold proper- and that’s when I bought
ties throughout California, Alabama, North the property. And it was
Carolina, Texas, Tennessee, Georgia, Mis- a lot cheaper and I got
souri and Indianapolis. more bang for my buck.
Her company Out Estate Investments, is That’s when I realized
a full-service firm offering multiple prod- that, although my father
ucts, including her popular Zero Money — who’s been in real
Investments. “It’s basically a ‘no money estate for over 40 years
down’ investment program where we help — he usually does a lot
investment buyers acquire houses,” she ex- of investing in his own
plains. Terica adds: “The program incorpo-
From Local to Global
back yard; for me it was
Terica teaches how to Invest Out of State
rates a rent-to-own strategy, where the type a little different. Although I was working in Flip Program is about $25,000. He’s going
of people we put in [the homes] want to LA, I thought that I might as well leverage to be able to do about three deals. The aver-
buy the property for the future. They usu- my income and buy something bigger and age net profit on those deals is $10,000 in
ally have bad credit, so we enroll them in a better and cheaper outside of California. six months. So on those three houses, he’s
credit repair program.” And so, I invested in properties in Atlanta making $30,000 in six months. So in twelve
One of the advantages to this program for and also in Texas. That’s how the business months he’s making $60,000 dollars. It’s
investors is that they are able to cash out was built. It started in 2006. A couple of basically what I did personally to get out
on their deals. Tenants benefit because it’s friends from Deloitte wanted me to help of Corporate America. And I’m not telling
cheaper to own than to rent in the markets them out and teach them how to invest. It people to get out of Corporate America;
they’re investing in. The deals sold by Out started from a network of friends, family but we put you in a position where, if you
Estate Investments have 25% equity at the and acquaintances. I remember the day I want to leave, you have residual income
close of escrow, which is one of the many got my first client that I didn’t know and that matches your corporate dollars. If you
advantages to this program. now the majority of them are unkown. We put all of my programs together, I can help
Recently, Terica moved to Atlanta, the have a waiting list for all of our properties anyone — with some money and some
city where her first deal was done. She trav- and there’s a new program we’ve just cre- credit — get out of the rat race.
eled south to zero in on this thriving market. ated that I think is noteworthy. We have
I caught up with Terica recently to discuss a thing called a VIP Flip program. That Question: You work with clients all over
her new book, The Global Millionaire, and started because some clients were saying, the world. Describe the type of investors
to learn about her company’s brand new “Well Terica, you’re flipping the deal. How who make up your typical client base?
financing option for foreign investors and do I become YOU in the transaction?” So Terica: Our typical client is a corporate guy
their VIP Flip Program. I created a program where my clients and I who wants to invest, wants to get out of the
joint venture together. We buy, fix and flip rat race, but they don’t have the time to find
Question: Did you really do your first real houses to fussy housewives of Atlanta. property. They’re stressed. We help them
estate deal at the age of 19!? The average out-of-pocket for my VIP put together a strategy. We provide private
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![financing, property management, tenants, the end of the day: to wake up every day moved out to Atlanta as well. He has a
construction, the whole ball of wax. So that and know that I’m changing the new portfolio, he’s Mr. Southside [of At-
way they can sit back and be hands free. lives of genera- lanta]. Whenever I have any
tions of people. properties on the Southside,
Question: I know the foreign investor A lot of the I always call him. My uncle,
market is exploding. Do you assist many tenants that we he’s in the Philippines now.
foreign investors? help are first He has a hotel out there. He’s
Terica: Yes, we do have many international generation involved with owner financ-
investors. With the foreign buyers, it’s a home own- ing and things like that. Back
little different, only because they’re not e r s . T h a t ’ s in Los Angeles, he was telling
able to get traditional financing. But they huge. We’re me about his owner financ-
want to invest as well and right now their changing a ing program and that’s how I
only option is to put down 100 percent out generation of came up with my international
of pocket. We also have in-house financ- people and program.
ing resources that allow our investors to I’m right
put down 40 to 50 percent with an interest- there on the Question: I can’t let you get
only rate of 5 to 9 percent with an eight- front line. away without telling us about
year balloon. This is really popular because In corporate your book that’s coming out.
it allows dollars to be leveraged. Investors America, Terica: The book is all about not
really benefit from being able to get financ- there are so being in your back yard. My dad
ing that they would not otherwise be able many lay- and I, we’ve had so many fights
to obtain. ers of bu- about this topic. He’s what I call
reaucracy ‘old school.’ And ‘old school’
Question: How does the Atlanta market and politics tells you, do what you can see and
compare with markets in other parts of that you never really get to see nothing else. What I’ve learned is
the country? the full impact. I’m able to make decisions that you can definitely make some huge
Terica: I’m partial to Atlanta because our myself. I’m able to maintain a high level profits going outside of your comfort zone,
first investment opportunity occurred there. of integrity and not have to worry about going outside of your back yard. If you live
It was a purchase in Snellville [a suburb of all the things that come with corporate [in- in California, not being afraid to go and
Atlanta]. I’ve been investing in this mar- volvement]. invest in Atlanta. I teach people all about
ket now for ten years. I think that Atlanta that. I’ve also started businesses on five
is one of the best markets in the country: Question: The fact that you learned all different continents, so I have significant
mainly because of all the job opportunities about real estate from your many family experience on entrepreneurship in general,
that are available. And so, as an investor, members already involved, how much of not just here in the states.
you want to be put in a place where your an advantage do you consider that?
tenants will stay gainfully employed and Terica: My dad’s in real estate, all my un- Question: How would you advise a new
also be in a position to purchase if you ever cles and aunts. Back in the early 1900s, my investor to go about getting into this busi-
want to liquidate. Also, it’s a lot larger than great grandmother built houses on her land ness?
any other southeast market and, when we in Mobile, AL, and rented them out. My Terica: I would say step one, get educat-
look at Atlanta, it’s the entire metropolitan family also owns land that they sell timber ed. Knowledge is power. Read some good
area. And the metroplex has about 5.9 mil- and hunting rights to government, investors books. If you don’t have access to those
lion people. So it quadruples the opportuni- and other individuals. That’s a big advan- tools, there are seminars out there, boot-
ty to have access to great inventory as well tage because I’m not afraid of the investing camps, etc. At least get your feet wet. Join
as polished tenants. It’s a win all around. scene. I meet a lot of people who are strick- an investment club, where there are other
en with fear, that’s why they don’t act. A investors around. And, without sounding
Question: What are the biggest advantag- lot of people who go to seminars, they’re biased, call me. We’re a one-stop shop.
es being in your own business? working and they get all excited, but they Contact us at 866.488.1820 or online at
Terica: Time. Time. Time. At the end of the don’t move. I think the thing that freezes OutEstate.com and what we’ll do, for free,
day, I can go [home] to visit my little doggy people is fear. I’ve been around investing is look at your circumstance, look at your
and I don’t have to tell anybody about it. and entrepreneurship all my life, I’ve never goals and put together a comprehensive
I love having the freedom of time. That’s seen my dad go to a 9 to 5 ever. Knowing strategy just for you. And you can learn
worth its weight in gold. That’s a finite re- that helps me not be fearful. I have a higher as we do it for you. But I wouldn’t recom-
source we have. We don’t ever get it back. risk tolerance than most and technology mend you go out there and just do it. I had
Having freedom of time is huge. Number doesn’t scare me. tons of support, I grew up in real estate and
two, being able to spend every day doing I still lost over a half million dollars. I’ve
something I’m passionate about. I’m very Question: Do you ever call on family lost big. So the education I have right now
passionate about real estate; about making members for advice? cost me a great deal of money.
a difference in the communities we serve. Terica: Yes, all the time. I call my dad the
Everything we do is socially conscious at most because he’s really good. My dad Continued on pg. 27
Realty411Guide.com PAGE 15 • 2012 reWEALTHmag.com](https://image.slidesharecdn.com/realty411part1-120412120713-phpapp02/85/Realty411-The-Creative-Investor-s-Resource-Vol-4-No-2-PART-1-15-320.jpg)
![Retire In Style, Here’s How by Stephanie Mojica
I
n a down economy, buying a property for investment purposes and debt,” Dannenfeldt said. “So I would rath-
er someone purchase one property for cash
renting it out to a tenant might seem a risky proposition. But Chris instead of three properties with debt.”
Dannenfeldt and his team at Property Partners I are helping people Dannenfeldt encourages clients to think
of buying real estate that they do not intend
across the country create passive income through residential invest-
to live in as a business.
ments and literally “save their retirement.” “For example, people buy a franchise
Dannenfeldt, based out of Dallas, anchors for maintenance,”
the retirement funds or other cash assets Dannenfeldt said.
on behalf of his clients into the purchase “And we do all that
of residential real estate. The potential an- work with our own
nual return on investment is 12 to 16 per- in-house employ-
cent. ees.” The firm also
As of February 2012, occupancy rates mitigates vacancy
for about 8,500 houses managed through risks for its investors
Property Partners I are 97.4 percent. The through an income
company also manages about 32,000 mort- rental guarantee.
gage notes with a default rate of about .4 Investors can use a
percent. modest portion of
A typical Property Partners I client is their monthly profits
between the ages of 45 to 65, earning a to purchase the guar-
six-figure income, has at least $100,000 in antee. This step will Chris Dannenfeldt
investable assets and is not an experienced keep the monthly rev-
real estate investor. enues coming even if the property becomes like a McDonald’s,” Dannenfeldt said.
“They are people that have been used vacant due to a renter moving on or being “And they don’t buy McDonald’s because
to doing the traditional things like stocks, evicted. they want to buy the hamburgers. They
bonds, and mutual funds,” Dannenfeldt Property Partners I representatives work buy McDonald’s because there is a sys-
said. “And they’re dissatisfied with their with qualified attorneys who can help in- tem in place to produce results, which is
returns. They are tired of taking losses. vestors legally shift their assets. The law- income to them.”
They’re worried about what they’re going yers also help clients create the corporate Property Partners I representatives thor-
to do for retirement.” structures necessary to limit their financial oughly study the demographics of each
Unlike many of his competitors, Dan- liability in the event that a tenant or visi- market before setting up investors with
nenfeldt’s company also takes an active tor to the owned property is injured or has properties in the region. Their goal is to be-
role in the management and maintenance another type of legal claim. come the number one provider of safe and
of clients’ real estate investments. Repre- The company protects its investors as well-maintained low-income rental hous-
sentatives handle payment of taxes, insur- well as its reputation by conducting a thor- ing in each market they target, without get-
ance, repairs and any problems that may ough financial analysis before working ting involved with government-subsidized
require the eviction of a tenant. This lit- with a client. Dannenfeldt wants to ensure programs such as Section 8.
erally creates monthly passive income for that each investor has reserve accounts of “Over the last three years, we’ve com-
investors. liquid assets in case of unexpected job loss pletely phased out of Section 8,” Dannen-
Property Partners I purchases mainte- or another financial emergency before he feldt said. “The reason being that we have
nance contracts and weaves the cost into invests into purchasing real estate. Like- seen across the country some really dra-
their clients’ initial investment. Using wise, Property Partners I strongly encour- matic cuts in funding that people qualify
maintenance contracts can save thousands ages potential clients to use existing assets for because of the cutback of funding in
of dollars in one transaction, Dannenfeldt such as retirement accounts rather than those programs. So before that had become
said. A roof for which a general contractor borrowing money to invest. Some excep- an issue, we had already started phasing
would charge an independent real estate tions apply, such as for investors who have out.”
investor $3,500 costs Property Partners I at millions in assets and wish to take on Once someone begins renting a home
about $700 through its maintenance con- some debt to purchase multiple properties managed by Property Partners I, they typi-
tracts. rather than use up all cash reserves. cally stay in that residence or move to an-
“[Clients] will not ever get any kind of “As a corporate decision, in today’s
phone call ever on, ‘You owe me money economic circumstances I am opposed to Continued on pg. 25
Realty411Guide.com PAGE 17 • 2012 reWEALTHmag.com](https://image.slidesharecdn.com/realty411part1-120412120713-phpapp02/85/Realty411-The-Creative-Investor-s-Resource-Vol-4-No-2-PART-1-17-320.jpg)
Uploaded byRealty411 Magazine for Real Estate Investors
Realty411 - The Creative Investor's Resource - Vol 4, No. 2 PART 1
Realty411 Guide provides insights into the evolving real estate industry, including a focus on investing beyond local markets through platforms like HomeUnion and RealBay. HomeUnion aims to mitigate risks for out-of-state investors by emphasizing due diligence and cash flow properties, while RealBay offers a unique online marketplace for real estate transactions. The guide emphasizes the importance of long-term investment planning and diversifying across different markets to minimize risks.
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Realty411 - The Creative Investor's Resource - Vol 4, No. 2 PART 1
- 1. 411 Print • Online • Network www.realty411guide.com | Vol. 4 • No. 2 • 2012 A Resource Guide for Investors TERICA KINDRED Founder & CEO of From Local to Global Learn to Invest Outside Your Backyard to Accelerate Cashflow
- 2. Join us on www.RealBay.com Today! The FUTURE of The Real Estate Industry FREE EXPOSURE FOR YOURSELF AND YOUR LISTINGS Global Online Real Estate Marketplace Live Bidding Auctions BEST of ALL IT’S 100% Listing Style Property Offerings Fully Functional Social Network Designed to Get FREE! Exposure for Real Estate Professionals FREE to post listings FREE to bid on assets FREE to become a listed service provider and market yourself to potential clients! We make our money off of advertising so our users pay nothing ever!
- 3. Realty411 Wealth Real Estate FOUNDER ADVERTISING Linda Pliagas Jordan Weinstock info@realty411guide.com info@realty411guide.com EDITORIAL STAFF EVENTS & EXPOS Bonnie Laslo Lloyd Segal Isaac Newark III Lawrence Ruano Stephanie Mojica CALIFORNIA DISTRIBUTION COPY EDITOR Professional Distribution Solutions Bonnie Laslo 1.877.418.6500 Lori Peebles NATIONAL DISTRIBUTION PHOTOGRAPHERS KJ Banks: 805.377.6328 Wendy Pineda PUBLISHED BY John DeCindis Manifest Media Partners COLUMNISTS SUBSCRIPTIONS/INFO: Bill Gatten 310.499.9545 Sam Sadat info@realty411guide.com Randy Hughes Realty411Guide.com PRODUCTION reWEALTHmag.com Augusto Meneses WEB MASTER Join Our VIP Social Network: Diggs Design http://realty411guide.ning.com Questions? 805.693.1497 or 310.499.9545 Realty411guide/reWealthmag is published in Santa Barbara County by Manifest Media Partners © Copyright 2007-2011. All Rights Reserved. Reproduction without permission is strictly prohibited. The opinions expressed by writers and columnists are not endorsed by the publishers. DISCLOSURE: Publishers are not responsible for performing due diligence on the opportunities offered by advertisers. Before investing in real estate, seek the advisement of a trusted financial adviser, attorney or tax consultant. Real estate investing is risky and could result in loss of capital. PRINTED IN THE USA. GOD BLESS AMERICA Connect to our virtual network ~ online 24/7/365 Realty411Guide.com PAGE 3 • 2012 reWEALTHmag.com
- 4. Property Partners I INVESTORS WANT: 3 High Returns 3 Hassle Free Guaranteed Expenses 3 Predictable & Reliable Income and Investment Outcome Chris Dannenfeldt THIS IS OUR MISSION If you’re looking for a balanced, appropriate and suitable real estate investment for your porfolio, understands how to help you get there. 214-447-7304 972-693-2140 214-447-7306 972-692-5448 Property Partners1.com SaveMyRetirementToday.com
- 5. contents 6 Ready to Buy Differently with HomeUnion? 9 Spring Has Sprung, but Has the Market? 10 Realty Auctions with RealBay.com 14 From Local to Global: An Investor’s Journey 17 Retire in Style with Property Partners 1 18 Find Real Deals in Just Four Simple Steps 19 Kaaren explains How to Control Your Retirement 20 Lease-Option Deals with Black Belt Investors 22 Learn About the Rental Property Analyzer 23 Bill Gatten Shares His Wisdom 24 Note Buying Made Easy with Asset Ventures 26 Buy, Hold & Rent in Cleveland with Sean Whalen 28 Investing in Dallas with Tom Wilson 30 Is It Honest to Use a Land Trust? 31 WhiteRock Capital Creates Wealth in CA & AZ 32 Premier Equity Group Offers Twice the Cashflow 33 Is Flipping Property Good for Your Wealth? 34 Market Spotlight: Discover San Antonio, TX 36 Is the Phoenix Market Starting a Recovery? 37 Sam Sadat Dishes Words of Wisdom 38 Going Global to Meet Investor Demand 41 Diversify Your Portfolio with Stocks 44 How Hard is Your Money Working? Join Our VIP Social Network FREE Membership * LIVE Chat http://realty411guide.ning.com Find Events, Deals & Partners Questions? Just email us: info@realty411guide.com N ATIONAL R EAL E STATE I NSURANCE G ROUP , LLC Ready to Make an Extra $5,000 to $30,000 Every Month? “Your wealth is in your thinking” is the mantra trumpeted most by stock market teacher and trader Tyrone Jackson. For the past five years, Mr. Jackson has been helping creative artists and self-directed investors produce monthly residual income & build long-term wealth in the stock market. His Wealthy Artist/Wealthy Investor program exposes both the experienced trader & novice to the powerful concept of monthly residual income. See Join Tyrone Jackson & Our Magazine for a FREE Event! YOU There! For location and information, call: 310.499.9545 Realty411Guide.com PAGE 5 • 2012 reWEALTHmag.com
- 6. H omeUnion Services is a unique investment platform pro- Q: What are some challenges to viding high income single-family cash flow homes na- providing investors with great tionally for real estate investors. The company brings cashflow properties? together a network of property providers who have an excellent A: The challenges lie in selecting the track record and are certified through an extensive due diligence right partners in the markets that we process. HomeUnion Services offer tenanted properties and they like. We place a high bar on the prop- stay on as property managers after the purchase. This ensures a erty providers. They need to have a single point of accountability and significantly reduces risk for critical size, i.e manage several hun- out of state investors. In addition, rent and maintenance guar- dred properties, credible property Ravi Renduchintala antees are available on homes in some markets. HomeUnion pro- management metrics, good financial Partner, HomeUnion Services strength and impeccable investor ref- vides post-purchase market intelligence, portfolio analysis, and erences. The market is full of real estate management oversight for investors. Single family real estate is rapidly evolving as a le- gurus that peddle great properties and then gitimate asset class, yet it still does not enjoy the abundance of decision support data that disappear into the sunset. The investor is surrounds other asset classes. Their goal is to bring legitimate analysis and transparency left holding the bag with a less than ade- to the investment process. We recently interviewed Ravi Renduchintala, a partner with quate local manager. HomeUnion Services, to learn more about their due diligence process. Remote Investing with HomeUnion Question: What makes HomeUnion dif- on provider performance. We also provide ferent in the cashflow real estate invest- consolidated portfolio reporting for clients ment market? that have bought properties in multiple lo- Answer: HomeUnion is a platform to re- cations. Clients will also receive ongoing duce the risk of remote out of state real es- important economic information on the tate investments. We study markets, iden- zones where they have invested. tify cashflow zones and quality providers in that area. Q: Have you been investing in real estate The turn-key providers are put through for a while? a stringent certification process with six- A: The founders have been involved in sigma approach before their properties are many facets of the real estate market for Q: What type of financing is available made available to our investors. Our goal over a decade. Founders come with an ex- for your deals? is to establish single family real estate as a tensive background in mortgage, real es- A: There are preferred Fannie Mae lenders legitimate alternate investment class. tate, investment banking, process manage- in every market. In addition there are sev- ment, and technology. Our unique value eral non-recourse lenders that will lend to Q: Do you have specific markets you pre- proposition lies in the quality of due dili- IRAs or international investors. fer over others? And, how do you know gence that we perform in the selected in- where to invest? vestment zones and the turnkey providers Q: What is the first step to get started? A: We have a proprietary analysis process in our investment property market place. Investors can register online at www.home for every market. At a macro level we look We are able to share some of the best prac- unionservices.com or call (866) 732-3220. at employment rates, employer diversity, tices across multiple investment zones and We have customer service professionals population growth, and a number of other improve overall quality. who work with investors to help them build city and economy factors. At a micro level the right real estate portfolio. we look at neighborhoods and properties Q: Tell us a bit about the people behind within an “investment zone”. These prop- HomeUnion Services? Q: Do you have any advice for new in- erties are typically to the left of the mean A: The founders are engineers, MBAs — vestors starting out? prices in the bell curve but not at the tail. It serial entrepreneurs with a track record of In the market investors can either be day is an optimum balance between high rent to building and scaling successful companies. traders and stock pickers or invest with a price ratios and risk. We have six markets This is their third company in the real es- well-rated mutual fund or money manager. nationally that are on our platform tate space. The goal is to bring profession- For most people it makes more sense to alism, trust, and transparency to the single- take the latter strategy. In the real estate in- Q: Does your company manage the prop- family real estate investment space. Our vestment business this means working with erty for clients? primary investor is Soma Enterprises, an a trusted company that has done the due A: Our providers manage the properties, we $800 million global infrastructure develop- diligence for them so they can reduce the provide oversight and continued diligence ment company. Continued on pg. 45 Realty411Guide.com PAGE 6 • 2012 reWEALTHmag.com
- 9. Spring has Sprung buthas the real estate market? by Lori Greymont O ne of the repeated the past four years and if you questions I have been haven’t been buying when it asked is, “Is it time was on sale, don’t wait too to buy real estate and if so, much longer because the prices where?” will be going up. The rule of In Silicon Valley there buy low and sell high still ex- is a lot of talk about ists. And the unfortunate how the economy truth is that the is recovering, only way you rents are up, know you are unemployment at the bottom is down and is when you everyone is ex- have past the cited about the bottom and financial uptick you are looking expected with the back. Facebook IPO. Now to the Northern Califor- second part of nia real estate inves- the most commonly tors that have been sitting on asked question, “Where should the sideline are wondering, is I buy?” That depends! Really, this the right time to buy? My what you need to do is plan your answer is a resounding YES! exit before entering the real es- And that has been my same an- tate market. You need to know swer even through the darkest how long you plan to hold the of times. properties. Are you buying for For most passive investors, cash flow and wealth building? real estate investing should Or do you need to be more ac- not be a onetime event timed tive in real estate right now to perfectly like a game show replace your daytime job? contestant trying to leap onto a I typically tell people that moving object or face landing they should invest in two-to- in the muck. We saw what hap- three growing metropolitan pened when families bet their areas that are geographically financial future on apprecia- diverse from each other. For tion and many are still living example, don’t buy in three with the wounds today. California cities, but rather Instead, investing in real if you can find cash flow in estate ought to be a long term California, pick one city in plan of buying cash-flow prop- California and also purchase erties in several markets over someplace different like At- a several year period. This lanta. Having your investments simple risk mitigation tech- in different major metropolitan nique may not bring you the markets will reduce the risk of highest returns, but will allow your losses due to local eco- you to sleep at night knowing nomic failures. When I look you have cost averaged your into a new investment market, I purchases. It’s taking investing step-by-step instead of making analyze and look for seven key success factors: 1. Strong De- GreenBlasts.com We send your eMail, eFax or Voice Blast one giant leap. mographic Growth, 2. Strong to any Demographic, Industry or City The point I want to make and Diverse Economy Sectors, 310.499.9545 or info@realty411guide.com clear is that American real es- tate has been on clearance over Continued on pg. 42 Realty411Guide.com PAGE 9 • 2012 reWEALTHmag.com
- 10. RealBay.com Set to Launch this Spring! Article by Bonnie Laslo Eleakis & Elder Photography R eal estate professionals flood to RealBay.com for its Spring 2012 launch, and the silent buzz begins. RealBay.com is a unique real estate online marketplace, which has arrived to serve as a revolutionary platform in which its members can not only market their real estate listings, but also market themselves as real estate professionals and real estate service providers. The company just signed industry gi- ant Trulia as a marketing sponsor. Trulia will help drive traffic to RealBay.com by promoting their launch to their millions of members. “We anticipate about 40,000 members within the first few months of our launch based on all of our strategic partnerships,” says Stephan Piscano, RealBay.com CEO and co-founder. We recently sat down with Piscano to get an inside look at how RealBay.com came to be and what void it will fill in the current marketplace. Upon review, www.RealBay.com will serve as an online marketplace in which its Stephan Piscano, CEO/co-founder of RealBay.com members both “RE Pros” and “Everyday Joes” can list their properties on the site for sale in the form of live bidding auc- create this,” he adds. basis trying to round up inventory to pur- tions or listing-style property offerings. Piscano manages an investment fund chase and then liquidate instantly online. There are currently a few competitors out based in Napa Valley, Calif., he first got He purchased his first home for $600 (a there offering RE auction services online interested in online real estate in the sum- duplex) and sold it less than a week later but none of them that we have found offer mer of 2008 when he began seeing aston- on eBay for $6,900, and after that, he was the ability to connect in a social network ishingly cheap properties in Detroit, MI, off to the races. setting while doing so. selling on eBay of all places for as little as These experiences were condensed into “One of the goals we had here was to $2,500 or less. a short two-year period that yielded consis- try to really bring the entire experience of This was at the height of the market crash tent results of success and profits. buying a home online, not only with the and Piscano was greatly intrigued. From 2008 to January 2011, Piscano es- research process as you can do on Real tor. “I nearly purchased several of those timates he engaged in more than 250 online com and others, but to actually allow you cheap homes I saw on eBay, but I said to real estate transactions, most of which be- to make a buying decision and buying ac- myself, if they are selling them online that ing through eBay. Throughout this process tion, all from the comfort of your home, cheap they must be buying them some- Piscano realized the many gapping holes and do it all for free,” Piscano explains. where else even cheaper”. that were in eBay’s system, as it related “I feel like everything that I have done Piscano, from the other side of the coun- to real estate. On Ebay they had ramped throughout my life and in real estate was try, began cold calling asset managers and fraudulent bidding activity. Bidders would to bring me to a point in which we could listing agents in Detroit on nearly a daily bid properties up, win the auction and then Realty411Guide.com PAGE 10 • 2012 reWEALTHmag.com
- 11. “In effect wewant to be seen as a one-stop-shop to meet all your real estate needs online, allowing members to not only market their listings but market themselves as real estate pros.” never pay and never be heard from again. Madison began to craft the details of the which facets of the website caught most of One could report these members to eBay, site while he set up meetings with the top their attention. According to real estate in- and they would issue a non-paid item strike web site designers in Silicon Valley to de- vestor Patrick O’Donnell, his top five are to that bidder, but they would not refund sign what would become in their minds listed below: any fees to the seller. So the investor would “The Future of the Real Estate Industry”. 1. Free membership to bid on property be out $100 to $150 for the listing. Also, “There is no other website out there like and no buyer fees. eBay had problems with fraudulent sellers this,” stated Piscano. 2. Beginning property inventory of auctioning off properties they did not even The website includes features necessary 4,000 providing buyer variety. own. Because the cheaper homes were to change the way real estate professionals 3. No cost for business professionals to typically sold via quit claim deed, it would do business online over night. Some of the market themselves through the social be months before victims realized that they most notable functionalities are: network. had paid through Paypal for something that •Real Estate auc- they did not actually own. By then, they tions with live bid- typically could not track down the criminal ding, like eBay. The that had sold it to them. auction can be set at All of that mistrust created a market- different timelines, place that by 2011 was hurting the overall and buyers can con- industry, as well as the properties. tact sellers in real Piscano envisioned a web site that had time to get critical verified ownership of all properties sold, information about verified bidders in which if you had a the properties. fraudulent bidder on the site, you could •Open social auction that same property again for free networking, like in confidence — basically Piscano wanted Facebook, allow- a site where real buyers and real sellers ing members and could connect with trust and have it all take RE pros to market place online — from this desire RealBay themselves to po- has been born. tential partners and Piscano searched other competing sites clients. and actually had some of them contact him •Professional networking exposure like 4. Low-cost auctions starting at ap- allowing him to list on their sites com- LinkedIn allowing members to have con- proximately $5 per property. pletely for free just to get the inventory. nections, receive recommendations, and 5. Access to local resources, service pro- He found that none of them, in his opinion, truly market themselves as well as their viders, auction, and social atmosphere “Got It”. listings online. all in one place. “The competing sites are all charging a •Multiple video tutorials for speed and In addition, auction winners are provided percentage of the transaction after the fact ease of understanding. The markets are al- with a list of local product and service pro- — Either with a buyer’s penalty (premium) ways changing and education is key. The viders in the local area at no charge. This or acting as the list agent and trying to resources are available for learning. Topics proves to be an excellent retention feature pocket more money from the seller — That will include what other investors in your as the buyer and/or investor most likely creates a negative scenario for all the users area are doing to learn what is working and will be in need of a contractor, agent, or of those sites, which hurts all the members what is not. Trends are different and local- general service providers in the area. The in my opinion — At RealBay it is always ized to specific areas. time saved in researching this information free to bid, no buyers penalties or premi- •Allows users to search real estate ser- is also money kept in the buyer’s pocket. ums, and our sellers never pay fees after vice providers in the specific target crite- Piscano notes that nearly 100% of the buy- the transaction it is simply free that is it!” ria. ers who buy cheaper online real estate are Piscano and his partners believe that this “In effect we want to be seen as a one- outside of the state that they purchased the strategy of nearly making the entire mar- stop-shop to meet all your real estate needs subject property, making this need very ketplace free will create exceptional moral online allowing members to not only mar- dramatic. The buyers looking for invest- in which more transactions will take place ket their listings but market themselves as ments and/or assets will be able to search at higher rates as well. real estate pros,” Piscano says. using detailed search fields like location, Piscano working with his trusted busi- A survey was conducted among real es- ness partners, Patrick Madison and Reece tate professionals about their opinions on Continued on pg. 42 Realty411Guide.com PAGE 11 • 2012 reWEALTHmag.com
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- 14. by Isaac NewkirkIII D on’t be deceived by Terica Kin- Terica: Yes, I grew up in dred’s youth, inside lies an expe- a real estate family, so I rienced investor with millions of always knew I was going dollars worth of deals under her belt. Her to end up in real estate. first transaction, at age 19, was based in At- I was looking at a triplex lanta, GA. By the time Terica turned 24, she [in my original deal] and was a self-made real estate millionaire. all I had was an ‘offer A native of Southern California, Terica letter’ from Deloitte, the understands the needs of long-distance in- company I worked for vestors who choose to do deals far away due before I went out on my to economics. She started purchasing out of own. They wouldn’t take state and managing long-distance flips her- my ‘offer letter,’ but at self while still living in Los Angeles. Terica Sun Trust they would, has purchased, renovated and sold proper- and that’s when I bought ties throughout California, Alabama, North the property. And it was Carolina, Texas, Tennessee, Georgia, Mis- a lot cheaper and I got souri and Indianapolis. more bang for my buck. Her company Out Estate Investments, is That’s when I realized a full-service firm offering multiple prod- that, although my father ucts, including her popular Zero Money — who’s been in real Investments. “It’s basically a ‘no money estate for over 40 years down’ investment program where we help — he usually does a lot investment buyers acquire houses,” she ex- of investing in his own plains. Terica adds: “The program incorpo- From Local to Global back yard; for me it was Terica teaches how to Invest Out of State rates a rent-to-own strategy, where the type a little different. Although I was working in Flip Program is about $25,000. He’s going of people we put in [the homes] want to LA, I thought that I might as well leverage to be able to do about three deals. The aver- buy the property for the future. They usu- my income and buy something bigger and age net profit on those deals is $10,000 in ally have bad credit, so we enroll them in a better and cheaper outside of California. six months. So on those three houses, he’s credit repair program.” And so, I invested in properties in Atlanta making $30,000 in six months. So in twelve One of the advantages to this program for and also in Texas. That’s how the business months he’s making $60,000 dollars. It’s investors is that they are able to cash out was built. It started in 2006. A couple of basically what I did personally to get out on their deals. Tenants benefit because it’s friends from Deloitte wanted me to help of Corporate America. And I’m not telling cheaper to own than to rent in the markets them out and teach them how to invest. It people to get out of Corporate America; they’re investing in. The deals sold by Out started from a network of friends, family but we put you in a position where, if you Estate Investments have 25% equity at the and acquaintances. I remember the day I want to leave, you have residual income close of escrow, which is one of the many got my first client that I didn’t know and that matches your corporate dollars. If you advantages to this program. now the majority of them are unkown. We put all of my programs together, I can help Recently, Terica moved to Atlanta, the have a waiting list for all of our properties anyone — with some money and some city where her first deal was done. She trav- and there’s a new program we’ve just cre- credit — get out of the rat race. eled south to zero in on this thriving market. ated that I think is noteworthy. We have I caught up with Terica recently to discuss a thing called a VIP Flip program. That Question: You work with clients all over her new book, The Global Millionaire, and started because some clients were saying, the world. Describe the type of investors to learn about her company’s brand new “Well Terica, you’re flipping the deal. How who make up your typical client base? financing option for foreign investors and do I become YOU in the transaction?” So Terica: Our typical client is a corporate guy their VIP Flip Program. I created a program where my clients and I who wants to invest, wants to get out of the joint venture together. We buy, fix and flip rat race, but they don’t have the time to find Question: Did you really do your first real houses to fussy housewives of Atlanta. property. They’re stressed. We help them estate deal at the age of 19!? The average out-of-pocket for my VIP put together a strategy. We provide private Realty411Guide.com PAGE 14 • 2012 reWEALTHmag.com
- 15. financing, property management,tenants, the end of the day: to wake up every day moved out to Atlanta as well. He has a construction, the whole ball of wax. So that and know that I’m changing the new portfolio, he’s Mr. Southside [of At- way they can sit back and be hands free. lives of genera- lanta]. Whenever I have any tions of people. properties on the Southside, Question: I know the foreign investor A lot of the I always call him. My uncle, market is exploding. Do you assist many tenants that we he’s in the Philippines now. foreign investors? help are first He has a hotel out there. He’s Terica: Yes, we do have many international generation involved with owner financ- investors. With the foreign buyers, it’s a home own- ing and things like that. Back little different, only because they’re not e r s . T h a t ’ s in Los Angeles, he was telling able to get traditional financing. But they huge. We’re me about his owner financ- want to invest as well and right now their changing a ing program and that’s how I only option is to put down 100 percent out generation of came up with my international of pocket. We also have in-house financ- people and program. ing resources that allow our investors to I’m right put down 40 to 50 percent with an interest- there on the Question: I can’t let you get only rate of 5 to 9 percent with an eight- front line. away without telling us about year balloon. This is really popular because In corporate your book that’s coming out. it allows dollars to be leveraged. Investors America, Terica: The book is all about not really benefit from being able to get financ- there are so being in your back yard. My dad ing that they would not otherwise be able many lay- and I, we’ve had so many fights to obtain. ers of bu- about this topic. He’s what I call reaucracy ‘old school.’ And ‘old school’ Question: How does the Atlanta market and politics tells you, do what you can see and compare with markets in other parts of that you never really get to see nothing else. What I’ve learned is the country? the full impact. I’m able to make decisions that you can definitely make some huge Terica: I’m partial to Atlanta because our myself. I’m able to maintain a high level profits going outside of your comfort zone, first investment opportunity occurred there. of integrity and not have to worry about going outside of your back yard. If you live It was a purchase in Snellville [a suburb of all the things that come with corporate [in- in California, not being afraid to go and Atlanta]. I’ve been investing in this mar- volvement]. invest in Atlanta. I teach people all about ket now for ten years. I think that Atlanta that. I’ve also started businesses on five is one of the best markets in the country: Question: The fact that you learned all different continents, so I have significant mainly because of all the job opportunities about real estate from your many family experience on entrepreneurship in general, that are available. And so, as an investor, members already involved, how much of not just here in the states. you want to be put in a place where your an advantage do you consider that? tenants will stay gainfully employed and Terica: My dad’s in real estate, all my un- Question: How would you advise a new also be in a position to purchase if you ever cles and aunts. Back in the early 1900s, my investor to go about getting into this busi- want to liquidate. Also, it’s a lot larger than great grandmother built houses on her land ness? any other southeast market and, when we in Mobile, AL, and rented them out. My Terica: I would say step one, get educat- look at Atlanta, it’s the entire metropolitan family also owns land that they sell timber ed. Knowledge is power. Read some good area. And the metroplex has about 5.9 mil- and hunting rights to government, investors books. If you don’t have access to those lion people. So it quadruples the opportuni- and other individuals. That’s a big advan- tools, there are seminars out there, boot- ty to have access to great inventory as well tage because I’m not afraid of the investing camps, etc. At least get your feet wet. Join as polished tenants. It’s a win all around. scene. I meet a lot of people who are strick- an investment club, where there are other en with fear, that’s why they don’t act. A investors around. And, without sounding Question: What are the biggest advantag- lot of people who go to seminars, they’re biased, call me. We’re a one-stop shop. es being in your own business? working and they get all excited, but they Contact us at 866.488.1820 or online at Terica: Time. Time. Time. At the end of the don’t move. I think the thing that freezes OutEstate.com and what we’ll do, for free, day, I can go [home] to visit my little doggy people is fear. I’ve been around investing is look at your circumstance, look at your and I don’t have to tell anybody about it. and entrepreneurship all my life, I’ve never goals and put together a comprehensive I love having the freedom of time. That’s seen my dad go to a 9 to 5 ever. Knowing strategy just for you. And you can learn worth its weight in gold. That’s a finite re- that helps me not be fearful. I have a higher as we do it for you. But I wouldn’t recom- source we have. We don’t ever get it back. risk tolerance than most and technology mend you go out there and just do it. I had Having freedom of time is huge. Number doesn’t scare me. tons of support, I grew up in real estate and two, being able to spend every day doing I still lost over a half million dollars. I’ve something I’m passionate about. I’m very Question: Do you ever call on family lost big. So the education I have right now passionate about real estate; about making members for advice? cost me a great deal of money. a difference in the communities we serve. Terica: Yes, all the time. I call my dad the Everything we do is socially conscious at most because he’s really good. My dad Continued on pg. 27 Realty411Guide.com PAGE 15 • 2012 reWEALTHmag.com
- 16. Investment Tools Proven to Work! IRCA-LA & Eddie Speed, the Leading Authority on Notes, Rental Property Analyzer is a great piece Invite You to 2 SPECIAL EVENTS! of software designed to eliminate the guess work out of purchasing property April 3rd - 6:30 pm to 9: 30 pm Complimentary refreshments served at meetings! April 7th - 9 am to 5 pm Only $39! One day, in-depth training on notes with Eddie Speed IRCA-LA is the only Westside Club to offer meetings with Eddie Speed FREE ADMISSION Club Location: Four Points Sheraton, 5990 Green Valley Parkway, Culver City Contact IRCA-LA at 818.217.4630 www. HomeReplay .com For info on these events: www.IRCA-LosAngeles.com/Eddie PhoenixTour_Realty411_PrintAd_Rev03.pdf 1 3/9/2012 00:37:02 The Rental Property FREE Phoenix Investment Analyzer does this: •Takes the guess work out of buying •Compares multiple properties at once for Property Tour To Register for our next Tour go to: quick best-buy decisions www.PhoenixInvestmentPropertyTour.com •Accounts for hidden costs to prevent C PROMO CODE: Realty411 costly rehab surprises at the end of the job M •Provides estimate of current property Y value based on the condition of property CM •Provides solid repair cost estimates MY for renovation projects CY •Supports up to 20 financial options CMY for comparison purposes K To request our current inventory •Has charts, graphs, and tables for cash flow Contact Ray Bansal at (408) 210-4780 analysis and future profit projections or email him at •Projects the After Repair Value of a property Ray@USAPropertyInvesting.com based on size, location, and rehab work Invest In Your Business, Invest in Your Future, Invest in the Rental Property Analyzer Realty411Guide.com PAGE 16 • 2012 reWEALTHmag.com
- 17. Retire In Style,Here’s How by Stephanie Mojica I n a down economy, buying a property for investment purposes and debt,” Dannenfeldt said. “So I would rath- er someone purchase one property for cash renting it out to a tenant might seem a risky proposition. But Chris instead of three properties with debt.” Dannenfeldt and his team at Property Partners I are helping people Dannenfeldt encourages clients to think of buying real estate that they do not intend across the country create passive income through residential invest- to live in as a business. ments and literally “save their retirement.” “For example, people buy a franchise Dannenfeldt, based out of Dallas, anchors for maintenance,” the retirement funds or other cash assets Dannenfeldt said. on behalf of his clients into the purchase “And we do all that of residential real estate. The potential an- work with our own nual return on investment is 12 to 16 per- in-house employ- cent. ees.” The firm also As of February 2012, occupancy rates mitigates vacancy for about 8,500 houses managed through risks for its investors Property Partners I are 97.4 percent. The through an income company also manages about 32,000 mort- rental guarantee. gage notes with a default rate of about .4 Investors can use a percent. modest portion of A typical Property Partners I client is their monthly profits between the ages of 45 to 65, earning a to purchase the guar- six-figure income, has at least $100,000 in antee. This step will Chris Dannenfeldt investable assets and is not an experienced keep the monthly rev- real estate investor. enues coming even if the property becomes like a McDonald’s,” Dannenfeldt said. “They are people that have been used vacant due to a renter moving on or being “And they don’t buy McDonald’s because to doing the traditional things like stocks, evicted. they want to buy the hamburgers. They bonds, and mutual funds,” Dannenfeldt Property Partners I representatives work buy McDonald’s because there is a sys- said. “And they’re dissatisfied with their with qualified attorneys who can help in- tem in place to produce results, which is returns. They are tired of taking losses. vestors legally shift their assets. The law- income to them.” They’re worried about what they’re going yers also help clients create the corporate Property Partners I representatives thor- to do for retirement.” structures necessary to limit their financial oughly study the demographics of each Unlike many of his competitors, Dan- liability in the event that a tenant or visi- market before setting up investors with nenfeldt’s company also takes an active tor to the owned property is injured or has properties in the region. Their goal is to be- role in the management and maintenance another type of legal claim. come the number one provider of safe and of clients’ real estate investments. Repre- The company protects its investors as well-maintained low-income rental hous- sentatives handle payment of taxes, insur- well as its reputation by conducting a thor- ing in each market they target, without get- ance, repairs and any problems that may ough financial analysis before working ting involved with government-subsidized require the eviction of a tenant. This lit- with a client. Dannenfeldt wants to ensure programs such as Section 8. erally creates monthly passive income for that each investor has reserve accounts of “Over the last three years, we’ve com- investors. liquid assets in case of unexpected job loss pletely phased out of Section 8,” Dannen- Property Partners I purchases mainte- or another financial emergency before he feldt said. “The reason being that we have nance contracts and weaves the cost into invests into purchasing real estate. Like- seen across the country some really dra- their clients’ initial investment. Using wise, Property Partners I strongly encour- matic cuts in funding that people qualify maintenance contracts can save thousands ages potential clients to use existing assets for because of the cutback of funding in of dollars in one transaction, Dannenfeldt such as retirement accounts rather than those programs. So before that had become said. A roof for which a general contractor borrowing money to invest. Some excep- an issue, we had already started phasing would charge an independent real estate tions apply, such as for investors who have out.” investor $3,500 costs Property Partners I at millions in assets and wish to take on Once someone begins renting a home about $700 through its maintenance con- some debt to purchase multiple properties managed by Property Partners I, they typi- tracts. rather than use up all cash reserves. cally stay in that residence or move to an- “[Clients] will not ever get any kind of “As a corporate decision, in today’s phone call ever on, ‘You owe me money economic circumstances I am opposed to Continued on pg. 25 Realty411Guide.com PAGE 17 • 2012 reWEALTHmag.com
- 18. G It’s specific what area(s) are you willing to sess determination, persistence, by Matt Theriault to YOU. A look for this type of property? timing and an extraordinary ot your “real deal” And what price range are you willingness to work hard. Hav- atten- defined is a willing to consider? Knowing ing said that, here’s how to find tion? property that your property criteria is first. real deals in 4 simple (I didn’t The title meets your Second, what are the mini- say easy) steps: of this criteria and mum terms you’re willing to Step 1 - Establish your prop- article works because a seller that consider? If your intention is to erty criteria and the mini- it’s what investors are meets your create cash through short-term mum terms you’re willing to always seeking, but not terms. Any- strategies such as wholesal- accept. You should’ve done only are they seeking thing outside ing or “fixing and flipping,” is this already. If not, read this Find Real Deals in 4 Simple Steps “real deals,” they are always of that is not a real deal. There a 20% return on your invest- article from the beginning and in search of new ways of find- are two parts to what consti- ment in 90 days your minimum follow the instructions in para- ing them. Before finding a real tutes a real deal. First, what’s terms? Or, is it $20,000? Or, is it graphs two and three before deal, however, one must know your criteria for an investment 20% of market value? If you’re continuing to... what a real deal is. Seems logi- property? Is your investing in- intention is to create cashflow Step 2 - Identify property cal, but it’s a basic principle tention “cash” or “cashflow?” through lease options or “buy owners that need to sell, as of real estate investing that’s Being clear about your inten- and hold,” is $200 of net cash- opposed to those that want frequently underrated, or flat- tion can significantly impact flow per door your minimum? to sell. The center of every real out ignored and overlooked by the price and terms of your Or is it a 20% overall cash- deal is in the owner’s motiva- novice and experienced inves- deal. Once your intention is es- on-cash return? Knowing your tion to sell. No motivation? tors, alike. tablished, what type of proper- minimum terms completes your No deal. “Want” is not moti- A real deal is very specific. ty will create your intention? In criteria of a real deal. vation. “Need” is motivation. You get to choose. Nobody Motivated sellers can be found has any say in your criteria, but just about anywhere, however, Yes, YOU can do deals you. A deal for me might not be a deal for you, and vice versa. your greatest likelihood of lo- cating clusters of motivated even if you have no money, A real deal defined is a property sellers will be through notice that meets YOUR criteria and a of default (NOD) records, pro- credit or experience. seller that meets YOUR terms. bate records, expired listings, It seems counterintuitive to inheritance records and out- most, but the more narrow the of-state owners (absentees). focus of your criteria, the more Convenient resources for these real deals you will find. Once records can be found at www. you know your criteria and EpicProDownloads.com your terms, you can begin your Step 3 - Keep your name, search for real deals. contact information and a Locating properties that consistent message in front of meet your criteria is the easy these property owners. Avoid part. Locating property owners the games and gimmicks that willing to sell to you on your many real estate investors play. terms is the hard part, and lo- Advertise only what it is that cating these property owners is you do. key to creating wealth in real •Immediate debt relief. estate. There’s only one way •No commissions. to find property owners willing •No repairs required. to sell their property to you on •Close fast. your terms, and that is to mount an ongoing search to seek them Be straight with people. Tell out. Finding such owners is them what you’ll do, then do it. not for the weak-willed person It’s appreciated. who gives up at the first experi- As previously mentioned, ence of resistance, by the way. Successful deal finders pos- Continued on pg. 27
- 19. I CAN Controlmy Retirement Account? O by Bonnie Laslo rect IRA Services LLC. She is an expert in the field and has a high priority on educa- ne of the first questions you tion. This is a good aspect for a custodian to will be asked when invest- have, as being able to communicate and ed- ing is: Do you have an IRA ucate a client on how to use their accounts or 401(k)? is the most important part of having a self If the answer is yes, then directed IRA. A person has to understand the next question is: So who decides where the rules and having an educated custodian Kaaren Hall your money gets invested? to hand hold you through the process. This The answer should be you. Many do not is not only necessary, but it is a must. Then sisted her nationwide base of clients for realize that there is a way to have control you research and find assets, projects, and/ many years. over your own retirement funds. or companies to invest in to grow the funds. She is also president and founder of uDi- It has been available for years, but very Many people purchase real estate, give pri- rect IRA Services LLC, and speaks at many few people know about it or understand it. vate mortgages, buy precious metals, buy real estate club meetings and events to edu- We know you’re not one of those individu- companies, etc., as some of the investment cate the public on how to use self-directed als, or at least in the next 10 minutes will projects. IRA accounts. She is a sought after expert not be fully in the dark on this interesting Hall states, “Remember you are the one in the field and has assisted national real subject. IRA owners after reading this ar- making all the decisions, you’re the advi- estate experts with their own deal structur- ticle will find value in the knowledge and sor, and it’s not on someone else’s shoul- ing and accounts. The service and fees are resources to empower them with a wealth- ders. The Securities Exchange Commis- the aspects to consider when choosing a building tool. sion (SEC) promotes public awareness on custodian. Having access to the experience In today’s financial environment, the letting the public know to be careful, and and knowledge is the added value with this knowledge can be worth thousands to mil- what type of recourse is available. So in company. lions of dollars for a normal household our welcome packages we supply helpful After many years of building her busi- family. It is a newfound business skill for information, and also educational links on ness, Hall’s life has gotten much easier thousands, or at least a topic worth discuss- our website.” now that her children are older. This allots ing with a professional in the future. Final step, when you decide on where to for more time and expansion on educat- Many business owners and real estate place your funds, review your intentions ing the public on harnessing the control of investors have created profitable busi- with your custodian to ensure it qualifies their own retirement futures. Hall is a busy nesses, especially in today’s market. After and all rules are being followed. This is mother of two, and she travels throughout researching the information, we will show the most important step, and it’s wise to California for real estate events. you how to get started in a matter of min- have a set of expert eyes looking over your There are many employees who are no utes. intended investment. These companies are longer at their original job locations and are So here are the basics: in place to answer questions and to guide looking to rollover their 401(k). Some in- You must open or have an IRA account you along for proper uses to keep your self- dividuals are looking to rollover from their (Individual Retirement Account). directed IRA in compliance. employer plans, and self-directed IRAs are There are two main ones to choose from “Anyone can visit www.IRS.gov pub an option for people to become educated Traditional or Roth. With a Traditional, 590, which talks about IRA guidelines and on, in order to better their lives and their you take the tax deduction when you put goes over the rules,” according to Hall. family finances. money in, and pay taxes when you pull After reviewing www.uDirectIRA.com, The old saying that knowledge is power money out. The Roth is the opposite; taxes any individual can go to this resource loca- is obviously visible now to many, due to are taken when money is contributed, but tion for free information. There are many Hall’s hard work and sharing of her years it is tax free when pulling the money out. advantages for the public to convert their of experience with every day people who The Roth IRA is a very powerful account existing IRA accounts to self-directed, and can benefit from it the most. to have because one can use, for example, many people already have. Hall confirms, “I am here to enlighten $100 to invest, and if those funds create a “Because a self-directed IRA lets you in- readers about the self direction process in large profit, no taxes are paid on it. vest in anything (except life insurance and an effort to inspire them to be more proac- Individuals can transition current IRA collectibles), there are hundreds of possi- tive about their own retirement.” accounts to a self-directed IRA custodian. bilities,” states Hall. A new account can also be opened. Kaaren With a background of over 16 years of Visit www.uDirectIRA.com for more infor- Hall is the president and founder of uDi- real estate experience, Kaaren Hall has as- mation or to get started. Realty411Guide.com PAGE 19 • 2012 reWEALTHmag.com
- 20. LEASE OPTIONS Make Waves in Real Estate by Isaac Newkirk III Benefits for the buyer include: •You get the opportunity to buy a home bringing in larger gross rents compared to when your credit is seriously impaired other landlords in the neighborhood. (and the opportunity to substantially There is a big difference in the way the repair your credit) deposit and the rent premium are viewed •You can save up for a down pay- by sellers and buyers. The buyers are think- ment on the home while living in the ing in terms of their future home, and con- home (often times the down payment is sider these items as equity. The sellers are very low) considering these items as sort of a hedge 1 2 R O U N D S •A portion of the rent or rental premium against default, a guarantee that the deal is added to become a forced savings will go through because if it doesn’t, the The West’s Top Ranked of the Estate the tenant is Club •At the end Real option, Investor’s payments will be retained as income. This not obligated to purchase the home is what makes the lease option deal a win- Black Belt Investors, The West’s Top Ranked Benefits for the seller include: ner all around. There are various market conditions that Resource For Successful Cash and Wealth Building •Collecting rent on the home while it would dictate the proper time to sell using the otherwise be sitting vacant lease option process. If the market is ac- •The opportunity to receive a high pur- tive (there is a big demand for sales) and S 3 Reality Based Education, Training & Coaching to Keep chase price the prospective buyers understand and ap- You in Tip Top Shape ensei Gilliland is a manExciting Diversified •TheThat Revolve to sell your home instead of preciate the value of home ownership, but 3 who be- Topics ability Around Real lieves in diversification.Estate and Business Opportunities it His real just renting just can’t do it on their own, lease options 3 Networking to Help Build Your Team & Sharpen Your estate investment firm, Black Belt •The opportunity to increase your cash flow are a valuable alternative. Slow markets Skills Investors (BBI), derivesAits nameto Keep Youreceive aMotivated rate of return 3 Connection and Engaged and higher can mean either the re-sale market has de- from his first real passion of 3 Discounts From Local and National Businessesthe landlord/seller respon- creased significantly or there is a difficulty the martialMargins Increase Your •Having some of to Help arts. As a martial arts instructor and ownerBlacksibilities be Assist You 5 by the tenant/buyer 3 Support From Belt Investors to assumed in the acquisition of lender financing. In of several martial arts schools, he puts in •The ability to sell a home in a challenged this case, if an investor wants to sell and Days a Week 3 All This Information at Our Club Meetings and More! some very full days managing his real es- market (slow re-sale market) increase their ROI (return on investment), tate investment opportunities. Originally (951) 280-1900 the lease option is an excellent strategy. Black Belt Investors is a full-time professional network offering involved in the rehabbing (flipping) of real networking, business referrals, consult- are particularly Actually, this strategy is so potent that BBI its members education, Black Belt Investors keen on the moneymaking aspects of lease believes there is no time when its use is not estate properties, Black Belt Investors cash and wealth building opportunities. ing and exciting has FREE over the last decade also developed anaaf- belt investor just getting started or a the upfrontnd(and a viable proposition. Whether you’re white options. Initially, there’s black belt investor looking for new resources, we can assist you finity for lease option properties. your goals. non-refundable) deposit. This webinars a teleconferences. in reaching The lease option plans came into vogue is the option fee that represents BBI helps in the following areas. because so many people desirous of pur- an agreement (between seller •They can find and acquire the prop- Corona/Norco, Riverside County – Meet the 2nd Wednesday of the Month chasing homes were finding Downey, Los Angeles County andMeet the 2nd Thursday of the Month the great difficulty – buyer) to purchase erty for the client at deep discounts in qualifying for loans. Lease options, at a home at a fixed price at a later •They can organize contractors and minimum, gives potential sellers an oppor- date. In most markets, sellers rehab the property if needed Visit Black Belt Investors at: tunity to get a retail price for their property will add a monthly rental pre- •They can use guerilla marketing and an enhanced monthly cash flow. In a mium (non-refundable) to in- tactics to find a tenant/buyer www.BlackBeltInvestors.com lease option, a property owner and tenant crease the investor’s cash flow. This can be •They can do all the lease option agreement agree that, at the end of a specified rental applied to the principal balance or to build paperwork for the client period, the renter has the option of purchas- a down payment (whichever the tenant/ •They can put their property management ing the property, but not the obligation to buyer prefers). And, of course, there’s the component to work taking care of the cli- do so. It is the ‘obligation’ at the end of the equity from the sale that’s paid at the end ent’s asset agreement that makes the lease option dif- of the option period when the home is pur- Sensei Gilliland considers it to be all in ferent from the lease purchase, where the chased. The landlord/seller has made mon- a day’s work, albeit a rather lengthy day’s renter is required to follow through with ey at every stage of the lease option process work. But there’s so much more of the the purchase. (the beginning, middle and end). This gives story to be told. Why not drop by www. Lease options can provide tremendous an investor a big advantage over the com- BlackBeltInvestors.com and begin to get advantages for both buyers and sellers. petition: increasing monthly cash flow and an eyeful for yourself. Realty411Guide.com PAGE 20 • 2012 reWEALTHmag.com
- 21. 1 2 R O U N D S The West’s Top Ranked Real Estate Investor’s Club Black Belt Investors, The West’s Top Ranked Resource For Successful Cash and Wealth Building 3 Reality Based Education, Training & Coaching to Keep You in Tip Top Shape 3 Exciting Diversified Topics That Revolve Around Real Estate and Business Opportunities 3 Networking to Help Build Your Team & Sharpen Your Skills 3 A Connection to Keep You Engaged and Motivated 3 Discounts From Local and National Businesses to Help Increase Your Margins 3 Support From Black Belt Investors to Assist You 5 Days a Week 3 All This Information at Our Club Meetings and More! (951) 280-1900 Black Belt Investors is a full-time professional network offering its members education, networking, business referrals, consult- ing and exciting cash and wealth building opportunities. Whether you’re a white belt investor just getting started or a FREE black belt investor looking for new resources, we can assist you webinars and teleconferences. in reaching your goals. Corona/Norco, Riverside County – Meet the 2nd Wednesday of the Month Downey, Los Angeles County – Meet the 2nd Thursday of the Month Visit Black Belt Investors at: www.BlackBeltInvestors.com
- 22. Powerful Software for resources Analyzing Real Estate by Gary Geist A few years ago, a young man practiced his craft, day in and day out. Every chance he got, he was perfecting his technique and approach. Every swing, every club, every shot, under all kinds of conditions; his swing was always the same. His name was Jack Nicklaus, arguably one of the best golf- ers of all time. When you look at his whole career, his best trait was being consis- tent — always finishing at the top. The same trait needs to be the cornerstone of your real es- tate investing career. So the question is: “How does consistency apply when you are investing in real es- tate?” First and foremost, consistency means you have a well thought out approach you always use to evaluate new deals. This prevents you from forgetting key components or data from your analysis on properties you really like. No matter how long you have been investing in real estate, you must remove your emo- tions from the process (good or bad feelings you have about the property). If possible, each This software tool is easy to use and forces properties prior to purchase. deal must be evaluated on the same a consistent approach to analyzing each One of the best ways to achieve a stable, baseline (or identical sets of data) so property that enables the investor to have repeatable process for evaluating property you can do proper comparative analy- repeatable success in all types of market is to have a software tool that addresses all sis between properties to find the “best conditions. Key elements of this approach of the issues, such as — Which property to deal”. To do this you need the same include — property selection, property buy? How much to pay for this property? approach (or software model) just evaluation and reporting, cost analysis for What are the repair costs going to be? And like the professional golfer’s magic long-term investment purposes as well as what is the expected value after repairs? swing. calculating renovation costs prior to renting These questions and more are answered HomeReplay, LLC has developed the property. Furthermore, the software pro- by HomeReplay’s exciting new software an Excel-based analysis program vides the investor with realistic estimates of product called Rapid Property Analyzer combining over 75 years of real estate the property value in its current condition (RPA). This software tool provides a sys- investing experience and analysis of as well as after repair value, all of which thousands of investment properties. are good data points for comparing multiple Continued on pg. 42 Realty411Guide.com PAGE 22 • 2012 reWEALTHmag.com
- 23. asset protection Are YouA Target For A Lawsuit? by Bill Gatten L et’s start this article off stant by those who use the law right. First of all, take this to accomplish nefarious ends. simple test: Whether we’ve done anything wrong or not, defending one’s a. Are you in business? self in court often costs more b. Do you have employees? than losing the case would; c. Do you have a teen-aged and the Prius-driving, apart- driver? ment-dwelling polyester-suit- d. Do you own property? wearing “Consumer Advocate” f. Do you manage real prop- knows that his prey (you and erty? I) will likely give-in and settle g. Do you drive a car? with him/her for thousands of h. Do you have assets that oth- dollars, at least a third of which ers are envious of? goes to him/her, just for stop- i. Are you considered a profes- ping the (unfortunately) judi- sional? cially-condoned extortion. j. Do you have a steady in- Anecdotal to all of this, an come? action that I was involved in a If you answered YES to any of few years back had to do with these questions, you are a walk- a homeowner in Virginia who ing dart board in legal parlance. came to us with a real prob- Americans today are being as- lem and asked for our help. sailed by a group politely re- He needed $96,000 cold-hard ferred-to as Contingency-Fee at- cash with which to bring his torneys, or so-called “Consumer mortgage current and stop a Advocates,” a sweet sounding foreclosure on his $400,000 term perhaps, but a term, which home in Virginia (he had never all too often means, “Let’s find made a single payment on his someone who is innocent and mortgage since its inception sue him anyway until he runs two years earlier, and he had out of money and has to pay us thwarted foreclosure by re- to stop suing him.” peated BK filings). He agreed In my not-all-that-humble that for the $96,000 he would opinion, the American legal sys- gladly equity-share his home tem is out of control now a days with us on a 50/50 basis. He and the Average Joe has to be had about $100,000 equity more protective and proactive once the loan was brought cur- now than ever before. The com- rent (which we did for him). CONTACT US mon hard-working American We all agreed that the $96,000 BILL GATTEN CENTER citizen must remain constantly would be forgiven in exchange for Wealth & Education on the alert relative to protecting for the 50% ownership interest 6520 Platt Ave., St. 548 his hard-earned assets for those in the property and there would West Hills, CA 91307 who spend large portions of their be no monthly premiums paid 1 800 409 3444 Bill Gatten lives and their parents’ money in to us (we assumed we’d make FAX 1 800 967 0333 Renowned Author the study of Juris Prudence. our money on future apprecia- home@landtrust.net National Lecturer We non-attorney types all tion). Upon consummating the www.landtrust.net & Investor spend our lifetimes trying to transaction and giving him (Mr. acquire money and other assets Williams) a fresh start, he con- for our family’s financial wel- tinued his pattern of not mak- fare and safety, but it can all be Continued on pg. 43 snatched away from us in an in- Realty411Guide.com PAGE 23 • 2012 reWEALTHmag.com
- 24. by Tony Martinez park their investment pairs, no personal time and no labor. You A dollars. Competition will have much more buying power. You re you looking for for investment oppor- are not tied into how everyone else is do- the right investment? tunities can be very ing business — while letting your money Are you caught in the difficult and limited work for you. confusion of what is in this volatile market. working with the greatest return? The note business has Secret #3 - How do they Work Have you heard people talking fewer players because A note is a document that states: I.O.U. and about investing in notes? of a general lack of dollars are owed. The note also details the There are so many questions knowledge. amount owed, interest rate, and years to and maybe even a mystery to Understanding the repay a debt. The note controls the deal — this form of investing. Questions differences and ad- much like the Wizard of Oz from behind such as, “Is this a good time to in- vantages helps note the curtain. With proper knowledge the vest in notes? What the heck is a Tony Martinez investors keep the best note is difficult to erase. The loan doesn’t go away. The owner may lose the property, Is it a Good Time but the note remains. When you buy smart you have a safe and low-risk investment. You can purchase at deeper discounts than to Invest in Notes? most wholesalers and investors on the retail side, typically for pennies on the dollar. Secret #4 - Where Do Notes Come From The banks are flooded with bad debt, which note and how do I make money? Where do kept secret to themselves. Asset Ventures creates note buying opportunities as they I find them? Where do I go to learn about provides our investors everything from A rush to sell off collateral. The banks know notes?” These are the questions I asked my- to Z. they will get less money from a foreclosure self when I started. I found I couldn’t go to We know all the secrets. Therefore, we or short sale. The banks are overwhelmed one place for all the answers I needed. With established Asset Ventures as a full-service with non-performing (delinquent) notes all my knowledge in real estate and real es- and training company to mentor educate and they can’t sell to each other any longer tate investing, it was not an easy journey to and service our clients. With experience as the collateral is undervalued. learn what I know. I spent 7,000 plus hours handling over 1,000 notes, we provide the learning the business and researching this insight to this unique opportunity. Secret #5 - You can leverage the note to industry. I started Asset Ventures with the In an attempt to enter into the note busi- obtain ownership of the property sole purpose of bringing the blueprint to ness, here are seven of the biggest secrets While notes can be bought through seller/ success for investors in notes. to note investing to keep in mind: private financed, probates and lawsuits, the Asset Ventures has become a leader in investor can position themselves to be first working with experienced and novice in- Secret #1 Appreciation VS Amortization in line to obtain the property. This can be vestors, to educate them in acquiring notes Appreciation is tied into the strength of done in several different ways and usually as a solid investment. We are setup to pro- the economy (it can go up or down) where less of an investment than buying retail. vide a complete one stop, done for you, amortization is constant. In the retail side knowledge-based note company headed of selling; pricing and timing are pivotal to #6 - Why the Banks Sell So Cheap by national speaker and trainer Tony Mar- your exit strategy. Many investors became There has never been a better time to buy tinez. real estate rich and cash poor — limited op- right as the banks inventory is flooded and Although notes are always a good in- tions when the market changed. they must sell cheap. The bank’s cost for vestment, there has never been a better time Amortization means buying right, which collection activities are not cost effec- than right now to get involved. With the allows you to always make a profit. tive relative to the result. The banks have collapse of the housing industry, the banks There are several exit strategies with to freeze liquid assets to carry bad debt are overloaded with bad debt/collateral. lower risk and shorter terms if necessary, (NPNs). Selling allows the banks to cre- The note still has value if you buy right and based on the investors’ individual needs. ate more dollars for new loans. The banks offers investment opportunities like never As the bank, you control the deal from a want to avoid future lawsuits and simply before. distance. don’t want the problem any longer. “One man’s trash is another There is also the TVM — Time value of man’s treasure” Secret #2 - How much does it cost? money (worth more today than 30 years As an investor you can begin with very You can leverage your risk while using less from now). Notes offer investors the secu- little capital. Plus, your yield or return on initial capital, usually just a few thousand rity and benefits of real estate without the investment can return incredible results. dollars. Experience high ROI’s of 12% or burden of maintaining a rental property! Most real estate investors are challenged more guaranteed (generally more). You Avoid the 4 T’s: Tenants, Toilets, Trash, in this market, competing with others to will see lower maintenance costs — no re- and Termites! Realty411Guide.com PAGE 24 • 2012 reWEALTHmag.com