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Does it Make Sense to Buy a New House Before Selling the Old One?

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By Edward Brown

You’re interested in moving. You need to sell your old house first before buying a new one, right? After all, you don’t have enough of a down payment for the new house without selling the old one, and you are pretty certain your bank will not qualify you for two mortgages.

You are in a dilemma; houses in your area are currently receiving multiple offers. Inventory is low. Sure, you can sell your house under the same circumstances, but will you be able to identify a new house so that you can simultaneously move from the old house to the new one? Unlikely. Do you sell the current house, move to a rental [or hotel] while you identify and try and close on the new house? Is the extra hassle of moving twice and the added stress of the inability to simultaneously close on the sale and purchase the new worth it? IF you could purchase a new house while still living in the old house worth the added costs involved with having a second mortgage until you sell the old house? How much is “peace of mind” worth in not having the pressure of having to purchase a new house [because you sold the old house too soon]?

These questions are a reality in today’s world in many parts of the country, specifically, the San Francisco Bay Area, because of the real estate rebound after the Great Recession. According to Jeff Stricker, a real estate professional with Alain Pinel Realtors specializing in the Silicon Valley in California, his clients are faced with these exact situations much of the time, as property is swooped up almost as soon as it hits the market, and, many times, with multiple, over asking prices. Jeff states that, although it is great for his clients as sellers, those same clients face challenging hurdles when buying a replacement property; competing against other buyers, some with cash only offers, who are willing to bid up a property far beyond the asking price in many circumstances. Some buyers are just so frustrated with the process of competing and getting outbid that they act in ways that they normally would never have thought. Overbidding. Settling for a house that they may not have originally envisioned. The list goes on.

Jeff, however, decided to think outside the box. What would happen if another house was purchased [without the added pressure of “living out of a suitcase”, if you will] prior to the sale of the old house? Is it even possible with the banking regulations that were placed upon financial institutions as well as homeowners over the past decade due to the “mortgage meltdown” that happened in 2008 and on? Dodd Frank rules that placed inordinate restrictions on the ability of homeowners to obtain financing left many people unable to get loans in which they previously were easily able to qualify.

Jeff decided to come up with a spreadsheet wherein, if he plugged in some assumptions, he could figure out if it would make economic sense to acquire a new house before selling an old house. The other part of the equation was to find a lender who would allow for a homeowner to purchase a new home without first selling the old home; thus, carrying two mortgages at the same time. Since most conventional lenders would not touch this, Jeff had to look to alternative sources. He found a company called Pacific Private Money, in Novato, CA that specializes in such a product.

Pacific Private Money can lend enough to the borrower to purchase the new home if there is enough equity in the old home to justify a combined Loan to Value [LTV] of 70% or less. Sometimes, if there is not enough equity in the old home, the borrower needs to add cash to bring the LTV to 70%, but, the ability to purchase a new home without having to sell the old one first can solve many issues for the homeowner. First, the a new home can be identified without adding pressure since the homeowner is still living in the old house until the new house closes escrow. Second, the stress of moving twice is eliminated. Third, and probably the best [and possibly most surprising] is that this solution may actually cost LESS in terms of increasing net equity to the household than selling the old house and buying a new house with the proceeds from the old house [and new mortgage] in most circumstances wherein the new house is more expensive house than the old house.

In a rising market, the earlier the purchase of the more expensive new house and the delay of the sale of the old will increase the net equity to the homeowner more than the costs associated with carrying two mortgages.

For example, let’s assume the old house is worth $1,000,000 and there is currently a 1st mortgage of $200,000. The homeowner desires to purchase a new home for $1,400,000 and has $100,000 in the bank that can be used for a down payment. We will look at two scenarios; the first is where the homeowner sells the current house, rents for a period of time, and then purchases a new home. The second scenario is where the homeowner borrows the money in order to secure the new home while owning the old home.

Obviously, there are many moving targets with the both scenarios, such as how much it will cost to rent a place [in the event of selling the old house first] as well as how long it takes to identify and close on the new house, storage costs for belongings, the cost of obtaining a private loan, and the appreciation assumptions for both houses, just to name a few.

Below, is a calculation making the following assumptions; it takes nine months to close on a new house after selling the old house; houses in the area [both old and new houses] are appreciating at 1% per month; interest earned on bank deposits are at 1% per annum; storage costs are $1,000 per month, a conventional bank loan is not available because the homeowner does not qualify and has to use a private loan company; the costs for the private loan are 9% plus 2 points; the interest rate on the old house is 3% per annum.

 

As you can see, in a rising market, where the new house is worth more than the old house, there is a significant benefit to using a private loan to purchase the new home and sell the old home at a later date. Waiting 9 months to eventually acquire the new house has tremendous opportunity costs, as compared to a net benefit of purchasing the new house right away and eventually selling the old house.

Although assuming a 1% per month appreciation of real estate may seem aggressive, the San Francisco Bay Area, and specifically the Silicon Valley, has experienced such growth. However, even if we lower the appreciation to ½% per month [insert spreadsheet showing .5% per month appreciation], we still see a fairly significant benefit to purchasing the new house now rather than waiting to first sell the old house and then buy the new house.

Aside from the economic benefit, other factors need to be considered; the lack of stress of moving twice should the homeowner decide to sell the old house first and then purchase the new house; what if the homeowner finds the house of his/her dreams now and does not want to let the house slip away? In today’s market, sellers are not willing to take contingent offers. Can the homeowner budget for both houses at the same time while waiting for the old house to sell? Is the market rising? Is the new house more expensive than the old house? How long will it take to sell the old house? These are just some of the issues to consider before deciding one way or the other; however, and this can’t be stressed enough – when a homeowner finds a house they like, they do not want to lose the opportunity of buying it. This means that they can start looking at new houses before putting their old house on the market. This also allows them time to make any repairs or fix up their old house so as to maximize its value prior to putting it on the market.

Once homeowners know that there is a potential to purchase a new house before selling their old house, they can be proactive in obtaining a commitment letter from the lender. Of course, homeowners should see if they qualify for a conventional loan for buying the new house [owning two houses at once], but they should keep their minds open to procuring a private loan should the bank turn them down. Pacific Private Money is such a private loan company.

Edward Brown

Edward Brown currently hosts two radio shows, The Best of Investing and Sports Econ 101. He is also in the Investor Relations department for Pacific Private Money, a private real estate lending company. Edward has published many articles in various financial magazines as well as been an expert on CNN, in addition to appearing as an expert witness and consultant in cases involving investments and analysis of financial statements and tax returns.

3 Proven Strategies for Small Business Owners to Increase Cash Flow

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By Dr. Teresa R. Martin, Esq.

Is your small business struggling to make enough profit to pay the bills? Living paycheck to paycheck can be quite frustrating. Perhaps you started a small business so you could pursue your dream while earning money at the same time. If so, then you know that it isn’t always easy to get a small business to bring in the profits you’d like.

However, if you’re willing to work hard and have a good plan, there’s no limit to how far you can take your small business. Luckily, there are many ways to increase your current cash flow and free you from the threat of financial disaster.

Consider these strategies to increase your cash flow:

  1. Collect feedback. Many small business owners forget the importance of soliciting feedback from their clients. There are several effective ways to find out what your clients think about your products and services.

  • Ask the client to fill out a quick survey or questionnaire to rate various aspects of your business. These surveys can provide an excellent glimpse into your client’s point of view. There are many different websites that enable you to create simple surveys. Look online to find one that meets your needs.
  • Follow up with your clients with a phone-call or email asking for comments about your products or services. Inquire about which aspects they are satisfied with and which need some work.
  • Talk to your clients in person and ask them how they feel about their experiences with your business.

Remember, word of mouth is one of the best ways to advertise your business. If you have a bunch of satisfied customers, they’ll tell their friends and family about their positive experience and you’ll get more business.

  1. Get rid of products that don’t sell. It’s likely that you offer your customers a wide variety of products, but only a few of these products bring you maximum profit.
  • Sometimes a large inventory can work against your business. Customers often avoid buying altogether when they’re overwhelmed with options.

  • Instead of offering more products that likely won’t be sold, trash the unattractive products and offer more items or services related to your best-sellers. This is an excellent way to boost sales while reducing upkeep and inventory costs.
  1. Pursue unique marketing strategies. If your business is experiencing a steep drop in sales, there must be a reason. It could be that your marketing techniques are simply not as effective as you thought. Consider alternative marketing techniques.
  • Think about marketing your business online. It’s becoming easier with each passing day and more people are prone to search the internet for better deals. Businesses that have online order options are often much more successful. It’s a perfect way to increase cash flow.

  • Get the word out. Take advantage of social media sites like Facebook and Twitter to promote your business.
  • Radio advertisements, commercials, billboards, and flyers all increase the visibility of your business. Sometimes, door-to-door marketing is just as effective.

By using these strategies you can boost sales and increase the revenue of your business. Once these strategies have been implemented, there will be no need to worry about how you’re going to pay the next bill. You’ll finally have the money to live the life that you’ve dreamed of.

It just requires determination, persistence, creativity, and an open mind to make your business successful. Test different strategies and stick to the ones that work best for you. Your efforts will be worth it once you see those increased profits.

Dr. Teresa R. Martin, Esq.

Dr. Teresa R. Martin, Esq. is the founder of Real Estate Investors Association of NYC (REIA NYC). REIA NYC (www.reianyc.org) is a premier real estate investment association serving the New York City marketplace. Its primary focus and mission is “helping our members build, preserve, and harvest multi-generational wealth” in the areas of real estate investments, business ownership and personal development.

Improving Quality of Life through Real Estate Investment

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Featuring Dennis Henson

An exclusive interview with Dennis Henson on enhancing life while making fortunes on single family…

Dennis Henson has been investing in real estate longer than most real estate experts have been out of diapers. He’s seen the market from every angle, seen it rise and dip, and rise again. Today Dennis Henson heads up the Arlington Real Estate Association, and the comprehensive training portal Single Family Fortunes, which has seen one student recently soar to acquiring 23 properties in just 8 months. So what’s enabled him to not only maintain success, but successfully train others to get in and win?

Here’s the inside scoop…

How did you get started in real estate?

Dennis: “A combination of moving up from living in a small house to a large one, and badly renting out the old home, and then reading ‘How To Wake Up The Financial Genius Inside You’ by Mark O. Haroldsen.”

If there is one thing you could credit your success to, what would it be?

Dennis: “Maintaining a burning desire to succeed.”

How did you make president of the Arlington Real Estate Association?

Dennis: “I started the group in order to become more knowledgeable about REI Topics. For example; probate. If I had to do a class on that subject in front of 50 to 100 people – you can bet I was going study, learn about that topic, and master it.”

What’s different about your training system from what else is out there?

Dennis: “Many of the other teachers focus on one technique for examples Short Sales or Wholesaling. The biggest difference is that my training covers all areas of REI. I call it the 5 M’s of Real Estate Investing.”

  1. Mining
  2. Money
  3. Maintenance
  4. Marketing
  5. Management

You have students who report achieving very significant results, very quickly. What makes the difference between them and the rest of the wannabe investors out there? 

Dennis: “My training is one on one, and I am very interested in their success. There is nothing magic about my training. It is just combining knowledge with hard work. I have a system that works, if they do. ”

You have a slogan “Improving the quality of people’s lives through real estate investing” – what does that mean to you?

Dennis: “Well that is my motto. My goal in life is helping others become more successful so that they can enjoy a better quality of life.

What is a better quality of life?  It is being able to have the freedom to do the things you want to do, going to the places you want to go, and having the things you want to have.”

Where do you see the best opportunities in real estate ahead?

“I believe that REI always has, and always will have the greatest opportunities for those who are willing to learn and work hard. The number one need for a human is shelter. Do you ever watch those survivor reality shows where they leave someone stranded in a jungle or on an island? What is first thing they need? Not water, not food, but shelter. It is the most basic human need, and always will be. If there is a disaster people will not be needing stocks or bonds, or gold or silver, but they will be needing shelter. So I think REI will always be a great business for my students and association members.”

What’s the best strategy for those that fear the market may be in for a correction soon?

Dennis: “Buy lots of properties. When the people are not buying houses, what are they doing for shelter? Living in a cave? No, they are renting; so the rental market will be booming.”

Interested in learning more about Dennis Henson, his training, and the Single Family Fortunes he has empowered others to create? Look out for Dennis and his wife Norma at upcoming Realty 411 Expos, listen in to him speaking on Blog Talk Radio, and visit his website at SingleFamilyFortunes.com, where you’ll find a FREE TRIAL for an online app that helps you evaluate your deals faster.

 

What is Your Why?

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By Grant Trevithick

Are you interested in becoming a real estate investor?  Do you want to be your own boss?  Keep all the fruits of your labor for yourself, instead of making some company or someone else rich? Do you want the freedom of owning your company, working whenever you desire?

Most of us have watched the TV shows of other people buying and flipping houses. It is amazing to see that someone can search an entire city, find the property they want, do the research to determine what the offer should be, negotiate the deal to purchase the property, secure the financing, close on the purchase, prepare the repair budget, do all the repairs, market the property, find the buyer, negotiate with the buyer, and negotiate all the requirements to finally get to the closing table. It is amazing that each of these investors do all this in only 50 minutes, with 3 to 4 commercial breaks, and always seem to make allot of money out of each house.

Wow, if it were that easy, I would want to jump into the game as well. It surely would beat having to get up each day and head into an office, attend meeting after meeting, make nice with an incompetent boss, do all my work, and then go home and do the same thing every day for the rest of my life. That does not sound like fun… so perhaps we can escape this trap by being a real estate investor. After all, I can make as much money as I make in a year doing 3 to 4 houses, at least according to the television shows.

WRONG!

Virtually every real estate investor that I have ever met only talks about the glamorous part of the business. They only talk about how much money they make and how much fun they are having. First off, most of the ones that do the talking are the ones that have never bought or sold a house (at least according to my experience).

The reality is there are two types of real estate investors: the normal real estate investor and the successful real estate investor.

The normal investor attends allot of classes and reads allot of books or online. They may even sign up with one of the local or one of the traveling mentors / gurus. They attend allot of the networking groups for investors. They may look at several properties, but have never pulled the trigger to actually buy one. They talk a good game, but are more of the posers than the doers.

Then you have the 1%. Yes, only 1%. The statistic that I heard many times is that the top 1% of all real estate investors make 98% of the money. My experience proves this out. We have trained thousands of people, while we have one of the industry highest success rates for those that have attended our training (allot of our students ended up buying houses), yet very few of them have the dedication that is required to truly be successful.

To be a successful investor, you must know What Is Your Why? Why do you want to become an investor? Are you doing this to escape a boring and a mundane life? Are you doing this just to become rich?  Why do you think that you want to be an investor?

Are you willing to work hard?  Are you willing to work 6 days a week, and sometimes 7? Are you willing to work on the holidays?  Are you going to be available to do business whenever your clients are ready? (My definition of an entrepreneur is someone that is willing to work 100 hours a week so you do not have to work 40.)

Are you willing to fail more times than you succeed? Are you willing to be discouraged and disappointed?

Are you willing to spend hours and hours in your car each day? Leaving early in the morning and get home late in the evening?  Are you willing to put 30,000+ miles on your car / truck each year?

Are you willing to work when it is 105 degrees in the summer? When it is thundering and raining? How about when it is 5 degrees and snowing?  Or icing?

Are you willing to clean out dirty nasty houses? Dealing with flea and bed bug infested houses? Drug houses? Are you willing to clean dirty kitchens, with food left over for weeks or even months? Scrub toilets that just plain nasty and disgusting?

Are you willing to listen to the most heartbreaking excuses and still ask someone to get out of the house? Are you willing to spend thousands of dollars on lawyers taking houses back when the seller uses the law to avoid paying their mortgage payments and yet do not want to move out?

Are you willing to be discouraged, wonder if you will ever buy and or sell another house again, feel like a total failure?  And still get out of bed each morning and do what has to be done?

Funny, they do not show that part of the business on television, do they?

If you cannot answer, “absolutely, sounds like fun” to each one of these, then real estate investing is not right for you.

If you can think of anything else to do that would allow you to reach your goals, then my best advice is forget being a real estate investor and pursue that other avenue. If, on the other hand, you cannot imagine doing anything else, then perhaps you might have what it takes to be successful.

Real estate investing is a marathon, not a sprint. If you do investing right, it is not a get rich quick scheme. Working our model, you can become a millionaire in a short period of time, if you are willing to work hard enough and run the business in an honest manner.

But only if you know your Why.  And only if your Why is strong enough.

For me, I love helping people. In our company, our first and primary goal is to always put our clients first and do whatever we can to help them. We buy houses that people are trapped in, giving them the financial freedom move on without the burden of their mortgage. We then sell those houses to good families that desire to have a part of the American Dream, owning their own home, but cannot get a mortgage from a bank (for whatever reason). We help investors by realizing their dreams of becoming a successful investor. And last but not least, we donate the first ten percent of all our profits to charity to help those less fortunate.

That is my why. That is what yanks me out of bed every morning, excites me to make each day as full as I possibly can, with me ready to contribute and help as many people as possible. Of course, along the way we make enough money to become financially comfortable, but our Company never makes money our number one priority. And I think that is what makes us successful.

What is Your Why?

Grant Trevithick, after a successful career in EDS and AT&T, is now the owner of Owner Finance Homes LLC and Owner Finance Academy LLC. Owner Finance Homes LLC operates throughout the Dallas-Fort Worth area in Texas, buying houses and selling with owner financing. Owner Finance Academy trains people to become real estate investors using owner financing. The Company is accredited by the Better Business Bureau with an “A+” rating.

Is Timing The Real Estate Market Possible?

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By Fuquan Bilal

Can investors really time the real estate market, or is it wiser to just consistently invest, and hold?

We all know that there can be fluctuations in real estate prices, even if values are constantly going up over time. So, is it possible to time the market? If so, what does it take? What’s the best way to do it?

Why Try to Time the Market

Trying to time the market is critical in publicly traded stocks. Stocks are now believed to be 70% or more overvalued. It can take a decade or more to recover from that, just to get back to par. There isn’t anything you can personally do about the stock prices. You just have to wait. Worse, there is no downside protection. If it goes too deep, there is a PR scandal or the industry changes, all capital may be lost. It is vital to sell before the market begins to dip, and buy again before it begins to go up, if you want to avoid negative returns.

Real estate is a little different. You can absolutely find greater bargains during tougher times, and sell high in bullish times. This strategy can absolutely help to maximize returns.

However, real estate is a tangible, hard asset, that will be there no matter what. It can also produce income, which doesn’t vary much as asset prices fluctuate. Plus, you can control the value of your real estate assets with improvements and repositioning.

Reasons Not to Try and Time the Real Estate Market

There are two main reasons that most individuals and investors shouldn’t try to time the property market. The first is that investors are notoriously bad at it. Most almost invariably wait too long to sell, and end up folding at the bottom of the market. Then they wait far too long to buy, and miss all the gains.

The second reason is that transaction costs can be high. Between time spent on due diligence and hard closing costs, you stand to lose a decent chunk of change if you sell and rebuy the same property in an effort to time it. Depending on where you are, and the fluctuation, this may be more of loss than if you just held, and received income from the property in the meantime.

Factors Involved in Timing the Market

There are an enormous amount of data points and factors to watch when trying to time the market, including:

  • Affordability
  • Interest rates
  • Treasury bond yields
  • Taxes
  • Rents
  • Building costs
  • Seasonal fluctuations
  • Supply and new constructions
  • Default rates and bank balance sheets
  • Days on market
  • Population growth and migration patterns
  • Jobs and wages
  • Local economic trends

Best Moves

There is a lot to know, learn, master and monitor to effectively time the market. If you are epically good, you can do far better than most in timing the market. Even then, you may not want to sell all your holdings, as you’ll probably want to reacquire them within 48 months or so.

At NNG, we leverage a strong research team, deep data that is way ahead of what the public sees, and maintain a strong mix of assets and strategies, so that some are being turned at their ideal timing, while others are held for consistent yields

Investment Opportunities

Find out more about investing in secured debt and real estate, go to NNG Capital Fund

 

Don’t Leave Thousands on the Table at Closing

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By Kathy Kennebrook (The Marketing Magic Lady)

One of the things that never ceases to amaze me in the real estate business is how many investors leave hundreds or thousands of dollars on the table at closing due to errors in the closing documents. This is an area where many investors need to be educated. Many times investors get excited about the bottom line and forget to check the figures on the documents.

It is a mistake to assume that the HUD or closing statement is correct or that the closing documents are correct. The person preparing the closing statement can make mistakes. In addition, the person preparing the closing statement and documents is using figures that they have acquired from other people who could also make mistakes, such as the insurance company, the Realtors, the lender, home inspection service, or the surveyor.

You need to take the time to read all the documents carefully before closing on any deal. I have personally seen errors on the HUD at almost every closing I have ever been part of. Many investors only look at the bottom line and think “yes that’s enough money” but they fail to look at the whole closing statement, and in doing so possibly leave thousands at the table. I just had a closing take place recently where there was a mistake of a thousand dollars on the HUD. They put one of the buyer’s expenses on my side of the closing statement. I don’t know about you, but I think a thousand dollars is a lot of money to leave behind when you are entitled to it.

If you are looking at a closing statement and you aren’t sure why a figure is there, ASK the closing agent or attorney what it is and why it’s on the closing statement. It’s their job to make sure things are done correctly and all the figures are on the right side of the statements at a closing. Until I thoroughly learned the real estate business, I questioned every closing statement I looked at to make sure there were no mistakes.

There are some areas in particular that should be checked thoroughly. If there is a Realtor fee, make sure the percentages are correct and the payment amount to each Realtor is correct if more than one Realtor was involved in the deal.

Make sure you check the per diem interest to make sure this figure is calculated correctly. There are programs online that can help you with these calculations. I recently had a deal where I was the lender and my borrower was paying me off with the sale of the property to a buyer. When I received my check for the payoff on my note, I had been overpaid by $750.00. The per diem interest and pre-payment penalty had been calculated incorrectly. Had I not caught the error and written a check to my borrower, he would never have known there was an error. His mind was on nothing but the bottom line and he left at least $750.00 at the closing table. Compared to big checks, these may seem like small amounts, but multiply these amounts by how many closings you will do over a period of just a year and it adds up quickly! If it’s your money, you are entitled to it.

Make sure that the figures on the HUD from the insurance company, termite inspection, home inspection, survey, realtors or any other fee that should be carried to the HUD are correct. There have been many times when these figures were either incorrect or there were fees on the HUD that I had already paid out of pocket before the closing. If there are home owner association fees, make sure the pro-rated amounts on these are correct. If there is a home warranty to be paid for the buyer, make sure it shows up on the closing statement. These are all errors I have personally experienced on closing statements.

Check to make sure that the pro-rated property tax figures are correct on the HUD and appear on the correct side of the HUD. If you are due pro-rated taxes from your seller, make sure they show up as a credit on your side of the HUD. If you owe pro-rated taxes to a buyer, make sure these show up as a credit on the buyer’s side of the HUD. If there is a new loan amount or a payoff figure from a lender make sure these figures are correct. Make sure that any pre-payment penalties have been properly credited or charged. If you are paying off a mortgage, also make sure you are not charged a pre-payment penalty when none is due. This is another error I recently encountered on a closing statement.

There are other areas where I have frequently found errors so make sure you check your documents carefully before the closing. It’s much easier to deal with problems at the closing table than have them show up later and have to be corrected. If you are assisting a buyer with closing costs, make sure they don’t charge you more money in closing costs than they are entitled to. If you are assisting a buyer with closing costs and you see a big pay day on their side of the HUD, you need to open your mouth and protest it. Most lenders will not allow a buyer to take any more than 500.00 away from the closing table, especially when it is your money. If there is money left over from seller assisted closing costs, it should be credited to the seller who assisted with closing costs. It shouldn’t result in a big payday for the buyer.

Make sure you also check loan documents carefully. Check the interest rate, the balloon date and amount, and the amount of the note. I had a note and mortgage just recently where I was funding the deal for the buyer and the payee of the note and mortgage was the seller instead of me. They also had the balloon date wrong on the note. It showed a ten year balloon instead of a one year balloon because someone accidentally added a zero.

If there is an interest only payment to be made each month, make sure this is clearly stated in the note and mortgage. Also make sure that terms for late fees are clearly stated if you are the person holding a note for your buyer. Make sure names and addresses are correct and spelled correctly. Make sure you get an amortization schedule whether you are the mortgagor or the mortgagee. This is the best way to track a loan.

All of these are important points to check before any closing occurs. Don’t assume the title agent or attorney will catch the errors. They do many closings each day and they usually are unable to catch every mistake. In addition, very often the title agent or attorney is transferring figures they got from other people such as the Realtor, the lender or the insurance agent so they my not be aware that these figures are incorrect. It’s your deal and your closing, make sure the documents are correct so you don’t leave thousands at the closing table or create title problems later that could have been solved at the time of the closing of the deal.

Make sure all the documents that are to be signed and notarized are done properly. Make sure social security numbers or Tax ID numbers are correct on the 1099 so you are taxed correctly. I just recently had a closing where they put my social security number on the 1099 instead of the corporation that was supposed to absorb the income from the sale of the property. These are all real errors that occur all the time. Make sure you protect your interests when closing on properties whether you are buying or selling or simply holding a note so you don’t leave thousands on the table at the closing.

For more information on all the tools you need to find deals and automate your real estate investing business, visit my website at www.marketingmagiclady.com. While you are there be sure and sign up for my free monthly newsletter.

 

The 3 Things Investors Need Most in 2019

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By Fuquan Bilal

Do you have the three things you need most out of your investing for this year and beyond?

Many are finding it hard to make sense of the market right now. The media headlines proclaim the economy is awesome and supercharged with growth and low unemployment. Yet, the hard data and other signals suggest there are some corrections in the works. The bottom line though, is that you need these three things to get you through.

1. Passive Income

Time is the most precious and scarce resource we have. The only way to really get more time is with passive income. We can only become so productive. Then it is up to passive investments to make money so we can spend more time on other things. That’s true whether you are already making millions a year, or are in a high paying career, but are still trading your time for a wage. This is going to be even more critical over the next couple of years. And it doesn’t matter whether or not you own rentals right now, or you think your company is well insulated from a recession. If you’re not getting truly passive income, then it may be time to consider a fund or other vehicle.

2. Downside Protection

Who knows, we may really be in the best economy ever, and real estate prices, stock values and incomes might just keep going up. Of course, the odds are that there is some type of temporary correction in the works. That means it’s just smart to have some tangible, underlying hard assets and to be overcollateralized in order to protect wealth and capital during the months and years ahead.

3. Stable Performance

No single asset is going to perfectly and consistently perform the same forever. And it’s those fluctuations that are really tricky and usually come at the worst times. By diversifying and harnessing great management, we can keep our total portfolio performance steady, and yet without being so over-conservative that we end up with negative yields.

We believe we’ve achieved all this, and the ability to future proof your portfolio through our hybrid fund. Check out how we’re doing it today…

Investment Opportunities

Find out more about investing in secured debt and real estate, go to NNG Capital Fund

This is the Best Day of the Year for Real Estate Investors

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By Fuquan Bilal

What is the best day of the year for real estate investors?

I think Mother’s Day is a strong contender. It’s hard to beat from both a business point of view, and in being personally meaningful.

If you’re not a mother yourself, then you’ve got mothers in your life. Either they work with or for you, rent from you, support you in your investing, or are your grandmothers, daughters, cousins or just your neighbors. Everyone can relate.

The Start of a New Season in Real Estate

Mother’s Day really marks the start of a new phase of the market each year. New property listings are popping up to get ahead of the peak buying season. Serious buyers are coming out to sign contracts and set up their summer moves so they are all settled before school starts again in the fall. It can be a fantastic time for Mother’s Day themed open houses.

What Real Estate Investors Can Do For Mothers

The first and most obvious thing we can all do is celebrate and honor the mothers in our lives. That can be in your office, at home and out in the community.

Housing them is a huge deal. One of the best benefits of being in real estate for me is what I can do for my mom. I can house her, and recently bought her a car. I’ve also really enjoyed just taking time to intentionally spend quality time with her to learn from her years of wisdom.

Housing and keeping a roof over their family’s heads is a top concern for moms out there. It keeps them up at night, and working hard. I love giving them a chance to put their families in a safe, healthy and attractive looking place in our rentals and when we sell properties.

As a real estate investor, I believe one of the greatest gifts you can give is sharing your knowledge and experience, and giving the mothers out there the chance to own those benefits for themselves and their children. Host an educational lunch, or turn them onto the PFREI podcast, or take them to an industry event with you.

The workforce and housing market is changing a lot in many cities. That can mean some transition time while getting reskilled for modern jobs, and trying to hang onto homes, and keep up with all the mail and mistakes that some lenders, insurers and tax authorities make in their paperwork. This can all lead to loan defaults and distress, that could have been avoided. If you are investing in mortgage notes this is a great time to do a cash for keys deal, or to modify loans and help moms have a fair chance to get back on track and have a fighting chance to keep their homes.

Let us know what you are doing in real estate around this Mother’s Day on your favorite social media networks and tag us so we can like your posts!

Investment Opportunities

Find out more about investing in secured debt and real estate, go to NNG Capital Fund

Investing Insights from a REAL BLACK BELT

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By Tim Houghten

Sensei Gilliland just kicked the real estate bandwagon in half. If you want to lead, get to the gold, and keep it – read this… Real estate master Sensei Gilliland has never claimed to be a real estate investing ‘guru’. He has just put in the work, stayed focused, and refused to be knocked out.

This warrior spirit didn’t just lead him to become one of the youngest martial artists to be ranked in the nation’s top three, for five straight years. It has earned him the title ‘Sensei’ from his students, and makes him one of the few REAL Black Belt Investors.

For nearly 20 years Sensei Gilliland has been investing in real estate and he may be one of only a handful of notable trainers that still makes money from investing in real estate today. So what makes this guy different?

GOOGLE LOVES THIS REAL ESTATE INVESTOR

Sensei is the founder of 12 Rounds – ‘The West’s Top Ranked Investor’s Club for Successful Cash & Wealth Building’. We asked Sensei why people keep flocking to his meetup group, and why people should do business with Black Belt Investors. He said: “In 2007 there were over 100 real estate clubs in Southern California alone. When 2008 hit that number was slashed to around a dozen; and two of those left standing were mine. Now there are even more clubs. But who will be standing when the markets flex next time?”

Of his ability to withstand the second most severe recession in our country’s history, and how that is contrasted with the other 90% who folded, Sensei says: “They were very linear in their business models and thinking, and were too busy selling retail. Everyone was just jumping on the bandwagon of these copycats.”

If you really want to try to put Sensei Gilliland to the test in today’s ring he suggests you pull out your phone and see what Google says. We couldn’t resist the challenge! Try it…Talk about ‘mission impossible’. There are pages, upon pages of Google results for Sensei Gilliland, and everything is positive. And this is a guy who says he has never worried much about SEO. Seriously, even your teenager’s toughened video gaming thumbs would probably fall off before you run out of positive reviews of this guy.

Why does Google love Gilliland? He’s got depth. He is established. He has a rock solid reputation. And he has been in the ring since before most people even thought about ever using the internet to search for a home or a home loan.

WHERE IS THIS REAL ESTATE NINJA INVESTING NOW?

Most might have heard of Sensei Gilliland for his power packed, hands on, real estate training. Yet, he is still an active investor and is in the market doing deals every day. Sensei says that while you still might catch him helping distressed homeowners and serving up sweet wholesale deals close to home in sunny Southern California, he is also working with serious investors in re-emerging markets such as Cleveland, Kansas City, Indianapolis, and Phoenix, Arizona.

Investors can check out more details and find in-depth research on these markets at: http://RemoteRehabs.com

BECOME A REAL ESTATE CHAMP

For new investors, intelligent experienced investors, and even new gurus who don’t want to get KO’d and go belly up, Sensei extends the invitation to step up, and check out the 12 Rounds Investment Club. For information visit: http://www.meetup.com/bbinvestors/. This meetup is for those who want to enjoy long-lasting personal and financial success from their real estate investments.