WIAcademy EducateBlog

Consumer debt and a lack of financial intelligence is putting our country at serious risk. In a recent New York Times column, David Brooks made that point with chilling clarity.

He points out that the United States has been affluent since its founding, but until the past few decades, had remained “industrious, ambitious and frugal.” He writes this about lotteries: “Here is the government, the guardian of order, telling people that they don’t have to work to build for the future. They can strike it rich for nothing.”

He also observed a dangerous shift in values, writing: “[Benjamin] Franklin made it prestigious to embrace certain bourgeois virtues [of hard work, temperance and frugality]. Now it’s socially acceptable to undermine those virtues.”

Click here to read the full text of the column.

Posted 05:53 PM | Permalink | Comments (0)

Success Stories from Wealth Intelligence Academy Students:

A Great Time to Get Started in Real Estate

Rob and Kathy F. of Lansing, Michigan, were unsure about getting started in real estate investing in a declining market, but with the help of Wealth Intelligence Academy training and their mentor, they now have the tools they need to change their future.

Their first deal was a foreclosure in a beautiful South Lansing neighborhood they bought for $64,500. After investing another $10,000 in repairs, they sold the property for $105,000 on a two-year lease option. They credit their training and mentor with helping them overcome their fear of taking action.

“Just wanted to extend a heart-felt thank you to Wealth Intelligence Academy for supplying us with the knowledge and confidence to overcome the fear most people have right now investing in this uncertain, declining market, and to report that another couple of newbies are proving this training really works,” Rob and Kathy write. “We’ve come to the conclusion that learning to invest in real estate while in a depreciating market is like learning to drive a car during the winter. If you can do well in these conditions, you can do well in any condition.”

Note: Rob and Kathy F. attended the following advanced training programs: Asset Protection and Tax Relief; Keys to Creative Financing; Foreclosure; and Lease Option.

Disclaimer: Results from programs are based on individual effort and other factors, and are exceptional or atypical and are not to be expected by the average person using these programs or methods. Various advanced trainings are typically needed, each at a cost of approximately $4,990. Discount packages offered for courses purchased as a package.

Posted 07:02 PM | Permalink | Comments (0)

Communicating on the Telephone:

It’s What You Say and How You Say It

By Jacquelyn Lynn

Of the three basic components of interpersonal communication (body language, vocal qualities, and the actual words said) body language carries more than half of the message–which means you begin any telephone communication at an automatic disadvantage.

But you can still have powerful, effective telephone conversations. Understanding how important your voice is in getting your message across is the first step in developing a voice that gets you heard. Your goal is to develop a voice that will pull people in rather than push them away.

To develop a voice that is loud enough to be heard, clear enough to be understood, and expressive enough to be interesting, try these tips:

• Speak from your diaphragm, not your throat. This increases your ability to project your voice without sounding like you are yelling, and allows you to speak in a voice that sounds powerful and strong, not thin and wimpy. To confirm that you are speaking from your diaphragm, place your hand on your stomach; it should move out when you inhale and in when you exhale.

• Speak at your optimum pitch level. Your voice will function more dynamically and effectively, and be more convincing, believable and pleasing to the ear. To find your optimum pitch level, close your lips and say “umm-hum” spontaneously and sincerely.

• Clearly enunciate your words. When you do, people appreciate the clarity of your speech. Careless diction reduces your authority and can result in misunderstandings. The most noticeable errors are allowing “ing” endings to sound like “in,” dropping syllables, and dropping “t” and “d” endings. Sometimes the fault lies with regional dialects; other times, it’s simply a habit. Make your tongue, lips and mouth work with every word. Practice by saying the following phrases, focusing on speaking clearly and pronouncing all the sounds in each word:
Lips, teeth, tip of the tongue
Linoleum, aluminum
Twenty-two dwarfs took turns doing handstands on the carpet

• Use your voice to bring life to your words. A monotone voice will bore your listener. People will find it easier and more interesting to listen to you when you speak with “pizzazz.” Record yourself speaking spontaneously on a topic you really care about, then practice to add that sense of liveliness to other conversations. And if you cringe at what your voice sounds like, don’t just refuse to listen—work on changes to make it more pleasant.

• Persuade with emphasis. Emphasis relates to the prominence given to a word or phrase; by emphasizing key words and phrases, you can completely change the meaning of your message. Use volume, pitch, and inflection to give words their proper emphasis.

• Speak with a level of loudness that matches your message. Talking too loudly suggests you are aggressive and domineering; too softly suggests that you are timid, shy and uncommitted. Raising and lowering your volume appropriately brings variety to your speaking voice and adds impact to what you are saying.

• Speak at a rate of speed that matches your message. Speaking too fast may make it difficult for you to be understood; speaking too slowly could suggest you are unsure of your information or have little enthusiasm for what you are talking about. A good, all-purpose speaking rate is 140-160 words per minute. If you tend to speak faster and are having difficulty slowing down, pause more frequently to allow the listener time to process what you are saying.

To specifically enhance your telephone voice, avoid wedging the phone between your shoulder and chin; the awkward, uncomfortable posture will reflect in your voice. Instead, use quality headsets. And even though the other person can’t see you, smile—your facial expressions will reflect in your voice.

Finally, you may be surprised to know that sipping a beverage just before speaking can affect your voice. Products containing caffeine, alcohol, or starches produce mucous which accumulates on the vocal chords and may cause you to engage in excessive throat-clearing and coughing. Excessive mucous stresses the vocal mechanism and has a negative effect on your voice.

To periodically check to see how you sound, take advantage of the proliferation of voice mail systems that allow you to listen to a message you have left. Do that regularly to reinforce your voice development efforts.

Jacquelyn Lynn is a business writer and speaker, and the author of The Entrepreneur’s Almanac.

Posted 06:55 PM | Permalink | Comments (1)

A Key Element of a Successful Short Sale

The BPO: Broker’s Price Opinion

By Lauri Waddell

One of the items that seems to bring the most challenge in a short sale package is the lender’s perspective of the value of the property. This article will address how to legally and ethically show the lender what the true value of the property you are trying to negotiate the short sale for should be.

Lenders will often attempt to base the current value of the property from the appraisal from which the loan was originally underwritten and approved. In most current market conditions, the property has not attained the value stated in the original appraisal. This loss of value can result from a decline in the current market condition, from the overstated value in the original appraisal, or from an inability of the property owner to maintain the condition of the property.

Our job as a short-sale investor will be to show the lender the true current value of the property. First, we must address the issue of value from the lender’s appraisal. The real value of the property in most cases is going to be much less than the lender’s perceived value from the appraisal.

The lender will order a broker’s price opinion (BPO) to verify their values compared to what we state the value of the property is at current market conditions. A BPO is an evaluation done of the property performed by a real estate broker. A broker is a real estate agent who is licensed and bonded to own their own agency. Some lenders will accept a certified market analysis (CMA). CMAs can be completed by a real estate agent who is licensed but practicing under a broker’s license and bond. Whether a lender orders a BPO or CMA depends on each lender’s charter, and in some instances what different state statutes allow. You will need to check with a real estate attorney to see what your state statutes require. Bear in mind that even if your state allows a CMA to be used, many lenders will require a BPO.

You should always be proactive and submit a BPO or CMA with your short sale package. The lender normally does not request this in the short sale package—they will normally order their own. By ordering their own package, they can request that no real estate owned by the bank (REO) be listed in the BPO.

One of the most powerful strategies to be used with the BPO is to make sure that the comparables reflect what the property’s value will be if the lender were to take the property back as real estate owned by the bank. This occurs when property does not sell at an auction and the lender takes the property back through the auction process.

Should the lender end up with the property as an REO, the value will be as other REO properties. Real estate owned by the lender has a lower value than nice homes on the market. Real estate owned is normally bought only by investors. Owner-occupied purchases, or individuals buying the home to live in, typically do not want the stigma or “bad luck” that comes with an REO.

This results in REOs normally selling from 20 to 50 percent below regular market prices. REOs also have a tendency to sit on the market twice as long as other properties. This is a result of lenders trying to get market value prior to dropping the price low enough to sell to investors. Investors do not buy at fair market value, so the REOs sit much longer on the market and ultimately sell much lower than other properties.

As an investor, you can utilize this knowledge in preparing your BPO to submit with your package. Using REO comparables on the market immediately brings the property value into perspective with the lender as a preforeclosure.

Collect comparable sales of REO properties, making note to choose the lowest properties available that match the short sale property, as well as those that have sat the longest on the market. Include pictures of the rehabs necessary with your BPO as well as contractor bids to fix the rehabs.

Place your results on a CD or flash drive. Then provide this information to your Realtor or broker who will then compile the information and prepare a BPO to submit with your package. We have done all the legwork by providing comparables and rehab estimates, as well as pictures of the interior and necessary rehab required. The Realtor or agent will then only need to verify your work and possibly do a drive by.

It is important to provide interior pictures with your BPO in the short sale package. Most Realtors or brokers do not go inside of a property when they complete a BPO for the lenders; they simply do a drive by. If the homeowner has been trying to hide from their neighbors, family, and friends that they are in preforeclosure, then they may have been keeping up the curb appeal of the property while the interior has been suffering a lack of maintenance.

Providing the BPO legwork for the Realtor also assures that you have some control over the value achieved on the property as well as adding great assistance to the Realtor on your Power Team.

Should the lender in turn want to schedule their own BPO, you can provide the lender’s agent with the same information on a CD or flash drive. This ensures that the repairs and comparables are considered in determining the current market value. Submitting your own BPO with the short sale package also ensures that the lender must consider your value. Additionally, this ensures that the lender will be unable to use the original appraisal in the packet for the current market value of the property. These strategies enable you to ethically and legally affect the value the lender must consider for the property.

There are many strategies and methods to utilize in submitting a short sale package to the lender that gives you, the investor, strength in negotiating a strong discount. I encourage you to learn more in-depth about these and other strategies.

Lauri Waddell is an instructor of the Wealth Intelligence Academy Short Sales and Mortgages Advanced Training.

Posted 06:51 PM | Permalink | Comments (2)

Managing Residential Properties

Pets & Pet Peeves

By Victoria Greene

Like many others, I like animals. I grew up with German Shepherds, Dobermans, pugs, and poodles. We had cats, birds, gerbils, and fish at one time or another. Our furry and feathered friends were like family. So when I make recommendations for you to consider as you establish or refine your pet policies, it is not from a place of disliking pets or pet owners; it is rooted in the fact that I have loved my pets so much that I know there are times allowing pets is not in the best interest of the pet or the resident(s).

In my view, having a pet is a privilege that comes with great responsibility. I recommend you establish policies to discourage pet owners who do not act responsibly and make it possible for renters who comply with pet policies to live with their furry family members whenever possible.

As the “lord of the land” (a.k.a. landlord), you can establish your own pet policies, rules, and regulations, with the exception of service/companion animals for handicapped residents, which must be allowed by law*. One of the first things you may want to consider is the type of building you are renting. For example, if each residence in a multi-unit building has a private entrance, you may want to allow pets with certain restrictions. But if your residents must enter through a common hallway to access their unit, you may want to prohibit dogs but allow indoor cats. Other tenants may not be comfortable passing pets in the hall on their way home. More importantly, if a dog’s owner is not home, they typically bark when they hear people outside the door in the hall. (Yes, I know, none of your potential residents’ dogs bark.) A barking dog on the way to a vacant apartment can be a deterrent to the prospective renter you are leading down the hall—even if they do not seem to mind at the time.

The next thing I encourage you to consider is the types of pets you will allow. I suggest only “traditional pets” such as cats and dogs. Even if you state you will allow cats and dogs with certain restrictions, you will still get, “What about _________?” Believe me, residents will crack you up with some of their requests. I once had someone ask if I would allow a pig in a duplex in an upscale residential neighborhood. I had seen potbellied pigs wrapped in blankets coddled by elite families at dressage shows, but this caller was talking about a pig that would reach 400 to 600 pounds! Oh yes, I saw the television special about how they are smarter than dogs. It also showed how they dig their hooves in front of the door when they want to go outside. The more common requests include birds, fish, snakes, reptiles, ferrets, rabbits, macaws, cockatiels, guinea pigs. And residents will insist that they are always caged. If that were true, where is the enjoyment in having the pet?

Birds, especially large ones, can be extremely noisy. If you are renting a house, maybe sound is not an issue, but in a multi-family property it could be a problem. To quiet them, owners cover the cage. Is that fair to the birds? They can also gnaw on wood casings around doorways and windows. Droppings that splatter over cages onto carpeting can also cause mold if not addressed promptly.

If you allow fish tanks, you may want to limit the size and require additional renters insurance to cover potential damage in the event of a leak or breakage. Condensation on a tank that finds its way down a metal stand will surely leave rust stains on the carpet, too. Large tanks can change the humidity levels inside some residences. Humidity that forms an accumulation of moisture can also be a source of mold. If you allow fish tanks, make the resident aware of and responsible for humidity control.

If you allow dogs, decide whether or not you will restrict specific breeds or establish a maximum size. You may want to contact your insurance company to see what their policy is on covering properties with certain breeds. At a minimum, most property management companies will restrict German Shepherds, boxers, Rottweilers, pit bulls, Akitas, Doberman pinschers, chows, and sometimes Dalmatians. You may want to meet the dog and deny any animal that exhibits aggressive behavior. If renters tell you the pet is a mutt, ask which breeds it resembles.

Pet owners represent a significant share of our renter market. The key to a successful pet-friendly rental experience is only renting to responsible pet owners and having a Pet Addendum added to the lease outlining the responsibilities that accompany this privilege along with the consequences if they are violated. Have the written rules signed by residents and hold them accountable for complying or the privilege may be revoked.

* Unless a private individual owner falls within an exception to the act’s coverage, the Fair Housing Act says you cannot deny a service or companion animal necessary for a handicap person—even in a no-pet building. You may not charge a pet security, pet rent, or pet fee. As a landlord protection, you are allowed to verify the handicap and that the animal is necessary. More information regarding fair housing laws can be found at www.hud.gov.

The Wealth Intelligence Academy® Property Management course covers how to select the right properties, put effective policies in place, and other important issues to help real estate investors build wealth and increase cash flow.

Posted 06:39 PM | Permalink | Comments (0)

We want to share the success of our students! That’s why we are implementing a new feature on our blog which will spotlight their achievements. We want you to see what they’re doing and learn from their experiences. We’ll be posting these stories regularly and look forward to your feedback on them.

Posted 08:12 AM | Permalink | Comments (0)

I hope you either have used or will use your tax stimulus payment to stimulate your own path to financial independence with an investment in your economic future.

But here’s something you should be aware of: Apparently the IRS has mistakenly issued duplicate tax stimulus payments to some taxpayers. If you get paid twice, don’t just cash the check and hope no one will notice. Instead, return the check to the IRS.

For more, read “Stimulating confusion: As millions of taxpayers await checks, others find themselves with two.”

Posted 05:52 PM | Permalink | Comments (0)

I saw this quote recently and thought it was worth sharing. Remember, you can't move forward by opposition. You move forward by being positive and taking action.

"Nothing is produced, no progress is made, by being against or criticizing something. Progress, including personal success, results from being for something and doing something about it."
Ben Miller (d. 2003)
Business executive

Posted 04:07 PM | Permalink | Comments (0)

Recently in Central Florida, a tax certificate sale was, in the words of an Orlando Sentinel reporter, a “big bust” and potential losses for local governments could hit $20 million. According to this report, with the foreclosure rate so high, tax certificate investors are worried about getting stuck with property rather than the cash they want.

Tax liens and deeds are a great way to invest in real estate without actually buying property. You may want to review Jordan Taylor’s article on this topic – and scroll down to the question in the comments about what type of properties to look or and to stay away from. Keep this advice in mind: Don’t buy a tax lien on a property you don’t want to own. Chances are you won’t have to foreclose, but if you do, make sure you’ll be foreclosing on something you’re prepared to deal with.

Posted 01:35 PM | Permalink | Comments (0)