By Jacquelyn Lynn
E-mail has become one of the most common methods of business and personal communication. It's fast, efficient, and convenient, but it can be dangerous. Consider these tips for getting the maximum benefit from e-mail while avoiding its pitfalls, whether you are at work or home.
Continue reading "E-mail Guidelines: Get the Most Out of Your E-mail Communications" »
LEAPS Covered Write:
An Alternative to the Covered Call
By Tyler Craig
The covered-call strategy provides an efficient way to make money in a neutral-to-mildly bullish environment. The two critical advantages to this strategy are its ability to produce monthly income and provide some downside protection. However, two of the biggest drawbacks to a covered call are that it is a more capital-intensive trade, and it does not have as high of a return on investment (ROI) in comparison to other option strategies. Before a trader can write a covered call, he must first buy 100 shares of stock and, as you can imagine, this can get quite expensive. Some of the students I have taught shy away from this strategy for that reason. Fortunately, there is an alternative-option strategy, which not only has a greater ROI, but is also a lot cheaper. Let me introduce you to the LEAPS covered write.
Don’t be a Victim:
How to Protect Yourself from Online Scams
How dangerous is the internet? You might as well ask: How dangerous is your neighborhood? As in the real world, your risks increase and decrease based on the type of online communities you frequent. And also as in the real world, you never know when a criminal is going to strike—because crimes occur even in the best of neighborhoods.
Simply having a computer and an e-mail account makes you potentially vulnerable to internet crime. Your best defense is knowledge and common sense: Know what type of schemes internet criminals are trying to pull off and remember that any deal that sounds too good to be true usually is.
Sell or Rent Your Property Faster Using Color
By Mark Gilliland
It is no secret that if you have two similar homes, the one that looks nicer typically sells or rents faster. A few smart color choices can make your rehab stand out in a positive way with little or no additional cost.
Color is a powerful tool and very useful in attracting people to a property. Consider that small details have a huge impact on our subconscious appreciation for any work of art. Your rehab is your canvas. Before you begin painting, consider all of the colors you intend to use and how they will work together to create a masterpiece both inside and out.
Continue reading "Sell or Rent Your Property Faster Using Color" »
Sell or Rent Your Property Faster Using Color
By Mark Gilliland
It is no secret that if you have two similar homes, the one that looks nicer typically sells or rents faster. A few smart color choices can make your rehab stand out in a positive way with little or no additional cost.
Color is a powerful tool and very useful in attracting people to a property. Consider that small details have a huge impact on our subconscious appreciation for any work of art. Your rehab is your canvas. Before you begin painting, consider all of the colors you intend to use and how they will work together to create a masterpiece both inside and out.
Continue reading "Sell or Rent Your Property Faster Using Color" »
Developing a Playbook:
The 5 T’s of Trading
By Tyler Craig
Is it realistic to expect consistent returns from your trading if you have an inconsistent, unsystematic approach? Of course not. Most traders would concede the fact that developing a trading plan is essential to becoming a successful, savvy trader. However, while most accept this, few choose to actually take the time to develop a plan.
We are all familiar with the cliché, “those who fail to plan, plan to fail.” Nowhere is that more apparent than in the financial markets. Some face the struggle of knowing the best way to structure a trading plan. To help Wealth Intelligence Academy students alleviate this struggle, we developed a trading plan in the advanced trading camp, the Master Trader™.
Continue reading "Stock Education: 5 T's of Stock Trading" »
Keep It Covered: Insuring Your Real Estate Investments
As an investor, your insurance needs are different than a typical consumer—and as your portfolio grows, those needs will change
As part of the terms of a mortgage loan, most lenders require borrowers to carry property insurance. But simply meeting the requirements of your lenders does not necessarily mean that you are adequately insured. To be sure that your real estate investment business is properly covered, understand what your risks are, how much liability you are able to accept, and what types of policies are available.
The basic types of business insurance include:
Continue reading "Business and Finance: Insuring Your Real Estate Investments" »
Being an Investor Means Being an Investigator
By Mich Christensen
Why do we need to investigate properties when investing?
For the investor to choose a property wisely, he must find out everything about who owns the property, the history, and what is happening to the property. In anything we do in life there is a process—a procedure, a logical reason, and a methodology to accomplish our goals. Just as you follow a recipe for consistency in the kitchen, there is also an optimum plan when investing in property.
Organize yourself—give yourself the best opportunity to do your best!
Continue reading "Real Estate Investing: Being an Investor Means Being an Investigator" »
The Art of Successful Trading
By Joe Inman
Trading is considered by many to be the most dangerous event short of war, and like the old saying goes “he who is well prepared has won half the battle.” You are going up against the best and brightest Wall Street has to offer and sometimes it feels they all have one goal, which is to take your money. If this is true, what can you do to survive and prosper in such a demanding profession? First, you must commit to yourself that your goal is not merely to trade but to trade successfully. Successful traders are patient and let the market come to them. It is not in their nature to force a trade. They realize it is better to do nothing unless there is something that should be done. All too often, those who are new to trading will commit the costly sin of overtrading. This occurs most often out of the fear that if they miss this trade opportunity, they may not get another one. Experienced traders realize it is better to miss a trade rather than get into one that only has a marginal chance of success.
Continue reading "Stock Education: The Art of Successful Trading" »
Business Capital:
The Life Blood of Your Real Estate Business
By Matt Fagerness
We’ve all heard about the numerous ways you can successfully do real estate transactions with no money down (or at least with a bare minimum of operating capital) and I am a believer in these techniques myself. After all, I was also a Wealth Intelligence Academy® student before becoming a trainer and a mentor for the Academy. I have done deals with owner financing and I have done my share of wholesale deals too, which goes to show that the no money down concept is alive and well, and that these kinds of deals are also something you can do.
With that said, let me shift gears just a little bit. It is often said that businesses (particularly small ones) usually fail for three common reasons. One is the business owner selects the wrong business to begin with. With real estate being as diverse and commonplace as it is, I am not concerned about this pitfall being in your way. Another reason that businesses may fail is they are poorly managed. Right now, your business is likely so small (personnel-wise) that management is not really a factor. On top of that, remember none of us need to be experts on all facets of the business and what you do not know can and should be delegated to your professional power team.
Continue reading "Business and Finance: Business Capital for Real Estate Investing Businesses" »
The Hardship Letter:
Learn More about this Important Piece of the Short Sale Package
By Lauri Waddell
When a short sale is negotiated with the lender, a hardship letter from the homeowner is requested in the short-sale package. There are several purposes for the submission of the hardship letter which we will explore.
The hardship letter is a letter to be written by the homeowner detailing the events that led up to the default and pre-foreclosure of the mortgage. The letter should detail, in chronological order, the events that caused hardship which ultimately led to financial duress and the default of the loan. As investors, we must always keep in mind that “Life happens to good people.” No one intentionally chooses foreclosure. Our job as investors is to assist the homeowner in documenting the events that led to the preforeclosure of their home. We do this with an empathetic and professional approach that gives the homeowner dignity in the process of letting them tell their story.
Continue reading "Short Sales and Foreclosure Investing: The Hardship Letter" »
Surviving a Bear Market
By Lance Garvin
Whether you are a seasoned investor or just getting started, the question “What do I do in a bear market?” will most likely arise. Some of you may have heard that money can be made in any type of market environment—up, down, or sideways. In this article, I want to briefly talk about a few options you have in a down market that will help you protect your money. Some of them can even make money.
Continue reading "Stock Education: Surviving a Bear Market" »
Title insurance provides the property buyer and/or the mortgage lender protection against losses resulting from unknown defects in the title to a property that occur prior to the closing of a real estate transaction. Unknown defects in a title, such as any outstanding liens or encumbrances, can result in additional costs in the future or even invalidate a buyer’s right of ownership in the property, and might also invalidate the lender’s security interest in the policy. Title insurance policies will cover the insured party for any covered losses and legal fees that might arise out of such problems.
Are You Ready to Close?
Almost anyone who has ever purchased real estate can tell stories of problems at closing that ranged from minor glitches to massive headaches—and sometimes even resulted in the deal falling apart. Your closings will go more smoothly if you understand what you need to do and prepare ahead of time.
You find a property, you complete your due diligence, and you negotiate a deal that both you and the seller are satisfied with—but there’s still one more step in the process: the closing. There is no circumstance where the old saying, “the job’s not finished until the paperwork is done” is more appropriate. A real estate closing is where you complete the transaction, where the buyer pays the money and the seller takes ownership of the property. And though it sounds simple, there’s a lot of paperwork and it needs to be done accurately. What’s more, no two closings will ever be exactly alike. That’s why real estate investors need to understand everything involved in the closing process and what they need to bring to the table whether they are buying or selling.
Continue reading "Real Estate Investing: Get Ready to Close" »
Finding Farming Areas, Driving for Dollars, and Cultivating Our Market
By Mich Christensen
What is a farming area, how do we find it, and what do we do when we find it?
When we decide to become an investor, we go through the process of getting an education, gaining access to current information, and then implementing what we have learned. Here are some of the first steps in finding our “farming areas,” and once we find them, what to do with them. As beginners, we may start out with one or perhaps two areas that we may be interested in farming. Then as time and experience allows, we expand into additional areas.
Continue reading "Real Estate Investing: Finding Farm Areas" »
Communicating on the Telephone:
It’s What You Say and How You Say It
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.
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.
Continue reading "Short Sales: The BPO (Broker's Price Opinion)" »
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).
By Richard N. Pexton
Much of our activity in real estate investing involves buying, fixing, and selling houses in condensed time frames. This provides cash flow and also generates capital for creating wealth.
There are four obstacles to creating wealth: taxes, inflation, spending habits, and procrastination.
Continue reading "Real Estate Investing Strategy: Buy One a Year for 20 Years" »
By Tim Chaffin
I teach the Rehabbing for Profit class for the Wealth Intelligence Academy. I am not there to show students how to hang drywall or to put on a roof.
I am there to show students how to put together a rehab project and complete it without eating up all of their time and money. It is important to remember that you are not going to live in this house. You are simply going to fix it up and make it clean, safe, and livable.
Almost every property you find and/or purchase is going to need some sort of rehabbing. Whether it is a property for sale by owner, an REO, or in foreclosure, most likely it is going to need something done to it. Chances are you will rarely, if ever, find a property in “broom swept” condition that is ready to be occupied.
Headlines scream that foreclosures are up, property values are down, and pundits are talking recession. What’s true? And what does it mean for real estate investors?
Pick up a newspaper, turn on a news broadcast, or surf the internet for economic news, and you’re likely to come away with the impression that the world as we know it is going to end tomorrow, so what’s the point in doing anything? Let’s just all shop ‘til we drop and eat lots of chocolate.
The flaw in that thinking is twofold: First, the world is probably not going to end tomorrow—it might, of course, but what if it doesn’t? Spending all our money and getting fat is not the best way to prepare for the future. Second, the media love to use negativity and scare tactics to increase ratings, whether or not their frightening twist on the facts is justified.
Continue reading "The Real Truth About Today’s Real Estate Market" »
Book Review
Get Rich by Getting Smarter About Money
Increase Your Financial IQ: Get Smarter with Your Money by Robert T. Kiyosaki (Business Plus, 2008)
In what may be his best book to date, Robert Kiyosaki challenges his readers to wise up about their own financial situation and what they need to know to become financially intelligent because, he says, if you can increase your financial IQ, you can become richer.
Continue reading "Get Rich by Getting Smarter About Money" »
Ever feel like you’re swimming upstream? Try these…
14 Great Ways to Stay Motivated
By Jordan Taylor
One of the most challenging aspects of real estate investing is staying motivated in the face of adversity. Sure, it’s easy to keep going when things are going great, but what about when you can’t find deals, or when the deals you find are falling through, or when your friends and family are telling you you’re crazy to think you can do this? Because staying motivated is often easier said than done, we put together a list of 14 things you can do to lift yourself up when circumstances start dragging you down.
Being a good negotiator will help you in all aspects of your life, not just in business
When you think about it, life is a series of negotiations. The American Heritage Dictionary defines negotiate as conferring with another or others in order to come to terms or reach an agreement. You negotiate with others far more often than you may realize—negotiations that include interactions with family and friends, getting the best deal on a consumer purchase, and a wide variety of business activities.
Book Review
Letting People Know About What You Do
The Complete Idiot’s Guide® to Guerrilla Marketing: Get creative … and get the word out about your product or service, Susan Drake and Colleen Wells, (Alpha, 2008, $18.95)
Whatever your business, if people don’t know about what you do, you’re not likely to be very successful. That’s why marketing is essential, no matter what business you’re in—and especially for real estate investors. People need to know that you’re the go-to person when they need a property or have one to sell, and they only way they can know is if you’re telling them.
Tax Issues:
Preparing for an IRS Audit
The IRS has questions about your tax return—what do you do now?
Last year, nearly 1.4 million individual tax returns were audited by the Internal Revenue Service (IRS), an increase of 7 percent over 2006. Audits of businesses in general increased almost 14 percent in 2007, although audits of S Corporations were up 26 percent and audits of partnerships rose almost 25 percent. The IRS calls this “increased enforcement,” and a key driver behind it is the government’s goal to close the tax gap, which is the difference between the amount of tax the agency determines should have been paid and the amount of tax actually collected.
Mandatory Disclosure:
How much do sellers have to tell?
Real estate disclosure laws are changing constantly, and even the experts don’t always agree on what a seller of residential property must tell a prospective buyer. Up until about 50 years ago, there was little, if any, legislation requiring sellers to disclose a property’s defects. If there was a problem and the buyer didn’t find out before closing, he was typically out of luck.
Continue reading "Mandatory Disclosure: How much do sellers have to tell?" »
Real Estate Fundamentals:
Hard Money Isn’t Necessarily Hard to Get
If hard money sounds like borrowing the hard way, relax. The term is used primarily in the United States and Canada to describe a specific type of asset-based financing where the loan is made based on the value of the real estate with little or no consideration given to the creditworthiness of the borrower. [An increasing number of hard money lenders are asking borrowers to complete credit applications and taking credit history into consideration when making a lending decision, but their primary consideration is still the collateral being offered.]
Continue reading "Hard Money Isn’t Necessarily Hard to Get" »
Foreclosure strategies:
Short Sales Can Lead to Tall Profits
It’s a scenario that could happen anywhere: Joe and Mary bought their house for $250,000, put just five percent down, and took out an adjustable rate mortgage. Three years later, the market is soft and overall real estate values have declined. Joe and Mary’s house has a fair market value of $230,000, their loan balance is $225,000, and their mortgage has reset—and now they can’t afford their payments.
Can you help them? Possibly—if you can negotiate a short sale with their lender.
The situation might seem innocent enough. You’ve got a property for rent that you’ve been advertising. You get a prospective tenant from out of town, maybe even from overseas, who pays the deposit and one or more months rent in advance using a cashier’s check. You deposit the check, then the tenant—who hasn’t moved in yet—asks you to return a portion of the funds via wire transfer because of a family emergency or some other reason. Because the original payment you received was a cashier’s check and you haven’t been asked for a 100 percent refund, you feel safe cooperating.
Continue reading "Landlords: Don’t Get Scammed by Counterfeit Checks" »
You’ve set your financial goals, but do you know how far you have to go to reach them? And how will you know when you’ve made it? A net worth statement will tell you.
Do you want to be a millionaire? A billionaire? Or do you just want enough so you can retire comfortably? Regardless of what your goal is or how you intend to reach it, you should know your net worth. This information lets you know where you’re starting from and helps you measure your progress. If you’re going to be in control of your financial future, you need to know where you are today.
By Jordan Taylor
In most situations, tax liens are not good news for real estate investors; they can cloud titles and reduce profits. But tax liens are good when you want to buy tax lien certificates, because you are not investing in property but rather buying the rights of a taxing authority.
Continue reading "Tax Liens and Deeds: Should this investment strategy be part of your plan?" »
By Jordan Taylor
In 2006, a real estate agent working at an open house in McKinney, Texas, was brutally murdered. An agent in St. Petersburg, Florida, was attacked, robbed and her car stolen by a young man armed with a gun and a 12-inch hunting knife who had posed as a customer. Within 11 days in DeKalb County, Georgia, three different real estate agents were robbed by an armed couple in incidents authorities believe were connected.
Continue reading "Investor safety: Protect yourself when showing your properties" »
Important information for foreclosure investors:
Consumer Alternatives to Foreclosure
If you’re investing in foreclosures at the preforeclosure stage, it’s important to know all the options homeowners have.
By Jordan Taylor
You’re a real estate investor, not a consumer counselor—so why do you need to know what options a consumer who is facing foreclosure may have? Because the more you know, the more effective you can be as an investor.
Happy Holidays – Now What?
The holidays are over, the New Year is here.
What are you going to do now?
You’ve probably already made your New Year’s resolutions and maybe even broken a few by now. Resolutions are a wonderful tradition, but a more effective approach is to set goals and put together a plan for reaching them.
Goal-setting is a great way to articulate what’s important to you. If something is irrelevant or a distraction, it doesn’t belong on your goal list. Be sure your goals are your goals, not someone else’s or something you just think sounds good. You’re going to have a hard time getting motivated and doing the necessary work to achieve a goal that isn’t something you really want.
The most common way to generate cash flow with real estate is through renting your property to a tenant. Good tenants are some of your most valuable assets, while a bad tenant can be your worst nightmare. So how do you get the good ones? The answer is tenant screening, and it applies whether you have properties for low-, moderate-, or upper-income tenants.
Continue reading "Protect Your Investment Through Tenant Screening" »
Finish this sentence: “I’d like to invest in real estate, but ____________.”
If you said, “I don’t have the money,” there is a solution.
Remember that while it takes money to invest in real estate, it doesn’t have to be your money. If you have a good deal, you can find the funding. One alternative is a simple partnership.
Continue reading "Partnerships are a Great Way to Fund Real Estate Investments" »
Tax Actions to Take Now
What to do before the year ends to prepare for your 2007 tax return
The one sure thing about taxes is change, and some significant legislative changes made over the past year could affect your 2007 tax bill. Because few tax strategies can be applied retroactively, it’s a good idea to be aware of this year’s changes now so you can consult with your tax advisor and take the most appropriate action for your circumstances while you still have time. Brian M. Lewis, CPA, a certified public accountant in Maitland, Florida, says primary issues you should be aware of include:
The Entrepreneur’s Almanac: Fundamentals, Facts and Figures You Need to Run and Grow Your Business by Jacquelyn Lynn is a treasure trove of advice for business owners and managers on how to start, run, and grow a business. It’s designed to be something you can read for just a few minutes each day and get ideas and inspiration that will help you boost profits, increase productivity, and improve efficiency. You’ll find words of wisdom from real-world business owners, including names you’ll recognize—such as Russ Whitney, Robert Kiyosaki, Kim Kiyosaki, and more.
The Entrepreneur’s Almanac belongs in your own personal library and will make a great holiday gift as well. It’s available online and in all major bookstores.
The rich may be different, but millionaires and billionaires are people, too. One of the more entertaining aspects of Why We Want You to be Rich: Two Men, One Message by Donald J. Trump and Robert T. Kiyosaki is the glimpse into the private lives and motivations of these two very wealthy men who are committed to teaching financial literacy to as many people as possible. Beyond the entertainment—and certainly more important—is the information and the primary message, which is that you need to take charge of your own financial future.
How much should you pay for a property? Certainly you’ll want to consider what the seller is asking, but you should base your offer on the market, the condition of the property, and the cash flow and profit it will generate for you.
Let’s say you’re buying a single-family or small multi-unit residential building. Here are the steps to determine the maximum amount you’ll pay:
1. Determine the after repair value—that is, the market value of the property after you’ve completed any necessary repairs and fix-up.
2. Calculate the fire sale price, which is the amount slightly under market value that would assure you a quick sale.
3. From the fire sale price, subtract your repair and fix-up costs plus your sales and closing costs. Then subtract the amount of profit you want on the deal.
The figure you have left is the maximum amount you should pay for the property. Use this formula whether you are buying for a quick turn or to hold long-term.
Last month, we looked at the delegation side of your Power Team—the people who will do things for you that will help you reach your financial goals. Now it’s time to discuss the brain trust and money side of your team.
Continue reading "A Power Team is the Infrastructure of Your Investing Business" »
One of the joys of watching children grow up is seeing them learn to be independent. Certainly independence and self-reliance are qualities to be admired, but when it comes to real estate investing, interdependence on the right people can give your business a tremendous boost. The best way to create productive interdependence is to build a Power Team.
Continue reading "Fuel Your Investing Business with a Strong Power Team (Part 1)" »