10 Strategies that Work in the Bounce Market

Vena Jones-Cox By PresenterMedia.com

STRATEGY THAT WORKS #1:ABANDONED PROPERTIES

Properties that:• Are not occupied• Are not wanted• Are not “for sale”

May be:• Estates• Zombie foreclosures• Out of state owner-owned

• ???

Abandoned Properties, Defined

• The property was really and truly abandoned

• Smaller banks are easier to deal with

• The property was NEVER listed, no one else had contacted the owner

• I know how to wholesale properties

Why this works

• I found it while looking at this one, which I bought for $20,000 at $200/mo for 100 months and only needed a furnace and a porch

• Closing this one on Friday—bought for $1 + $1200 in back taxes, sold for $3,900+$1200 in back taxes

• Paid $4,000, wholesaled for $12,000

A once in awhile deal?Yeah, ok…

Reggie Brooks, the ONLY abandoned property expert in the U.S.

Where to learn all about this

STRATEGY THAT WORKS #2:SMALL BANKS

• Um…have you ever made on offer on a big 10 bank property?

The Problem with Big Banks

• You can talk directly to the decision maker

• They have no choice but to sell their REOs directly to the public

• REOs and defaulted notes are a big problem to them

• It’s easy to develop a relationship

• THEY’RE EASY TO WORK WITH

The Great thing about Little Banks

• Smaller banks CAN NOT have many bad assets

• I was able to use MY contracts and forms

• I know how to raise money to buy, fast

Why this works:

• Andy Heller’s “Regular Riches” program

Learn more from:

STRATEGY THAT WORKS #3:SHORT SALES ARE BACK

• Settlement of the robo-signing cases loosened up acceptances

• Government incentives for short sale instead of foreclosure added to banks’ motivation to accept lower prices

• Slow and burdensome foreclosure processes in many states…

Yes, they’re back

• Multiple bailout programs mean that more and different paperwork is necessary

• Traditional contract-assignment “flips” are nearly impossible

• A real estate agent nearly always has to be involved

But they’re different…

• How to get the right agent involved

• How to influence the BPO

• How to assign land trusts, or LLCs, or whatever

• What Shaun McCloskey will teach at OREIA!

What you need to know:

STRATEGY THAT WORKS #4:GET IN THE BACK DOOR—BUY THE NOTE, NOT THE PROPERTY

• There are 10-11 million “non-performing mortgages” in the U.S.

• These “toxic assets” are held by small banks, big banks, private equity funds, and individuals

• Sometimes, buying the MORTGAGE is the solution to getting the property the otherwise won’t work

Buy the wha???

There’s a LOT of bad paper floating around Ohio

…The owners of the paper often put little or no value on that paper

…It gives you more exit strategies than a short sale (ie you can modify the note and get it to “reperform” and get high returns)

The neat thing about “buying the paper” here

Eddie Speed—”Toxic Assets, Healthy Profits”

Who knows more about defaulted paper than ANYONE?

STRATEGY THAT WORKS #5:GO AFTER DEALS OTHER PEOPLE DON’T KNOW WHAT TO DO WITH

• Despite higher prices, more than 20% of Americans are still “upside down” in their homes

• Despite the boomlet in house buying, 70%+ of Americans can’t qualify for a loan.

Gee, it seems like there ought to be a way to make some money here…

i.e. the overleveraged, non-defaulted pretty house!

• There’s not enough equity here to stay in the middle

• There’s not enough cash flow to risk a default

• So what’s the solution?

The problem with the “sandwich lease”

Joe McCall’s automated lease/option assignment system

Get the right system in place…

STRATEGY THAT WORKS #6:GO AFTER DEALS OTHER PEOPLE JUST DON’T

• Minimal competition

• Prices per door still low

• Lots of seller financing available

• More and more conventional money available

• Wright Thurston at OREIA

4-40 unit apartments

STRATEGY THAT WORKS #7:WHOLESALE, WHOLESALE WHOLESALE

• In every price range

• In every property class

• The key is FIND THE DEAL

“buy when others are selling, sell when others are buying”

• 15 units• Abandoned• Out of town owner• Paid $15,000• Sold for $45,000

Vena’s Multi-Family Flip

• To get cash

• To take advantage of the market

• TO BUY FREE AND CLEAR RENTALS in preparation for the coming inflation/interest rate hikes

Why wholesale?

Steve Cook—What to do with ugly houses + get a life

Who can teach you how to wholesale (and retail) housesAND get debt free?

STRATEGY THAT WORKS #8:GET OWNER FINANCING

Case Study• Single family home, 3

br 1.5 bath• Nice street in a rental

area• Would rent for

$750/mo.• Less than $2,000 in

work to be rent ready• Out of town owner,

bought in SDIRA, no need for cash

Case Study• MAO for cash: $17,000• Seller’s bottom dollar:

$23,000• Agreement: $23,000,

$230/mo for 100 months• First payment due in 3

months

• Owners don’t need to earn interest—they need to sell a house

• Owners don’t need 20% down—they need to sell a house

• Owners don’t need you to have a 780 credit score—they need to sell a house

• Chris McClatchy will explain more at the convention…

That’s “The Power of Zero”

STRATEGY THAT WORKS #9:OPERATE TAX FREE

• Ordinary income taxes on your flip income—headed up

• Taxes on your interest and rental income—headed up

• Capital gains and depreciation recapture—all headed up

• And then there are health care costs…

Uncle Sam is your #1 expense!

• IRAs

• HSAs

• CESAs

GET SELF-DIRECTED PLANS!

• All of these plans can be opened with small contributions

• Small contributions can be turned into real money pretty quickly using wholesaling

• Real money can be used to buy notes, buy rental, retail houses, etc

GET SELF-DIRECTED PLANS!

• ONE decent wholesale deal in your HAS can fund the entire deductible for a high-deductible health care policy for the year

• Taking care of this is like getting a will—you can’t wait until you need it, or it’s too late

• Learn the rules from Jeff Watson at the convention

GET SELF-DIRECTED PLANS!

STRATEGY THAT WORKS #10:GET A LIFE

• Most small housing providers work their “businesses” as a well-paid job

• You do NOT want to be an independently wealthy, financially free, 90-hour a week EMPLOYEE!

• As long as you• Do everything yourself

• Have a ton of debt to service

You Don’t Have the Freedom You Really Want!

A Real Estate BUSINESS, or a Real Estate JOB?

• Sending out your own marketing

• Answering your own phone

• Running your own comps

• Posting your own craigslist ads

• Creating your own flyers

• …???

In today’s world, why are you…

• Michael Gerber, author of The E-myth, on how to create a world class real estate business at our banquet

• Ron Legrand and Jay Conner on how to automate your business at the all-day pre-convention workshop

• Jason Palliser on the software you’ve been looking for

• Steve Cook and Shaun McCloskey on debt-free investing and “Getting a Life”

The “Automation” Meme at the OREIA Convention

OREIA and GDREIA will take you to the next level…

Come to the “Main Convention” November 8th, 9th, and 10th

• Sample 13 different topics & strategies in 3 info-packed days

• Free concurrent trade show• Lots of awesome networking

events

All these great topics

• How to wholesale & retail * How to buy small multifamilies * How to buy defaulted notes * How to collect every dime of your rents *How to grow your IRA * How to make money with overleveraged houses * How to do short sales * How to buy abandoned houses * How to buy tax liens and deeds * How to protect your assets * How to buy with $0 down, 0% interest * How to say “Yes” to success * How to get private money

OREIA’s “Pre-Convention Workshops” November 7th Cover:

Automate or Die• With Ron Legrand

Beginners start here

• Wth Vena Jones-Cox

Bring the family…

• The Great Wolf Lodge is a family-friendly resort/waterpark

• Just $99 per night (waterpark admission extra)

• When you stay 3 nights, you get the VIP perks package

• $400 gift pack from our presenters• VIP only receptions• Bonus lunchtime trainings

PLUS

• The Youth Academy at just $10 per youth

• The networking banquet with Michael Gerber, just $50 pp

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