Flipping House Tips - Pot, Cats, & More

When you’re flipping houses, sometimes you’ll inherit the tenants from hell (as well as cats with super powers).

I like tenants because it creates more deal opportunities. If it wasn’t for tenants, there wouldn’t be so many landlords throwing their hands up in complete disgust to become motivated sellers. And as a result, you’ll inherit some of these tenants for your house flips.

You gotta know how to light a fire under that ass to get them out without risking your investment. Make the wrong move and they’ll trash it like there’s no tomorrow, leaving you thousands of dollars in the hole.

Here’s a short video of one of my recent dealings with tenants that involved pot, cats, and more.

Learn to wave the carrot - you’ll see. Check it out…

Free Question Friday - The Bank’s “Credit Line” Disappearing Act plus more

What a week…

Sorry for my absense this week on the blog, but I’ve had some pressing issues that’s involved falling trees, fighting with contractors, and more…

Enough - check out this weeks Free Question Friday:

Do you remember your first time?

No. I’m not talking about anything personal- so get your head outta the gutter will ya?

I’m referring to your first deal.

Were you excited?

Scared to death?

Nauseous?

How did the deal go?

It’s good to reflect back. So here’s a pic of my first deal:

This junker appraised for $37K back in September of 2000. I bought the property for $23,500.

Read more

Project Lifeline - another waste of time?

Today, President Bush is expected to announce ‘Project Lifeline’- a new program designed to help homeowners that are behind 90 days or more with their current mortgage to aid in stopping foreclosure.

Six banks have agreed to take part- Bank of America Corp., Citigroup Inc., Countrywide Financial Corp., JPMorgan Chase & Co., Washington Mutual Inc. and Wells Fargo & Co.

From what I’ve gathered it will suspend foreclosure for 30 days to allow the homeowner and lender to come up with new loan terms. While this may help a very small percentage, I don’t believe this is the magic bullet that congress and lenders are looking for. I’m curious to what the expectations are with the program. It will be interesting to see how this plays out.

What do you think? Do you think this proposal is another waste of time or a step in the right direction?

Bank Drops The F Bomb

This week’s Free Question Friday revolves around what options you have when then bank drops the “f” bomb.

This week’s question will help you when talking with homeonwers in preforeclosure.

Click play for streaming:

Or you may click on the link to download the file:

http://www.successrei.com/audio/fbomb.mp3

Inspiring Movies

Some movies just make you tick giving you that needed nudge to go out and do something.
Here are some clips of some of my favorite movies of all time.

I have to warn you though, some of these clips contain very strong language. So, if you’re easily offended, then I urge you not to watch. Otherwise, enjoy:

My all time favorite- The Boiler Room Interview:

Wall Street

Glengarry Glen Ross

Any Given Sunday- Al Pacino

The First Ever Free Question Friday

Howdy folks,

Welcome to my first ever Free Question Friday where I answer your questions. This will be an ongoing segment to the Success REI blog published every Friday with either a video or a podcast.

If you have a question, I’ll have a form added to the Contact Page in a couple of days for you to submit your questions to.

Here’s the first Free Question Friday edition:

Preforeclosure Trap

I was on the phone today with an investor friend of mine that I’ve known for several years.

Just so happens, he’s wrapped up some real estate training with one of the well known gurus that’s teaching how to get a credit line for your real estate business regardless of your current personal credit ratings.

Anyway…

He was describing how the “guru guy” was teaching how you could get a credit line, then give homeowners in preforeclosure a 2nd mortgage to bail them out, then when they quit making payments (which is obviously going to happen 99% of the time) you can then foreclose and get the house. And if they make you payments - you charge a 18%- 24% in interest. And of course, you have a ballon so that they don’t drag it out.

Pretty smart huh?

Not so fast…

As my friend was explaining it - I stopped him and said “this guy is f****ing nuts - that’s extremely risky.”

He gets real defensive and starts explaining how you only loan money to those with lots of equity.

I stopped him again and said - “It’s risky because of the legal issues!”

See, this little technique was a new idea to my friend but has been taught in seminar land for years and it has a legal name for it called:

Predatory Lending

It’s when you give a homeowner a loan knowing the homeowner has no way to pay you back. This happens to be one of the fastest ways to get you in court causing you lots of legal drama.

And when real estate investors go to court over one of these instances- there’s a prejudice that you are the “fancy pants” professional and that you’re taking advantage of the poor homeowner.

That’s the truth

Now go ahead and tell me you have a fool proof way of making this little technique work- break out your disclosures, break out your CYA letters-

I don’t care.

This IS NOT a legitimate investment strategy!

Personally, if I’m not able to buy the house because the seller is wanting a loan, then I don’t offer a loan, I don’t offer a leaseback - I simply move on or look at approaching the deal from another angle.

Right now, there so many legal cases surrounding this very technique and also using leasebacks.

Leasebacks are when you take the house “subject to” then lease the home back to the homeowner.

Stay away from both of these techniques and realize anyone telling you otherwise is full of shit.

I made a post with a video about using the sale leaseback you can see here