Over the past several months I’ve been asked what specifically am I doing that has helped me in my investing. Well, the main thing I’ll say is I’m taking action. I’m putting to practice the very things I’ve learned from all the courses I’ve purchased and the bootcamps I’ve attended, but there is more.
I’m going to give you critical, highly important tools that assisted me in my investing. What I’m going to suggest is in no way a slight on any other person’s course or material. I have purchased courses by Lou Brown, Nick Sidoti, Dwan Twyford, Mike Collins, Preston Eley, Jim Mitchell, Larry Goins, Robert Kiyosaki, Kenny Rushing, Richard Roop, Dan Auito, Dave Lindahl, Jamal Gibbs, Darren Dickie, Mark Walters and several others. Yes I’m a course junkie, but again I put what I learn to use.
Here take this key I’m giving you and put it to use.
KEY #1,Fortune Builders, Inc. They have three of the most complete courses to get you started and on the right track.
Wholesaling for Quick Cash: this course covers the ins and outs to wholesaling properties. It covers finding deals, evaluating deals, marketing deals, your team and so on. In short all you will need.
Marketing for Deals: this course covers all, and I do mean everything you need to do to attract buyers, sellers, investors and how to get others to do the same for you as well.
Rehabbing for Huge Profits: this one here covers how to deal with and find contractors. It outlines the proper way to deal with them and not get taken advantage of and more importantly, the proper way to rehab and repair a property.
In short these 3 courses cover it all from start to finish as far as the knowledge and the how to in the real estate world. If I had to suggest any real estate courses these would be the ones I suggest.
Wait… no, hold on, wait, I hear you. Your saying I still need money to get the deals done. Guess what I have that one covered as well. I told you I was giving you the key, so here it is.
KEY #2, Alan Cowgill. He has found the key to getting all the funds you need to fund your deals with his Private Lending Home Study Courses.
The SEC Bible: in this course it covers the exact requirements of every state. You get information on how to deal with the SEC in your state.
Yeah, I know, I dropped a lot on you but hey you can do it. How do I know…… because I’m doing it and these are some of the several courses that have helped me to do so. Again, I come from being a college drop-out to a GM employee, to now being a full-time real estate investor. The only thing and I do mean the ONLY thing that I may be doing different from you……… I Took ACTION and put what I’ve learned in motion. That’s it, that’s all.
Everyone who decides to flip a house has dreams of being the one to bring home the big one. You know that really huge success story about how you made more money in three months of working on a house than you and your wife combined made last year. The sad truth is that very few flippers ever have a flip that good and those that do often do not manage to do so on their very first flip. If you don’t have those dreams it’s glad to see that you have your feet firmly planted in the sometimes harsh soils of reality.
Flipping houses is one form of real estate investing that has received a lot of media attention in the last few years and is currently the source of many interesting television shows that play on do it yourself channels on television. If you haven’t managed to watch any of these shows you may be in a much better position to tackle your first flip than many who see these shows and get a false sense of confidence when it comes to bringing in a substantial profit by flipping houses. While the profits exist and are much better than most people would envision, the average first timer doesn’t fare on the higher end of the profit scales all too often.
In fact, most first time flippers make rather slim profits when the tremendous amount of work that goes into flipping a property is considered. One thing you will want to do when flipping your own property is take care not to get too greedy in the asking price. If you can make ten thousand or more on your flip after all expenses are paid (including taxes, realtors, and any fees) then you are doing exceptionally well and should be congratulated. It is those who decide to go for fifty thousand rather than being content with ten that find themselves alienating a good portion of the population that may have been interested in purchasing the property from the very beginning.
In order to make your flip a success you need to be negotiable on the price when all is said and done. This is where many people loose potential buyers and find themselves sitting on the market month after month until they find themselves in a situation where they must sell or risk loosing the house and in this situation they are often in a position that they actually loose money rather than profiting.
Success stories, when it comes to flipping houses are widely available though many of them are just as widely exaggerated. Be cautious in your optimism when it comes to flipping houses but plan for profits and you will find that you are much more likely to get them than if you enter into the house flipping and real estate investing process without a proper plan at your disposal.
Turn your house flip into a success story by spending as much time in the planning process as you spend in the entire labor process that is involved and necessary when it comes to flipping houses. If you do this and budget carefully while sticking to your budget religiously you will find that you are in a much better position to have the success you are hoping to have.
Recently I’ve had more conversations with rehab flippers complaining about the FHA seasoning guidelines than I can remember. For those of you who are not aware of the guidelines, in short if a person is getting FHA financing, the property they are purchasing needs to be owned by the seller for 90 days before they will finance.
Well, here is a simple solution to your problem.
locate a potential buyer who is pre approved
accept a 3 to 5 percent down payment
place them on a 3 month lease purchase allowing them to lease the property until the FHA time guidelines are met
explain to them that they shouldn’t apply for any credit or make any large purchases until they close on the house
If their pre-approval expires have them renew
set up close date & collect your check
Obstacles many times get in your way, but with an understanding of your desired goal it should not be hard to look at any situation and come up with multiple ways to solve them.
Your real estate education is the key to you establishing yourself as a real player in the game. With the proper education it will position you to dominate your market and also convert deals you once walked away from. Imagine for a moment, you having the knowledge to recognize a deal within minutes of seeing the needed information.
Over the past several weeks I have received many calls and emails from people asking a myriad of questions on deal structuring, lead generation and funding. The topic of funding is dear to my heart due to the fact that when I started out investing it was without a doubt the one issue (lack of funding) that kept me from aggressively pursuing the kind of deals I wanted to do. Well, that day is long gone!!!
You know I love to give helpful information to you (my readers). I don’t want you to have the struggle I had with funding so, I’m giving you wonderful insight into how you can get all the funding you need for each and every deal you do. Funding Information
First YOU must educate yourself. Education is the key.
Money management during any real estate investment venture is an essential skill. If this is your first time flipping a property it is probably more important on the first flip than any other as you need to fully realize how much things cost and how quickly those expenses can up. It is so simple for the budget on a house flip to get completely out of control. For this reason you need to take control of the financial situation from the very beginning.
Begin by establishing a realistic budget for the entire project. If you find yourself spending more money in one area than you had originally planned you need to either revisit the initial budget and plan for adding more money to the pot or you need to make cost lowering adjustments elsewhere along the way to recover the excess. You will need to have a firm idea of the projects you are going to tackle, big and small, as well as the costs involved in each project. Take a walk through a hardware store and get a firm grasp of today’s prices on the hardware, equipment, and supplies you will need to complete the job.
Use contractors when necessary but sparingly. There are times when it will cost much less to use a contractor on a project than to muddle through on your own. There are also times when local laws require a contractor. You need to use contractors for these times but you need to avoid paying the princely labor costs contractors charge for things that you could easily do yourself. You never want to spend a penny on a flip that you don’t need to spend and labor costs are a huge budget buster.
Get permits first and up front. Time is money when you are flipping a house and once you start the work that time is precious. Make sure you have all the permits you need and that they are paid for before you begin the project in order to save time and money after the project has commenced.
Then create a habit of accounting for every penny spent throughout the day at the end of every day. This becomes a good habit to have for your first and all subsequent flips. By doing this you will have a solid grasp of how much money you are spending as well as how quickly you are spending it. You will need money to spend on little things throughout the course of the project so if you are spending money too fast up front you may not have the money needed to take care of the small details that mean a lot when all is said and done.
One huge way to better manage your money during a house flip is to make a conscious decision and consistent effort to work according to your tastes. Chances are quite good, especially for a first flip that you will be working on a house for those who have less financial means than you may have. For this reason you need to keep your project within the budget of your buyers. This will save tons of money. In other words a lower income community cannot absorb the costs of granite, marble, and hardwoods in most situations so don’t go to that exsteem.
In order to turn a solid profit when flipping a house or doing any type of real estate investment you absolutely must have a firm grip on your money, where it is going, and what your plans are for the money. The less money you spend the more money, in many cases you stand to bring home in profit. Spend the money you need to spend in order to improve the value of the home but avoid luxury expenditures that aren’t necessary for the neighborhood or the home in question in order to maximize the potential profits you can bring home.
First I want to thank all of you who read, comment and enjoy this blog, I appreciate all the emails you have sent.
I’m going to tell you briefly about how you can save money on your next flip. I know, I know…. I had you all following my flip. Well it came to a screeching halt. I had a bad water meter in the house and need some plumbing completed before I can finish the job, plus come to find out the cities shut off valve at the street is broken, but anyway let me give you all this money saving info. It’s going to be short but sweet.
If you’re flipping houses it is HIGHLY important that you create a product price list, I do this in Excel. I make a list of the products I’ll use rehabbing the property from paint, drywall, carpet, supplies, cleaners and so on. I leave a space to put the price of each product.
Once I have a list of all the materials and supplies needed I can figure my cost for those products (I purchase all my materials and avoid contractor markups). Now, wherever you purchase your products; (Home Depot, Lowes) take the list and order all your supplies at once, asking them to submit it to the “Bid Floor” so you can get a nice discount as opposed to paying full retail. Doing it this way you can save about 15% to 20% off the retail price.
One nice little tip before I go. I’ll get my price, from lets say Lowes and then go to Home Depot with the list and explain to them I’d rather do business with them and if they can beat the price I have quoted then they will get my business. When you have competing stores in an area they will usually beat the price by 5% to 10%,.
So see you can save 20% to 30% on your material cost if you apply this correctly.
All I ask is that when you do this, come back and leave a comment telling how well you’ve done. You can thank me then and buy me a coffee later.
Tare out is totally complete. I just wanted to post a short follow up to point out a few things to keep in mind that will help you save money along the way.
1. get the largest dumpster available for all the trash and tare out material.
2. have your own tare out crew.
3. make your decisions on color, cabinets, flooring, windows and anything else your changing prior to tare out.
4. purchase all your supplies in 1 large order at places like Home Depot and the like. talk to the store manager and ask for a large purchase order discount. you usually can save about 5 to 20 percent over purchasing everything separate.
5. get labor only estimates from contractors, there are contractors who will do this. read this post on how to save money when rehabbing and dealing with contractors.
6. check on your work site to make sure everything is flowing as it should so you can meet the schedule complete date.
Next Post I’ll have another video of some of the work completed. I’m so excited I can’t stop thinking about the whole process. Talk to you soon.
“greatness come with a price, sacrifice. so what will you sacrifice to become great”
When starting a flip it’s best to have several components in place so that you get the most for your money. You should have your tare out crew, repair/contractor and vendors in place. In this edition I’m covering the tare out being performed, plus the added surprise we had while taring things out.
It’s can be cost effect to have a separate tare out crew of two to three people, make sure they know and fully understand how you want the tare out completed. You can save money utilizing a small crew like this as opposed to having your contractor charge you to tare things apart and put them back together again. Outside the cost of the dumpster this tare out from the completed state you saw in the first video cost around $100.00
We had a small surprise, while taring out the old, it was discovered that there was a water issue. A water pipe had busted and the drywall was soft and wet with some mold appearing. The lower half of the drywall separating the laundry area and baths had to be ripped out as well. While removing the kitchen counters there was soft drywall as well.
Lesson to be learned here is that you must prepare for surprises whenever rehabbing a property.
When you start a rehab set a budget, get your estimates for the work, when you have those totals add an additional 20% to 25% to the total cost to cover unexpected things.
The budget for our flip is $10,000 so we factored an additional 25% to cover things like this so our total budget on the flip is $12,500. If we hadn’t factored things in this manner these surprises may have ruined or flip.
First I would like to extend a heartfelt thank you to each and everyone who has subscribed to this blog, given feedback or comments. I also want to give a “your welcome” to those of you I have personally spoken to or corresponded with by way of email and you expressed to me that what we discussed was helpful to your investing career.
I’ve been asked on several occasions to share an actual Flip/Rehab project that I’m working on. As of mid March a property that we had sold came back to us so we have decided to do just that (you ask for it and we provide it). Through several post I’ll take you through the process of our Flip/Rehab from start to finish. Below you will find the orignal video we shot of the property last year and in future post you will see the progress we make.
If you’re looking for investment properties in the NW Ohio area please follow this link so you will have access to the best available properties that will allow you to cashflow after all repairs are completed.
What you don’t see on many of the television shows about flipping houses are the many sad tales of promising flips gone wrong. These epic tales of woe are often the precursors to financial hardships for quite some time as those who fail at their property flips work on recovering from their heavy losses and moving on with their lives. Some are hit harder than others but the snowball effect of a bad flip are often not even hinted out on the prime time televisions shows that are so proud of the many success stories that arise because of serious and studious efforts in the house flipping arena.
If you are planning to flip a house for a real estate investment you really need to take a step back and decide that you are absolutely not going to be one of the house flip sob stories that are rumored about in Internet chat rooms. In fact, you want to be listed among the success stories. Unfortunately that takes a great deal of proper planning that is almost never shown on these television shows. In fact, to put forth your best effort you need to devote as much time to studying and planning properties, prices, and home values in your area before you even begin to search for your first property to flip as you need to invest in the entire process of actually working on your first flip. In other words, months worth of planning need to go into your first property pick in order to lower the risk of failure and to greatly improve the odds of success.
The second thing you need to do when planning your first flip and avoiding a sad tale and a sob story is to be realistic and avoid great expectations. With your first flip you are darn lucky to turn a profit at all. If you are expecting to make more money on your first flip than you made last year as a full time employee you might need to make other plans. The first flip rarely goes as expected.
Third, you need to set aside at least twice as much money (preferably three times as much) as you think you will need for the work on the property in order to cover the actual costs that will be needed. There are inevitably tools, permits, supplies, and labor that was not counted in the initial budget figures as well as the tendency to seriously underestimate the cost of the materials that will be needed in order to get the job done. If you don’t have that much or can’t spend that much and walk away without a loss then the property you are considering might not be the best property for your first flip.
Finally you need to plan everything. Every day needs to be fully planned before you show up to work on the property and you need to have all the materials you will need on hand from lunch to drinks, to tools and supplies. Trips to the hardware store, lunch breaks, and coffee runs quickly kill a day and any productivity that may have been made during that day. Avoid these costly delays by proper planning and you will discover that you have a real estate investing success story worth writing home about.
