Answer:
Will I don’t know Alabama’s tenant/eviction Laws so I would suggest you find them out. But I can help you with a few gentle suggestions. First off why did it take 60 days for you to see that the tenant was not paying? Our companies policy is the moment a tenant becomes late we send them a 3 day notice to pay or vacate. Depending on the communication they give us and the reasons for them being late we will allow up to two week s before we push eviction but that is it. Here in Texas it takes us about 21 to 45 days to get someone out so we know that if we start 15 days into them being late the worst were looking at is two months of nonpayment.  Another trick is to offer the tenant an incentive to leave. I have found that telling the non paying to leave the place spotless and in good shape and they will get 500 bucks and you have an eager person ready to leave your unit. (Yes I don’t like to reward bad behavior) but in this case the money and time you save makes it worth it.

Craig from Melbourne Australia
Question:  Here in Melbourne it is very common to own one unit amongst many others is that popular in the states?

Answer: Craig yes here it’s called Condo ownership. Condos can be popular depending on the city and the cities needs. For instance condos tend to be more popular in cities that do not have a wide sprawl to them. For instance in New York City Condos are all the rage. There simply is not a lot of room to expand. But here In San Antonio Condos are here but are not as popular. Simply put if you could buy a small home for the same price as a condo most people would choose the home and that is the case here.

Juwanna from Atlanta
Question: What is your Favorite book on business?
Answer:
Juwanna to be honest I cannot pick just one. (I know that is a copout answer) I will for these purposes keep it to a simple three
Trump the art of the deal
Carnegie How to win friends and influence people (IT IS A BUISNESS BOOK)
Kiyosaki  Prophecy (The first chapter)

I was speaking with an investor/client a few days ago and during our conversation this investor asked me the following questions.
Is now the right time to buy?
Is Texas a good place to buy?
What other places are good buys right now?

Now to the average investor these questions may seem normal and even appropriate considering the market conditions we are in. To me however these questions were a huge RED FLAG as to this investors investing ability. Why? You may be asking. Well let me go into some more detail as to what the problem is with the is now a good time to buy mentality.
To me when I hear this line of questions it alerts me to the fact that I’m dealing with either a novice investor or an investor who lacks financial sophistication. To illustrate my point let me answer the three questions the investor asked me.

Is now the right time to buy?
The answer to this is different for all of us.  I feel however that the components of the investors question was geared more as how is the market doing in relation to should I be investing there. To me this question is faulty from the start. The truth is I feel no matter the market conditions I can and have found great deals. Therefore I should always be investing (as long as they are good deals) in 2008 at the bottom of the drop I followed the drop all the way down by doing deals. Those deals are still positive cash flowing and have equity in them. Therefore to me they were smart purchases even though they were at a time that the market was in free fall.

Is Texas a good place to buy?
Let me answer this question with a story from my investing past. In 2007 we were looking to expand in too two different markets. We looked at buffalo NY and we looked at Corpus Christi TX. Whenever we are set to go into a new market we do extensive research on the area’s economics and population migration numbers. After doing this it was clear to us that Buffalo was the superior market. Homes could be purchased for next to nothing and could produce a huge positive cash flow. So we went to Buffalo to see the market for ourselves and to see if we could put a team in place. When we got there it became evident to us that there was not a team in place to handle our investments let alone our investors.  Being very disappointed I came back to San Antonio and drove the three hours to Corpus Christi. We were able to put a team in place there and as you can guess that is where we did deals. The point of the story is. There are very real differences in markets and you need to know them. But you need to remember that the number one thing you need in a market is a good team. You can have the best numbers on paper and they mean nothing unless there is a team in place to bring them to reality. Therefore when someone asks me where they should invest I always shoot back at them with. “Not where but with who are you investing?” THAT’S THE QUESTION!

What other places should I buy?
At this point in the article you are getting the point and could most likely answer this question for the investor who asked it. So instead of answering this one I will ask the most important question of this article. Why do investors undervalue education and overvalue area?
To me this is the number one enemy of investors. The ability to think that an area will bring their investment through as opposed to the knowledge base of knowing what to do in any circumstance. Or the ability to know how to hire a team that has that base. I want to make this very clear. I will invest anywhere no matter the market conditions as long as the base fundamentals are there for me to be successful. I would highly suggest if you do not live by this motto yourself that you start. As this motto alone will be the difference between good investments and bad ones.

INVEST WITH PASSION!
Brian Payton

THE GOLDEN RULE IS TO ROLL WITH THE PUNCHES!

Like any good boxer, investors must dodge the punches coming at them. In today’s market of subprime crashes, lenders closing doors and realtors looking for second jobs just to pay the bills, fear is motivating many investors to unload their properties. I’m wondering to myself, “Why am I the only one on the mountain top?” Below are my top three reasons for loving real estate right now:

1. When they stop buying, they start renting!

It’s a proven fact that real estate markets are cyclical. Sometimes they’re up and sometimes they’re down. What people don’t realize is that the market is also like a scale and when one is up, another is down. Well right now with the buyers’ market slowing, the rental market is gaining strength, which of course means higher rents and higher returns.

2. What else will get Uncle Sam off your back?

No matter where the market is, one thing that never changes are the tax breaks investing in real estate can offer. For instance, I may own a home that’s worth 10,000 dollars less than last year, but I still get the depreciation on the house. I still get to write off ALL of the expenses that are associated with the house in ANY way, which can make up many times over for the loss in actual value your property may have had.

3. How you buy matters–always.

Whether you’re in a high market or a low market you should always buy right, which is–AT A DISCOUNT. The truth is, in a market like we are presently in, it is much easier to purchase properties at a discount. Why, you ask? Well the answer is simple. More people are afraid and more people are in foreclosure and that means more people are willing to sell to you at a discount, a DEEP discount. So your job is even easier today than it was a year ago.

Investors–now is a great time to be in real estate! Deep discounts, motivated sellers and a growing number of renters–the only thing missing from this picture is you. And you’re missing a chance to make money! Don’t let fear stop you from overlooking opportunity. Remember the Golden Rule and you can succeed in any market!

WHO IS THE MOTIVATED SELLER?

That, my friend, is the million-dollar question and will be addressed further down. I often encounter investors who work on bank foreclosures. Investors will spend ample amount of time attempting to make these deals work, when in reality they’re fighting an uphill battle from the beginning. There are often hidden costs associated with acquiring this type of property that the investor doesn’t think to consider. Commonly, bank foreclosure deals entail a substantial sum in attorney fees, filing fees, and late payment fees to the lender; this is in ON TOP of the principal amount owed. These hidden fees must be satisfied in order to close the deal and add to the expense of the transaction, making it much less lucrative than you originally thought.

Now at this point, you’re probably thinking that a few extra hundred or even a few extra thousand dollars in unexpected costs isn’t enough to deter you from proceeding with a bank foreclosure because it’s still a great deal. Well, therein lies the secret to why tax foreclosures are such a better deal to work with. In my experience, at least 70-80% of the time you do a transaction that involves a Bank REO, you’re dealing with a buyer who is behind on their taxes anyway. So the government is already involved in the deal, regardless of the fact that you are working a bank foreclosure.

Lenders have a huge amount of holding costs on foreclosures. They place so many barriers in the way to getting a deal done that it becomes very difficult. My point in going over all of this is to point out to you the battle you’re facing when you’re placing the bank as first in the negotiation process. So, to answer the “million-dollar question”–in general, lenders are not motivated to sell to investors. They are less likely to negotiate, in an attempt to recoup their expenses, which they have a right to. Homeowners, however, ARE motivated to sell to investors. A homeowner facing a tax foreclosure is much more likely to negotiate with an investor because it may be the only opportunity they’ll have to make any type of profit.

By implementing the following priority of whom you’re working with, you’ll be closing deals in no time:

1. Uncle Sam

2. Seller

3. Bank

This formula works because we use the natural progression of the deal against the bank to force their hand in working with us.

The bottom line is that what is owed to Uncle Sam is, for the most part, the one debt that cannot be changed out of all the debts you will see in a foreclosure deal. The government is ALWAYS the first lien holder on transactions. They tell you what you owe and give you a deadline. If you don’t get the funds by that time, you lose the property. For the banks this would be devastating because what would then happen to their lien? Even though on paper they are in the first position (this means they have a greater right to take back the home), in reality the Government is always in 1st position. So the banks will actually lose their note if the government seizes the property.

1. What is the principal amount owed to the bank?

2. What is the total amount of taxes owed to Uncle Sam?

3. Is there rehab work needed to the house?

Once I have this basic information I find out these important pieces to the deal:

1. How much money will I need to spend to perform the rehab work to the home?

2. What can I sell the house for Retail?

3. What can I rent the house for?

Once I have this information I’m ready to start negotiating the deal.

Does this work every time? NO! But once you get the swing of it down, it can work in your favor. You can work this formula in about two days time instead of working through the red tape of the Banking and Realtor systems. Even if your offer is rejected, you get it quickly so you can move onto the next deal.

INVEST WITH PASSION!

GO TEXAS!

As we say here in the Lone Star state, “Everything is bigger in Texas” and that includes the returns. Really, it’s easy to see the opportunity that investing in Texas can bring.

The top three reasons to invest in Texas are:

1. Get more for your money.

It cannot be overstated enough that leverage is the name of the game in investing. When compared to other areas in the U.S. you will be blown away with the length your money can go to here in Texas. It is not uncommon to purchase investment homes here for 30,000 dollars to 40,000 dollars. Whereas, a comparable property in other markets such as California, could easily have a down payment higher than this total price, plus a loan.

2. Appreciation, Appreciation, Appreciation

Appreciation is what many investors in other markets are hoping and praying for. Well in Texas investors do not need hope, as the market has been growing at about a 10% clip, which includes 2007. Now for all of you east and west coast investors who were used to the 20% and 30% appreciation of a few years ago you may not be impressed. When you analyze the economic demographics of the three major cities San Antonio, Houston and Dallas you see that the appreciation you’re looking at in Texas is based on job growth and a housing need, as opposed to the hysteria of a few years ago on the coasts. I don’t know about you, but I’d take a true 10% appreciation over a phony 30% appreciation any day of the week.

3. Things in Texas are just better all around for investors.

From top to bottom you will be hard pressed to find a state government that works on behalf of the investor more than Texas. Landlord laws are set up in favor of the landlord. We’re able to evict tenants in 21 days or LESS. We pay no State Tax. Additionally, we have a government that is currently attracting more and more jobs by giving the companies who relocate here tax incentives. Which means that the economy is only at the surface of what it can accomplish. Throw in the new trade line that will run from Mexico straight through Texas and you have job growth and economic projections like you have never been seen before.

I invite all investors to take a closer look at the Texas market. Once you go Texas, you won’t go back.

Now I want to state clearly that while I’m an advocate for anyone taking that first step and commend anyone who wants to improve his or her life through investing in real estate, it should be noted that many of these first timers are also last timers. In my experience, these ultra-enthusiastic investors start off with a bang then crash and burn with their investments, only to never try again. The truth is that these investors, who I’ve dubbed the “Resolution Investors”, really didn’t have a chance because they avoided the proven track record to success in real estate investing.

Below, I list the top three mistakes made by the resolution investors and how you can overcome them!!

1. Putting action before education.

The fact is that the first action a resolution investor should take is to dedicate themselves to education in the real estate game. Seminars, books, educational programs, and real estate blogs are offered through many channels, including the website listed below, and are absolutely needed to help transition from “Resolution Investor” to a “Real investor”.

The bottom line is–if you do not understand basic real estate terms like “short sale”, “wholesaling” and “wrap deal”, then you are at a serious disadvantage. Also if you don’t know how to negotiate with contractors, realtors, loan officers, sellers and even the government, then you are a statistic waiting to happen. However, I believe that the investors who make the mistakes noted above are still better than the investors who analyze and then analyze and then analyze without ever taking action. Mistakes will happen, that’s inevitable, but learn from them and that mistake becomes invaluable.

2. The first move is to a realtor.

Now let me make this clear–I love realtors! They are a vital part of our team. The realtors on our team are smart and some of the best marketers I have ever seen. Now with that said, I see so many resolution investors go to realtors to help find their first deal. The sad truth is that the realtor is not there to help find you a deal. Realtors are there to sell you a property, period. If that home is a good deal then so be it, if it is not then so be it. Their job is to sell you a home but it is your job to make sure it is a good deal, not the realtor. I talk to so many of these resolution investors and they say to me, “Brian my realtor told me it was a good deal, I should sue him”. When confronted with that statement I realize that the investor is still refusing to see the problem. The problem is their own mentality, not the realtor.

3. It’s just a hobby!

Let me be very clear here–Anything that concerns my money is not a hobby and should not be yours either. I remember one investor who invested with us on a rather large and complicated transaction. We had produced pages and pages of documents detailing the investment’s possible ups and downs. Our plans detailed all that could happen and what we would do about it. We had pages of past performance pro formas as well as projection pro formas. I was so proud of the detail and content of the work. I mean we had nailed the due diligence on this project 100%. So I walked into this investor’s home and laid the paperwork on the table. She picked it up, looked at the cover (which had the ATW logo on it) then said to me “What a nice logo. I’ll do it.” She never opened the package I had slaved over. It was obvious that this was a mere hobby to her and not a business. Fortunately for her sake, this transaction turned out well, but I know of countless others who have had very different outcomes. I advise anyone to never be so cavalier. This is a business that can make you very wealthy but if you take it lightly, it can ruin you financially.

My friends I wish you a Happy New Year. It will truly be one with great opportunities! May this be the year you become an investor–a real one not just one with a resolution.

First off I acknowledge that by writing this article I am separating myself from the overall investment community, which believes in holding on to their investment dollars at the present moment. I will give you two reasons why now is a great time to invest in real estate.

Reason 1.

When the pigs go to slaughter, where will you be?

Have you ever heard the expression, “You know it’s time to get out of a market when the pigs come to slaughter”? Well, what that means is when investing in real estate becomes popular; it is harder to locate good transactions. Right now this is not a problem. I am finding that I am looking at some of my very best deals right now. The funny thing is no one wants in on the action. I find it very interesting that the overall community may say buy low and sell high but in fact, they practice the exact opposite. Now is the perfect time to buy positive cash flowing transactions with equity.

Reason 2.

The US Dollar is not really dead.

Is it beaten? Yes. Damaged? Yes. But it’s not dead and when you look at the reasons behind the dollar’s decline there are finally signs on the horizon that things are changing. For instance, the three major reasons for dollar decline were:

A- Soaring Energy Prices

B- Unfair Trade Agreements

C- Out of Control Debt

If you look at the situation you will see that our economy has faced these types of issues before and the nation was always able to recover. There is no reason to think that this case will be any different. What have we heard during the whole presidential election cycle this year? Lower energy costs, fix the trade agreement and less spending from the government. It is this investor’s opinion that the sky is falling and all the Chicken Littles out there want you to think that real estate is dead. If you listen to them, you will be missing a HUGE 12-18 month window of opportunity to buy homes at discounted prices.

Let me give you an idea on a deal we just completed to show you the power of this market. We purchased a home here in San Antonio for $16,000 (yes I know it’s low). This home has a retail market of about $60,000. We sold the home on an owner finance note for $40,000 at an interest rate of 7%. We are producing a $600 positive cash flow each month! I did not mistype those words. I never could have received that opportunity three years ago, but now I see them all the time.

Remember there is gold out there in real estate if you’re only willing to sniff it out.

Good luck and happy investing!

Investors today are having a tough enough time with their current investments. Refinances are tough, if not impossible, to do in your investment portfolio at the present moment. With the sliding market we are seeing great prices on homes everywhere but how do you get yourself into the transaction if you’re not able to get a loan on the home?

The “Subject To” deal may very well be the solution to your problem.

The definition of a subject to deal is when you purchase a home from a seller “subject to” them keeping their current financing (loan) on the property for an agreed upon amount of time.

So what does that mean and how can you use this strategy to buy 100 homes in this market?

To give you an idea of how these deals work and why they are win-win powerful deals, let me describe a recent transaction we participated in.

We had a seller who moved to San Antonio about five years ago, then decided it was his wish to move back home to Alaska. (As an investor I never question the cause of motivation.) This particular seller wanted to go to Alaska and now wasn’t soon enough! He didn’t have the time or patience to make the minor repairs the home needed or to let it sit on the market. He wanted a quick sale and just wanted out of the home.

To help him out we agreed to take the home over and closed the deal a week later. We put the home into a land trust and put a renter in the home. Within a month we had purchased a home with equity and cashflow. The seller is now in Alaska and is as happy as can be!

Most of the time you won’t be doing subject to deals with folks who just want to move to Alaska. It is true that subject to’s are normally used to help folks who are JUST entering into pre-foreclosure but still these type of deals work. As a matter of fact, they work like a charm.

Subject to Detractors:

1) A subject to deal is risky because you don’t own the home.

This is an inaccurate statement. When we do subject to deals we ALWAYS have the home deeded to a land trust, which we own.

2) A lender can call the note due at anytime.

While this is correct, I have never seen a lender call a note due on any investor who is paying the note in a timely manner. In fact, I have called lenders to tell them I now have a fiduciary interest in the home and that I will be making payments on the home (Can you spell it out any clearer?) The lenders just say okay and send me the payment information on the property. The bottom line is that lenders want to work with people who make payments on the homes. It does not make sense for them to pay the fees to call a note due when the note is being paid.

I will give this last word of caution to my investor friends. Subject to’s are a great way to buy homes at a discount and with cashflow. But we must always remember we are giving the seller of the home our word that we will make the payments on the home no matter what. The only time subject to deals go wrong is when investors don’t keep their promises and fail to make the payment. Although I would say in this case, it is not the investment strategy that failed but the investor. The bottom line is if you can’t handle the worst-case scenario (you paying the mortgage), then you shouldn’t do the deal. But that is the case with any kind of deal. I take my commitments seriously to my sellers and I advise all investors to do the same.

With that being said, subject to deals are a powerful and helpful way to purchase real estate. In today’s current market this is, above all, the most powerful strategy in buying tons of undervalued homes. It’s why we have made a goal of purchasing over 100 of these homes this year! You too should cash in on these great deals and remember at the same time you’re making money; you are helping lots of people out of bad situations. And that, my friends, is the best way to make money.

Investors- I wanted to take a moment to talk about one of the most crucial parts of investing in real estate. Those who already know this secret and practice it well, have and will consistently achieve returns in the 20, 30 and higher percentiles. Those who do not yet know this secret or plan to disregard it, should practice saying your prayers because you’re going to have to bank on your financial planner (also known as glorified sales agent) to get you high returns (which they don’t tell you is about 5%).

So I know what your saying, “What is this secret?”

The answer is: Effective Leadership.

You’re probably saying to yourself at this moment, “Huh? What does leadership have to do with investing?”

The answer is: EVERYTHING!

To succeed in real estate you must have a team (everyone knows this). What they don’t tell you is that you must be an effective leader for your team. If you cannot manage you team, they will either leave you or worse they will stay (which means there not worth anything to you).

Below are the three most common attributes to poor leaders:

1. The “I will do it all myself” guy.

At some point, we’ve all seen this guy, heard of this guy or turned out to be this guy. This guy will do the sheet rock, fix the roof, collect rents and market the asset for resale all by himself. This guy is so smart he can do it all.

The problem is YOU CAN’T DO IT ALL! Not to say you cannot possess the ability to do it all. Even if you could do everything yourself, did you get into investing to do sheetrock? I believe the reason someone would feel this way is because this type of investor is afraid to trust others and has a self-confidence problem. There is no leverage at all in doing it all yourself. When you calculate returns on a project like this, the amount of your time and effort put in needs to be considered and this poor guy has put in way too much of both.

2. The “I don’t know how to do anything” guy.

This is the investor who doesn’t know how to do anything and has no interest in learning at all. This guy knows nothing about materials, timeframe, procedure or cost. You’ll know who this guy is by his glazed-over look and excessive head nodding.

The issue here is this guy garners no respect from his team or for his team. Either the team takes advantage of him or worse just leaves. You have to have a base knowledge of the job to garner respect from your team and respect the work they do. Ignorance is not bliss-it’s just stupidity.

3. The ” My guy will take care of that” guy.

This investor is the one who’s too busy for everything-eating, sleeping, drinking. Surely, he’s too busy to lead a team (which in all reality takes maybe 1 hour a week when done right). This guy expects someone else to take care of managing his team.

Well it’s impossible to get your team to do what YOU need them to do when they’re managing themselves. I suggest that this investor either get involved or seek out a financial planner then pray and hope for those wonderful 3% returns.

The point is you must garner control of your team and manage your team. Your team is what produces the return. The team you build is what makes or breaks your investment. They must respect you and most importantly want to see you succeed. Effective leadership is the only way to make this happen and it is truly what separates average investors from great ones.