NAR Commercial Education Connection
Prepare yourself and your business for 2010 by registering for the final two Top Dogs sessions brought to you by NAR Commercial. On December 17 and 18, Top Dogs is offering two webinars at a deeply discounted rate of $49 per session. The two hour sessions are regularly priced at $89, but if you use one of the following discount codes fhosuddnkr or rihequpimu, you will receive an immediate $40 discount. The Top Dogs webinars will give you the opportunity to learn from Peter Droubay and Bob McComb, the co-creators of the Top Dogs commercial real estate training programs.
The December 17 session Tools You Need to Have and People You Need to Get to Know covers the tools you need to have at your disposal if you are going to succeed as a commercial agent or broker. Top Dogs' December 18 webinar The Best Reputation to Have: How to Be A Take-Action-Today, Do it Now, Finisher is all about attitudes and strategies for personal productivity and will show you how to elevate your personal productivity. These sessions are a deal, priced at $49 per session for two hours of fast paced, ready to use information!
Webinar Session Description and Registration: December 17: Tools You Need to Have and People You Need to Get to Know (beginner level)
Webinar Session Description and Registration: December 18: The Best Reputation to Have: How to Be a Take-Action-Today, Do It Now, Finisher (expert level)
All sessions are first come, first-served and limited to 200 attendees. Visit the NAR Commercial Education web page to learn more about the education resources available to you from NAR Commercial and the Commercial Institute Affiliates. For Top Dogs webinar registration questions, contact Top Dogs at 888-894-5772. For general questions, contact NAR Commercial at 800-874-6500.
Wednesday, December 16, 2009
Monday, December 14, 2009
Are you ready to covert your IRA to a roth
There are changes coming in 2010 that includes no restrictions, the Modified Adjusted Gross Income limited on a ROTH will be lifted for conversions - so just about anyone can convert an existing IRA to a ROTH.
Read More from Equity Trust by clicking here
It's an Online World: Are You Prepared
I recently attended a broker series class at KCRAR and wanted to share some of the notes I took about current marketing trends for real estate and beyond.
http://www.secondlife.com/: were all very busy learning how to use Facebook and Twitter, but the next thing is SecondLife, and if you are really in to Second Life you may find yourself buying and selling virtual real estate in a virtual world and selling real stuff in a virtual world.
Google Maps for Real Estate Google is allowing people to search for real estate for sale using their mapping feature. You can get your listings on google maps through one of the syndicating web sites out there or load them yourself into google base. If your properties are not on this, figure out how to get them there.
Neighborhoods: we talked about buyers wanting to live in walkable neighborhoods, where they can walk to work, shop, and play, more urban and less suburbs.
Realtors: buyers are looking for buyers (or home sellers) who are honest, good listeners, know the market, and can explain the process, and are connected to all the answers
Websites that consumers are going to get more information
Google Maps for Real Estate Google is allowing people to search for real estate for sale using their mapping feature. You can get your listings on google maps through one of the syndicating web sites out there or load them yourself into google base. If your properties are not on this, figure out how to get them there.
Neighborhoods: we talked about buyers wanting to live in walkable neighborhoods, where they can walk to work, shop, and play, more urban and less suburbs.
Realtors: buyers are looking for buyers (or home sellers) who are honest, good listeners, know the market, and can explain the process, and are connected to all the answers
Websites that consumers are going to get more information
- http://www.houselogic.com/ from the National Association of Realtors
- http://www.commercialsource.com/
- http://www.incredibleagent.com/ and http://www.incredibleagents.com/
- http://www.outrageousagents.com/
- http://www.homethinking.com/
- http://www.realestateratingz.com/
- http://www.agentrank.com/
- http://www.yelp.com/
- www.ziprealty.com/
- Google Alerts
- StepRep
- Trackur.com
- Backtype
- Immediate Responsiveness with comments going directly to listing agents email / smart phone
- Lead Management
- Relationship Managment Applications
- So now for example when a Realtor list a property through the Kansas City area's MLS, properties can be immediatly syndicated out to a bunch of web sites and may will allow the viewer to comment on the listing that will get back to the listing agent to act on very quickly
- Information Central
- ProQuest
- Field Guides on all types of topics
- Research Statistics
- Tool Kits
- Community Outreach Programs
- PodCasts and other training
- We have posted a sample Blog Policy in the Business Management Section of the MAREI Library. go to http://www.mareinet.com/ and log in to access.
Wednesday, December 9, 2009
December Meeting in Review
Many thanks to everyone who braved the rain, the ice, and the snow to attend the December 09 holiday meeting. We had about space for 30 reserved and we were packed from about 6:30 to 7:30. We had people from all over the metro as well as visitors from the Omaha group and an investor visiting from Florida.
Lots of business cards were changing hands, deals were being talked about, food being consumed and pool being played.
Check out some of the pics . . .
Lots of business cards were changing hands, deals were being talked about, food being consumed and pool being played.
Check out some of the pics . . .
Focus
At the networking last night we talked a lot about having focus. Then this morning as I sit at my desk I have a window open on my computer to order a Christmas gift, a camera hooked up to download photos on a house, a house file on my desk to look up comps, the MAREI schedule on my desk to work on next years meetings.
I need focus, and when I come back to what I did in a previous life it comes down to making a list. Sit down at the end of the day and write out everything you want to accomplish tomorrow and prioriize. Then the next morning, review, start at the top and mark off as you go. Then at the end of the evening, go through your list, see what you accomplished, mark it off, and plan out the next day.
This really works well for me, but of course when life happens through out the day, you need to decide, do you write the new life issues on the list for tomorrow or deal with them as they come. I am unfortunatly a deal with them as they come, even if they are interrupting something more important. And I know I need to work on this, keep focused on the project at hand and add the little fires that need delt with to the list to look at at least after I am finished with my current project.
What do you think? Please comment and let me know how you stay focused or not and what works for you.
I need focus, and when I come back to what I did in a previous life it comes down to making a list. Sit down at the end of the day and write out everything you want to accomplish tomorrow and prioriize. Then the next morning, review, start at the top and mark off as you go. Then at the end of the evening, go through your list, see what you accomplished, mark it off, and plan out the next day.
This really works well for me, but of course when life happens through out the day, you need to decide, do you write the new life issues on the list for tomorrow or deal with them as they come. I am unfortunatly a deal with them as they come, even if they are interrupting something more important. And I know I need to work on this, keep focused on the project at hand and add the little fires that need delt with to the list to look at at least after I am finished with my current project.
What do you think? Please comment and let me know how you stay focused or not and what works for you.
Monday, December 7, 2009
Activities at MAREI this week
MAREI members:
We have a lot packed into the schedule this week, and hopefully we will have a 3 week break until we start marketing for January events.
First is our Virtual Food Drive running the whole month of December. We have partnered with Harvesters to raise funds for 10,000 meals. We currently have 550 meals in our donation pile. To find out more go to: MAREI's Food Drive
Second is our meeting. We have canceled the regular meeting at the Marriott and instead we are having a holiday networking "happy hour" from 5:30 to 8:00 at the Fox & Hound at 103rd & Metcalf. More info: 12/08/2009-2009 Holiday Networking Meeting - Happy Hour
Third is our webinar on Wednesday with Mark Klee & Caryn McKinney on buying houses from people in bankruptcy. Find out how you can turn misfortune into a win win for everyone. More info: 12/09/2009-Webinar - Turning Bankruptcy into Gold
Fourth is our webinar on Thursday with Dan Doran. He is going to share how to buy REO properties for pennies on the dollar and have all the work done for you. Check it out: 12/10/2009-How to buy REO’s without doing any of the work!
If you missed the December Newsletter, be sure go go to the web site to read: Current Newsletter
And last we will have a new meeting location starting in January, Sylvester Powell Jr Community Center at 6200 Martway in Mission (Johnson Drive and Nall north of Shawnee Mission Parkway, by the license plate and drivers licenses places sort of)
We have a lot packed into the schedule this week, and hopefully we will have a 3 week break until we start marketing for January events.
First is our Virtual Food Drive running the whole month of December. We have partnered with Harvesters to raise funds for 10,000 meals. We currently have 550 meals in our donation pile. To find out more go to: MAREI's Food Drive
Second is our meeting. We have canceled the regular meeting at the Marriott and instead we are having a holiday networking "happy hour" from 5:30 to 8:00 at the Fox & Hound at 103rd & Metcalf. More info: 12/08/2009-2009 Holiday Networking Meeting - Happy Hour
Third is our webinar on Wednesday with Mark Klee & Caryn McKinney on buying houses from people in bankruptcy. Find out how you can turn misfortune into a win win for everyone. More info: 12/09/2009-Webinar - Turning Bankruptcy into Gold
Fourth is our webinar on Thursday with Dan Doran. He is going to share how to buy REO properties for pennies on the dollar and have all the work done for you. Check it out: 12/10/2009-How to buy REO’s without doing any of the work!
If you missed the December Newsletter, be sure go go to the web site to read: Current Newsletter
And last we will have a new meeting location starting in January, Sylvester Powell Jr Community Center at 6200 Martway in Mission (Johnson Drive and Nall north of Shawnee Mission Parkway, by the license plate and drivers licenses places sort of)
Friday, December 4, 2009
December Newsletter Sponsors
Realty Resource of KC . . . is a real estate brokerage for investors by investors. Our agents are investors themselves, so they know the ropes. They have bought and sold property, rehabbed, and managed rental property. They have the contacts and the know how to assist you with your real estate investments on both the buying side as well as the selling side. Find out more about our properties for sale and how our agents can help you by going to http://www.realtyresourcekc.com/
TuckerOneProperties, Inc. . . . and their partner company ROI Realty buys and sells houses through out the Kansas City metro area. Focusing primarily on Jackson County in Missouri and Johnson County in Kansas they buy houses and because of their line of credit, can pay cash and close fast. If you have a house that you need to sell, or a great buy on a house that you can't quite take down, give us a call. If you are looking for fixer uppers in better areas, check our site for current inventory. All properties are offered as is before we start rehab. Find us online at http://www.tuckeroneproperties.com/
Accurate Title Co . . . has over 50 years of experience in the real estate industry. Offering title insurance, ownership and encumbrances, closing and escrow, and 1031 exchange services. If you need it closed, the team at accurate can get it done. If you buy and sell in Kansas or Missouri, or do a little bit of wholesale selling, you need to call and talk to the staff. Find our more about their services at http://www.accuratetitleco.com/
YellowLetter.com . . . is owned and opperated by National Trainers John and Donna MacNiel, the investors of the original Yellow Letter marketing tool. They offer direct mail services with their Yellow Letter as well as Pre-NOD lead lists nationwide. Find out more at http://www.yellowletter.com%20and/ sign up for their newsletter to find out about their special deals and promotions.
Monthly Advertisers
T.O.T.L. Renovations with members Tony and Emily Culp offering full service renovation services. They are licensed and insured and accept most major credit cards. See their ad here .
TuckerOneProperties, Inc. . . . and their partner company ROI Realty buys and sells houses through out the Kansas City metro area. Focusing primarily on Jackson County in Missouri and Johnson County in Kansas they buy houses and because of their line of credit, can pay cash and close fast. If you have a house that you need to sell, or a great buy on a house that you can't quite take down, give us a call. If you are looking for fixer uppers in better areas, check our site for current inventory. All properties are offered as is before we start rehab. Find us online at http://www.tuckeroneproperties.com/
Accurate Title Co . . . has over 50 years of experience in the real estate industry. Offering title insurance, ownership and encumbrances, closing and escrow, and 1031 exchange services. If you need it closed, the team at accurate can get it done. If you buy and sell in Kansas or Missouri, or do a little bit of wholesale selling, you need to call and talk to the staff. Find our more about their services at http://www.accuratetitleco.com/
YellowLetter.com . . . is owned and opperated by National Trainers John and Donna MacNiel, the investors of the original Yellow Letter marketing tool. They offer direct mail services with their Yellow Letter as well as Pre-NOD lead lists nationwide. Find out more at http://www.yellowletter.com%20and/ sign up for their newsletter to find out about their special deals and promotions.
Monthly Advertisers
T.O.T.L. Renovations with members Tony and Emily Culp offering full service renovation services. They are licensed and insured and accept most major credit cards. See their ad here .
Mid-America Association of Real Estate Investors announces it's December Newsletter Is Posted
Stay up to to date with the activities at Mid-America Association of Real Estate Investors, Kansas City Real Estate, and Real Estate Nationwide.
Read the current newsletter here:
click for newsletter
Read the current newsletter here:
click for newsletter
Monday, November 30, 2009
Special Price on Broker Classes at CES
SPECIAL ½ PRICE OFFER ON
BROKER PRE-LICENSE CLASSES!
If you sign up and pay for a broker pre-license class now through the end of December, you can attend either our December, 2009 or February, 2010 broker pre-license class for ½ price. Call us for details as well as requirements to obtain your broker's license. Offer applies to Kansas City, St. Louis or Wichita classes.
Must have 2 years experience as an agent.
More Info
MAREI Next Meeting: Mid-America Association of Real Estate Investors meets on the 2nd Tuesday of the month for their vendor hall, networking, and education. Check out the current meeting on this month’s calendar. December 8th, at the Fox & the Hound
Friday, November 27, 2009
Lowes for Pros
If you are a realtor, you may or may not know about this link: http://www.lowesrealtorbenefits.com/
This is set up for National Association of REALTORS®, through their REALTOR® Benefits Program, but it seems that just about anyone can actually use the service.
Benefits
- send free, personalized direct mail and e-mail with special Lowe’s coupons to your buyers and sellers
- gives you a 5% discount on Lowe’s gift cards purchased online
- plus free videos, web banners, and Monthly Newsletters.
MAREI Next Meeting: Mid-America Association of Real Estate Investors meets on the 2nd Tuesday of the month for their vendor hall, networking, and education. Check out the current meeting on this month’s calendar.
Mid-America Association of Real Estate Investors and Harvesters Community Food Network
Mid-America Association of Real Estate Investors (MAREI) is supporting Harvesters – The Community Food Network, and will sponsor a fund drive from Monday, Nov. 30 through Wednesday, Dec. 23.
Members and friends are encouraged to participate in the drive to help Harvesters’ network feed those in need throughout Kansas City metro area by donating at their local grocery store or going to the Harvester’s web site to donate at http://marei.harvesters.org/
It is hard to believe that in Kansas City and across the country that people are going hungry. But the reality is that there ARE people who are hungry every day in Kansas City. Harvesters and their agencies provide assistance to nearly 60,000 people every week. And half of those are children and the elderly.
A contribution from Nov. 30 – Dec. 23 means much needed help, and hope, will be available to those who need it. And while you can donate items at the local grocery, Harvesters can do a lot more with cash. At the store you can spend $1 and buy maybe up to 3 food items. But $1 donated to Harvester’s combined with the companies they work with can provide five meals. So donating the $1 is much more cost effective than 3 cans of beans.
What’s in it for you? The good feeling of helping out a family in need. And remember, it could be you, your parent, your child or grandchild that needs help tomorrow. And it may be that you help one or more of tenants in your rentals put food on the table so they have the funds to pay for utilities or rent.
Don’t have an extra $1 to donate, then check out their web site to find out how you or your organization can donate time and labor.
For more information about Harvesters, visit http://marei.harvesters.org/.
MAREI Member Resources: Visit for real estate investor articles, real estate investor events, real estate investor properties, investor continuing education, free bonuses, general meeting archives, Kansas City area info, Real Estate Investor Message Board, Newsletter Archives, and more.
National Property Database
National Association of Realtors - NAR recently announced that their Second Century Initiatives include the creation of REALTORS Property ResourceTM (RPR), an online real estate library/archive that will provide real estate professionals with data on every property in the United States.
This will provide access to a national database of property info and provide real estate professionals with the best access to real property information needced to serve their customers.
Database to include:
- public record information,
- details of prior transactions,
- MLS-provided information,
- zoning information,
- transfer tax information,
- and other relevant information.
Press Release
REALTORS Property Resource™ Fact Sheet
NAR CEO Dale Stinton's Webcast
MAREI Next Meeting: Mid-America Association of Real Estate Investors meets on the 2nd Tuesday of the month for their vendor hall, networking, and education. Check out the current meeting on this month’s calendar.
News From Washington for Real Estate Investors
From HUD: 120 day period of restraint for the enforcement of the new RESPA Rules
11.13.09 - HUD has announced it will have a have a period of restraint for 120 days in the enforcement of the new RESPA Rules. Rule includes: mandatory Good Faith Estimate and the HUD-1.
HUD Press Release
HUD RESPA FAQs
FHA Removes the Requirement for 2nd Appraisals
11.14.09 - Federal Housing Administration (FHA) It was announced at the annual National Association of Realtors (NAR) convention in San Diego that FHA will soon remove the 2nd appraisal requirement on some types of loans. In a letter released from FHA (Mortgage Letter 2009-48) it oulined elimination of the 2nd appraisal on: loans exceeding $417,00, having an LTV =/> 95%, secured by properties located in declinging makets. Requirment retained if property is being sold between 91 days and 180 days after acquistion by the seller, so rehabbers and flippers, you can sell to FHA buyers if you have owned for 90 days, but house will need 2 appraisals.
Mortgagee Letter 2009-48: Second Appraisal Reporting Requirements
Mortgagee Letter 2009-08: Limits on Cash-Out Refinances
Mortgagee Letter 2008-09: Second Appraisal Requirements/Limits on Cash-Out Refinances
Mortgagee Letter 2006-14: Property Flipping Prohibition Amendment
MAREI Member Resources: Visit for real estate investor articles, real estate investor events, real estate investor properties, investor continuing education, free bonuses, general meeting archives, Kansas City area info, Real Estate Investor Message Board, Newsletter Archives, and more.
Monday, November 23, 2009
Holiday Networking Party for Kansas City Real Estate Professionals
Mid-America Association of Real Estate Investors or MAREI, in the Kansas City metro area is announcing its December monthly meeting. This will be a purely networking event for real estate investors in the Kansas City metro. This event will take place on Tuesday December 8th from 5:30 pm to 8:00 pm at the Fox and Hound pub at 103rd and Metcalf in Overland Park.
This event will focus on bringing together our members and their guests to discuss the current trends in real estate, services available to investors and landlords, deals, and to ask questions. This meeting is open to all real estate investors, landlords, wholesale investors, Realtors, rehabbers, lenders, mortgage bankers, contractors, insurance providers, staging professionals and more. Experienced investors as well as new investors and people just getting their feet wet in the industry.
Be sure to practice up on your 15 second pitch or elevator speech. Fill your pockets with business cards. And bring a few dollar for a drink and an appetizer. No fee to enter or to join in, open to the general public. Please RSVP on our web site at www.MAREInet.com.
MAREI meets monthly to provide motivation, networking opportunities, and up-to-date education for people who want to buy their own home or investment property in today's real estate economy. Each month, a nationally known real estate investment speaker or local specialist is featured. Real estate professionals, investors, landlords, realtors, contractors, wholesalers, rehabbers, and the general public are invited to attend our monthly meetings for educational and networking opportunities. For more information, please call (816) 523-4400 or visit www.MAREInet.com for more information
About MAREI
MAREI is one of the largest real estate investors & apartment owners & landlord association in the Kansas City Metro area and its mission is to provide educational and networking opportunities as well as business-to-business opportunities for entrepreneurs in the real estate investment community. We're firmly committed to promoting a sound understanding of ethical real estate investing principles and to help further develop our members' investing abilities.
This event will focus on bringing together our members and their guests to discuss the current trends in real estate, services available to investors and landlords, deals, and to ask questions. This meeting is open to all real estate investors, landlords, wholesale investors, Realtors, rehabbers, lenders, mortgage bankers, contractors, insurance providers, staging professionals and more. Experienced investors as well as new investors and people just getting their feet wet in the industry.
Be sure to practice up on your 15 second pitch or elevator speech. Fill your pockets with business cards. And bring a few dollar for a drink and an appetizer. No fee to enter or to join in, open to the general public. Please RSVP on our web site at www.MAREInet.com.
MAREI meets monthly to provide motivation, networking opportunities, and up-to-date education for people who want to buy their own home or investment property in today's real estate economy. Each month, a nationally known real estate investment speaker or local specialist is featured. Real estate professionals, investors, landlords, realtors, contractors, wholesalers, rehabbers, and the general public are invited to attend our monthly meetings for educational and networking opportunities. For more information, please call (816) 523-4400 or visit www.MAREInet.com for more information
About MAREI
MAREI is one of the largest real estate investors & apartment owners & landlord association in the Kansas City Metro area and its mission is to provide educational and networking opportunities as well as business-to-business opportunities for entrepreneurs in the real estate investment community. We're firmly committed to promoting a sound understanding of ethical real estate investing principles and to help further develop our members' investing abilities.
Saturday, November 14, 2009
Real Estate Investing - Getting Started
After purchasing your own home, many turn to the idea of owning another or several other homes as a money investment. As everyone and their brother realizes that real estate and the housing market it way low, many might be a little scared to jump in the investment arena. However, if with a little education and due diligence, right now is an excellent time to invest in real estate.
Interest rates remain low and have dropped some in the past year. The number of foreclosur ehomes on the market are going up, which makes the number of deals that are easy to find out about and purchase has lowered the average home prices. So if you are thiking about jumping into investing in real estate, consider the following.
Financing.
As you invest in real estate, one of the biggest components to profiting is to make sure that you have the property financing ready to go. Unlike a store where you buy inventory, mark it up and sell it, real estate has a few more components. first you need to decide if you want to rent the home for a little income now while the tenants pay off your mortgage so you have a nice free and clear investment home at retirment. Or do you want to flip it for a profit now. If you are going to flip, and you know you have a great deal that you WILL be able to resell, you may consider using your own cash, a more costly hard money loan, or private lender. If you are going to hold, you will want to be able to secure a long term, fixed rate loan from a traditional lender, a private individual, or maybe even from the seller.
Get help.
You can't be an expert at everything. By all means do what you have the knowledge, the talent, and the time for. But you may find that you can pay someone to fix the toliet and get it done in less than an hour or you could learn how to do it yourself, buy several different parts with several trips to the hardware store, and have it all fixed and working in 3 days. So if it is not something you know how to do, ask for help, get referrals, and check out prices to make sure you are not paying too much.
Learn your market
Market trends are very important. If you are going to fix up a house, you need to know what is renting or selling in your area, or you could waste you rmoney on somethign that is no longer in. Just yesterday we learned that oak is out while dark wood is in, brick is out while tile is in, vanity cabinets are out where furniture look is in.
Manage your Real Estate Investments as a Business
Do not treat it as a hobby or things will end up cosing you more money and time than it should. Real Estate Investing is a business, so treat it like one.
Education
You have many choices in educating yourself on real estate investing. These choices range from free online events, to books in the $20 range, events from your local real estate association in the $30 to $100 range, home study courses between $500 and $1000, and then bootcamps from $1000 to $10,000 and even more. I strongly recommend checking out your local real estate association and accessing all the training they have available before you start spending the big bucks. Get an idea of what it is you want to do, get focus, do some research and find out what training is recommended by fellow investors at the association, and do some online research before you break out the credit card to shell out $10,000 for training.
You will find a complete list of real estate investment associations from across the country online at http://www.nationalreia.com/. And in the Kansas City Metro area, we highly recommend Mid-America Association of Real Estate Investors (http://www.mareinet.com/) Membership in MAREI is just $99 a year and you will reap $1000x in educational materials, networking, and money saving benefits.
Interest rates remain low and have dropped some in the past year. The number of foreclosur ehomes on the market are going up, which makes the number of deals that are easy to find out about and purchase has lowered the average home prices. So if you are thiking about jumping into investing in real estate, consider the following.
Financing.
As you invest in real estate, one of the biggest components to profiting is to make sure that you have the property financing ready to go. Unlike a store where you buy inventory, mark it up and sell it, real estate has a few more components. first you need to decide if you want to rent the home for a little income now while the tenants pay off your mortgage so you have a nice free and clear investment home at retirment. Or do you want to flip it for a profit now. If you are going to flip, and you know you have a great deal that you WILL be able to resell, you may consider using your own cash, a more costly hard money loan, or private lender. If you are going to hold, you will want to be able to secure a long term, fixed rate loan from a traditional lender, a private individual, or maybe even from the seller.
Get help.
You can't be an expert at everything. By all means do what you have the knowledge, the talent, and the time for. But you may find that you can pay someone to fix the toliet and get it done in less than an hour or you could learn how to do it yourself, buy several different parts with several trips to the hardware store, and have it all fixed and working in 3 days. So if it is not something you know how to do, ask for help, get referrals, and check out prices to make sure you are not paying too much.
Learn your market
Market trends are very important. If you are going to fix up a house, you need to know what is renting or selling in your area, or you could waste you rmoney on somethign that is no longer in. Just yesterday we learned that oak is out while dark wood is in, brick is out while tile is in, vanity cabinets are out where furniture look is in.
Manage your Real Estate Investments as a Business
Do not treat it as a hobby or things will end up cosing you more money and time than it should. Real Estate Investing is a business, so treat it like one.
Education
You have many choices in educating yourself on real estate investing. These choices range from free online events, to books in the $20 range, events from your local real estate association in the $30 to $100 range, home study courses between $500 and $1000, and then bootcamps from $1000 to $10,000 and even more. I strongly recommend checking out your local real estate association and accessing all the training they have available before you start spending the big bucks. Get an idea of what it is you want to do, get focus, do some research and find out what training is recommended by fellow investors at the association, and do some online research before you break out the credit card to shell out $10,000 for training.
You will find a complete list of real estate investment associations from across the country online at http://www.nationalreia.com/. And in the Kansas City Metro area, we highly recommend Mid-America Association of Real Estate Investors (http://www.mareinet.com/) Membership in MAREI is just $99 a year and you will reap $1000x in educational materials, networking, and money saving benefits.
MAREI Library
Members of MAREI have access to our library online. It is jam packed with:
- Past Newsletters
- Articles
- Forms
- Contracts
- E-Books
Friday, November 13, 2009
Incorporation
Do you need to incorporate your business for 2010?
You should always consult with an attorney and your CPA when doing any type of new incorporation. But if you are bound and determined to do it yourself, MAREI member's can access a do it yourself incorporation kit. Log into the member's area at http://www.mareinet.com/ and visit the library under asset protection.
You should always consult with an attorney and your CPA when doing any type of new incorporation. But if you are bound and determined to do it yourself, MAREI member's can access a do it yourself incorporation kit. Log into the member's area at http://www.mareinet.com/ and visit the library under asset protection.
Saturday, November 7, 2009
I need a mentor . . .
We get request quite often from people looking for a mentor or a coach to help them get started in real estate. We have looked at starting a mentoring program ourselves, but just can't quite figure out how to add it into our busy schedule.
But then I look at all the gurus out there who have a mentor program. For just $5,000 more, or $8,000 more or $10,000 more you to can become a part of a guru's mentoring program. Now I have never been a student in a mentoring program, but I have been unwittingly conned into being a student in one of these very expensive mentor/coaching programs.
You see they come to town and do the free pitch at the hotel, sell you something small and get you to come to a week end event, sell you something bigger that includes a bootcamp, and then they rope you into the mentor program - these are usually people like Robert Allen, Russ Whitney, Robert Kyosaki. Now I am not saying these things are bad, but just wanted to share some observations on how the coaching program seems to work from my side.
The student gives my office and I am assuming a bunch of different types of people a call. It goes something like "I have a coach coming to town next wednesday and he/she has asked me to contact a few realtors/ mortgage people/ title companies/ etc and set up a time for us to meet. I am building my power team and I wanted to find out more about how you would fit on my team. Could we come in on Thursday about 2 pm. I will need about an hour of your time."
Then the student and the coach and about 4 to 6 other students show up in my office. All have their list of questions, who do you recommend, how do you do this, how do you do that. It seems to me that I am doing the teaching and the coach is getting paid the big bucks. So we don't take meetings with these students anymore. I have yet to have a single one (and we have had a lot of these groups of coaching students through) to actually buy anything.
No I take that back. We had a coaching student who actually took action before the coaching week and bought a house from us in advance of the coaching. The house cost about the same as the cost of the coaching and I know he learned a lot, I don't know if he ever rehabbed and tenanted the house, but he did get a lot of Kansas City connections through us.
So I wanted to give you some options on getting some mentoring for free, or at least for a more economical price that what the gurus want to charge you.
1) Join your local REIA Group: Kansas City - rest of the Nation
2) If they have a quick start program or a fast start program, go through them asap.
3) Take advantage of all the teleconferences, webinars, workshops, etc
4) Figure out to a small degree what it is you want to do: wholesale, rehab, landlord
5) Buy a training program and / or attend a bootcamp (Always try to buy through the local REIA, they can usually get you the best price and free bonuses)
6) Utilize the messasge boards offered by the local REIA and or the Guru whose program you purchased.- and ask questions. More on message boards in future posts.
7) Get in the game and get your hands dirty!
But then I look at all the gurus out there who have a mentor program. For just $5,000 more, or $8,000 more or $10,000 more you to can become a part of a guru's mentoring program. Now I have never been a student in a mentoring program, but I have been unwittingly conned into being a student in one of these very expensive mentor/coaching programs.
You see they come to town and do the free pitch at the hotel, sell you something small and get you to come to a week end event, sell you something bigger that includes a bootcamp, and then they rope you into the mentor program - these are usually people like Robert Allen, Russ Whitney, Robert Kyosaki. Now I am not saying these things are bad, but just wanted to share some observations on how the coaching program seems to work from my side.
The student gives my office and I am assuming a bunch of different types of people a call. It goes something like "I have a coach coming to town next wednesday and he/she has asked me to contact a few realtors/ mortgage people/ title companies/ etc and set up a time for us to meet. I am building my power team and I wanted to find out more about how you would fit on my team. Could we come in on Thursday about 2 pm. I will need about an hour of your time."
Then the student and the coach and about 4 to 6 other students show up in my office. All have their list of questions, who do you recommend, how do you do this, how do you do that. It seems to me that I am doing the teaching and the coach is getting paid the big bucks. So we don't take meetings with these students anymore. I have yet to have a single one (and we have had a lot of these groups of coaching students through) to actually buy anything.
No I take that back. We had a coaching student who actually took action before the coaching week and bought a house from us in advance of the coaching. The house cost about the same as the cost of the coaching and I know he learned a lot, I don't know if he ever rehabbed and tenanted the house, but he did get a lot of Kansas City connections through us.
So I wanted to give you some options on getting some mentoring for free, or at least for a more economical price that what the gurus want to charge you.
1) Join your local REIA Group: Kansas City - rest of the Nation
2) If they have a quick start program or a fast start program, go through them asap.
3) Take advantage of all the teleconferences, webinars, workshops, etc
4) Figure out to a small degree what it is you want to do: wholesale, rehab, landlord
5) Buy a training program and / or attend a bootcamp (Always try to buy through the local REIA, they can usually get you the best price and free bonuses)
6) Utilize the messasge boards offered by the local REIA and or the Guru whose program you purchased.- and ask questions. More on message boards in future posts.
7) Get in the game and get your hands dirty!
Sunday, November 1, 2009
Expand and Extend the Homebuyer Tax Credit
This is from the Realtor Action Center from National Association of Realtors
Thank you for your continued support to Expand and Extend the Homebuyer Tax Credit.
We need to ask for your help one more time. Please make a quick call to your Senator's office to ask for cloture on the Unemployment Insurance Extension bill that contains the tax credit provision. This cloture vote is scheduled for Monday evening. Sixty Senators must vote yes so that a vote can be scheduled on the tax credit.
Count me in. I am ready to make my call*.
It is easy. Just enter your phone number to be connected to your Senator's office. You will receive a phone call immediately and it will have some handy talking points on what to say before connecting you to their office.*
The vote is on Monday at 5 PM. So if you make the call this weekend, leave a voicemail with the provided talking points. Otherwise, save this email and make the call first thing on Monday morning in order to speak to a member of the Senator's staff.
This call is important. The tax credit will not get voted on unless we can get past this critical legislative procedure. All you need to say once you are connected:
The $8000 first-time homebuyer tax credit will end soon. The housing market is stabilizing and improving, but the housing market crisis won't end this year. We can't wait until late in the year to see what happens. Please call NOW and tell your Senators to help get the tax credit to a vote*.
*Standard text messaging fees and rates apply
Thank you for your continued support to Expand and Extend the Homebuyer Tax Credit.
We need to ask for your help one more time. Please make a quick call to your Senator's office to ask for cloture on the Unemployment Insurance Extension bill that contains the tax credit provision. This cloture vote is scheduled for Monday evening. Sixty Senators must vote yes so that a vote can be scheduled on the tax credit.
Count me in. I am ready to make my call*.
It is easy. Just enter your phone number to be connected to your Senator's office. You will receive a phone call immediately and it will have some handy talking points on what to say before connecting you to their office.*
The vote is on Monday at 5 PM. So if you make the call this weekend, leave a voicemail with the provided talking points. Otherwise, save this email and make the call first thing on Monday morning in order to speak to a member of the Senator's staff.
This call is important. The tax credit will not get voted on unless we can get past this critical legislative procedure. All you need to say once you are connected:
- I am a constituent and a REALTOR®. (or I am a constiuent and a Real Estate Professional)
- Thank you for helping to ensure the ongoing recovery of the housing market.
- As a member of the National Association of REALTORS®, I appreciate your support to expand and extend the tax credit. (or as a member of the National Real Estate Investors Association (or your REIA group), I appreciate your support to expand and extend the tax credit.)
The $8000 first-time homebuyer tax credit will end soon. The housing market is stabilizing and improving, but the housing market crisis won't end this year. We can't wait until late in the year to see what happens. Please call NOW and tell your Senators to help get the tax credit to a vote*.
*Standard text messaging fees and rates apply
Thursday, October 29, 2009
Virtual Real Estate Investing Telethon
Go Sit Back Down in Your Recliner . . .
Almost every real estate professional works way too hard for way too little.
You may be in that camp. You sacrifice time with your family and friends to constantly prospect, hustle, and "make things happen". Right now, your life is a blur trying to stay a step ahead of the dismal economy.
Here's a word of advice.
Stop. Relax. And Chill. . .
Here's why, Starting November 2nd, Terry Wygal and Duncan Wierman will show you how to sit back and draw motivated homebuyers and home sellers to you. Like a moth to a flame, the best prospects will seek you out. They will ignore the competition to get your opinion. They will hold-off on making a purchase or selling decision until they consult with you.
You will have your entire marketplace under your control. Every phone call will hold possibilities for even more profit, easy cash flow, and commissions.
Terry will show you how to bend Google to your will. Hundreds (maybe thousands) of buyers and sellers in your area are looking for YOU. Terry has a fool-proof method to keep your name in front of them and top-of mind.
PLUS
Duncan will show you "authority and trust" strategies that short-circuit your prospects "skepticism" radar. Within days, Duncan's strategies will transform you from "just another realtor or investor" into the "A-List" celebrity in your market.
Listen and learn from both of these powerhouses on the Real Estate Automation Telethon FOR FR*EE.
Just listen and profit.
Get the complete details and registration information here:
http://www.1shoppingcart.com/app/?Clk=3348498
Yours For Easy Profits -
Kim Tucker
Director of MAREI
www.MAREInet.com
P.S. I've just heard that the event organizers have confirmed the attendance of a couple new presenters that will rock your world - you can read about all of them here
http://www.1shoppingcart.com/app/?Clk=3348498
Almost every real estate professional works way too hard for way too little.
You may be in that camp. You sacrifice time with your family and friends to constantly prospect, hustle, and "make things happen". Right now, your life is a blur trying to stay a step ahead of the dismal economy.
Here's a word of advice.
Stop. Relax. And Chill. . .
Here's why, Starting November 2nd, Terry Wygal and Duncan Wierman will show you how to sit back and draw motivated homebuyers and home sellers to you. Like a moth to a flame, the best prospects will seek you out. They will ignore the competition to get your opinion. They will hold-off on making a purchase or selling decision until they consult with you.
You will have your entire marketplace under your control. Every phone call will hold possibilities for even more profit, easy cash flow, and commissions.
Terry will show you how to bend Google to your will. Hundreds (maybe thousands) of buyers and sellers in your area are looking for YOU. Terry has a fool-proof method to keep your name in front of them and top-of mind.
PLUS
Duncan will show you "authority and trust" strategies that short-circuit your prospects "skepticism" radar. Within days, Duncan's strategies will transform you from "just another realtor or investor" into the "A-List" celebrity in your market.
Listen and learn from both of these powerhouses on the Real Estate Automation Telethon FOR FR*EE.
Just listen and profit.
Get the complete details and registration information here:
http://www.1shoppingcart.com/app/?Clk=3348498
Yours For Easy Profits -
Kim Tucker
Director of MAREI
www.MAREInet.com
P.S. I've just heard that the event organizers have confirmed the attendance of a couple new presenters that will rock your world - you can read about all of them here
http://www.1shoppingcart.com/app/?Clk=3348498
Tuesday, October 27, 2009
Real Estate Convetion in November
Many of our member's remember past real estate conventions that we have held right here in Kansas City with a bunch of different speakers. And we keep getting asked, when is our next event.
Well, this is kind of spur of the moment, but we have a chance to participate in a Virtual Real Estate Convention during the 1st week in November.
So what is a Virtual Real Estate Investor Convention: well, you don't have to get dressed up, you don't have to leave your home or office, and you don't have to wait in between speakrs, because it is Virtual - right from your own home or office. Just tune in and learn.
Because it is virtual and we don't have to pay for a hotel or feed anybody, we don't have to charge a dime. And because the speakers are doing most of the promotion and the hard work, MAREI doesn't have to figure out computer stuff, we just give you a link to click, you sign up with a name and an email, and they do the rest.
They will send you emails with the times and dial instructions for each of the speakers, you dial in at the appropriate time and join in.
To find out more, click here.
Watch your emails for more information
Well, this is kind of spur of the moment, but we have a chance to participate in a Virtual Real Estate Convention during the 1st week in November.
So what is a Virtual Real Estate Investor Convention: well, you don't have to get dressed up, you don't have to leave your home or office, and you don't have to wait in between speakrs, because it is Virtual - right from your own home or office. Just tune in and learn.
Because it is virtual and we don't have to pay for a hotel or feed anybody, we don't have to charge a dime. And because the speakers are doing most of the promotion and the hard work, MAREI doesn't have to figure out computer stuff, we just give you a link to click, you sign up with a name and an email, and they do the rest.
They will send you emails with the times and dial instructions for each of the speakers, you dial in at the appropriate time and join in.
To find out more, click here.
Watch your emails for more information
Saturday, October 24, 2009
Make Money
Make money on the internet doing things you would do anyway!
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• Save Money! Receive up to 15% cash back on purchase from over 400 stores!
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It’s simple,
• Click here
• Watch the videos
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• Shop if you need to buy anything online
• Invite your friends
• Get your own customized home page with music, videos, games, news, and more!
• Save Money! Receive up to 15% cash back on purchase from over 400 stores!
• Make Money! Invite your friends & get paid every time they shop!
It’s simple,
• Click here
• Watch the videos
• Sign Up
• Shop if you need to buy anything online
• Invite your friends
Thursday, October 22, 2009
New York-Based Bank Earns $498 Million
Morgan Stanley returned to profitability for the first time in a year as income from its investment banking operations offset losses in commercial real estate.
From KMBC-TV Channel 9 - read full article
From KMBC-TV Channel 9 - read full article
Pulaski Financial Reports Fourth Quarter and Full Year 2009 Results
This just came across our Google Alert - local KC area Pulaski Bank published their 4th quarter and 2009 results and they appear to be good. The report also notes increased profits from mortgages, which means they must be lending where other banks are not. It does not define if that is investor loans, commercial, or home owner loans.
Read report from Reuters
Read report from Reuters
Wednesday, October 21, 2009
2nd FREE Book for MAREI Members
Tell us where to send it, and we'll send you the number one
success book of all time.
My friends Vic and Lisa Johnson are doing this crazy marketing
test where they're giving away Napoleon Hill's "Think & Grow Rich."
I'm helping them with their big giveaway and wanted to make sure
you got your copy before they take this offer down.
Get the details here:
www.FreeTGRbook.com/MAREI
Feel free to pass this on to friends. They can get one too if they
act right away.
This is one of my favorite books. I know you'll love it!
success book of all time.
My friends Vic and Lisa Johnson are doing this crazy marketing
test where they're giving away Napoleon Hill's "Think & Grow Rich."
I'm helping them with their big giveaway and wanted to make sure
you got your copy before they take this offer down.
Get the details here:
www.FreeTGRbook.com/MAREI
Feel free to pass this on to friends. They can get one too if they
act right away.
This is one of my favorite books. I know you'll love it!
FREE book for MAREI members
Real Estate Investors, if you have been in real estate and doing any online research for any amount of time, you will probably came across a ton of people giving away this book.
Order your FREE copy of James Allen’s "As A Man Thinketh."
http://www.FreeTGRbook.com/MAREI
CHANGE YOUR THOUGHTS, CHANGE YOUR LIFE
It’s the book that’s changed the lives of millions.
"I have personally read As a Man Thinketh over 25 times."
- Mark Victor Hansen, co-creator, the Chicken Soup books.
Download a FREE eBook of James Allen’s "As A Man Thinketh."
http://www.asamanthinketh.net/cmd.php?af=927012
Order your FREE copy of James Allen’s "As A Man Thinketh."
http://www.FreeTGRbook.com/MAREI
CHANGE YOUR THOUGHTS, CHANGE YOUR LIFE
It’s the book that’s changed the lives of millions.
"I have personally read As a Man Thinketh over 25 times."
- Mark Victor Hansen, co-creator, the Chicken Soup books.
Download a FREE eBook of James Allen’s "As A Man Thinketh."
http://www.asamanthinketh.net/cmd.php?af=927012
Cash Flow Game in Lawrence
Announcing a new Meetup for The Jayhawk Cashflow Meetup!
What: Cashflow 101
When: October 27, 2009 6:00 PM
Price: $5.00 per person
Where:
Lawrence Parks & Recreation
115 W 11th St (11th & Vermont)
Lawrence, KS 66044
The last Meetup was a lot of fun!
We have one game available and can accommodate 5 people. The first members to RSVP will be confirmed, up to the 5 slots that are available. Let's get together and have some fun while learning!
I look forward to seeing you at the Meetup!
Learn more here:
http://www.meetup.com/cashflowgames/calendar/11677481/
If you can bring your own game, please get with the group leader and help him grow his group.
MAREI would like to find someone to host a group in Overland Park - please email info@MAREInet.com if you have a game and could schedule a time and place for 4 other people to play with you.
What: Cashflow 101
When: October 27, 2009 6:00 PM
Price: $5.00 per person
Where:
Lawrence Parks & Recreation
115 W 11th St (11th & Vermont)
Lawrence, KS 66044
The last Meetup was a lot of fun!
We have one game available and can accommodate 5 people. The first members to RSVP will be confirmed, up to the 5 slots that are available. Let's get together and have some fun while learning!
I look forward to seeing you at the Meetup!
Learn more here:
http://www.meetup.com/cashflowgames/calendar/11677481/
If you can bring your own game, please get with the group leader and help him grow his group.
MAREI would like to find someone to host a group in Overland Park - please email info@MAREInet.com if you have a game and could schedule a time and place for 4 other people to play with you.
Monday, October 19, 2009
Octomber Meeting Replay is Available
MAREI member's did you miss the October Meeting - the replay is now available in the General Meeting Archives. Just go to www.MAREInet.com, log in, then click on General Meeting Archives. You can listen to the mp3 of the meeting and download the powerpoint with all the notes.
Not yet a member - Join Now
MAREI General Meeting - Internet Marketing 101
First, you need to create a quality online presence that shows of your expertise on your subject. Second you need to give them a reason to subscribe in some way and to come back and use your site again. Third is the hard part, getting people to find your web site.
It does not matter how awesome your web site or how many buzzers and bells it has, unless people find your web site, it will not do you any good. There are many steps you can take so people find your web site and that is what we are going to be talking about at the October General Meeting.
Find out
All Attendees Receive Directions to receive a FREE Magazine Subscription on Utilizing the Web.
Meeting to be held at the Overland Park Marriott at 10800 Metcalf (I435 & Metcalf) in Overland Park.
6:00 Doors Open for Vendor Hall & Networking
6:15 New / Potential Member Orientation (about 20 minutes - meet fellow new members)
7:15 Announcements and Sponsor
7:30 Presentation
9:00 Networking
Not yet a member - Join Now
General Meeting
October 13, 2009
Internet Marketing
More than ever, today's businesses depend on marketing to bring in new business and to keep current business coming back time and again. There are many modes of marketing, TV, radio, magazines, newsletters and more. To keep costs in line businesses large and small need to find ways to optimize the low cost marketing available through the internet.First, you need to create a quality online presence that shows of your expertise on your subject. Second you need to give them a reason to subscribe in some way and to come back and use your site again. Third is the hard part, getting people to find your web site.
It does not matter how awesome your web site or how many buzzers and bells it has, unless people find your web site, it will not do you any good. There are many steps you can take so people find your web site and that is what we are going to be talking about at the October General Meeting.
Find out
- Steps to take to boost traditional marketing with your web site.
- What your web site needs to contain to help the search engines find you.
- How to research key words and where to use them.
- The difference between organic results and paid results on search engines.
- How to use blogs and articles to boost your organic results.
All Attendees Receive Directions to receive a FREE Magazine Subscription on Utilizing the Web.
6:00 Doors Open for Vendor Hall & Networking
6:15 New / Potential Member Orientation (about 20 minutes - meet fellow new members)
7:15 Announcements and Sponsor
7:30 Presentation
9:00 Networking
November General Meeting
General Meeting
November 10th - Please Reserve Your Spot
Speed Networking
The Real Estate Investing Gurus, the Real Estate Investing Training Books, and all the other Real Estate Training media out there tell us we have to build our team. Pay some of the real estate mentoring programs out there $1000's and what do they want you to do first, build your team, talk to people, make contacts, learn from them.
So join us on Tuesday November 10th to do just that, build your team. We will have our normal vendor hall and informal networking where you can visit with the vendors who have reserved space and work the room. Then at 7:15 we will start our formal networking event.
We will have 90 minutes to complete our formal networking. You will be divided into pairs and given 3 minutes to pitch yourself, your deal or what ever it is you need to pitch. Then everone gets a new partner and gets another 3 minutes. You should go home with at least 30 new contacts to add to your database.
We are also going to segregate the general marketing table into different catagories and only allow business cards tonight. So you can put your stack of business cards in the appropriate catagory so people can just pick them up, even if they don't get 3 minutes to talk to you.
We do need to know how many people will be here, so members and non-members alike we ask you to pre-register so we can get a good head count. You will need to have business cards, so check out the free ones and the discounts now on our Vendors page under printing and get your cards ordered now. Takes about a week to get to you. Or heck, print up a bunch on your printer, they don't have to be fancy. Name, Company, contact info, and your 1 line message so people know who you are and what you do.
Register Now: 11/10/2009-MAREI General Meeting
Reserve A Vendor Table - room for 5: 11/10/2009-Vendor Table Reservation Deadline
Sponsored by
Details
Overland Park Marriot: 110th & Metcalf
6:00 pm Vendor Hall / Check In / Networking
6:15 pm New member / Potential Member Orientation
7:15 pm Sponsor Presentation
7:30 Educational Portion
Cost: No charge for Members, Guest Fee at Door $25
Pre-Register on our Calendar of Events and Save $10 (Click Here)
Reserve Vendor Table throuh Calendar of Events(Click Here)
Larry Goins Bootcamp - Wholesale Real Estate Training
If you have wanted to learn more about real estate investing in general and how to wholesale houses in particular, then Larry Goins and his training team are the people to get hooked up with. They have all the info you need to start a wholesale real estate investing business. Plus a ton of tools to plug into an existing start up wholesale real estate investing business.
At last! The powerful secret to selling 5, 10, even 15 houses a month and pumping up to $30,000 AND MORE into your bank account is finally going to be revealed... right in front of your eyes...
"Have You Ever Wondered...
What Is The ONE Insider Secret That
Fat Cat Real Estate Moguls Use To
Earn the Million-Dollar Incomes That
‘Small Cat’ Investors Only Dream About?”
It all comes down to minimizing risk and maximizing returns with commercial and residential properties to buy and sell for quick profits.
How can YOU do that?
Click the MAGIC link below and instantly discover
- How to Locate Great Deals, Great Neighborhoods, and Great Properties so you’ll have no trouble flipping for profits
- The Best Strategies for distressed Property and Foreclosure Investing so you’re ahead of the pack when it comes to profits
- Contacting and Negotiating with Owners to make them see how working with you will make them winners (and you, too)
- Financing Your Deals in a way that bulletproofs your assets and puts other people’s money at risk
- Quick Turning Investments that put money in your pocket fast in ways that are just as easy as they are honest and legal
- Exit Strategies that leave you with no worries except how to spend your profits
- And more!
Just click the link below for more information & to register now!
The event is free but spaces are filling up quickly. Don’t hesitate and miss out on this incredible training opportunity!
The training and the giveaways alone will be well worth your time investment. Don’t miss it!
Saturday, October 10, 2009
Real Estate Investing for Beginners – Part 2, Types of Properties for New Real Estate Investors
Not all real estate property types may be appropriate for new real estate investors. There are many factors to consider when making the decision to add real estate to an investment portfolio.
Read full article
And check out the Fast Start to Success workshop on October 17th at http://www.mareinet.com/ to be held in Kansas City, Missouri
Picking a Domain Name
How to Choose a Good Domain Name
To help your business grow by increasing your customer base through your website, you need to pick a website or domain name that does 5 key things.
1. Easy to remember
2. Easy to find which means easy to type
3. Includes reference to your product or service.
4. Is easily recognizable as you name so it can be trademarked to that competitors will not be able to use a similar domain name.
5. And last you need to be sure it is not already trademarked to someone else.
So, what makes a good domain name?
1. Good extension – that means the .whatever at the end. When someone is going to the web, they will most likely try your name with a .com, so as a web site owner, if at all possible you want to get a .com name for your web site.
2. Short – As in the length of the name. Ideally you will be less that 7 or 8 characters. Short names are easier to remember, tell someone about, to type, and let’s face it www.widgets.com looks a lot more professional that www.wesellthings.com.
3. Easy to spell – Test out your name choice and talk to people about it over the phone. If you can tell 4 or 5 people your name and have them email it back to you, then it’s probably going to work. But if even one of them screws it up, then you need something different. Also consider if there are 2 words in the name that the last letter of the first word is not the same as the first letter of the next word. People are not sure if they spelled it right. One thing you could do if you have to have the double letter is to buy both names and have the misspelling redirect to the correct one. Don’t use dashes or dots in the name.
4. Descriptive – As you are starting out with probably a very limited marketing budget, use a domain name that describes what your site is all about. People will know what you do just by reading your name. As this article is for a Real Estate venue, let’s talk about Realtors getting a domain name that is their name. You want a domain name that fills these 5 characteristics, but you might also want to buy a domain that is your name – like www.JoeBrown.com and redirect it to your web site. It has become a common practice in real estate to do this and your customers might look for you at your name, it just probably would not be a very good name for the search engines to find.
5. Keywords – a name will also Include keywords that describe your product or business. This will help you in some cases to increase your search engine rankings.
Who to buy from
When you go to buy a domain name it is important to work with a reputable company. Note that there is a huge growth in affiliate programs that allow resellers to open online companies reselling names for legitimate companies. Some Resellers are legitimate and will be there when you come back, but others are here and gone overnight. So before you buy, be sure to research the company you are using. You can find a full list of accredited companies http://www.icann.org/registrars/accredited-list.html
Domain Name Extensions
While we suggest that you should always go for a .com extension, you need to know a bit about other choices. The three most popular are “.com”, “.net”, or “.org”. You may find that depending on what your company does, you might also want to buy a different extension.
· COM is short for commercial and are the most widely recognized for businesses.
· NET is short for network and was originally designed for technical web sites.
· ORG is short for organization and is typically associated with non-profit organizations or associations or clubs.
You can also obtain a domain name extension that fit a specific country such as .ca for Canada or .jp for Japan.
Some web sites to check out
About the Author: Kim Tucker is the marketing manager for Mid-America Association of Real Estate Investors and several other real estate companies. She will be discussing marketing your company on the internet at the October 2009 MAREI meeting. Find out more about the meeting at MAREInet.com
Thursday, October 8, 2009
Member Benefits: Rental Marketing Web Sites
Don't forget the many benefits for MAREI members including FREE listings on http://www.reiarentals.com/ and a 20% discount on http://www.rentals.com/. Log into the member Library and look under beneftis for more info and discount codes.
Also check out the syndication tools on these websites. List your property once and syndicate out to other web sites with the click of a button.
Also check out the syndication tools on these websites. List your property once and syndicate out to other web sites with the click of a button.
October 13th Meeting - Promoting Your Business Online
Meeting October 13th, 6pm, Overland Park Marriott - Details
Most if not all of Real Estate Professionals are a small business and don't have huge budgets for marketing. Utilizing the internet, your website, blogs, articles and social media are great low costs ways to promote your business and in many cases work better than many costly old fashioned marketing methods.
At the October meeting we are going to be talking about things you can do to get your web site to move up in Google searches, how to use articles and blogs to drive traffic to your web site, how to use social media to gain more business.
All attendees to the meeting receive free subscription to a Website magazine and an E-Book on Facebook for Entrepreneurs.
Most if not all of Real Estate Professionals are a small business and don't have huge budgets for marketing. Utilizing the internet, your website, blogs, articles and social media are great low costs ways to promote your business and in many cases work better than many costly old fashioned marketing methods.
At the October meeting we are going to be talking about things you can do to get your web site to move up in Google searches, how to use articles and blogs to drive traffic to your web site, how to use social media to gain more business.
All attendees to the meeting receive free subscription to a Website magazine and an E-Book on Facebook for Entrepreneurs.
The October Newsletter is posted
Read Now
This month's newsletter includes tons of info on setting up your web site and getting started. It is designed to go hand in hand with our meeting this month.
Discussing
1. Starting a website
2. Designing a website
3. Key Elements of a website
4. Picking a Name for your website
5. Plus a comprehensive list of our current member benefits
This month's newsletter includes tons of info on setting up your web site and getting started. It is designed to go hand in hand with our meeting this month.
Discussing
1. Starting a website
2. Designing a website
3. Key Elements of a website
4. Picking a Name for your website
5. Plus a comprehensive list of our current member benefits
Forecast: Kansas City economy will recover in 2011
from the KC Business Journal:
The Kansas City area’s economy will recover in 2011, along with seven other metropolitan areas, according to a nationwide economic forecast by IHS Global Insight.
The other areas whose economies the company predicts will turn around in 2011 are Dallas-Fort Worth; Houston; Oklahoma City; Raleigh, N.C.; Salt Lake City; Virginia Beach-Norfolk, Va.; and Washington.
Read full post
The Kansas City area’s economy will recover in 2011, along with seven other metropolitan areas, according to a nationwide economic forecast by IHS Global Insight.
The other areas whose economies the company predicts will turn around in 2011 are Dallas-Fort Worth; Houston; Oklahoma City; Raleigh, N.C.; Salt Lake City; Virginia Beach-Norfolk, Va.; and Washington.
Read full post
Wednesday, October 7, 2009
Self Directed Retirment Accounts
Self Directed Retirement Accounts
By Kim Tucker
The purpose of this article is to give the reader a few ideas of what they can do with a self-directed retirement account. Before we get into the idea’s part thought, let’s first discuss a little bit about what a self-directed account is and what it can and can’t do.
A self-directed retirement account is basically an IRA, 401k or other retirement account that you are used to seeing that is invested in stocks, bonds, and mutual funds. But where the accounts that you are familiar are managed by third party custodians that invest in the traditional stocks, bonds, and mutual funds, a self directed account is managed by a custodian that will allow you the owner to select the investments you would like to make. Investments can be what ever you would like as long as the IRA does not complete a prohibited transaction, does not invest in collectibles, make excess contributions, and withdrawals are made when required by law. Further you cannot enter into a transaction with a disqualified person.
To keep things simple we will be referring to all these various self-directed accounts as a IRA.
When you create a IRA it becomes an entity of it’s own. What it does is completely separate from your own personal funds. It is managed by the third party custodian or more simply a custodian which is a company that signs all legal documents on behalf of the IRA, writes checks, and acts as the all around book keeper and record keeper of the IRA. Two of the top companies that fill this role in the country are Equity Trust Company and Entrust. To get a full education on all the different types of accounts, how to set them up, and required forms and documents, please visit their web sites: www.trustetc.com and www.theentrustgroup.com .
While the IRA is an entity unto itself and managed by the custodian, you are the owner and can direct how the custodian invests the funds. The profits and losses created from these investments will increase and decrease the IRA account balance with all taxes deferred until you start with drawing funds when you retire. Or in the case of a Roth IRA that is created with after tax money, no taxes will ever be paid as long as you do not complete a prohibited transaction, invest in things you are not supposed to, and don’t make early withdrawals.
So what can’t you do? A prohibited transaction is any improper use of your IRA account by you, your beneficiary, any disqualified person. Basically YOU cannot borrow money from your IRA, YOU can’t sell property to your IRA, YOU can’t receive unreasonable compensation for managing your IRA, YOU can’t use your IRA as a security for a loan, and YOU can’t buy properties for personal use with your IRA funds. YOU cannot get a benefit out of your IRA. Likewise, your beneficiary, the person who inherits all your stuff, cannot do any of these things either.
You cannot do any of these things with a disqualified person. Understanding exactly who a disqualified person is will allow you to make a huge profit with your IRA.
So who is disqualified? Anyone who has discretionary authority in administering your IRA: you and your beneficiary we have already discussed, and also linear members of your family, and your spouse. So your spouse, your grandparents, your parents, you, your children and grandchildren are out. Your brothers and sisters, step children not legally related to you, cousins, and friends are in. Please keep this in mind when you are putting together transactions.
What if my IRA enters into a prohibited transaction. No there is no IRA jail, you don’t get locked up, but if you may have to pay taxes on premature distribution, your IRA may loose it tax deferred status, and you may have penalties to pay. Please be sure to read up on the custodian web sites mention previously.
So what can’t my IRA invest in? You can invest in any legitimate investment, but not in collectibles. This includes art works, rugs, antiques, metals, gems, stamps, coins, alcoholic beverages and other tangible personal properties. In some cases you can buy gold or silver, and coins, but please investigate this a little further before doing so.
You also cannot make excess contributions into your IRA. Each and every retirement account has a different set of rules and regulations on how much you can sock away into the account each year and is way beyond the scope of this article. Please get with your accountant and your custodian when you set up your account so you know exactly how much you can put into the account each year and when and how much you need to withdraw when the time comes.
To set up a self directed account, the first step would be to gather information about all the types of accounts from custodian company and then sit down with your accountant and / or financial advisor to find out which type of account best suits your needs. You may find that you want to roll over an existing account that you currently have into a self directed IRA. If you don’t have an existing account to roll over, you may want to start a new account with the basic $2000 annual contribution. Or you if you have a corporation or other type of company, you may want to open a simple IRA account that has much higher contribution limits. There are many different options and combinations of options, so please get with an expert for advice.
Let’s take a look at a typical scenario. Mr. & Mrs. Investor have worked quite a few years in corporate America and both have built up a sizable 401k account with their corporations. Both have socked away as much as they can into their accounts over the past 10 or so years and have about $50,000 each. As their real estate investing career is really taking off, they have just left their corporate jobs for good. They get a letter in the mail from the current company managing their 401k advising them that they need to roll their 401k account over from it’s current company and into another retirement account somewhere else.
Being astute real estate investors who have educated themselves on self directed IRA’s, they roll each of their 401k accounts over into a self directed IRA and now can direct how their money is invested. All profits made from their investments will go back into their retirement accounts and not into their own pockets, but they know they are passing on a few good real estate deals every year for lack of funds and while they don’t really need the income from these passed up deals today, if they utilized their 401k accounts to buy into a few of these deals, they sure could used the income in 20 or 30 years.
Mr. & Mrs. Investor also have formed a corporation to invest in their real estate to protect their assets from lawsuits and from taxes and their tax advisor tells they should also start a simple IRA plan within their company for each of them. Then they can contribute up to $7,000 each out of the salaries they receive from this company that reduces the income they report to the IRS by $7,000. Their company can then match up to 3% of their annual compensation.
So for example if they paid themselves a salary of $10,000 each from the company, they can take $7,000 of that each to contribute to their simple IRA and reduce their reported income by $7,000. Their company can then contributed up to 3% of their $10,000 salary or $300. So at the end of the first year, they will each have an account with $7,300 in it. At the end of year two they could each have $14,600 in their accounts, just from contributions and with no profits from investing the amounts.
Now Mr. Investor’s son, Investor Junior. He is working right along side mom and dad, he is doing well in real estate also and so has never really had a corporate job. He has a wife and kids and needs almost every dollar he makes from his investing to support his family, so he takes a different route and he starts a Roth IRA for himself and his wife. They each contribute only $3,000 to their IRAs and at the end of year one have 2 Roth IRA’s worth $3,000 each and at the end of year 2 worth $6,000 each if they make no investing profits. But they do have an advantage in that their Roth IRA’s were created with after tax dollars, so any profits they make are tax free with no taxed to be paid when they start taking distributions at age 59 ½. Please take note here for future examples that Investor Junior is related to Mr. Investor, but as he is from a previous marriage, he is only Mrs. Investor’s step-son and not actually related. We will look at this more in a minute.
Ok, now we know what a self directed IRA is and some basics of setting them up and getting initial funds into them. Now on to the fun stuff, let’s look at a few examples of how a self-directed account can be used!
After rolling over their 401k accounts Mr. Investor comes across a little house in his town that is in a nice rental neighborhood with an after repaired value of $80,000. It should rent for about $800 a month with maybe a little more if he gets a lease to own tenant to take it over. It needs about $10,000 in repairs: landscaping, painting, new carpet, and some minor handy man items. He can buy it for $40,000. He has enough income from other investments to live on for a while, so he decides to buy this house with his IRA account that he created by rolling over his 401k that has a current balance of $50,000.
He fills out all the proper forms and purchases this house in the name of his rolled over IRA. And immediately finds a lease to own buyer that pays his IRA $4,000 down as a non-refundable option fee. The buyer agrees to do the landscaping, painting, and handy man repairs if the IRA will pay $3,000 to replace the carpets. They are going to pay him $800 a month with $100 of that going toward their down payment when they get financed and cash him out. And about 6 months later his tenants are able to get their credit in line, get a loan and pay off their lease option. When they pay him off he will have earned $80,000 in proceeds from the sale, down payment and monthly credit toward down payment, plus $700 (the $800 lease payment less $100 rent credit) for 6 months for another $4,200, and has spent $40,000 to purchase and $3,000 on carpets. So his new balance in his roll over IRA after 6 months is $91,200 ($50,000 - $40,000 purchase - $3,000 for carpet + $4,000 option fee + $600 down payment credit from rents for 6 months + $4,200 in rent + $75,400 proceeds from sale). He almost doubled his account with one transaction.
Mr. Investor is very proud of this first deal and is discussing it with his advisors and thinking about trying to find two more similar deals. He is cautioned by his advisors that just like buying real estate in his personal name, buying real estate directly in his IRA name can be risky too. What happens if he has grown the account to $300,000 and he has one of his tenant get hurt in one of the houses owned by the IRA and they go to court and win a law suit, he could stand to loose the entire retirement account. So like Mr. Investor, before you purchase rental properties in the name of your IRA, you might also want to talk about the risks with your advisors and your custodian. But again this can get outside the scope of this article.
Investor Junior has his account with a paltry $3,000 in his account. He figures he can’t do much with his account, but has talked to his advisors and found that since he is Mrs. Investor’s step son and for purposes of the self directed IRA not related to her, that he might be able to borrow money from Mrs. Investor to do a deal. Any interest payments he pays to Mrs. Investors IRA for the loan of the money will go back into her IRA, but any profits he makes will be his to keep.
He then goes out and finds a killer deal but he has to act fast. There is a bank owned property listed for $30,000 that has an after repaired value of $80,000. There are quite a few buyers interested in the property. He made an offer that was full price and he told them he could close in 5 days. As all the other offers even though they all offered a little more than $30,000 all wanted 30 days to get their loans put together and Junior can close in 5 days, he gets the deal.
Investor Junior then goes to Mrs. Investor and strikes a deal with her. She can lend him the $30,000 to purchase the property plus another $15,000 for him to pay for the repairs out of her rolled over IRA. He will pay her the same fees he would have paid a hard money lender: 5 points and 15% interest and he will pay it all at once when he pays her off in about 6 months.
So they draw up the proper paper work and she pays the $30,000 for purchase and loans him $15,000. In the next two months he rehabs the house, gets a tenant in it and then at the end of month 4 he sells it to an out of state investor for $80,000 and pays off his loan from Mrs. Investor’s IRA.
Let’s look at their profits. Mrs. Investor’s IRA gets $45,000 back, plus 5 points or $2,250, plus 4 months of interest at 15% or $2,250 an now her balance is $54,500. Investor Junior spent $64,500 ($30,000 purchase, $15,000 rehab, $2,250 in points, and $2,250 in interest) and earned a profit of $15,500.
The next month Investor Junior’s wife and Mrs. Investor go out to look at a house. Mom is coaching her daughter-in-law as she did not grow up in real estate as Junior did. This is the deal they worked out. They found a house that was worth $130,000 that was in really bad shape, needing about $30,000 in repairs. The owner had died and the heirs were very motivated to get it sold and agreed they could let it go for $50,000 if they could sign a contract today. Mrs. Junior signed a contract to buy it from the seller’s with her IRA that if you remember only has $3,000 in it. She had her IRA wire a $1,000 earnest money deposit to the title company the next day, got the keys from the seller’s who were leaving town and made sure she had the right to assign the contract and she had 45 days to close on the contract. Plus she had a safety net with her mother in law. If she could not find another investor to assign her contract to, Mrs. Investor was going to buy it with her IRA for $50,000.
After getting all the contracts signed up, the next day Mrs. Junior got busy. She put a sign in the yard and got on the local investor chat room and posted the following post:
675 Mulberry Street.
3 bedrooms, 1 ½ bath, 1 car garage, full basement
After repair value $130,000
Needs $30,000 in repairs – nothing structural
Need cash buyer for $60,000
House will be open today at 5:30 pm, will take a cash buyer contract today!
Please call Mrs. Junior at 816-555-1212
She had 10 calls by noon, held the house open and had 5 investors show who she knew to be very active and one agreed to take over her contract at a price of $65,000. Remember there were 5 buyers there at 5:30 so they did get into a little bit of a bidding war. Everyone went to closing on their assigned day and Mrs. Junior ended up with a check for $15,000 going back to her IRA as her assignment fee. Now her account balance stands at $17,000 ($3,000 initial balance - $1000 EMD + $15,000 in assignment fee).
Now all these examples are fictitious and the deals are simplified and do not include holding costs and a few other fees, but you can see how utilizing a self directed account whether you start with a large balance or a small one can grow your retirement funds very quickly. You do need to keep in mind that all profits earned by the IRA, need to stay in the IRA and not go back into your personal or business accounts and to get advice from experts where you needed. It also helps if you have a non-related friend that you might borrow money from or lend money to or buy and sell houses between your IRA accounts.
There are quite a few more complicated scenarios, so do your homework on self directed IRAs as well as private lending. You may find that you can make a good return on your investment by being the bank for other investors letting them do all the hard work of hunting down houses, making repairs, dealing with tenants and the like and you just sit back and have your IRA collect the interest payments each month.
About the Author: Kim Tucker is the Executive Director of Mid-America Association of Real Estate Investors located on the web at www.MAREInet.com , an association for Networking and Education based in the Kansas City Metro. If you would like to learn more about investing in real estate, please visit this site and check out our numerous teleconferences on various subjects and check out our guru pages for informational articles and ebooks. Kim has been investing in real estate with her husband Donald since 2000 and primarily invest in fixer uppers, rehabs, and rental properties in Kansas City Missouri. Currently their company Tucker One Properties, Inc. offers turn key rentals, and fixer upper properties in the Kansas City Market. To learn more about Kansas City real estate visit them on the web at www.TuckerOneProperties.com or call their offices at 816-523-4400.
Reprint permission – this article may be reprinted on any REIA groups web site or newsletter as long as the about the author section at the end is included. Thanks - Kim
By Kim Tucker
The purpose of this article is to give the reader a few ideas of what they can do with a self-directed retirement account. Before we get into the idea’s part thought, let’s first discuss a little bit about what a self-directed account is and what it can and can’t do.
A self-directed retirement account is basically an IRA, 401k or other retirement account that you are used to seeing that is invested in stocks, bonds, and mutual funds. But where the accounts that you are familiar are managed by third party custodians that invest in the traditional stocks, bonds, and mutual funds, a self directed account is managed by a custodian that will allow you the owner to select the investments you would like to make. Investments can be what ever you would like as long as the IRA does not complete a prohibited transaction, does not invest in collectibles, make excess contributions, and withdrawals are made when required by law. Further you cannot enter into a transaction with a disqualified person.
To keep things simple we will be referring to all these various self-directed accounts as a IRA.
When you create a IRA it becomes an entity of it’s own. What it does is completely separate from your own personal funds. It is managed by the third party custodian or more simply a custodian which is a company that signs all legal documents on behalf of the IRA, writes checks, and acts as the all around book keeper and record keeper of the IRA. Two of the top companies that fill this role in the country are Equity Trust Company and Entrust. To get a full education on all the different types of accounts, how to set them up, and required forms and documents, please visit their web sites: www.trustetc.com and www.theentrustgroup.com .
While the IRA is an entity unto itself and managed by the custodian, you are the owner and can direct how the custodian invests the funds. The profits and losses created from these investments will increase and decrease the IRA account balance with all taxes deferred until you start with drawing funds when you retire. Or in the case of a Roth IRA that is created with after tax money, no taxes will ever be paid as long as you do not complete a prohibited transaction, invest in things you are not supposed to, and don’t make early withdrawals.
So what can’t you do? A prohibited transaction is any improper use of your IRA account by you, your beneficiary, any disqualified person. Basically YOU cannot borrow money from your IRA, YOU can’t sell property to your IRA, YOU can’t receive unreasonable compensation for managing your IRA, YOU can’t use your IRA as a security for a loan, and YOU can’t buy properties for personal use with your IRA funds. YOU cannot get a benefit out of your IRA. Likewise, your beneficiary, the person who inherits all your stuff, cannot do any of these things either.
You cannot do any of these things with a disqualified person. Understanding exactly who a disqualified person is will allow you to make a huge profit with your IRA.
So who is disqualified? Anyone who has discretionary authority in administering your IRA: you and your beneficiary we have already discussed, and also linear members of your family, and your spouse. So your spouse, your grandparents, your parents, you, your children and grandchildren are out. Your brothers and sisters, step children not legally related to you, cousins, and friends are in. Please keep this in mind when you are putting together transactions.
What if my IRA enters into a prohibited transaction. No there is no IRA jail, you don’t get locked up, but if you may have to pay taxes on premature distribution, your IRA may loose it tax deferred status, and you may have penalties to pay. Please be sure to read up on the custodian web sites mention previously.
So what can’t my IRA invest in? You can invest in any legitimate investment, but not in collectibles. This includes art works, rugs, antiques, metals, gems, stamps, coins, alcoholic beverages and other tangible personal properties. In some cases you can buy gold or silver, and coins, but please investigate this a little further before doing so.
You also cannot make excess contributions into your IRA. Each and every retirement account has a different set of rules and regulations on how much you can sock away into the account each year and is way beyond the scope of this article. Please get with your accountant and your custodian when you set up your account so you know exactly how much you can put into the account each year and when and how much you need to withdraw when the time comes.
To set up a self directed account, the first step would be to gather information about all the types of accounts from custodian company and then sit down with your accountant and / or financial advisor to find out which type of account best suits your needs. You may find that you want to roll over an existing account that you currently have into a self directed IRA. If you don’t have an existing account to roll over, you may want to start a new account with the basic $2000 annual contribution. Or you if you have a corporation or other type of company, you may want to open a simple IRA account that has much higher contribution limits. There are many different options and combinations of options, so please get with an expert for advice.
Let’s take a look at a typical scenario. Mr. & Mrs. Investor have worked quite a few years in corporate America and both have built up a sizable 401k account with their corporations. Both have socked away as much as they can into their accounts over the past 10 or so years and have about $50,000 each. As their real estate investing career is really taking off, they have just left their corporate jobs for good. They get a letter in the mail from the current company managing their 401k advising them that they need to roll their 401k account over from it’s current company and into another retirement account somewhere else.
Being astute real estate investors who have educated themselves on self directed IRA’s, they roll each of their 401k accounts over into a self directed IRA and now can direct how their money is invested. All profits made from their investments will go back into their retirement accounts and not into their own pockets, but they know they are passing on a few good real estate deals every year for lack of funds and while they don’t really need the income from these passed up deals today, if they utilized their 401k accounts to buy into a few of these deals, they sure could used the income in 20 or 30 years.
Mr. & Mrs. Investor also have formed a corporation to invest in their real estate to protect their assets from lawsuits and from taxes and their tax advisor tells they should also start a simple IRA plan within their company for each of them. Then they can contribute up to $7,000 each out of the salaries they receive from this company that reduces the income they report to the IRS by $7,000. Their company can then match up to 3% of their annual compensation.
So for example if they paid themselves a salary of $10,000 each from the company, they can take $7,000 of that each to contribute to their simple IRA and reduce their reported income by $7,000. Their company can then contributed up to 3% of their $10,000 salary or $300. So at the end of the first year, they will each have an account with $7,300 in it. At the end of year two they could each have $14,600 in their accounts, just from contributions and with no profits from investing the amounts.
Now Mr. Investor’s son, Investor Junior. He is working right along side mom and dad, he is doing well in real estate also and so has never really had a corporate job. He has a wife and kids and needs almost every dollar he makes from his investing to support his family, so he takes a different route and he starts a Roth IRA for himself and his wife. They each contribute only $3,000 to their IRAs and at the end of year one have 2 Roth IRA’s worth $3,000 each and at the end of year 2 worth $6,000 each if they make no investing profits. But they do have an advantage in that their Roth IRA’s were created with after tax dollars, so any profits they make are tax free with no taxed to be paid when they start taking distributions at age 59 ½. Please take note here for future examples that Investor Junior is related to Mr. Investor, but as he is from a previous marriage, he is only Mrs. Investor’s step-son and not actually related. We will look at this more in a minute.
Ok, now we know what a self directed IRA is and some basics of setting them up and getting initial funds into them. Now on to the fun stuff, let’s look at a few examples of how a self-directed account can be used!
After rolling over their 401k accounts Mr. Investor comes across a little house in his town that is in a nice rental neighborhood with an after repaired value of $80,000. It should rent for about $800 a month with maybe a little more if he gets a lease to own tenant to take it over. It needs about $10,000 in repairs: landscaping, painting, new carpet, and some minor handy man items. He can buy it for $40,000. He has enough income from other investments to live on for a while, so he decides to buy this house with his IRA account that he created by rolling over his 401k that has a current balance of $50,000.
He fills out all the proper forms and purchases this house in the name of his rolled over IRA. And immediately finds a lease to own buyer that pays his IRA $4,000 down as a non-refundable option fee. The buyer agrees to do the landscaping, painting, and handy man repairs if the IRA will pay $3,000 to replace the carpets. They are going to pay him $800 a month with $100 of that going toward their down payment when they get financed and cash him out. And about 6 months later his tenants are able to get their credit in line, get a loan and pay off their lease option. When they pay him off he will have earned $80,000 in proceeds from the sale, down payment and monthly credit toward down payment, plus $700 (the $800 lease payment less $100 rent credit) for 6 months for another $4,200, and has spent $40,000 to purchase and $3,000 on carpets. So his new balance in his roll over IRA after 6 months is $91,200 ($50,000 - $40,000 purchase - $3,000 for carpet + $4,000 option fee + $600 down payment credit from rents for 6 months + $4,200 in rent + $75,400 proceeds from sale). He almost doubled his account with one transaction.
Mr. Investor is very proud of this first deal and is discussing it with his advisors and thinking about trying to find two more similar deals. He is cautioned by his advisors that just like buying real estate in his personal name, buying real estate directly in his IRA name can be risky too. What happens if he has grown the account to $300,000 and he has one of his tenant get hurt in one of the houses owned by the IRA and they go to court and win a law suit, he could stand to loose the entire retirement account. So like Mr. Investor, before you purchase rental properties in the name of your IRA, you might also want to talk about the risks with your advisors and your custodian. But again this can get outside the scope of this article.
Investor Junior has his account with a paltry $3,000 in his account. He figures he can’t do much with his account, but has talked to his advisors and found that since he is Mrs. Investor’s step son and for purposes of the self directed IRA not related to her, that he might be able to borrow money from Mrs. Investor to do a deal. Any interest payments he pays to Mrs. Investors IRA for the loan of the money will go back into her IRA, but any profits he makes will be his to keep.
He then goes out and finds a killer deal but he has to act fast. There is a bank owned property listed for $30,000 that has an after repaired value of $80,000. There are quite a few buyers interested in the property. He made an offer that was full price and he told them he could close in 5 days. As all the other offers even though they all offered a little more than $30,000 all wanted 30 days to get their loans put together and Junior can close in 5 days, he gets the deal.
Investor Junior then goes to Mrs. Investor and strikes a deal with her. She can lend him the $30,000 to purchase the property plus another $15,000 for him to pay for the repairs out of her rolled over IRA. He will pay her the same fees he would have paid a hard money lender: 5 points and 15% interest and he will pay it all at once when he pays her off in about 6 months.
So they draw up the proper paper work and she pays the $30,000 for purchase and loans him $15,000. In the next two months he rehabs the house, gets a tenant in it and then at the end of month 4 he sells it to an out of state investor for $80,000 and pays off his loan from Mrs. Investor’s IRA.
Let’s look at their profits. Mrs. Investor’s IRA gets $45,000 back, plus 5 points or $2,250, plus 4 months of interest at 15% or $2,250 an now her balance is $54,500. Investor Junior spent $64,500 ($30,000 purchase, $15,000 rehab, $2,250 in points, and $2,250 in interest) and earned a profit of $15,500.
The next month Investor Junior’s wife and Mrs. Investor go out to look at a house. Mom is coaching her daughter-in-law as she did not grow up in real estate as Junior did. This is the deal they worked out. They found a house that was worth $130,000 that was in really bad shape, needing about $30,000 in repairs. The owner had died and the heirs were very motivated to get it sold and agreed they could let it go for $50,000 if they could sign a contract today. Mrs. Junior signed a contract to buy it from the seller’s with her IRA that if you remember only has $3,000 in it. She had her IRA wire a $1,000 earnest money deposit to the title company the next day, got the keys from the seller’s who were leaving town and made sure she had the right to assign the contract and she had 45 days to close on the contract. Plus she had a safety net with her mother in law. If she could not find another investor to assign her contract to, Mrs. Investor was going to buy it with her IRA for $50,000.
After getting all the contracts signed up, the next day Mrs. Junior got busy. She put a sign in the yard and got on the local investor chat room and posted the following post:
675 Mulberry Street.
3 bedrooms, 1 ½ bath, 1 car garage, full basement
After repair value $130,000
Needs $30,000 in repairs – nothing structural
Need cash buyer for $60,000
House will be open today at 5:30 pm, will take a cash buyer contract today!
Please call Mrs. Junior at 816-555-1212
She had 10 calls by noon, held the house open and had 5 investors show who she knew to be very active and one agreed to take over her contract at a price of $65,000. Remember there were 5 buyers there at 5:30 so they did get into a little bit of a bidding war. Everyone went to closing on their assigned day and Mrs. Junior ended up with a check for $15,000 going back to her IRA as her assignment fee. Now her account balance stands at $17,000 ($3,000 initial balance - $1000 EMD + $15,000 in assignment fee).
Now all these examples are fictitious and the deals are simplified and do not include holding costs and a few other fees, but you can see how utilizing a self directed account whether you start with a large balance or a small one can grow your retirement funds very quickly. You do need to keep in mind that all profits earned by the IRA, need to stay in the IRA and not go back into your personal or business accounts and to get advice from experts where you needed. It also helps if you have a non-related friend that you might borrow money from or lend money to or buy and sell houses between your IRA accounts.
There are quite a few more complicated scenarios, so do your homework on self directed IRAs as well as private lending. You may find that you can make a good return on your investment by being the bank for other investors letting them do all the hard work of hunting down houses, making repairs, dealing with tenants and the like and you just sit back and have your IRA collect the interest payments each month.
About the Author: Kim Tucker is the Executive Director of Mid-America Association of Real Estate Investors located on the web at www.MAREInet.com , an association for Networking and Education based in the Kansas City Metro. If you would like to learn more about investing in real estate, please visit this site and check out our numerous teleconferences on various subjects and check out our guru pages for informational articles and ebooks. Kim has been investing in real estate with her husband Donald since 2000 and primarily invest in fixer uppers, rehabs, and rental properties in Kansas City Missouri. Currently their company Tucker One Properties, Inc. offers turn key rentals, and fixer upper properties in the Kansas City Market. To learn more about Kansas City real estate visit them on the web at www.TuckerOneProperties.com or call their offices at 816-523-4400.
Reprint permission – this article may be reprinted on any REIA groups web site or newsletter as long as the about the author section at the end is included. Thanks - Kim
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