Jackie Lange
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The Commonwealth Letters have been on CashFlowDepot since it began in 2007.
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This example was another deal that I actually did.
The couple had a 35′ RV parked in their driveway that had a faded For Sale Sign. I asked if they would take $6500 for the RV so they could get enough cash to stop the foreclosure. I wrote an option to buy the RV for $6500 then I called every RV dealer in town to ask what they would give me for a 35′ SouthWind. I was offered $14,000. I hired someone to drive the Rv to the dealer (I was afraid to try to drive it myself) so they could look it over. I got a check for $14,000 that day. I gave the homeowners the first $6500 then we split the remainder even though that was not part of our agreement. So, I made a couple of thousand dollars for my efforts and stopped the foreclosure plus the owners for some cash to help them get back on their feet again.
Sometimes the best solution is NOT to buy the house!
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https://www.cashflowdepot.com/premium-training/coaching-call-prentiss-yates-how-to-prepare/
You need to meet with the landlord.
tell him, there are two ways I can solve your problem
way 1 – I will lease your house for $X, you’ll get a guaranteed payment every month even if the house is vacant Let’s prorate the February rent. I can pay you today.
way 2 – I will lease your house to my tenant than pay you __% of all the rent I collect, when I collect rent. I’m ready to start marketing your property to find the very best tenant. I will pick up all the marketing expenses.
which solution is best for you mr. landlord?
if he says, I’m concerned about who you put in the property – say let’s select them together. I will send you all credit applications then we can discuss and go with the tenant you like best
Remind him of the legal benefits of you renting the house versus hiring a property manager. If the property manager screws up — the fault gets passed on to the landlord. But by renting to you, the problems all fall on your shoulders so you want to make sure everything is done correctly.
think of what other objections he can come up with – have an answer ready to go.
watch the Master Lease training in the Premium Member section – you will get TONS of ideas to answer any objections that come up.
The replay of the Coaching call fro April27th is now available at
Learn about the ULTIMATE low-risk and low-down real estate technique
A starting bid of $190,000 is way too high. You will not get many people to the property. Unless you get a LOT of people to the property, the price will not go up up up.
I suggest a $137,000 starting bid – definitely needs to be under $150,000
People from Dallas need a good reason to drive 2+ hours to see his house. Give them a reason and a sense of urgency!
Lilia
I know a lot of people who have acquired control of a property with a lease option then when it came time to exercise their option, the “seller” backed out and refused to sign any closing docs. Don’t let this happen to you. Make sure you have all closing docs signed in advance. Get a power of attorney so you can sign for the sellers at closing. CYA CYA CYA
Ayesha
If this is a great area, why sell? Is the house currently occupied or vacant? Your buyer may be an owner occupant.
If you do decide to sell, sell with a Highest Bidder Sale for the highest down payment. You do NOT need to give any credit for repairs needed. The buyer will adjust their highest down payment bid to compensate for any repairs needed.
It would be a good idea to get an inspection report to have available for prospective buyers to see during the open house.
Would you put a balloon on the note to get cashed out in 5 years or so OR keep the cash flow stream coming in as long as possible?
There are other exit strategies you could use.
What if… you sold the property for the highest down payment but kept an option for a 50% interest in the upside over your sales price. It may be worth nothing in 5-10 years or it could be worth twice the value of the house today. You may have to take a little less down to make this one work but it is worth a discussion if you have a buyer who really wants the house ( investor or owner occupant) but does not have the highest bid. If you do this, you’d need to record a deed of trust to secure your option for a 50% interest.HI Ben
Can you give us an example of some of the multiple offers you use and explain why.
When I’m doing wholesale deals, I always make three or four offers (at the same time) so the seller can pick the one they like best. Remember, if you make one offer the seller will either say yes or no but if you make multiple offers the seller is much more likely to pick one.
1st offer – lower price all cash fast –
exit strategy to do a wholesale flip for more cash2nd offer – small down now, the rest in one payment later – usually ask for 3-5 years ( with hopes to get 2 years)
exit strategy – I can sell to a rehabber for much more & offer seller financing – will charge down payment, interest, get monthly payments3rd offer – equal monthly payments – with no mention of interest
exit strategy – sell to a rehabber for much more because I am offering seller financing.When you can offer financing to the buyer of your wholesale deals, you can charge more for the house, you’ll get a down payment, monthly cash flow PLUS a big payoff later.
There is also the opportunity for the deal after the deal because if I have 3 years to pay off the seller but the rehabber is ready to pay off the note early, I can negotiate a discount for early pay off or do a substitution of collateral.
Dave, an unlawful detainer is the next step after an eviction has been filed. Usually the tenant moves out when served with an eviction notice. But if they don’t, the next legal action is called an unlawful detainer – in Texas it would happen about 5 days after eviction court. The Sheriff’s department would go to the house and forcefully remove the tenant from the property. You, the landlord, has to hire people to remove all of the tenants stuff to the curb then get the locks changed and perhaps board up the house.
I had to do this one time. It is a sad situation that most landlords would prefer to avoid.
Thanks for the report Don. Internet marketing is so exciting when you learn how to use it.
NOTE — I just added a link to a FREE report about the top 50+ keywords to use with SEO — see the sidebar on the right for access. It’s under the best selling products section.
Youtube is a great way to get traffic to your site. Other than production costs – which could be el cheapo – this is super affordable.
PPC is good too but expensive. Advertising on Facebook is cheaper than advertising on Google. Make sure you set a budget.
I like using press releases too. You can hire people on fiverr to write and distribute the press release too. This is an alternate way to get information about your website (and services) on the first page of googe. I hire part time writers in the Philippines to write and distribute press releases for me.. it is about $150 a month for a 20 hour a week worker. See the outsource section in the premium training to learn how to do this
Instead of pulling cash out of the equity of a house, it would be MUCH faster to do a wholesale flip or a Highest Bidder Sale for fast cash.
You don’t ever want to treat your rental properties as an ATM machine. The objective with any rental property is to get the tenant to pay it off for you as fast as possible. When you get excess cash, use it to pay down any debt on your rentals so you can get to free and clear as fast as possible. A free and clear rental produces a LOT of cash flow. Cash Flow is what will replace your income from a job and support your lifestyle forever.
Do not pull cash out of a rental. Do some other deals instead.
Instead of pulling cash out of the equity of a house, it would be MUCH faster to do a wholesale flip or a Highest Bidder Sale for fast cash.
You don’t ever want to treat your rental properties as an ATM machine. The objective with any rental property is to get the tenant to pay it off for you as fast as possible. When you get excess cash, use it to pay down any debt on your rentals so you can get to free and clear as fast as possible. A free and clear rental produces a LOT of cash flow. Cash Flow is what will replace your income from a job and support your lifestyle forever.
Do not pull cash out of a rental. Do some other deals instead.
