The document summarizes the benefits of investing in apartment buildings over single family home flipping. It notes that apartment building investing provides passive income without the risks and hassles of tenant management, contractor issues, and ongoing work associated with house flipping. The author owns 33 apartment complexes with over 7,000 units, which are managed by property managers with only one phone call required per manager per month. Last year he sold four properties and received checks over $200,000 each after paying off loans.
1. 411
Print • Online • Network
www.realty411guide.com | Vol. 4 • No. 1 • 2011 A Resource Guide for Investors
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5. contents
10 An interview with Sam Sadat, the
director of Sam’s Real Estate Club.
8 and 22 Top Secrets from master investor
and educator Dave Lindahl.
13 Guild Mortgage clarifies misconceptions
about financing.
15 Invest with the
Best, Invest with
MemphisInvest.com.
19 Entrepreneur/Investor Kent Clothier
takes the road less
traveled and succeeds.
20 Black Belt
Investors teaches us
how to master the art
of the flip.
24 True Wholesale Houses
delivers steady returns for
investors in a volatile industry.
27 Market Spotlight: Kevin and Alex are at
the forefront of multiple top South Eastern
markets.
29 Tyrone Jackson wants to diversify your
real estate portfolio with stocks.
their property rehab secrets.
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30 Christian and Ruth teach Southern Californians
����������������������
33 Richard Barrett asks: What is ������������������ ���� ������� ������� ������ ��� ����� ��������
your real estate time? ������������������������������ ������������� ����������� ���� �� ������������������������������������������������
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34 In memory: Fred Tingley’s ������� ������ ������ ������� ���������������������������������� ���������������������������������������������
last real estate column. ������� �������� �������� ����� �������������������������������� �����������������������������������������������������
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35 Market Spotlight: Phoenix, Ariz.
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36 Top 20 excuses for failure. ������������������������������� ��� ����� ��� ���� ���� ���
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38 Gary & George’s Monopoly Secret
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39 to 53 Meet the Hip Real ������������������� ���������������� ����������������������������������������������������
Estate Divas of Today: �������� ��� ���� ��� �� ���� ��� ���� ����������������������������������������������������
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Powerful gals in the industry give
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their advice and tips. ������ ���������� ��� ���� ��� ��
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54 Maximize your legal protection ��������
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57 Inside the cashflow board games ���
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58 Tom Wilson gives his insight on the market recovery.
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Questions? Need a Referral? ���������������������������������
���������������������������������
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805.693.1497 or 310.499.9545 ���������� ����� ������� ��� ������������
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Photo credits top right and clockwise: Sam Sadat, Tyrone
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�������������������� Kent Clothier and Jay Hinrichs
Jackson, Terica Kindred, ������������������������������
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Realty411Guide.com PAGE 3 • 2011
���������������������������������� ��������������������������������
������ ���� ���� ������� ��� ����� ���� ��� ����������� ��������� ������������� reWEALTHmag.com
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8. If Single Family Homes Are Such Great
Investments, Why Do Most ‘Investors’
Still Go To Work Every Morning?
W
by Dave Lindahl
ouldn’t you love to discover
how to make $9,700+ in
passive income month after no income. That’s not financial
month… and how to reap huge positive freedom.
cash flows from real estate – with less
risk, less money down, and no tenant 4) The government takes
headaches? 33%-50% of your profits!
I’ll tell you what, if you want to collect When you hold houses for less
an automatic monthly income of $9,700 than a year, your profits are
or more -- without having to get up ev- taxed at the painfully high rate
ery morning and “go to work” – then you of “ordinary income”. Com-
need to know that most real estate ex- pared to my approach, you have
perts are giving you the wrong advice! far less cash to roll into the next
See, they rave about buying and selling property. The result: it could
single family homes, but they don’t tell take you twice as long to attain
you about the risks and downsides. They financial independence.
When you’re flipping houses, you’ve got to
keep working to earn your next “paycheck”.
don’t admit that single family homes are tors. Most bargain homes are in disre- If you’ve read the best-selling book
poor investments for passive income... pair. You’ve got to renovate them, but Rich Dad Poor Dad, you understand that
for attaining real financial freedom. most contractors are unreliable. You’ve income-producing assets are the key to
Now don’t get me wrong, if you can got to oversee everything they do, or risk financial freedom. You also know that
wait a few years for your upside, single paying for their mistakes. And the good Robert Kiyosaki (the book’s author) built
family homes have a history of appreci- ones are always booked up for months in his personal fortune through buying and
ating nicely. And if you’re happy making advance. holding real estate.
one-shot profits, flipping houses can be Unfortunately, Kiyosaki doesn’t go
an exciting business. Over the past eight 2) You lose money for four to six into detail about how he selected, man-
years, I myself have bought, rehabbed, months. That’s how long it takes to fix aged, or sold his properties. That’s why
and/or sold 422 houses. If you can pull up a house and resell it. When your con- I’m writing, “The Real Secret…Apart-
it off (despite the risks), you can make tractors drag their feet, you’re left help- ment Buildings And How To Manage
a big profit in four to six months. It can less and stressed out. Every day your 642 Units With One Phone Call Each
be a good business model. But it’s not house sits vacant, your bank account is Month!”
financial freedom. further depleted by loan payments, taxes, Today, I own 33 multi-family apart-
When you’re flipping houses, you’ve insurance, and utilities. ment complexes, with 7,322 units in all.
got to keep working to earn your next Yet, I never deal with a single tenant,
“paycheck”. You’ve got to keep market- 3) Your job never ends. When you their complaints, any repairs, or vacan-
ing, buying, renovating, and selling. finally sell, you’ve got to start all over cies.
again, marketing, negotiating, and over- My carefully chosen property manag-
This is the life of a “house flipper”; seeing your contractors. If you take time ers handle 100% of the tenant manage-
1) You’re at the mercy of contrac- off, or can’t work for awhile, you have ment. I have one phone call per month
Realty411Guide.com PAGE 8 • 2011 reWEALTHmag.com
9. with each of them; that’s it. tion devalues your principal. But when ship program. It’s aim is to take you by
Last year, I sold four of my proper- your buildings appreciate and your ten- the hand and share with you the proven
ties. After paying off my loan balances, ants pay off your loans, you create huge tools you need to be successful in invest-
I received four separate checks for over equities, and eventually own them free ing. But with everything in life there is
$200,000 apiece. And I used a legal tax and clear. of course a catch. And the catch is that
loophole to pay zero taxes on three of I can’t work with everyone. There isn’t
them. I can show you how to do the same. 4) Hands off management. Because enough time in the day. But my strate-
Why haven’t you heard more about apartment houses offer so much income, gists and I can work with a select group
apartment buildings? Because apartment property managers charge an average of of people.
investors don’t
want the general
public to know
about their suc-
cesses. Apart-
ment investors
are already
w e a l t h y. J u s t
look at the late
Red Auerbach of
the Boston Celt-
ics. He made his
real money buy-
ing apartment
buildings, then
b r a n c h i n g o ff
into hotels. Like-
wise, Arnold
Schwarzenegger
made his first
fortune buying
apartment hous-
es in Colorado.
Here Are The
Biggest Advan-
tages That I See
In Apartment Investing: just 4% of the gross rents (versus 10% There is no better time than right now
for single family homes). to find out if you qualify for the mentor-
1) Apartment buildings are “cash ing program. To take my brief question-
cows”, especially when compared to sin- 5) Cut your taxes in half. Instead of naire to determine if apartment investing
gle family homes. For example there is a paying 33-50% in taxes, you’ll pay the is right for you and to see if you qualify
six unit building I own in Brockton, MA, low capital gains rate (now 15%). to become one of the lucky few people
that nets me $1,877 per month (after all I will mentor, visit Rementor.com/Re-
expenses)! Think about it, more units in Seventeen years ago, I was fortunate alty411, do it now.
each property brings you more income. to have a mentor that showed me the My mentor made me promise that
truth about apartment investing and he when I became successful, I would pass
2) You start profiting instantly. Rather was there to take my hand and get me on my knowledge. I hope you are one of
than being drained for 4-6 months, car- started!. Now whether you have ever the few people I take under my wing to
rying the costs of a vacant house, you invested in real estate before or if this share these powerful techniques.
enjoy positive cash flows from day one. is just something that you have always
And you can live off that income, so you thought about doing, I would love to take Receive Dave Lindahl’s free report, call
don’t have to go to a job everyday! your hand and share with you the exact 800-559-8590 or visit:
strategies and processes that have made www.DavesOffer.com/Realty411
3) Build huge equity and live off the me a multi-millionaire. To read more about Dave and hear a stu-
cash flow. If you live off the income Fortunately for you, I have created dents success story visit:
from bonds, CDs, or mutual funds, infla- a very successful but limited mentor- www.Rementor.com/Realty411
Realty411Guide.com PAGE 9 • 2011 reWEALTHmag.com
10. Mr. Motivator
The founder of Sam’s Real
Estate Club in Beverly Hills
discusses his start in real
estate and explains why
his message of abundance
is so urgently needed into
today’s volatile market.
article by Linda Pliagas
photography by John DeCindis
the nation and eventually made his home
base in Santa Monica, Calif.
Sam’s passion, other than putting togeth-
er real estate transactions, is the study of
metaphysics and spirituality. It is this reap-
and-ye-shall-sow philosophy, which also
permeates at his club, that has attracted
many loyal monthly followers to converge
at the Beverly Hills Country Club.
“I try to shift people’s mindset from scar-
city and lack to that of abundance,” reveals
the daily mediator. “Most people thinks
that motivation comes from the outside,
but that is an illusion. The fact is, motiva-
tion comes from within.”
Sadat began his quest for real estate
knowledge shortly upon graduating from
T
University of Texas, Austin, with a degree
in mechanical engineering. He recalls:
“At the time, I was working for corporate
he Westside of Los encourages individuals to take action for a America. I took a hard look at my bosses,
Angeles is hustling life of fulfillment. who had already been working there for 20
with investor activity. With over 2,000 members throughout to 30 years, and I knew there had to be a
Within a five-mile ra- Southern California, Sadat attracts visitors better way.”
dius there are no less from up to two hours away. His clubs also In his quest for real estate, he first became
than seven real estate hosts some of the nation’s most sought-after attracted to real estate finance because he
clubs, serving thou- speakers, such as Than Merrill, Scott Mey- realized that “knowing the numbers,” was
sands of investors. But ers, Richard Roop and Reggie Brooks. vital. Part of Sadat’s real estate education
one organization goes way beyond simply Sam’s Real Estate Club founder is Sam led him to start attending real estate clubs.
being a club that talks about real estate. It Sadat, a spirited U.S. immigrant of Persian He fondly recalls attending investment
is a self-help investor organization, which descent who has lived in numerous parts of gatherings in different parts of the country,
Realty411Guide.com PAGE 10 • 2011 reWEALTHmag.com
11. including Colorado. By the time Sadat be- “Fear.” He adds: “That is really the funda- creative transaction, later he found out the
gan to live in Los Angeles, he was already mental reason why people don’t act, it’s be- seller was attempting to sell the same prop-
experiencing phenomenal success in real cause of fear. The fear of the unkown and erties again!
estate finance, including traditional mort- fear of failure are really two of the most “It was a learning experience for me and
gage and hard money lending. He was also incredible fears that we have.” for others of what not to do, not having
buying, rehabbing and flipping properties While Sadat is thankful for the success gone though a traditional escrow caused
as a sole investor and also with partners. he has found in real estate, it hasn’t al- me a lot of aggravation and money because
It is then that he says he felt a longing ways been smooth sailing. “I lost millions I ended up having to take legal action.”
to create his own space. “I wanted to have because of the Northridge earthquake in During emotionally and finan-
a forum for me. I wanted to make sure I 1994,” he confides. (Most Californians do cially devastating times, Sadat turns in-
could inspire people.” ward for strength and relies
He carved out a space in on words of wisdom from
Van Nuys and began to
host monthly meetings in
The Scoop on Sam’s Real Estate Club the individuals he admires
most: Carl Yung, Wayne
May 2003. The number Join Sam Sadat the 4th Wednesday of every Dyer, Ralph Waldo Em-
of guests soon swelled month at the beautiful Beverly Hills Country erson and Rumi, a Persian
into hundreds of people. poet.
Sadat prides himself in Club. Meetings start at 7:30 p.m. and usually Successful attributes in
having a club where edu- last about 2 1/2 hours. Reserve your seat online life, like in real estate, need
cation, not promotion, is for $10 per person, which includes valet parking. to be developed. “I’ve heard
the focus. my shares of ‘no’. I’ve had
His goal is to transform Please register for the club meeting online at: to work on myself. It’s a life
each one of his members www.SamsREClub.com mission.”
from being a potential in- For Sadat that calling
vestor into an active one. is not merely a personal,
“My main focus has become teaching not carry earthquake coverage due to its internal goal, as much as it is an evolving
and mentoring my students because often lack of affordability.) Another tough lesson and fully dimensional manifestation. It is
you have to hold their hand and literally he learned was that no matter what type of an avocation that he says he hopes will el-
push them to act upon their knowledge.” transaction a real estate investor does, they evate all those he reaches.
When asked why so many people sit on need to hire an independent escrow com-
the sidelines when it comes to taking ad- pany to make sure the contract is followed Be sure to visit Sam’s Real Estate Club on-
vantage of the greatest buyer’s market of accordingly. Sadat learned the importance line for a schedule of speakers:
all-time, he replies with one simple word: of this when he purchased three homes in a www.SamsREClub.com
“Most people think that motivation comes
from the outside, but that is an illusion.
The fact is, motivation comes from within.”
Realty411Guide.com PAGE 10 • 2011 reWEALTHmag.com
12. This is Your Chance to Learn to Be the Bank!
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h MEET OUR
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Private lenders borrow money at a
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preneurs looking transactions, rate, making a nice profit or spread,
ide sales & marketing, give him a unique
their business. just like the bank!
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15. Invest with the Best
The Market Leader is MemphisInvest.com
by Charles Salisbury, MBA
Photograph from left to right: Chris Clothier, Brett Clothier, Kent Clothier Jr. and Kent Clothier Sr.
“If you commit to getting better every day,
your customers will demand you get bigger.”
T
— S. Truett Cathy, founder of Chick-Fil-A.
his sage advice, as well you plan to invest out of state, you need an out of state investor.
as nuggets of gold from to find the right company to partner with Chris continues, “You are looking for
other customer focused gu- — someone that has experience, that has someone with all the business acumen to
rus, has been adopted into knowledge not only of the industry but of put together all the steps that make sense.”
MemphisInvest.com’s own the market, and someone that is a true turn- The Clothier family established Mem-
company goals and aspira- key provider.” phisInvest.com and her sister companies,
tions; namely to be the absolute best turn- While there are many companies who Memphis Invest Renovation Services and
key investment company possible. call themselves “turn-key” (so much so that Premier Property Management on the firm
Many investors try their hand at out-of- he feels it has become an overused phrase), belief that out of state investors need ac-
state investing only to become frustrated Chris believes that investors searching for cess to proven, qualified professionals who
with the less than stellar returns they expe- a turn-key company to partner with should understand their needs. MemphisInvest.
rience when dealing with companies who look for organizations who “own and op- com partners with investors by handling all
claim to be “turn-key” investment compa- erate every step of the equation.” This of the details — from purchasing invest-
nies that simply provide contacts, leaving way, investors are not getting a company ment properties to ongoing maintenance
customer service out of the equation. that says: “buy from me and I will give and property management, helping to al-
Chris Clothier of MemphisInvest.com you contacts for renovation, or contacts leviate the stress that often accompanies
offers his advice for individuals who are for property management or contacts for buying properties far from home.
interested in finding a true turn-key com- insurance.” Chris says this is a recipe for Memphis Invest makes investing simple
pany for their out of state investments. “If disaster and it is a lot of hands-on work for
Continued on pg. 17
Realty411Guide.com PAGE 15 • 2011 reWEALTHmag.com
16.
17. for out-of-state investors. “You make one
phone call,” states Chris, “and you’ve got
every department any answer — access
to every single person in this company, so
[the process is] very streamlined.”
Chris believes that successful investors
possess some common traits — “they have
to be inquisitive, they have to have curios-
ity. They shouldn’t ever take everything at
face value. They should be inquisitive as to
who they’re dealing with, and what mar-
kets that they’re looking to buy in. They
should be willing and able to do some
homework, look around, and ask the right
questions. They should also have a long
term mentality. This is not get rich quick
by any means. The other thing that inves-
tors need to be successful in long-term buy
and hold, is they need access to capital. No Top: An out of state real estate investor celebrates purchasing two investment properties.
money down is not an avenue to success.
You have to have access to some capital
and be able to build a long-term portfolio
whether you use straight cash or some kind
of leverage.”
MemphisInvest.com, possessing a strong
customer service focus and attitude, makes
sure that an investor knows, from the start,
if this opportunity is right for them. “I
don’t want to waste an investor’s time or
raise their hopes,” says Chris. “We are very
up front and very frank when we have our
discussions. We need to know the financial
strength and ability of an investor so we
can help make sure they’re successful.”
Investors who partner with Memphis
Invest will realize that “they have found
a great opportunity in Memphis, they’ve
identified one of the premier turn-key in- Top photo: Customer Service Team at MemphisInvest.com Carol Henderson, Cyndy
vestment companies in Memphis, and McCrary, Ashley Claunch; Bottom photo: Brett Clothier gets ready to speak to a room
they’ve communicated real clearly exactly full of real estate investors at a buyer tour in Memphis, Tennessee.
what they want — from there they just let
us do it, and then they buy the opportuni-
ties that we bring to them,” says Chris.
He continues: “This is about buying cash
flow investment property, if an investor tells
us that they need to earn a certain amount
of cash flow to pay their bills each month,
we are very adamant that they need to look
at other financial opportunities, other finan-
cial advice before buying real estate.”
For the Clothiers, “There is no sale
worth making that’s gonna hurt somebody,
just for us to make a little bit of money,”
states Chris.
Why would an investor choose to partner
Continued on next page Continued on pg. 31
Realty411Guide.com PAGE 17 • 2011 reWEALTHmag.com
18. with MemphisInvest.com?
“As a company, we hold in very high
regard the customer service that we pro-
vide,” says Chris, “we have three dedi-
cated employees that provide customer
service, including calling every one of our
clients every month on behalf of our prop-
erty management company and on behalf
of the Clothiers, as the owners — and they
ask the simple question: “What can we do
for you?”
Chris shares the reason for Memphis In-
vest.com’s amazing growth. “About a year
ago we started to take time every single
week to stop everything, and come togeth-
er and study how to get better at customer
service, and at business as a whole.”
The investment in customer service has
paid off — in spades.
In the first half of 2011, MemphisInvest.
com became the larg-
est private home sell-
er in west Tennessee.
The only companies
who sell more homes MemphisInvest.com
than Memphis Invest
are Fannie Mae and
Rental Opportunity
the Department of
Housing and Urban
Development.
“ To d a t e , ” s a i d
Chris, “we closed 163
transactions so far in
2011. Last year at this time, we had closed 79 transactions.”
The integrity and distinction that MemphisInvest.com brings to
the turn-key investment industry is seen clearly by their actions -
MemphisInvest.com doesn’t recommend properties that they
wouldn’t buy themselves. In fact, their investors buy and own in
the same neighborhoods that the Clothier family buys and owns
in.
Traveling to other cities, such as New York, Chicago, Boston,
and all major California cities, MemphisInvest.com takes time to Here is one sample property, this home is already
visit their clients face to face. Why? “We’re willing to do whatever sold, but other great rentals are still available.
it takes to provide the best service possible and to show our clients Be sure to add one to your portfolio.
that we’re there for them,” Chris replies.
3 Bed/2 Bath with 2 car garage
Built in 2000 - Sq Footage - 1,601
MemphisInvest.com invites readers to join Purchased for $69,000
them at their events in the following cities: OR $37.41 PER SQUARE FOOT
•September 8th-11th - New Orleans $10,000 in full renovation work completed
•October 1st - Boston Tax assessed value in 2010 of $104,000
•October 18th - Phoenix Gross yearly Rents Between:
•October 29th - NY $9,900 and $10,740
•November 12th - Vancouver Assuming 30% of rents for yearly expenses and
•December 1st - San Jose the property has a cash on cash ROI
•December 3rd - San Diego of approximately 10%
Realty411Guide.com PAGE 18 • 2011 reWEALTHmag.com
19. Kent Clothier Chooses to
Follow the Road Less Traveled
O
ne conversation with Kent wants to do, has been the
Clothier will open your eyes to key to Kent’s success.
a fatal flaw found in many real “If you’re willing to do
estate programs: Most of the what others are not, then you
gurus who pitch the products don’t actu- will find that success will
ally utilize them. Well, here is some inside usually follow,” said Kent.
scoop: Kent Clothier (and his entire fam- Kent believes that his suc-
ily and team) actually use the systems Kent cess, and that of his family,
promotes. As owner of 1-800-SELLNow, the Clothiers, “...lies in the
the systems Find Cash Buyers Now and fact that we’re willing to do
Find Private Lenders Now, and as co-own- something that others aren’t.
“If you’re willing to do what
others are not, then you will find
that success will usually follow...”
er of MemphisInvest.com, Kent Clothier We are always willing to
uses the same knowledge that he shares send someone down to the
with his clients, many whom have already county clerk’s office to sift
seen great success in their own right. through property records to
“The industry is filled with people find cash buyers, people that
who want to tell you how to do it,” notes are in our back yard, that we Kent Clothier
Kent, “but they’re not doing it themselves. get to know, and by doing that we’ve built a
There’s a lot of people who want you to buy very successful business, not a hobby.” learn how to “run their business like a busi-
this program, or buy that program, [but] When Kent and his family shared the ness.”
the actuality is, very few of them are doing methods they utilized in growing their “In our real estate education classes, we
deals. Not only do we educate people, but business with others in the real estate in- only spend 20 percent of our time teaching
we’re also buying and selling three to four vestment industry, they were surprised at people on real estate, and we spend prob-
hundred houses per year.” the reactions they encountered. Individuals ably 80 percent of our time educating them
Kent got his start in real estate after a were amazed that the Clothier’s could find on how to be an entrepreneur, or how to
successful career in the wholesaling busi- cash buyers, and build a brand for their in- actually get in the game the right way,”
ness with a multi-billion dollar company in vestment business. said Kent.
the grocery industry. After leaving the gro- Kent’s businesses were “born out of our Rather than wait for the elusive (read
cery business, he was, like many individu- own investing interest,” said Kent. “We “non existent”) “perfect” time to invest,
als, “sucked into” the real estate industry realized that what we were doing was so Kent advises his clients to realize that
by those infamous late nite “infomercials”, unique, that we needed to share it with “there will never be a better time, [your]
however unlike so many who try their hand other people.” inaction is costing [you] the opportunity of
at real estate investing and fail, he put ev- Investors who purchase their systems are a lifetime!”
erything into his businesses and has grown provided with access to a wealth of infor- “There’s never going to be another op-
three successful ventures in addition to mation on real estate investing, including portunity like this,” said Kent, “and yes, it’s
working with his family’s business, Mem- webinars, access to online cash buyers, supposed to be scary, it’s supposed to be a
phisInvest, a truly wholesale investment continuous customer support and access to little unnerving, but it’s also what makes
company. private lenders; virtually everything a seri- it exhilarating, it also makes it very excit-
A focus on creating a relationship with ous individual needs to grow their invest- ing, it also makes it so rewarding when you
their clients and meeting their needs, as ment business. finally get there, when you finally achieve
well as always doing what’s necessary, More than just great customer service the level of success you desire. ”
even the “dirty work” that nobody else and access to fantastic products, investors
Realty411Guide.com PAGE 19 • 2011 reWEALTHmag.com
20. Disciplined Investing
Mastering the Art of the Flip
by Anita Cooper
Mastering the art of wealth creation takes a transaction - you’re flipping real estate
time, it takes dedication, and most impor- without the risk. get passed that obstacle, whether you have
tantly, it takes direction - guidance from Black Belt Investors is unlike many oth- to go around it, over it, through it or under
a wise investor who has himself mastered er real estate consulting, educa- it. If you can learn that from your coach,
his own destiny through smart investment tion and investment firms. you will find yourself in a profitable posi-
strategies. “I truly believe that if you tion. I know with a few of my realty-based
Sensei Gilliland, Founder and Presi- want to become a real es- techniques, you will be able to pass any
dent of Black Belt Investors, has trained tate entrepreneur and cre- obstacle and get paid.”
hundreds of investors to grow their ate your real estate cash “One thing about Black Belt Investors,”
wealth through his “action oriented and machine,” shared Sensei, shared Sensei, “is that one of our primary
results focused” training programs. Uti- “you need proper training goals is keeping our investors engaged all
lizing discipline gained through years of by an experienced instruc- the time. We’re not a fly by night company
martial arts training, Sensei has created tor that practices what that trains students for 3 days and leaves
a program designed for all levels he teaches. You them to do the work on their own. We’re a
of investors who need guid- also need company that reaches out to help the stu-
ance and direction and the instruc- dent to get to the next level. We accom-
who desire to create a tor to take plish this through my coaching program
real estate business you from which is directly with me and not through
that is cash flowing classroom a call-in center that answers questions
tens of thousands instruc- from a script. We also keep investors en-
of dollars every tion to gaged through multiple free webinars,
month. applying workshops, on-site mentoring and my
Every experi- the tech- free monthly real estate club meetings in
enced, or “black niques in the Southern California, which keeps me ac-
belt” investor, was trenches to help countable as I must show my face there
once a “white belt” you develop every single month. If I was over promis-
(beginner). He did not your newly ing and under delivering, then I would be
attain to his advanced posi- acquired skills exposed at that club meeting. Our inves-
tion overnight; his knowl- and put you on tors keep coming back because they’re en-
edge increased as he put the fast track gaged, and when they’re engaged they be-
Deals are not going to fall in
your lap, deals are created.
his training into practice. He also did not to getting paid. There’s a lot of real estate come more successful. The only way not
train on his own, rather he had a teacher trainers and gurus out there that just pro- to be successful after one of my trainings
that led the way. mote fluff and stuff. They glamorize real is if you were to unplug yourself.”
It’s vital that you find a successful men- estate to be extremely easy and profitable You will learn by doing. “If I were to
tor, someone who is interested in helping all the time, and yes, real estate can be ex- train you to wholesale properties, we
you achieve your business goals. If you’re tremely profitable, but the reality is, you’re would develop a battle plan, grab your
looking for immediate cash, wholesaling going to have to do some work. Deals are hand to lead you onto the field, and start
is the best place to begin. Black Belt In- not going to fall in your lap, deals are cre- doing the business. There is nothing bet-
vestors will train and coach you on how ated. Just know that you will have some ter than hands-on training,” shared Sen-
to control properties and create immediate deals that are extremely easy that will put sei. “Think about it, if you were to learn
cash without the use of cash, without the cash in your pocket quickly and with oth- how to kickbox, and I had a kickboxer that
use of credit, and without the use of loans. ers you’re going to run into obstacles - it’s
Basically, you become the middle man of up to you as an investor to learn how to Continued on pg. 56
Realty411Guide.com PAGE 20 • 2011 reWEALTHmag.com
21. A Way to Effortlessly Flip or Rent
Cash Generating Properties in the
Hottest Markets Across the Nation
We call it Remote Rehabs! Almost everything has been done for you, we have:
• Strategically Targeted Markets to Buy cheap, Fix Easily and Sell Quickly
• Generated a Revolving Inventory of Deeply Discounted Properties starting at $20K
• Taken Away the Headaches of Deal Searching, Pencil Pushing, Rehabbing and Sales
• A Success Manager to Keep you Abreast and Coach You Throughout Your Deal
• Basically Put Time Back on Your Side to Rehab Houses without Lifting a Hammer
• “Gain Complete Control Over Your Life and Spend Less Time on Doing Things You Hate Doing By Using
Remote Rehabs, a 100% Hands-Off Fix and Flip System.”
“Exceeded Expectations”
“Wow! Just wow! I don’t even know where to start with all the things that Remote Rehabs has done for me. Know that list of benefits that
Black Belt Investors offers? Well they are all completely, one hundred and fifty percent true! All I know is that Remote Rehabs is the simplest
and most profitable program I have ever experienced.”
- Pek Lee Choo - Chicago, IL
“Simply Amazing”
“Here is what I did: I enrolled in Sensei’s program Remote Rehabs, he found me a deal and his team did all the work A-Z. Soon after the
rehab and listing the property, I was amazed to receive offers on my investment! At first I put it off to blind luck, but within 45 days I receive
a check for over $17,000 in net profits and I’ve been smiling since.”
- Lynn McCloskey - Concord, CA
27 Days! Cash Flow 51 Days!
Sold in Equity & Sold in
Indianapolis, IN Phoenix, AZ Indianapolis, IN
Purchase Price: $43,000 Purchase Price: $45,300 Purchase Price: $36,500
Repairs & Misc.: $32,000 Repairs & Misc.: $4,200 Repairs & Misc.: $22,700
List Price: $110,000 Fair Market Value: $71,000 List Price: $99,900
Sold Price: $110,000 Equity Position: $21,500 Sold Price: $95,000
Net Profit: $25,100 Cash Flow: $725 mo / 8,700 yr. Net Profit: $27,250
Cash-on-Cash Return: 33% Capitalization Rate: 18% Cash-on-Cash Return: 38%
Black Belt Investors’ Remote Rehabs program is a truly unique and phenomenal way
to build cash quickly. Believe that Remote Rehabs is without rival in any shape and form.
Black Belt Investors stake their reputation on the fact. By getting involved today, you will
be receiving a profitable and automated hands-off rehab business with its time tested meth-
ods, as well as Black Belt Investors’ 15 years of experience. Trust me... This is one chance
you cannot afford to pass up; Take Action Now!
Office: 951-280-1900 www.BlackBeltInvestors.com
22. Dave’s RE Tips Wealth
Real Estate
Fro
m
th
eP
ub
lish
ers
of
Re
alt
y4
11
Vol. 1 • No. 3 • 2011
How could a real estate “investor”
flip houses for eight years, only to
wind up with no assets, no cash
flow, and no income? by Dave Lindahl
Serving the Needs of Accredited Investors - INSIDE: Information to Grow and Maintain Your Wealth
8 TurnaaProfitable Business 10 Be a Private Lender, 18 Zero DownSecret Recipe
into
Real Estate Hobby
Learn to make BANK! Learn Our
Investments
I
started working in real estate with ture appreciation. After all, he always got expenses. The result: at the age of 65, his
my friend, Walter. We both started $5,000 plus upfront in “option consider- net worth is only about $33,000. And that’s
out rehabbing houses, but there were ation” and he always sold his houses and not the worst part...
two big differences between us. First, made a profit. Over a three year period, he If he stops buying and selling, he’ll have
I was a lot younger; I was 32, Walter was grossed an average of $109,00 per year. no income to live on! That’s because he
58. Second, I grew my net worth and cre- Sounds pretty good, doesn’t it? has no income-producing assets. No posi-
ated a hands-free passive income. Walter, Unfortunately, the IRS calls him a “deal- tive cash flow. No annuity. And no equity.
by contrast, got hooked on buying and er”. That’s because he rarely holds a house Now he looks back at all of those years and
selling. Why? for more than a year. So his profits are realizes he made a big mistake.
He was afraid of tenants, so he rarely taxed at the painfully high rate of “ordinary Most of the homes he bought in the mid-
rented houses. When he did, it was always income”. For example, he sold a house 90’s have doubled in value, but he sold
on a “rent to own” basis. (He offered the for a $29,000 profit, that’ll cost him about them all before they had a chance to appre-
tenant a lease option). After all, single $10,000 in taxes. ciate. He gave away hundreds of thousands
family homes don’t generate much posi- After overhead costs and taxes, Walter’s of dollars in appreciation. (And the IRS
tive cash flow. “take home pay” is only about $60,000 per took a third of his profits). He never bought
Walter didn’t mind giving up his fu- year. And every dime pays for his living
Continued on pg. 62
Realty411Guide.com PAGE 22 • 2011 reWEALTHmag.com
23. TrueWholesaleHouses, LLC
“Equity Day 1, True Cash Flow, Peace of Mind”
We are proud to offer a proven cash flow investment with substantial instant equity. The investor receives
the best of both worlds a true turnkey investment backed and managed by a team of life long real estate
professionals.
The Genesis of True Wholesale Houses, LLC is taken from a deep understanding of cash flow real estate
investing properties and what it takes for the passive investor to succeed. The investor that chooses to
invest with True Wholesale Houses, LLC will enjoy a predictable monthly cash flow and instant equity.
True Wholesale Houses, LLC takes the work and worry out
True Wholesale Houses, LLC brings
of owning a rental property, while maintaining a proven cash investors Wholesale to Wholesale deals
flow to the investor. as opposed to Wholesale to Retail
No more worrying about:
1. Collecting Rents. HERE ARE SOME OF OUR NEW ADDITIONS TO
2. Maintenance Emergencies. OUR SELECTIVE INVENTORY
3. Finding a Tenant.
4. No more worrying about managing property and
managing your managers.
5. Property Taxes.
6. Finding the right home in the right neighborhood.
7. Insurance.
True Wholesale Houses, LLC is your Equity Partner for the
life-time of the transaction. Our partners on the ground
have a stake in the home, the tenants, and preventing main- Atlanta, GA - $19,500 Equity DAY 1
Net Investor Cash Flow $340/Mo • Note Price $51,000
tenance problems by doing a quality re-habilitation on the
property before we place a tenant.
True Wholesale Houses, LLC pays monthly cash on cash 9%
return for the term of the note. If the home has a vacancy,
we still pay you every month.
As your partner, True Wholesale Houses, LLC will manage
the property and sell it when the market recovers. If you
wish to keep the cash flow and the 9%, you as the investor
can dictate an extension on the note, holding the home in Jackson, MS - $17,500 Equity DAY 1
the caring hands of True Wholesale Houses, LLC. Net Investor Cash Flow $262/Mo • Note Price $35,000
True Wholesale Houses, LLC is here to work with you to give
you the best value for your money. We are your true whole-
sale partners so we can all prosper together.
For information, contact:
888 285 1900 Atlanta, GA - $20,000 Equity DAY 1
Net Investor Cash Flow $309/Mo • Note Price $53,000
Join True Wholesale Houses, LLC
!
Now Website: http://www.TrueWholesalehouses.com
24. True Wholesale Houses
Offers Investors Security & Returns
T
by Anita Cooper
ruly unique, truly up front. Our profit is deferred un-
amazing, truly one Rock-Bottom Prices, Secure til the property sells. And like the
of a kind. True Returns & Built-In Exit Strategy triple net lease, we offer the same
Wholesale Houses thing – investors get their payment
is different from ev- monthly, regardless of whether it’s
ery other investment rented or not.
company you’ve come across. With this program investors
Jay Hinrichs, managing owner of Step 1 never have a cash call and they
True Wholesale Houses is uniquely True Wholesale Houses, don’t have to worry about any of
LLC acquires a foreclosed
qualified to provide investors with the maintenance. True Wholesale
or REO property
top notch investment opportuni- Houses deals with all the manage-
ties that promise consistent returns. ment headaches associated of own-
Hinrichs is both a licensed mortgage Step 2 ing and managing an asset.
banker in the state of Oregon, and a Partner Company, Unlike other investment com-
licensed real estate broker in Cali- Portland Funding LLC panies, Hinrichs says that at True
makes a loan at True
fornia, Oregon and Mississippi. Wholesale Houses, both the prop-
Wholesale Cost
Hinrichs shared his reasoning be- Creating Instant Equity erty manager and the rehabber
hind True Wholesale Houses’ cre- are owners of the property. “Our
ation; “As a lender, back in 2008 guys on the ground are vested in
Step 3
and 2009, like every other lender at True Wholesale Houses the properties. They have an own-
the time, we had foreclosure prob- does a complete Reha- ership interest, and they too are
lems, I looked at the model and bilitation of the property. working for the equity bonus when
said, ‘There’s gotta be a better way Creating a problem and we sell these properties.”
to protect the investors than just let- maintenance free “Our ownership interest in the
property
ting them go off on their own.’” Step 4 properties, assures investors that
Concerned about this trend, Hin- True Wholesale the assets are being managed to
richs devised the current model that Houses tenants the their highest potential for profit,”
property creating
True Wholesale Houses follows: Hinrichs maintains. His forecast of
instant cashflow
They provide professional invest- the market is explained: “We be-
ment and property management lieve we’re in the middle of a ten
Step 5
experience that guarantees both year cycle, and that in 3 to 5 years
The investor buys the note
the company and the investor yield from Portland Funding, we’re going to be coming out of
substantial profits from their col- gaining First Deed of Trust that cycle and once we see a chance
laboration. on the property, and a to sell our properties at a substan-
“We’ve combined my years of 50% equity position. tially higher amount than what the
lending knowledge and my years of note values are, that’s when we’ll
buying and owning rental proper- Step 6 start to roll out of the properties,
ties, and combined that knowledge Monthly interest because that is where our big profit
into a hybrid model that gives the checks are sent is lying.”
conservative investor, who’s look- to the investor There is steep learning curve
ing for the utmost in protection Step 7
for individuals who are exploring
and equity preservation, another 3 - 5 years later, TWH investing in real estate. According
avenue.” sells the property and to Hinrichs, what True Wholesale
Hinrichs shares one key differ- investor gets 50% of the Houses does is “mitigate the learn-
ence between his company and equity built, on top of the ing curve, give a real return based
monthly returns from the
most other investment companies: on years of experience owning and
cash flow generated by
“At the end of the day, none of these the tenants renting rental properties, and giv-
investment companies have an own- ing the utmost consideration to
ership interest in the property going principal preservation. We’re not
forward, they’ve taken their profit going to lose money. You’re invest-
Realty411Guide.com PAGE 24 • 2011 reWEALTHmag.com
25. ing with people who do this for the property is maintained in front, and the investor is bank- tensive experience in mort-
a living. We stay in these trans- a peak performance standard ing on property values going gage banking and real estate,
actions for the long haul and for throughout the life of the trans- up. “If the investor comes in he shares advantages that his
the life of the transaction.” action.” with us, they already got equity company has over its competi-
“I have put this model to- According to Hinrichs, when because we’re putting them into tors. His partner, Mike Hanks,
gether so that everyone is a one invests with their model, the asset for literally 20, 30, 40 is a successful home builder in
stake holder and have skin in they can expect a nine percent percent less than anybody else Oregon. He has built over 500
the game. As long as we buy in cash on cash return with no is going to sell it to them for,” homes. Hanks also has an IT
the area we want to be in, re- downside, for the life of the in- said Jay. background and has set up prop-
hab to our standards, not just to vestment. Then, when it is sold, In addition to Hinrichs’ ex- erty administration systems for
rental standards, treat our ten- (they believe that timeframe to Guardian Management, which
ants like gold, like they are, the be within three to five years), had 11,000 units, so they have
rest falls into place. Our cash there’ll be another 30 to 50 the tools to manage hundreds
flow is great, and our investors percent equity payday for the and hundreds of houses.
get taken care of.” investor. “Our partners on the ground
The reward is a real estate in- Compared to houses offered are people that we’ve known
vestment with a steady, unwav- by other investment com- for years. They are highly ex-
ering return, which may sound panies, Hinrichs says these perienced and very excited to
like an oxymoron. When asked properties are truly “whole- be part of the team and have an
how this is possible, Hinrichs sale.” For example, in Jackson ownership interest in the house,
replies: “We assure investors of Mississippi, they were able to other than just managing the
a consistent monthly cash flow, offer a home to an investor at house for somebody else and
regardless of whether the prop- approximately $30,000 less not owning any of it.”
erty is rented or not. We achieve than a similar home offered by Please note:
this by using a conservative another investment company. Investors will be provided, upon request,
vacancy and maintenance re- In other business models, with banking references to validate True
serve allocation that assure that the retailer takes the equity up Wholesale Houses’ financials.
26. We Help You Get The Most Out Of
Your Investment!
Carolina Liquidators helps
investors like yourself find the best
deals on properties in your area.
Along with providing a resource to
help you find investment property
we also pride ourselves in having
the ability to educate you on making
sound investments and helping your
make the most out of your business.
1825 Remount Rd. Charlotte. 3 bed 2 bath home
Carolina Liquidator and it’s affiliates are primarily Real Estate Wholesalers.
for $55,500.00 • Tax Value $101,900.00
With over 40 years combined experience in the Real Estate and Mortgage in-
$593.00 Net cash Flow
dustry we are able to help you achive your Real Estate Goals that may have not
otherwise have been possible.
Pricing Property Location Features
$55,500.00 1825 remount Rd Bedrooms: 3
We have a full staff of people hunting, researching, marketing, inspecting and
Charlotte, NC 28208 Bathrooms: 2
negotiating these deals. Companies like us can supply you with deal after deal;
why not let us do the work for you? We have the time and resources to find these
This home is located near downtown Charlotte NC. It is a newer
deals that most likely will not be available to you. 3 bed 2 bath home and will rent for $850.00 a month. With
the sales price being half of the current tax value it’s a steal at
We can provide everything an investor would need to make $55,500.00 and netting $593.00 a month cash flow. It is near
schools, employment and shopping and less than 5 minutes to
a sound decision. We have you covered every step of the
down town Charlotte. Don’t let this one slip away.
way from planning, based on your financial goals, to
property acquisition and property rehabilitation. Breakdown:
Rent: $850.00 Total Expenses: $257.00
We have been doing Real Estate Investing for the last 18 years and mortgage Approximate taxes: $122.00 Net Cash Flow: $593.00
for the last 15 years. We have the experience and know how to get deals done. Insurance: $50.00 Cash on Cash Return: 14%
Whether your looking for a home to make a quick return on, or homes that Property Management: $85.00
produce a constant cash flow. We will find you what you are looking for!
“ ”
Carolina Liquidator made the buying process so easy. I would definitely recommend
their services to anyone who is looking at investing in a home...
www.CarolinaLiquidator.com
803-325-1925
27. Market Spotlight: Rock Hill, SC
LOCATIONS:
Rock Hill, South Carolina
Charlotte, North Carolina
Atlanta, Georgia as much a part of the team as anyone else is figure out what you are looking for and
COMPANY: involved. It is kind of shocking to some what your goals are and we put scenarios
Carolina Liquidator of the investors when they come out to together that will help you achieve those
CONTACT: visit our office because we have so much goals. We have a great team that works
Kevin & Alex community support, we have churches and daily on achieving the goals of our inves-
ph: (803) 325-1925 community leaders that work with us to tors. Our team includes our research spe-
CarolinaLiquidator.com help keep the areas clean and safe. cialist, Emily Harris; property manager/
office manager, Cherry Stegall; and gen-
Question: What kind of opportunities Q: Why should investors buy rentals in eral contractor, Bennett James. These three
are you seeing in your market? your area? work to keep the daily operations of our of-
Answer: We currently have a 67 house A: Investors should buy rentals in our area fice moving so that we can continue to find
package that we are working on. It is not because we have good, hard working peo- deals for our investors.
only a great opportunity for us but for in- ple living in our homes. People who rent Q: How long have you personally been
vestors who are interested in this package.
About half of the homes are currently rent-
ed and we should be able to place tenants
in the other homes very easily.
This is a once in a life time deal for our
company, to buy so many of these homes,
rehab them, and get tenants in them. It is a
big challenge for our company, but we have
a great team, and we are up for the chal-
lenge. This is just one of the projects that
we have currently going, we have many
smaller deals also, many in the $30,000
dollar range.
Q: How is your market handling the eco-
nomic slump?
A: Being based in the Charlotte, NC area,
we haven’t felt the effects quiet as heav-
ily as other cities, but we have noticed an
increase in the number of tenants interested
in our rent to own program. More people in
the area are looking to rent but still have a
desire to own their own home. With a rent- Alex Franks and Kevin Burrell
to-own program, we are able to place good
tenants in these homes who will pay each our homes are mostly blue collar workers investing in real estate?
month because they want to own the home. who make a living by working anywhere A: Alex Franks started his real estate in-
This is real simple, the properties values from retail stores to our local industrial vesting in 1999 as a way to generate pas-
are down and the rents are staying the same plants. sive income and long-term wealth. Starting
or even going higher than previous years in For a very small investment, you can out wholesaling deals is something he con-
some occasions. Just to give you an idea, turn a very good income. Literally for what tinues to actively pursue today. By 2006,
we have several homes available in the mid you could buy a car for, you can buy real he made the leap from wholesaler to a full-
$30,000s that are net cash flowing over estate in our markets with a net cash flow time real estate investor.
$400 a month with cash purchases. of more than $400 a month. Just about ev- Kevin Burrell has 18 years experience in
ery home we have is under $50,000, with Real estate and 15 years in the mortgage
Q: What is the best part of being an in- the majority being in the $30,000 range. lending business, after he bought his first
vestor in your city? house in 1994, Kevin was hooked on real
A: We handle everything for the investor; Q: What makes your company unique? estate investing.
it is a total turnkey process for the passive A: We don’t just sell real estate to people, In 2008, Alex and Kevin joined forces to
investor. We take care of our tenants just we create portfolios, we are currently in create Carolina Liquidator, LLC. They both
as well as we take care of our investors. the Charlotte, NC, Rock Hill, SC, and the specialize in being able to quickly analyze
After all, these are the people who are put- Atlanta GA, areas and we are still expand-
ting money into your retirement. They are ing into the florida market. What we do Continued on pg. 31
Realty411Guide.com PAGE 27 • 2011 reWEALTHmag.com