One of the 6,127 reasons that I’m single is because I can’t stand high maintenance women (this one’s voluntary, so two out of 6,127 ain’t bad…I’ll get to the second voluntary reason in a minute). Anyways, right now I’m working on a pretty house wholesale deal (wholesaling a house subject-to) and the seller is crazy high maintenance. This guy calls me multiple times a day… “Hi Jason, this is Mr. Seller, its 5:00, just wondering if you’ve found a buyer…Hi Jason it’s 5:05, just wondering, Hi, Jason it’s 5:07…” This guy is also a talker which is why I have my assistant return the calls and handle almost everything. If you don’t have an assistant I would get one ASAP. I got my first assistant before I could even afford one and it was well worth it. And when I say assistant, I mean virtual assistant. My latest assistant lives in Wisconsin and has been with me for almost two years. I have her make all my calls and she handles almost everything for me. Remember, us investors need to focus on high dollar activities, not making phone calls. (By the way, I found a buyer for this wholesale sub-2, and at closing I will be getting a nice $9,997 pay day).

Okay, the second reason I’m single is because I’m cheap. I just got back from a week in Florida. As I was packing for my trip, I stuffed all of my clothes in my old suitcase and I destroyed the zipper trying to get everything to fit (but I did get it closed). Then when I tried to unpack, I couldn’t get the zipper open. Being that I’m such a patient guy, I ended up “teaching the bag a lesson”, which means it ended up in a dumpster after I tore the zipper off and it was totally unusable. So, I needed a new piece of luggage and asked my friend to show me the closest Goodwill store. I ended up getting a beauty of a suitcase for $2.13. It’s a Samsonite hard shell. I’ve always wanted one of those hard shell pieces and $2.13 is right up my alley. I love Goodwill and the Salvation Army stores.

Alright folks, if you’ve been reading my posts you know that I’m going through a lease option deal from A-Z. Last week was the paperwork needed between you and the seller and this week I am going over the checklist you need to follow after you have the paperwork signed. Here it is:

1. Make copies of all of the paperwork and either mail it to the seller or scan and email a copy to the seller.
2. Make copies of all keys (so you have a key and so you can also put a key in the lock box on the house).
3. Fax or mail the lender notification to the mortgage company so they send all of the coupons and mortgage info to your address.
4. Run a credit check on the seller. Since lease options are more risky, you need to make sure the seller is not in a dangerous financial situation (if they are, do a subject-to).
5. Fax the authorization to release form to the mortgage company and check the mortgage balance and the monthly payment amounts.
6. Send a thank you gift and card to the seller. (I usually send a gift certificate to a restaurant).
7. Go to the courthouse and record the option agreement. This should cost between $20.00-$50.00.
8. Start marketing the property to find a tenant buyer. Place a sign in the front yard, run classified ads in the local paper and post ads on Craigslist.
9. Set up your Excel spreadsheets, Word documents and folders for this property.

There you have it, my million dollar checklist. Next week, I will go over the paperwork for a tenant/buyer. I certainly hope that you are writing down all this information on lease options, because you are getting no B.S. info that took me thousands of dollars to perfect. Have a great week and remember to do at least one marketing activity every single day!

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Tags: creative real estate, crei, lease, lease option, real estate investing, real estate investor

When I become President and it’s the United States of Jason, I will impose the death penalty on anyone that stops at a yield sign…for heavens’ sake, if you were supposed to stop, there would be a stop sign and not a yield sign. Do you think they put that extra strip of roadway there for the fun of it? So, now you have been warned that unless you want the electric chair, do not come to a complete stop at a yield sign.

Alright, alright, now to show you how to make money. As most people know, I am a FIRM believer in only utilizing investing methods that require very little cash and absolutely none of my own credit. And that the best deals are when you work directly with the homeowner (which is why I don’t do foreclosures). Well, a partner and I just picked up a lease option deal in Baltimore, MD and I want to give you the numbers to show you why this is a must learn technique.

First off, I got this property from a landlord who I had already done a deal with, which is why my favorite group to target is absentee landlords (they usually own multiple properties). Anyway, we signed a five year lease option with a monthly rent of $800 and a purchase price of $80,000 (this means that anytime within the within the five years we can buy the house at $80,000). We put zero money down (yes…..zero, nada,, zilch, zip). My lease option agreement reads that I never put money down and that I make the first rent payment 60 days from the date the paperwork is signed (60 days gives me time to advertise the property and find a tenant/buyer…I always do 60 days).

After we took care of the paperwork with the seller, it was time to find a tenant/buyer. The best ways to find a tenant/buyer are classified ads (Rent to own, bad credit OK, 3br/2ba, only $1,399/mo, Free $300 rent credits, call Lisa 555-555-5555), placing ads on rental property websites and placing signs everywhere. The advertising will generate a ton of calls. Finding a good tenant is just like finding a motivated seller…you will go through about 99 bad leads until you find one quality lead.

Once you get your leads you can either set up appointments or use a lock box. For this property we set appointments on the weekends (you will want to set appointments, do not hold open houses or nobody will show). We ended up getting a couple who gave us $5,200 to move in. This breaks down as $4,150 in option money, $200 security deposit and $850 for the first months rent. Also, they have an option to purchase the house at $110,000.

We spent about $150 on marketing, put zero money down and got $4,150 in non-refundable option money. Now, I am no math genius but I think that’s a profit of $4,000…then of course don’t forget about the big payday when the property sells.

Speaking of big paydays, over the weekend I had a lease option tenant call me and tell me their loan was approved and they were exercising their option, so that’s another $30,000 payday…how can you not love this business?

Here is the million dollar lesson I hope you learned: You need to eliminate the word BANK from your vocabulary. You need to learn wholesaling, lease options and subject-to if you want to purchase millions of dollars worth of property every year. The only people who should be going to banks are your tenants when they buy the house and the people you are wholesaling properties to. I can’t emphasize this enough: You need to think like a “player” and not a “wannabe.” Players become millionaires using creative financing methods and wannabes wait for bank loans to be approved or they wait until they have 20% saved up to buy a property.

So, which one are you? A player or a wannabe?

Tags: creative real estate, crei, financing, lease option, wholesaling