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The stock markets are taking a beating. Media is hyping a recession. The place for safe money is in long term rentals that CASH FLOW. If you have not been shopping the markets start looking because the current prices are unbelievable in many parts of the country. A real estate investor just bought a 1400 SF 4/2 in the Phoenix area for 65K as an REO and that same house was over 250K three years ago! It will cash flow even with bad financing!

Now is the time to be on the hunt. You don’t need your own cash either. For more info join my newsletter at http://www.kickassrealestate.com.

Author Gerald Romine

As the saying goes, I will eat steak tomorrow night as I choose regardless of what you do or don’t do; regardless of whether you eat steak or beans.

The same is true for the economy, the financial crisis, and the so called recession. Some people will be eating steak and others will be eating beans. Is this a harsh wake up call for you?

KNOW AND UNDERSTAND THIS

The same ocean of money is in constant motion; it just flows in different directions from time to time. It’s up to you to move where it is flowing!

Have the economic times changed? Absolutely. Is it harder to near impossible to get loans? Yes. This is the constant motion I’m talking about and if you’re old business model required loans then it is time to change models. It is up to you to move to where the money is flowing.

Right now short sales and REO’s are hot and if you are playing in this arena you need to have money to close or real estate investors to flip to and here’s a big surprise: People are still flipping houses and doing very well. Need proof… check out an auction or two and you’ll see folks paying a lot more than you would which means they are a source of potential buyers.

OPPORTUNISM

You, yes you, need to capitalize on the opportunity delivered by the so called financial crisis. Know that all UBER SUCCESSFUL Entrepreneurs and Real Estate Investors are opportunists. There is no difference between “good” or “bad” events in the value offered to opportunists because opportunists take action on the events given without prejudice.

If you are a real estate investor just starting out or even a seasoned pro be sure to get my FREE Online Real Estate Investing Course. There’s no strings attached so you don’t have any excuses.

Author: Gerald Romine

I’m against the $85,000,000,000.00 bailout of AIG.  In fact I am against ANY bailout at all but will admit that if you can’t beat them join ‘em and I will as a real estate investor find ways to profit from what I’m calling the “GREAT Socialistic Bailout.”

So to bring a point home let me share an alternative bailout program that makes more sense.

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Original Author Unknown:

Instead, I’m in favor of giving $85,000,000,000 to America in a We Deserve It Dividend.

To make the math simple, let’s assume there are 200,000,000 bonafide U.S. Citizens 18+.

Our population is about 301,000,000 +/- counting every man, woman and child. So 200,000,000 might be a fair stab at adults 18 and up..

So divide 200 million adults 18+  into $85 billion that equals $425,000.00.

My plan is to give $425,000 to every person 18+ as a We Deserve It Dividend.

Of course, it would NOT be tax free.  So let’s assume a tax rate of 30%.

Every individual 18+ has to pay $127,500.00 in taxes.  That sends $25,500,000,000 right back to Uncle Sam.

But it means that every adult 18+ has $297,500.00 in their pocket.  A husband and wife has $595,000.00.

What would you do with $297,500.00 to $595,000.00 in your family?

• Pay off your mortgage - housing crisis solved.
• Repay college loans - what a great boost to new grads
• Put away money for college - it’ll be there
• Save in a bank - create money to loan to entrepreneurs.
• Buy a new car - create jobs
• Invest in the market - capital drives growth
• Pay for your parent’s medical insurance - health care improves
• Enable Deadbeat Dads to come clean - or else

Remember this is for every adult U S Citizen 18+  including the folks who lost their jobs at Lehman Brothers and every other company that is cutting back. And of course, for those serving in our Armed Forces.

If we’re going to re-distribute wealth let’s really do it…instead of trickling out a puny $1000.00 ( “vote buy” ) economic incentive that is being proposed by one of our candidates for President.

If we’re going to do an $85 billion bailout, let’s bail out every adult U S Citizen 18+!

As for AIG - liquidate it.  Sell off its parts.  Let American General go back to being American General.  Sell off the real estate. Let the private sector bargain hunters cut it up and clean it up.

Here’s my rationale. We deserve it and AIG doesn’t.

Sure it’s a crazy idea that can “never work.”

But can you imagine the Coast-To-Coast Block Party!

How do you spell Economic Boom?

I trust my fellow adult Americans to know how to use the $85 Billion We Deserve It Dividend more than I do the geniuses at AIG or in Washington DC .

And remember, The “We Deserve It Dividend” plan only really costs $59.5 Billion because $25.5 Billion is returned instantly in taxes to Uncle Sam.

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Now Go Buy A House,

Gerald Romine

Note: I did not write the above article and the math error has been left intact.

Last week the Bush Administration proposed a $700 billion to $1 trillion rescue plan for the financial and real estate industry.  The heart of the plan is to purchase bad debt/loans from the lenders thereby relieving their bad loans so they can concentrate on making good loans (talk about a bailout funded by the taxpayer). Personally it is appalling that the government is going to spend 1 trillion dollars of tax money to bail out the banks.  This is the equivalent of you or I running up $250,000 of credit card and short term debt and the government wiping the debt clean.   Sure… it is great for the bank but don’t forget the bill is being footed by you and I the taxpayer. Plus, pumping huge amounts of dollars into the economy is a devaluation of our currency giving us less buying power. I’ve been a broken record that there has never been a housing crisis… just a money shortage that has been manufactured. Setting aside my personal opinion if we look at this from a purely selfish business standpoint as a real estate investor it can be a very good thing. The Banks Make Money Making Loans. If you don’t understand Fractional Reserve Banking you are handicapped in understanding the big picture - there is a good definition at http://en.wikipedia.org/wiki/Fractional-reserve_banking. To summarize fractional reserve banking means the bank’s loan money without having any of their own money collateralizing the loans then the banks collect interest and fees money created out of thin air.  If you deposit $10,000 the bank is able to make a loan of $80,000 and the bank collect points, interest and fees on money that did not cost them anything.  Their investment is ZERO in the loan.  I know this might sound crazy… but look it up and research the subject. The important thing to remember is banks are in the business of making loans.  With the tightening of money lending the strong banks are not only surviving but they are now getting government bailouts and when they start lending again in mass the surviving banks will have increased profits because of decreased competition. The one trillion dollar bailout for the economy signals a green light for the banks to start lending.  The government is not only taking the banks bad debt off the books but the government has taken over Fannie Mae and Freddie Mac which currently buys approximately 90% of the loans on the open market.  The translation is we have a taxpayer bailout AND the taxpayer through Fannie Mae and Freddie Mac will be buying the majority of the new loans! What To Do Right Now? Realize that a speeding locomotive does not stop on a dime.  Foreclosures will continue to rise and be offset by buyers coming back into the markets.  With time the course of direction will be turned as buyers rush to the market and properties will regain their values quickly. As a real estate investor stay close to the action.  Be on the lookout for real estate deals that can be bought for a fraction of their value, bought ’subject to’ and kept as profitable rentals, or for your own personal residence that can be bought at prices not seen in over a decade.  If you need to analyze deals or create any of the necessary paperwork check out The Ultimate Real Estate Investing System. Author: Gerald Romine

Recently I was asked to co-author a book with several other Maverick Entrepreneurs. This small group of entrepreneurs can be best described as people who blaze their own trail, overcome obstacles, find unconventional solutions, and simply writes their own rules for success. I was asked specifically to author a section about my rules for success.

My rules come from the significant life events I’ve experienced.

As I write this, I am now 38 years old, and during my life thus far I suspect that I’ve encountered more significant life events than most people ever dream about. Here’s some information about me:

I grew up in a lower middle class family in Prunedale, California. I’ve earned everything I ever received and very little was given to me.

I’ve worked for as long as I can remember. Whether it was milking goats, mowing grass, selling Amway(8 years old), cleaning houses, minimum wage fast food jobs, construction, licensed tennis teaching pro, Marine Corps, I’ve always been making my own money and way in life.

I’ve been very fortunate in my life.

Not all experiences have been desirable and my life has not been a fairy tale. But from all my experiences I have strived to learn something and moved forward towards bigger and greater things. I’ve found success as a real estate investor, professional speaker, author, and software developer and throughout all of life experiences, I have accumulated a number of rules that I live by. Well, I call them the 10 Commandments!

I’ve read and understand that original ideas are rarely original. My work is no different. The only credit to which I can claim is that I have learned from others and put their ideas to work for me.

Here are the 10 Commandments I Strive To Live By:

1. The Only Thing That Matters Are Results.
There are only two things in life, results and excuses and life does not care about the excuses.

2. Approach Everything You Do With Integrity.
Of all the things we have integrity is the only one you can give away and never get back.

3. Life Isn’t Fair.
You make your own breaks. The only definition fair should have to you, is something that you pay when you get on a bus (i.e., fare).

4. You Must Have A Dream.
We all have a dream, but most people give up on their dreams and then lose the ability. Without dreams there is little to strive for. If you don’t have a dream you can’t make your dream come true! As long as you have your dreams you have a reason for life! Never lose your gift of dreaming.

5. Learn Continually.
When you stop learning you start dying. Always embrace self improvement.

6. Be Accountable To Yourself.
Don’t blame the problems in your life on other people. You made your life what it is by the decisions you have made; take credit for the good and the bad. Life is self manifested, make it what you desire.

7. The Price Is The Price.
There is a cost(time, money, effort, etc) associated with everything. The real question becomes: “Are you willing to pay the price to get what you want?”

8. Of All Your Talents Determination Is The Most Important.
Determination alone accounts for more success than all the talents of men combined. The reality is talent is relatively easy to find, but determination is a treasure few possess or are willing to develop.

9. Success Is A State Of Mind.
One is not successful because of what they achieve; they are successful because of how they feel.

10. Be Humble.
Judge yourself at least as harshly as you judge others.

Author: Gerald Romine

Banks have a real big ugly problem because foreclosures are at record highs, property values are falling, there is a shortage of real buyers, and once they foreclose on a property it becomes there dead asset. What’s a bank to do???

When the market was booming banks scoffed at the idea of selling properties at a discount through foreclosures or REO’s. Many banks laid off most of the loss mitigation staff because they had grown fat and lazy with the market boom. But oh how the times have changed.

Short sales are now hotter than ever and I’m going to let you in on a dirty little short sale secret. Sometimes a bank can do a shortsale and sometimes they can’t . You see… it all depends on who the “investor” is on the loan, if it is tied to a security, and a few other important behind the scene facts most investors are never privy too.

To keep it simple just understand that a bank could have two houses side by side with the exact same loan balances and with one house they can short sale and with the other house their hands are tied and they can do little or nothing other than foreclose on the house.

Does that mean you should not pursue short sales? No! It means you should understand that the “bank” is not always calling the shots. Personally, I love short sales because you can get some TREMENDOUS BARGAINS… But today I’m going to focus on REO’s because not only can you get phenomenal deals they can be quick and easy too!

ANALYZING and MAKING OFFERS On REO PROPERTIES LIKE A PRO

Whether you are buying a house to live in, to hold as an investment, or to flip for a quick profit, knowing your profit BEFORE your offer is the key to making a great deal! As easy as this sounds most investors do not take the time to “run the numbers” on a property before making an offer and in today’s market it has never been more important because with the changing markets you could go into a NEGATIVE EQUITY position if you do not buy right.

Bottom line is you have to run the numbers and know your profits before you even make an offer.

The Art Of Presenting The Offer

Let’s face it, nobody likes to lose money!

While it is true that the banks are writing off losses faster than the ink can dry that does not mean the bank is going to just give you an REO property for pennies on the dollar. The key to your REO success is presenting the offer in such a manner that the bank sees your offer as a fair and reasonable solution to their problem of holding a non performing asset – AKA a vacant house that is bleeding them dry.

Sounds simple enough, but presenting the right offer to the bank is not nearly as easy as you think. The key is to do the bank’s job for them and put together “the right” package presented in the right manner with the right words so it is easy for the bank to JUSTIFY accepting your offer.

Basically, you are doing the banks job of justifying your offer for them. When you make the REO departments job easy to say yes then it goes without explanation that your offers will be accepted faster.

Fortunately there is the Ultimate Real Estate Investing System available where it takes you just 5 short minutes to analyze and put together near perfect REO offers that are worded and justified so the bank can easily say yes and accept your offers!

Here’s what happened when John Pierro used the Ultimate Real Estate Investing System to make an REO Offer:

“My Very First Offer Using UREI”

“I can describe my very first offer I made on an 2 Family REO property using the UREI software. The offer was accepted on the first try because of the Justification that UREI explains for you. I was actually expecting to receive a counter offer from the bank, and was prepared to go up an additional 10K. To my surprise the offer was accepted at $ 204,343.00. The ARV(true property value) on this property is $ 380,000. I spoke with the REO agent afterwards and she was blown away, and said she had never see an offer quite like the one I provided, she (REO AGENT) went on to say it made her job a whole lot easier, because the bank called her, and ask her opinion and she was able to justify it by simply confirming what was written on the offer as the bank rep followed along.” John Pierrro - Ronkonkoma, New York

The Advantage of REO’s Over Short Sales

When attempting a short sale the cooperation of the lender and property owner are required to complete the short sale. The bank does not own the property and the only power they really have is to foreclosure on the note (which takes time) or to negotiate a short sale or other workout program. In short the bank may want to work something out but because the bank is not the property owner they have limited options.

Buying REO properties can be much easier because the bank is the owner and they alone make the decisions to sell the house. Once a property becomes an REO the bank now becomes responsible for property upkeep, HOA dues, utilities to have the property show ready, property insurance, etc. Once the property becomes an REO the bank has real property owner expenses and for most banks the only option is to sell the property. And since banks make their money by creating and servicing loans they want/need to get rid of REO’s fast so they can be in the loan making business and not have the expenses, risks, and liabilities of vacant houses. REO properties are prime for major SWEET deals!

Not since the 1980’s have we seen REO opportunities like we have in today’s market. So long as the foreclosure rates are high the REO opportunities will be plentiful. For an REO buyer the part is we are in an election year and much of the real banking fiasco is being swept under the rug as politicians battle for the presidency and control of the house and senate. This translates to the banking fiasco not being answered anytime soon and no end in sight for REO Investors to make extreme deals and profits.

The REO Investing System

The Ultimate Real Estate Investing System(UREI) is the most complete real estate investing system ever created and includes a NEW REO Module. Go here for more information on REO’s and UREI.

Note: The New REO Package has just been released and is not shown in the above link… but is part of the system.

EXISTING UREI SYSTEM OWNERS can request the NEW REO MODULE be uploaded to their account free of charge by completing a support ticket request for the REO PACKAGE for Existing UREI Users.

Author: Gerald Romine

As you can see from the subject about this article, it’s about the so-called elephant in the room…the economy, and the dreaded ‘R’ word (Recession). Economists are arguing over technicalities. The news media has had us deep in a recession for months. People do seem troubled by gas and grocery prices.

Some of you may be wondering about the title and what exactly is meant by “The elephant in the room”? The expression is most often used in sales and the elephant is the big objection that is in the customers mind. Nobody is speaking about it… but the elephant is definitely in the room and on people’s minds. (For real estate investors the elephant in the room is how do I sell my house.)

Right now that elephant is the economy and the so called media created Recession we are experiencing. Do I buy the so called recession? Not for one minute. Are people hurting financially? Of course, but there are always people hurting financially! In fact most people live beyond their means and spend more than they make so any “bump” in the economy becomes a mountain.

I just came back from hiking the Grand Canyon and the permits for the campground were oversold for the entire month of June! Realize where I go is a 6 hour drive to a parking lot in the middle of nowhere, you then hike 11 miles in to a campground that has no electricity or running water, and you have to pack everything in and out on your back with a pack. Oversold for the month of June and June is the HOT season when most people do not want to go. Where’s the recession?

And with my family in town for the weekend we went out to Joes Real Barbeque on Friday and The Good Egg on Saturday and both places were packed with HUGE lines and waiting lists to be seated.

The question really becomes “What are you going to believe?”

Do you want to let the news and media do the thinking for you and simply believe what you are told or do you have your own brain that is capable of thought and drawing your own conclusions?

As for me, I’ll believe there is a recession when the grocery shelves are empty and there are long lines to get into the grocery stores to get the basic necessities like food!

Now Go Buy A House!

Gerald Romine

If you are already actively buying and selling houses in the current market consider this message an update of what you are already experiencing in the market.

If you are NOT currently an active real estate investor you will find this message helpful to move you from thinking about taking action to improve your income and life…to actually taking action to do so.

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First, I want to start off with a WARNING:

This is a warning that you could easily be locked out of possibly the biggest real estate buying opportunity ever due to sheer ignorance. The truth hurts and before you discredit those harsh words realize I am not trying to sell you anything.

Have the markets changed? Definitely.

Is it harder to get financing on properties? Absolutely.

Are investors making money? Yes… and lots of it. Are you???

Between my involvement in the market and the feedback I get from successful investors using the Ultimate Real Estate Investing System I have an understanding of what’s really happening in the markets like no other.

Now, I want to tell you about what’s really working in the real estate markets.

1) Short Sales: With record foreclosures and REO properties backing up the lenders are seeing the need to play ball and move short sales whenever possible. Make no mistake that short sales are a REAL opportunity and unbelievable deals are being done. Understand that some lenders are easy to work with and other lenders are nearly impossible. UREI users have a distinct advantage because it takes less than 5 minutes to prepare complete short sale packages and if you are in the short sale game be sure to have an efficient system.

Note: UREI users are even getting short sales accepted on properties that are current on the payments.

2) Subject To: A VERY successful strategy in today’s market is to find a price range of a properties that will cash flow as rental property then go after that range with offers to take over the existing financing.

Example: A 3/2 in Phoenix may rent for $1000 per month. Searching the MLS I found 67 homes in the city of Phoenix that are 3 bedrooms and 2 baths and have 1000 square feet or more with a price that is under $90,000. The lowest priced property is $37,500! The second home is $45,500 and is an REO offering a $1000 bonus to the buyer’s agent.

Let’s look at the possible numbers for a house with a $90,000 loan. If the loan was a 30 year fixed at 6.5% the monthly principle and interest payment would be $569. Add another $200 for taxes and insurance and the PITI would be $769. If the property rents for $1000 per month the cash flow after reasonable expenses would be positive and let’s assume $100 per month. Not bad for a nothing down deal and taking over the payments.

Huge opportunities abound and subject to’s do not require you to get new loans or qualify for financing.

3) REOs: I can’t say enough about the opportunities to buy REO properties. Banks are leading the pack with price reductions and the opportunities to make once in a lifetime deals are everywhere.

WHY IS THIS SO IMPORTANT?

For many, for a growing number of would be real estate investors, the news about a bad economy is keeping them out of the market and stopping them from what may prove to be the biggest opportunity and fastest way to wealth ever presented through real estate!

The three types of investing outlined above can be the solution to negative developments and news in the real estate industry that we are constantly bombarded with by American TV and media.

It can permit profitable focus on small niches or sub-niches of the real estate market.

I’ve put hundreds of real estate investors on this fast track, one way or another, and I’m on top of the markets daily and aware of the latest developments.

You may think real estate success is beyond you in the current market but you may change your mind if you learn to focus on what’s really working and ignore all of the media noise. And if you have any thoughts of actually building a thriving real estate investing business that can secure your financial future now is the time to tune in and get involved.

Author: Gerald Romine

Note: Your comments are encouraged.

I wanted to share a resource with you - Camtasia. If you’re not already using this wonderful screen capture software, a PC magazine in Britain recently published a link where you can get version 3 of Camtasia at no cost! It’s normally $300 so if I were you I’d jump on this pretty quick if you don’t own Camtasia yet:

http://download.techsmith.com/camtasiastudio/enu/312/camtasiaf.exe

What can real estate investors to do with Camtasia? One big thing you can do is record a Powerpoint Presentation as a video on how you buy houses, sell houses, what you do, etc and set it up on your website. Then, drive potential buyers and sellers to the video and let it do the screening and work for you.

If you have a webcam you can get fancy and record the Powerpoint and yourself at the same time. It’s a web world and you should get on board!

I hope you get some benefit from this resource.

Author: Gerald Romine

P.S. Have you tried out my new software yet? It’s available at Test My Software For 10 Days - Then Decide!

The state of the country is in a real mess! Not because of the economy but because of the idiots running the country and blatant misrepresentation by the media. Here’s a reality dose for the whiners and people with their head in the sand.

News Headline: Consumers Are Downbeat On Economy

As I read this real “News” story it talks about “Consumer Sentiment” being at a 28 year low because of surging gasoline prices, falling home prices and a weakening job market.  Let’s see…. I’m a consumer and my “sentiment” is low?  Damn, I didn’t know my sentiment was low so now I’m worried. Does that mean I need to have my prostate checked or something because I don’t even know where my sentiment is located?

Are gas prices high? Yes, and  I don’t like paying anymore than you do but I count my blessings.  Compare our gas prices to Europe ($7.615 per gallon Sept 2007) and they are still a real bargain.  With gas prices surging out of control per the media  you would think everybody would park their cars and start riding bicycles… but that’s not happening.  Drive around on any Friday or Saturday night and notice the restaurants, bars, and hot spots are packed full!  Just last week I left a restaurant because I did not want to have a 45 minute wait!  And they say this country is in a recession? Seems like a lot of people have plenty of spendable income and Starbucks is still doing great charging $7 for a cup of coffee.

Let’s put you in charge of the oil companies… How much would your charge for gas?  $1 a gallon?  Not on your life.  It makes business sense to keep raising the price if gas until you have raised it so high that the loss in consumption equates to a loss in net profit.  And right now they aren’t even close to that amount and this is verified by looking at US consumption of gasoline.

But don’t worry because the government is doing their best to get your gasoline prices lowered.  That’s why we’re in Iraq, right? Or was it for weapons of mass destruction?   You have to realize that the government profits on every gallon of gasoline sold through gasoline taxes which nationally average 47 cents per gallon.  So if Uncle Same really wanted to lower the cost of gasoline they could just suspend gas taxes and we’d save 50 cents per gallon.  That would be fast and easy but it will never happen! Instead the politicians will talk about all kinds of things that need to be done yet refuse to do anything that does not line their pockets with profits.

When it comes to gas we’re in a very bad position because as a Nation we are dependent on the Middle East for oil/gas.  Supply and demand 101… they’re the only supplier so they control the prices.  This is really odd since we have so many oil sources much closer than the Middle East - Alaska, Russia, Central America, and South America come to mind.  Countries like Brazil are turning to ethanol as an alternative but here in the US there is no talk of using real alternatives.

History Fact: Henry Ford endorsed ethanol before the gasoline companies gave him financial incentive to switch to gasoline motors!

What do gasoline prices have to do with housing?

Supply and demand rules are the same for both.  With oil we are currently screwed for several reasons. First we have one supplier. Second, the government does your thinking for you so you have no control over getting another supplier. Third, the government profits from the sale of gasoline by the gallon. No matter what the cost of gasoline the only choice you have is it buy it or not to buy it.

You do not need to be concerned with gas prices or the economy because these are all things that are out of your control.  Focus on things you can control as individuals.Your life. Your finances. Your business decisions.

With the housing market sales are based on supply and demand as well.  New construction increased as the demand for housing increased to the point that the market was flooded with an oversupply of houses. New construction lags actual demand and as sales slowed more inventory reached the market as builders completed projects which worsened the situation.

Demand for houses is down and this is reflected in the low number of permits requested for new construction.  As the oversupply is sold, rented and occupied prices will stabilize and rebound.  The cycle will be reborn and as it gains strength there will be another rush to build houses. This cycle is never ending.

What we are experiencing now is nothing new to old real estate investors like me who used to watch a 7 year cycle in the markets. Prices will go back up and there are things that can be done to make this happen sooner rather than later.

If you are looking to buy a personal residence now is a good time and you can get a lot more for your money today then you could three years ago. Understand that buying a residence to live in is NOT an investment. Robert Kiyosaki 101 - investments pay you money… your house is a liability because you make payments.

For real estate investors the focus should be cash flow. I know, a mythical thing your grandparents may have told you about but trust me it really does exist and tenants can make you rich, filthy rich.

Tis all for now.  If enough people find value in this article and post comments then I will write more articles that talk about the big picture, success, and how to obtain it.

Author: Gerald Romine

This could be the most important real estate tip you ever receive, and by taking daily action, you could change your financial life forever!

It is easy to claim to be a real estate investor. You can easily uncover whether people are truthful about this with one simple question. The question is:

“Are you a committed real estate investor?”

Commitment equals results. Generally, being a real estate investor means the result is making lots of money. Let’s assume that as a real estate investor you want to net $100,000 per year in cash.

How do you measure your own level of commitment? The first step is to answer the following questions honestly:

1. What did you do yesterday to prove you are a real estate investor? Phone calls? Offers? Drive neighborhoods? Letters? Craigslist.com? Backpage.com? Ebay?
2. What did you do last week to prove you are a real estate investor?
3. What did you do last month to prove you are a real estate investor?

The second step is to analyze your own actions and ask whether those actions show commitment.

The bottom line is that if you are not taking action on a daily/weekly/monthly basis then can you really expect six figure results? Of course not! Action equals results, and cash.

Author: Gerald Romine

The short answer is YES! You can, and should, borrow money to invest in real estate. However, let me clarify. Investing is where you have a realistic plan to make a strong return on your investment. The return is not based on appreciation of the property. It must provide a return on investment after allowing for costs, expenses, and an allowance for things that might go wrong.

When borrowing money to invest, here are 3 simple rules to follow:

1. If you had the cash, would you loan someone else the money you’re asking to borrow against the same property? If the answer is, “No,” then you don’t have a great investment that you are confident in. Move on.
2. Does the risk justify the reward? Are you making enough money to make it worth it, or are you getting involved because you want to be “in” real estate? The only reason for a business is profit. If there is not enough profit, move on to another deal.
3. Is this a long term investment? If the answer is, “Yes,” then the next question becomes, “How much money are you making monthly?” If you’re not making money monthly, then you are speculating (hoping, not investing) for future profits.

Certainly there are exceptions to these rules depending on your financial position and your investing goals. However, many novice investors get sucked into buying properties. They believe, mistakenly, that real estate always goes up in value. They hope that history will repeat itself and they will become rich in the future from their property.

Smart and profitable real estate investors base investment decisions on instant profitability. You can’t go broke when you are making a profit from the beginning.

Author: Gerald Romine

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IndyMac bank has adopted a new policy of charging $300 for real estate
investors to submit a short sale. This is absolutely insane for Indymac bank or
any lender to expect an investor to flush $300 down the toilet.

My conversation would be something like… “Let me get this straight… you want
me to pay you $300 for the privilege of you saying no and taking my $300. Do I
look like and idiot? Here’s something for you to think about. Right now I’m
holding the deed on the property in escrow pending our negotiations on a short
sale. How about if you pay me to release the deed to you won’t have to wait 3
months to file foreclosure, 3 months for the foreclosure process, miss at least
6 months of payments, and hope the borrower does not file bankruptcy which
delays your losses indefinitely all while the value of your security is dropping
like a rock. Did you want to review my short sale package or play or watch the
values drop on your security?”

Check out my video real estate tip for more information.

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A mechanic was busy removing a cylinder head from the motor of a Harley-Davidson motorcycle when a well-known heart surgeon entered his shop.

The surgeon was waiting for the service manager to take a look at his bike when the mechanic shouted across the garage, “Hey, doc, can I ask you a question?”

The surgeon, a bit surprised, walked over. The mechanic straightened up, wiped his hands on a rag and asked, “Doc, look at this engine. I open its heart, take valves out, fix ‘em, put ‘em back in, and when I finish, it works just like new. So why do I get such a small salary and you get the really big bucks, when you and I are doing basically the same work?”

The surgeon smiled, leaned over, and whispered to the mechanic, “Try doing it with the engine running.”

What does this have to do with real estate investors?

Many investors approach real estate deals like the mechanic. They try to solve problems with textbook answers and forget they are dealing with people.

As an example, assume your property meets my buying criteria. I’ll pay cash, or the only other way I can buy your house is to take over the payments.

While both options may be true and are good things to say when talking to the seller, investors should take the surgeon’s approach and realize they are working with real, live people that want (and need) to be heard and listened to.

Real estate is a great business that can be financially rewarding, just remember to put people first and you’ll benefit in more ways than you can imagine. If your only focus is the money, people will “sense” this and many will not want to work with you or sell you their home.

Author: Gerald Romine