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Why Invest In Real Estate?
Most people think that the path to success in real estate is to buy a handful
of rental properties, lease them out for 30 years, and then retire rich with
millions in equity and a healthy cash flow to sustain you the rest of your
life. Well, in a way that's true; in 30 years the mortgages on the properties
will be paid off, the properties will have at least doubled in value and the
rents will be substantially higher than they are today.
There's only one problem with that equation, you have bills and financial needs
today and while achieving wealth in 30 years is a nice idea, it still doesn't
solve today's cash needs. You need to solve today's cash flow crisises before
worrying about creating long term wealth. Only once you have made enough to
cover you expenses and live comfortably can you afford to focus on building
your empire.
In steps quick-turn real estate. The first advantage of quick-turn real estate
over the traditional approach of investing is obvious: cash in your pocket
today. Quick-turn real estate can put $5,000-$50,000 or more of cash in your
pocket with each deal. Quick-turn real estate can change your life in a matter
of months, not years. Quick-turn real estate give you a fast path to financial
independence away from a job.
If you're like most Americans, your biggest concern is security. That's the
reason so many people today keep working at jobs that they absolutely hate;
they can't let go of that security of a regular paycheck. So with that
understanding, we do not recommend that you up and quit your job to pursue real
estate and put the future of yourself and your family on the line. If you can't
do this business part time you won't be able to do it full time either. Get a
few deals under your belt and convince yourself you can do this business before
you tell your boss to get lost.
Little To No Risk
The other huge advantage to quick-turn real estate is the lack of risk. If you
follow the instructions in this course precisely the risk you have in doing
these deals is almost nonexistent.
One of the big drawbacks to the traditional method of investing described
earlier is that you are personally liable if anything goes wrong with one of
(or all) of your deals. Here's an example, let's assume you own 10 rental
houses that you purchased with loans from your bank. You paid $150,000 each on
average for these 10 houses. You put a $10,000 down payment on each house and
the bank financed the other $140,000 at 7% interest for 30 years. Each house
rents for $1,300 per month. You payments to the bank on each house are
approximately $1,100 per month including principal, interest taxes and
insurance.
That means you're making $200 per house each and every month. Multiply that
times 10 houses and you have a nice $2,000 per month income any you wealth is
growing each and every day. Sounds like a great plan right?
Well, here's a few things to consider, for starters you haven't accounted for
any expenses for repairs, management or vacancy. If you choose to manage them
yourself and don't mind tenants waking you up at 3AM with clogged toilets then
you can take that expense out of the equation. But what about the other two:
maintenance and vacancy. Well, as a minimum you should figure 5% of your gross
rents is eaten up with vacancies and another 5% with repairs, assuming the
houses are in good mechanical condition and you don't have a tenant that
trashes one of them (tenants are know to do that). That means that out of
$156,000 of gross rents, $15,600 will be consumed by vacancies and repairs. Add
that $15,600 annual expense to your annual bank mortgage payments on those ten
houses ($132,000) and you're now making a whopping $700 per month off of all
ten houses combined.
You're obviously not getting rich today with that approach. And by the way, we
didn't throw in the common variables. What happens if you have trouble filling
a couple of vacancies and two houses sit empty for three months. What happens
if a tenant trashes a house and quits paying rent. After two months of not
paying their rent you finally evict them but it takes another two months and
$15,000 to repair the damages. Now you have four months with no incoming rent
and a $15,000 bill. There's not enough profit from all of these rentals to pay
those bills so guess who gets to dig into his pocket and pay them; you do.
Very quickly you become the motivated seller calling every "We Buy Houses" ad
you can find trying to dump this burden fast. You'll learn later on that some
of the best deals out there can be had from landlords that have gotten
themselves into this very same situation.
Now that we understand the high risk nature to traditional investing, let's
discuss why quick turn investing has so little risk when it's done right. To
begin with, in the quick-turn world we NEVER walk into a bank and ask for a
loan. We do not personally guarantee debt to finance a deal. Secondly, we don't
write big checks to buy real estate. If you don't write a big check you can't
lose that big check. To quote the great godfather of quick-turn investing, Ron
LeGrand, "Always buy houses as if you're broke".
We use creative strategies to get in and out of deals and get paid without ever
personally guaranteeing debt or writing big checks. Many of the strategies we
use to buy real estate literally require only $10 for an earnest money deposit
and not a dime more invested in the deal. When we run into a deal that does
require all cash, we have ways of easily getting the cash without using banks
and without personally guaranteeing debt.
No Cash Required
As we touched on earlier, another advantage to the quick turn real estate
business is that you can get started today with little to no cash. In this
business, $10 for an earnest money deposit is all you need to do your first
deal. This is not your typical "no money down" approach that you may have heard
of on late night infomercials. We are not asking sellers to take no down
payment and owner-finance the entire purchase price. Most sellers are either
scared of owner financing or just don't want the hassle. What we are doing is
giving motivated sellers an immediate solution to their situation which just
happens to cost us nothing.
Sellers don't just walk away and give you $20,000 plus in equity for nothing.
They trade that equity for peace of mind. And the best part is there's no limit
how much equity a motivated seller is willing to trade for that peace of mind.
If you can solve the sellers' problems, the sellers will make you very rich.
Win-Win Situations
We have the rare opportunity to be in a business where everyone wins. We the
investors make a fortune quick-turning houses. The sellers get immediate
solutions to their problems, oftentimes saving their credit from certain ruin
and letting them get on with their lives. Even banks are on the winning end
because they are forced to foreclose on fewer properties, saving them time and
money and increasing the value of their stock.
How Do I Get Started?
The famous quote by Abraham Lincoln sums it all up, "If I had five hours to chop
down a tree, I'd spend four hours sharpening the axe". The proper
education is critical to your success as a real estate investor. To get
started, simply sign up for a
FREE MEMBERSHIP at uslandco.com and you can access all of our
valuable free training instantly. Your
free membership at the uslandco.com website will give you access to
tons of free training: free articles, free tele-seminars, interactive
discussion and more. See you at the top! |
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