The advantage of using private lenders is truly staggering.
• Speed. The two greatest competitive advantages in the real estate market are cash-flow and speed. With private lending you will already have your investors in place. When an opportunity arises you have immediate funds to take action. What an incredible feeling to have the confidence that you’ll never let another profitable opportunity slip away.
• Cash-flow. Because most lenders prefer not to deal with monthly payments, you have an ever-increasing flow of cash to use to your best advantage and that of your investor.
• Great deals on houses. We all know that cash upfront means a better deal on a home. Especially with short sales. Not only will you win a house out from under someone waiting on a bank loan, you’ll pay less for the house as well!
• Close more deals. Immediate funds mean shorter transaction periods and more time to place money into new deals.
• No down payments.
• No pre-payment penalty.
• Reduced closing costs.
• No points like you’d have with mortgage brokers.
• You set the rules. For the first time, you’ll be in control of your loans. In my business, I give 15% and no early withdrawal penalty, but when borrowing from a private lender, you can set any parameters you like. I use the generous terms because my lenders are very happy and come back to me over and over. I’m equipped with funds 100% of the time to take advantage of any deal which may arise. And, because of their involvement, I’m making a lot of money.
Where do you find private lenders?
Everywhere. I’ll be honest, my very first private lender was my mother. She invested with me and, because she was living off the money, I sent her the interest checks every month. Many lenders prefer to let the money sit and receive payment either quarterly or in one lump sum at the end. For them, this means something very similar to compound interest, except with a very high interest rate! And for you it means more funds accruing more revenue.
Find anyone with money stored in a CD or the stock market, and you’ll have found a potential private lender. Think about it. Like all of us, private lenders want to make money. They seek safe, high-yield opportunities for their funds. CD’s and money markets offer limited profits. Smart real estate investing offers them a return that is leaps and bound above anything they are currently earning.
My friend Alan Cowgill is a speaker, author and real estate entrepreneur. Alan has bought or sold over 175 investment properties. His step-by-step system “Private Lending Made Easy” teaches others to find private lenders. Go to www.reimostwanted.com to sign up for a free audio teleseminar series, featuring Alan and many other experts, and learn this powerful secret to real estate investing success. To your success, CD
Wednesday, August 15, 2007
Saturday, August 11, 2007
The Key to Freedom and Real Profit in Real Estate Investing
Most people don’t realize it, but obtaining money for real estate deals has
nothing to do with saving money for a down payment, going to a bank, filling out an application, and waiting to be approved. In fact, if you’re going about things this way, as I did for many years, you’re wasting time and losing money.
For me, discovering how to use private lenders in my real estate business has been truly life altering. The amount of money I make and the kind of work I do each day is incredible to me. And not only is it possible, it’s really very simple. If I can do it, anyone can.
For seventeen years I languished in a full-time corporate position. I wasn’t happy and I was barely making ends meet. I was thousands of dollars in debt and it was only getting worse. It wasn’t the life I wanted. I felt that my life was just ticking away. When I sat down and really faced things, I knew in the end I could actually retire poor. Something had to be done.
Real estate investing came to me in the form of an infomercial at 2 a.m. on a Tuesday. The course piqued my interest, but the cost was $159. Money was so tight, I didn’t have $159, but I did have a credit card and the company offered a 30-day money back guarantee. I held that credit card in my hand and considered the future I wanted. Then I picked up the phone and ordered the course. It was the first step toward a brand new life and eventual wealth beyond what I could have imagined.
But that was only the beginning. After a few years I took a second step that propelled my business and my life to a whole new level. In 2001, when I quit my corporate job and took the plunge full-time into the world of real estate, I was immediately faced with a very big problem. It turns out that this problem was the best thing that could have happened to me. You see, without full-time employment, traditional lenders weren’t exactly eager to loan me funds. And without consistently available money to fuel my real estate transactions, I had no business at all. I tried everything:
• Banks
• Line of credit
• Hard money lenders
• Partners
• Credit cards
If only I had known that all of these methods, even if they had been eager to give me a loan, were complete wastes of my time!
Finally, about five years ago I learned a lesson I’ll never forget. I came across a foreclosure on a $150,000 property that was going for only $70,000. I’d hit the jackpot! It was almost too good to be true. Of course I jumped at the chance to get in on this incredible deal. But I didn’t have the available funds. It’s every real estate dealer’s nightmare. I scrambled to the bank, to my partner. I tried to extend lines of credit. But all of this took time, and time is exactly what you don’t have with a lucrative short sale like this.
As you can guess, I didn’t get the sale. By the time I had secured funds, the property was sold to someone who had the cash ready and could close within days. In this one deal I lost a potential $60,000.
I swore then and there that this would never happen to me again. And it never did, because then I discovered private lending.
A whole new world opened to me and my investing has never been the same. Private lenders literally provide you with your own private bank to fund your real estate deals. Imagine: limitless funds that are constantly and immediately available. Today, I have more available capital than I do property in which to invest it. It’s simply a store of money waiting for me to make use of it. And anyone can have this
– that’s what’s so amazing. It’s like a dream come true for any serious investor.
It sounds a little overwhelming, doesn’t it? Let’s slow down. I’ll explain the specifics of private lending, and you’ll see for yourself how this incredible system works.
Who are private lenders?
First of all, private lenders are everyday people. Some are retired, some work, some have substantial investment capital, and others have only a little. They may want to make the most of the savings they’ve spent their lives building, or perhaps they suddenly came into money through an inheritance or property sale. Regardless of their background, all private lenders are looking for a safe, high-yield opportunity for their funds. I give my lenders a guaranteed 10-15% return on their investment. There’s nothing like it anywhere. The incredible thing is that most people don’t know about this opportunity. They let their hard-earned money sit in CD’s or IRA’s. Some even risk the volatile stock market. The win-win reality of private lending is unparalleled. Really, you get immediate, limitless funds to invest in real estate opportunities at a moment’s notice.
Your lenders get an incredible 15% simple interest on their money. They are secured by both a mortgage and hazard insurance on the home. The safety of their investment is guaranteed because the total investment is never more than 70% of the appraised value of the property. Your lender can’t lose. If for some reason you would fail to repay the loan, they have the value of the property to reclaim their funds. Not a bad deal for your lenders.
My friend Alan Cowgill is a speaker, author and real estate entrepreneur. Alan has bought or sold over 175 investment properties. His step-by-step system “Private Lending Made Easy” teaches others to find private lenders. To get more info from Alan go to www.reimostwanted.com/101alancowgillcall.html for a free call. Charles Dudley (www.reimostwanted.com)
nothing to do with saving money for a down payment, going to a bank, filling out an application, and waiting to be approved. In fact, if you’re going about things this way, as I did for many years, you’re wasting time and losing money.
For me, discovering how to use private lenders in my real estate business has been truly life altering. The amount of money I make and the kind of work I do each day is incredible to me. And not only is it possible, it’s really very simple. If I can do it, anyone can.
For seventeen years I languished in a full-time corporate position. I wasn’t happy and I was barely making ends meet. I was thousands of dollars in debt and it was only getting worse. It wasn’t the life I wanted. I felt that my life was just ticking away. When I sat down and really faced things, I knew in the end I could actually retire poor. Something had to be done.
Real estate investing came to me in the form of an infomercial at 2 a.m. on a Tuesday. The course piqued my interest, but the cost was $159. Money was so tight, I didn’t have $159, but I did have a credit card and the company offered a 30-day money back guarantee. I held that credit card in my hand and considered the future I wanted. Then I picked up the phone and ordered the course. It was the first step toward a brand new life and eventual wealth beyond what I could have imagined.
But that was only the beginning. After a few years I took a second step that propelled my business and my life to a whole new level. In 2001, when I quit my corporate job and took the plunge full-time into the world of real estate, I was immediately faced with a very big problem. It turns out that this problem was the best thing that could have happened to me. You see, without full-time employment, traditional lenders weren’t exactly eager to loan me funds. And without consistently available money to fuel my real estate transactions, I had no business at all. I tried everything:
• Banks
• Line of credit
• Hard money lenders
• Partners
• Credit cards
If only I had known that all of these methods, even if they had been eager to give me a loan, were complete wastes of my time!
Finally, about five years ago I learned a lesson I’ll never forget. I came across a foreclosure on a $150,000 property that was going for only $70,000. I’d hit the jackpot! It was almost too good to be true. Of course I jumped at the chance to get in on this incredible deal. But I didn’t have the available funds. It’s every real estate dealer’s nightmare. I scrambled to the bank, to my partner. I tried to extend lines of credit. But all of this took time, and time is exactly what you don’t have with a lucrative short sale like this.
As you can guess, I didn’t get the sale. By the time I had secured funds, the property was sold to someone who had the cash ready and could close within days. In this one deal I lost a potential $60,000.
I swore then and there that this would never happen to me again. And it never did, because then I discovered private lending.
A whole new world opened to me and my investing has never been the same. Private lenders literally provide you with your own private bank to fund your real estate deals. Imagine: limitless funds that are constantly and immediately available. Today, I have more available capital than I do property in which to invest it. It’s simply a store of money waiting for me to make use of it. And anyone can have this
– that’s what’s so amazing. It’s like a dream come true for any serious investor.
It sounds a little overwhelming, doesn’t it? Let’s slow down. I’ll explain the specifics of private lending, and you’ll see for yourself how this incredible system works.
Who are private lenders?
First of all, private lenders are everyday people. Some are retired, some work, some have substantial investment capital, and others have only a little. They may want to make the most of the savings they’ve spent their lives building, or perhaps they suddenly came into money through an inheritance or property sale. Regardless of their background, all private lenders are looking for a safe, high-yield opportunity for their funds. I give my lenders a guaranteed 10-15% return on their investment. There’s nothing like it anywhere. The incredible thing is that most people don’t know about this opportunity. They let their hard-earned money sit in CD’s or IRA’s. Some even risk the volatile stock market. The win-win reality of private lending is unparalleled. Really, you get immediate, limitless funds to invest in real estate opportunities at a moment’s notice.
Your lenders get an incredible 15% simple interest on their money. They are secured by both a mortgage and hazard insurance on the home. The safety of their investment is guaranteed because the total investment is never more than 70% of the appraised value of the property. Your lender can’t lose. If for some reason you would fail to repay the loan, they have the value of the property to reclaim their funds. Not a bad deal for your lenders.
My friend Alan Cowgill is a speaker, author and real estate entrepreneur. Alan has bought or sold over 175 investment properties. His step-by-step system “Private Lending Made Easy” teaches others to find private lenders. To get more info from Alan go to www.reimostwanted.com/101alancowgillcall.html for a free call. Charles Dudley (www.reimostwanted.com)
Wednesday, August 8, 2007
AVOIDING THE DUE ON SALE CLAUSE - Part 2 of 2
When proposing that a seller remain on the existing loan for you: if you really want to be assured of 'getting the deal,' its important that you make it sound so good for the seller that he can't refuse. To do that, you’d suggest that for his own safety and peace of mind, you'll pay to put the property into a neutral trust (if he prefers), and that he needn't ever transfer the property’s title to you at all…until you've proven yourself, by eventually refinancing or selling the property and paying off his loan. Explain that you'll consent to merely becoming a co-beneficiary in HIS trust until his loan is retired in, say, 6 months (or 3, 4, 5 or 20 years…or more).
Note that this arrangement (i.e., a "NARS PAC Trust™") gives you, as the buyer, 100% of the tax write-off (See IRC § 163(h)4(D)); 100% of the use, occupancy, possession; 100% of the equity build-up (from principal reduction); full rights to all rents; and other profits upon the sale or other disposition of the property. As well, you also have any and all of the other rights ordinarily only available under the so-called "Bundle of Rights" in any form of Fee-Simple Real Estate ownership.
In a NARS PACTrust™, the seller needn’t ever take any chances with you; and you don't have to take any chances with the seller either. By virtue of the structure of the NARS PACTrust™, the trust property is protected from liens, suits judgments, divorce actions or claims, bankruptcies or anything else you can think of…on both sides…including state and/or IRS tax liens. Moreover, the due-on-sale clause becomes pretty much a non-issue in that the property has not been sold; the title has not been transferred (other than to the borrower’s authorized trust); and there is no consideration for a ‘purchase of real estate’ per se. Furthermore, the commodity being transferred (beneficiary interest in a trust) is characterized as Personalty (personal property), and not Realty (real estate), and is therefore not subject to the same creditor rights as would be real estate. And…the transaction has not infringed upon the lender’s foreclosure rights, or compromised its security interest).
In closing, do note that for maximum safety, it recommended that at least 10% of the trust's Beneficiary Interest and 50% of the beneficiary’s Power of Direction should be retained by the seller, with an agreement to forfeit that interest to you upon disposition of the property at the trust's termination. However, also note that the Settlor Beneficiary’s fifty percent Power of Direction can be given to you by means of either an Assignment of Power of Direction, or by a Revocable, Limited, Power of Attorney. The reason for the seller’s retaining a percentage of beneficiary interest is to satisfy the requirement that if the seller places his property into a revocable trust, he must be and remain a beneficiary of that trust. The reason for keeping the 50% Power of Direction intact, is that most county jurisdictions will not re-assess the property for property taxes, or require transfer fees, when transferring the property to a living trust, so long as no more than 50% of the “voting rights” are conveyed.
This article was written by my good friend and associate Bill Gatten, who will be featured as a special live guest Aug 10-12 in Roanoke, VA as well as on a bonus teleconference Thursday night, Aug 9th at 8:30pm EST at www.reimostwanted.com/liveevent.html
Note that this arrangement (i.e., a "NARS PAC Trust™") gives you, as the buyer, 100% of the tax write-off (See IRC § 163(h)4(D)); 100% of the use, occupancy, possession; 100% of the equity build-up (from principal reduction); full rights to all rents; and other profits upon the sale or other disposition of the property. As well, you also have any and all of the other rights ordinarily only available under the so-called "Bundle of Rights" in any form of Fee-Simple Real Estate ownership.
In a NARS PACTrust™, the seller needn’t ever take any chances with you; and you don't have to take any chances with the seller either. By virtue of the structure of the NARS PACTrust™, the trust property is protected from liens, suits judgments, divorce actions or claims, bankruptcies or anything else you can think of…on both sides…including state and/or IRS tax liens. Moreover, the due-on-sale clause becomes pretty much a non-issue in that the property has not been sold; the title has not been transferred (other than to the borrower’s authorized trust); and there is no consideration for a ‘purchase of real estate’ per se. Furthermore, the commodity being transferred (beneficiary interest in a trust) is characterized as Personalty (personal property), and not Realty (real estate), and is therefore not subject to the same creditor rights as would be real estate. And…the transaction has not infringed upon the lender’s foreclosure rights, or compromised its security interest).
In closing, do note that for maximum safety, it recommended that at least 10% of the trust's Beneficiary Interest and 50% of the beneficiary’s Power of Direction should be retained by the seller, with an agreement to forfeit that interest to you upon disposition of the property at the trust's termination. However, also note that the Settlor Beneficiary’s fifty percent Power of Direction can be given to you by means of either an Assignment of Power of Direction, or by a Revocable, Limited, Power of Attorney. The reason for the seller’s retaining a percentage of beneficiary interest is to satisfy the requirement that if the seller places his property into a revocable trust, he must be and remain a beneficiary of that trust. The reason for keeping the 50% Power of Direction intact, is that most county jurisdictions will not re-assess the property for property taxes, or require transfer fees, when transferring the property to a living trust, so long as no more than 50% of the “voting rights” are conveyed.
This article was written by my good friend and associate Bill Gatten, who will be featured as a special live guest Aug 10-12 in Roanoke, VA as well as on a bonus teleconference Thursday night, Aug 9th at 8:30pm EST at www.reimostwanted.com/liveevent.html
AVOIDING THE DUE ON SALE CLAUSE - Part 1 of 2
DUE-ON-SALE CLAUSE: The clause (Para. #17) in virtually all mortgage loans, which permits a secured mortgage lender (federal, state or private) to call the entire unpaid loan balance Due and Payable immediately should the property securing the loan be sold, transferred, traded, gifted or otherwise disposed of without the lender’s prior written consent (and without giving them the opportunity to charge more money or say “No” to the transfer).
Despite the due-on-sale clause and its implications in the creative real estate financing business, it is quite possible for one to take over the payments on a non-assumable mortgage loan without needing to fear, or even to be concerned with, a DOS Violation…without violating it.
In order to effect such a take-over without an unauthorized transfer, one simply assures that the property is, in-fact, NOT being sold, traded, hypothecated or transferred in any ‘unauthorized’ manner. In other words, since placement of real estate into the borrower’s revocable living trust for asset protection purposes is fully allowable under the law (12USC 1701-j-3; and since appointment of a co-beneficiary is a prudent thing to do anyway: a would-be seller need only place its property into such a trust, and then deal with the interest in the trust, rather than dealing with the property itself. At this point, the buyer (of beneficiary interest: not real estate) gains virtually 100% of the same incidents and benefits of Fee Simple Real Estate ownership that he or she might have under a traditional transfer of the property’s title.
The only caveat here is that the living trust that is utilized for this purpose must be an Illinois-type, title-holding Land Trust. Such a trust is fully revocable and it is an inter-vivos trust; however, land trusts by nature are directed by their beneficiaries, not the trustee: and all “legal” title, as well as all “equitable” title, is vested with the trustee. Beneficiaries of land trusts own no real estate, only personal property…and even though they retain all the benefits of an owner, the property has not been sold, transferred or hypothecated.
The trust term of the agreement is decided upon by beneficiaries and stipulated in the contract. Such terms generally run for from 1 to 20 years, with the understanding that, at the end of that time, the trust will be terminated and the seller's interest (as little as 10%) will be forfeited to the co-beneficiary (buyer). Such forfeiture merely needs to be in consideration of some future act by the buyer (e.g., prompt payments; strict adherence to contract terms; a share in appreciation or overall profit; etc.). Often times, however, beneficiaries might mutually agree to share profits at termination in proportion to their respective beneficiary interests (50:50, 90:10; 75:25, etc.).
It is most important to understand here that the verbiage of a lender’s Due-on-Sale clause doesn't always convey exactly what we or our attorneys THINK it does, or what the lender expects us to believe it does (a little trickery here)…irrespective of whether a lender's exercising its rights under a DOS clause are "real," "false" or indifferent. What the DOS does infer is: “UNLESS PROHIBITED BY APPLICABLE LAW…” the lender has a right to foreclose, if the title to its security is transferred into a trust, and if a beneficiary interest in that trust is sold or transferred." Well...make no mistakes about it! Such action ‘IS’ indeed prohibited by “applicable law.” The Law (The Federal Depository Institutions Act of 1982) strictly prohibits ANY lender from taking exception to a borrower's placing its property into its own inter-vivos (living) trust (such as a Title-Holding Land Trust) and appointing a 2nd party to function as a co-beneficiary or remainder agent. Further, there is nothing to prevent those same co-beneficiaries from leasing the property out to any one they may choose…say, to the 2nd co-beneficiary, for example.
Overall, the process described here creates what is tantamount to a legally constructed, and very safe and well-shielded ‘Wrap-Around Seller-Carry’ device. Since the original owner of the property has named the second party as a beneficiary in the trust and leased to the property to him or her under a triple-net lease (i.e., net, net, net lease, wherein the tenant pays mortgage interest, property tax and handles all maintenance), the resident beneficiary (or investor co-beneficiary) has obtained all the benefits of a sale… without there actually having been one.
This article was written by my good friend and associate Bill Gatten, who will be featured as a special live guest Aug 10-12 in Roanoke, VA as well as on a bonus teleconference Thursday night, Aug 9th at 8:30pm EST at www.reimostwanted.com/liveevent.html
Part 2 of this article will be coming tomorrow. All the best - Charles Dudley
Sunday, August 5, 2007
“Why Business Credit Is A MUST For Every Business Owner!”
As an entrepreneur, you’re hardwired to enjoy a greater level of risk than the average person. But do you enjoy the thrill of business and investing so much that you’re willing to risk:
-Being hounded by creditors?
-Declaring bankruptcy?
-Being denied a mortgage?
-Paying more than your fair share of interest on your loans?
-Losing your house?
If you answered “no” to one or more of these questions, this may be the most important report you’ve read in a long time.
Because, if you’re like most entrepreneurs, investors, and business owners I’ve met over the past 28 years, you’re in danger of facing all of these horrific problems.
And it’s all because of your business.
You see, entrepreneurs typically make one or more financially devastating mistakes when financing the launch, operation and/or growth of their businesses. In most cases, they don’t realize that they’re making a mistake.
And to tell the truth, even when they do realize they’re making a mistake … they lull themselves into thinking that the consequences will be a minor annoyance.
Until, one day, they can’t qualify for a mortgage. Or they can’t get the to-die-for financing offered on the new car they’re buying. Or they’re hounded by creditors and eventually have to declare bankruptcy.
And it is all because they use their personal finances to fund the launch or expansion of their business. They then use personal credit cards to pay for business expenses. If you are in business or thinking about starting a business, business credit is a must.
Let me explain, most business owner have no idea that they can establish business credit and even fewer know how to how to establish business credit. If owners would take the time necessary to educate themselves about establishing credit they would no longer have to use their personal funds for start up capital or working capital.
They would also be able to use business credit cards which don’t report to their personal credit reports, therefore, not lowering the personal credit scores.
The most important goal of business credit though is to obtain unsecured business lines of credit, which can be done once the business credit profile is set up properly. Once a business obtains unsecured business lines of credit, they then have the working capital they need to start a business or expand their business. The business owner has check book control to use the business lines of credit as they wish. And best of all, the business lines of credit don’t report to the business owner’s personal credit report.
If you have set up your business profile correctly there are a number of banks that will lend to brand new start up business. That is right, brand new start up business with no track record whatsoever. The banks will extend unsecured business lines of credit so they can have the start up capital they need to finance the business of their dreams.
Make no mistake about it; business credit is a MUST for every business owner. Don’t put your personal assets at risk finance or fund your business!
Written by Chad Lee of CCC
Corporate Credit Concepts makes it easy to establish business credit. To listen to a free interview with Trent Lee, co-founder of CCC and learn how to build business credit and obtain Unlimited Financing go to www.reimostwanted.com and register for a free training series and get access to this and many other wealth enhancing topics. CD
-Being hounded by creditors?
-Declaring bankruptcy?
-Being denied a mortgage?
-Paying more than your fair share of interest on your loans?
-Losing your house?
If you answered “no” to one or more of these questions, this may be the most important report you’ve read in a long time.
Because, if you’re like most entrepreneurs, investors, and business owners I’ve met over the past 28 years, you’re in danger of facing all of these horrific problems.
And it’s all because of your business.
You see, entrepreneurs typically make one or more financially devastating mistakes when financing the launch, operation and/or growth of their businesses. In most cases, they don’t realize that they’re making a mistake.
And to tell the truth, even when they do realize they’re making a mistake … they lull themselves into thinking that the consequences will be a minor annoyance.
Until, one day, they can’t qualify for a mortgage. Or they can’t get the to-die-for financing offered on the new car they’re buying. Or they’re hounded by creditors and eventually have to declare bankruptcy.
And it is all because they use their personal finances to fund the launch or expansion of their business. They then use personal credit cards to pay for business expenses. If you are in business or thinking about starting a business, business credit is a must.
Let me explain, most business owner have no idea that they can establish business credit and even fewer know how to how to establish business credit. If owners would take the time necessary to educate themselves about establishing credit they would no longer have to use their personal funds for start up capital or working capital.
They would also be able to use business credit cards which don’t report to their personal credit reports, therefore, not lowering the personal credit scores.
The most important goal of business credit though is to obtain unsecured business lines of credit, which can be done once the business credit profile is set up properly. Once a business obtains unsecured business lines of credit, they then have the working capital they need to start a business or expand their business. The business owner has check book control to use the business lines of credit as they wish. And best of all, the business lines of credit don’t report to the business owner’s personal credit report.
If you have set up your business profile correctly there are a number of banks that will lend to brand new start up business. That is right, brand new start up business with no track record whatsoever. The banks will extend unsecured business lines of credit so they can have the start up capital they need to finance the business of their dreams.
Make no mistake about it; business credit is a MUST for every business owner. Don’t put your personal assets at risk finance or fund your business!
Written by Chad Lee of CCC
Corporate Credit Concepts makes it easy to establish business credit. To listen to a free interview with Trent Lee, co-founder of CCC and learn how to build business credit and obtain Unlimited Financing go to www.reimostwanted.com and register for a free training series and get access to this and many other wealth enhancing topics. CD
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