REI Today Podcast
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Want a great way to make money in real estate FAST? Here’s how to put thousands in your pocket quickly, regardless of your experience… and a tip for avoiding one HUGE error that will entirely destroy your deal. I’m Carole Ellis. This is Episode 1.
Let’s make a quick $10,000 or more from real estate, shall we?
However, before we do that, I need to take just 30 seconds tell you about a really interesting thing that a certain developer is doing ALL OVER THE COUNTRY that you just might want to consider before you buy your next investment property. Mega-developer DR Horton started doing this back in 2014 and now they’re way ahead of the curve and selling homes no other developer can even offer at this time. If you’ve got these types of properties, you’re ahead of the curve too and just about EVERY ANALYST OUT THERE says you’re going to be in big demand in 2016 and beyond. Want to know more about what DR Horton is doing and what it has to do with you and your quick $10,000? We’ve got all the details – and, more importantly, information on how you can get in on this trend before it peaks – in our News and Networking section at REI.Today.
Now back to that $10,000. One of the very quickest ways to do that is through a strategy known as wholesaling. You probably know what wholesaling is OUTSIDE of the real estate world. It’s where you buy a certain something for $X and then quickly resell that certain something for a little bit more than $X… and you keep the difference. Then you do it again enough to make a lot of money!
But the nice thing about doing that with real estate is that the difference you get to keep can be a lot of money. Many wholesale deals will put a few thousand dollars in your pocket with very little effort. But many wholesalers are actually able to profit by 10’s of thousands of dollars on each deal… and do this several times each month.
How would that affect YOUR life, to collect a check for $5,000 or $10,000 – and maybe do it several times a month? Keep that in the back of your mind as I tell you how to do this… and just as importantly… I’ll tell you a HUGE land mine that you must avoid.
This wholesaling strategy is one of the simplest ways to make money in real estate, and it even works for beginners, too. But exactly HOW does it work?
Well, first: You find a piece of real estate you can get below what it’s really worth. There are dozens of ways this can be done, and we’ll cover that, too. But for now, let’s assume that you’ve found a piece of real estate worth $100,000 – but you can get it under contract for $60,000.
Yes, people. You can find seriously deep discounts on real estate… if you just do the work to find it. That’s how you make your money! More about this in future episodes of this show.
So, you enter into a real estate contract to buy that property from the owner for $60,000. Easy peasy.
Then, you find a real estate investor or other buyer who might have an interest in that property. And rather than being greedy, and trying to keep all of the profit for yourself, you do what’s smart: You leave some profit in the deal… you leave some “meat on the bone,” as they say….
And you sell that property to the real estate investor for $70,000!
So, let’s do the math. You bought for $60,000 and you sold for $70,000. You’ve made $10 grand – that’s great!
BUT… how did that actually happen? Did you have to come up with $60,000 to buy the house first before you sold it for $70,000? And what if you simply don’t have $60,000 to finance this deal?
Well, my friends, I have great news: a cool strategy called “Assignment” makes it easy for you to collect your $10K without ever buying the deal yourself.
Here’s how it works:
You contract to buy the property at $60,000 just like before. But you put some simple but important language in that contract that allows you to “assign” the deal to a third party.
What is “assignment”? It’s when you allow a third party to take your place in the contract. In other words, YOU currently have the right to buy that house for $60,000. But if you “assign” your contract to that third party, at that point, the third party can buy the house for $60,000 instead of you.
But the right to buy at such a great price is valuable! So what you’ll do is charge that third party a fee to assign the deal to them… such as $10,000. So, what happens is that the third party pays YOU $10,000 for the right to buy that house for $60,000. Their total investment is therefore $70,000 – which is far, far below the actual value of $100,000. So, still a GREAT DEAL for the third party investor and a great deal for you because you get to pocket 10 Grand very quickly.
But, the devil is in the details, folks. Many of the gurus out there will tell you that all you need to do in order to be able to assign a contract is to put the words “and/or assigns” after your name as the buyer in the original contract. And it’s true, that can work.
BUT… it leaves huge holes open for problems that can steal away your $10,000 payday before you ever see it for the first time. For example – do you have any lingering liability in the deal? Do you have to get consent to perform the assignment? Can the seller veto the assignment? While assignment itself is really very simple as a concept, just using the words “and/or assigns” really doesn’t address any of those issues in a way that helps you.
You’ve got to be SMART… protect that $10,000 profit before anybody can take it from you!
And my friends, remember: This isn’t just theory. I’d like to introduce you to AC. AC is real estate investor based in my hometown of Atlanta, Ga. He’s been investing full-time for just a few years after spending 20 years as a computer programmer. He was able to quit his job and start investing full-time while devoting more time and energy to his family and church thanks to deals like the one I’m about to describe. He recently did a deal just like what I just described to you… got a house under contract for $127,000… found an investor just days later… assigned the deal to the investor for a fee of $8,500… and his bank account is a lot fatter and he’s repeating the process right now. And YOU can do this too! What would you do with an extra $8,500 like AC now has?
Well, you certainly can… but one thing you’ve got to have is the right legal clauses to make sure your deal gets done quickly, safely and for maximum profit.
How can you do that? Well, I have a special gift for you, my friends! It’s a collection of powerful legal clauses that are worth their weight in gold, and that you can use in your own contracts – only with your attorney’s consent, of course – to make sure that your assignment deal is air-tight and that your $10,000 profit is rock-solid!
How do you get access to those “golden clauses”? Well, good news – it’s inside the REI TODAY Vault, our free resource library for every listener to this show! If you’re already a member of the REITODAY Vault, download the special resource for today’s show called “REI Today Golden Legal Clauses for Assignment”. And if you’re not yet a member, you can get your free membership RIGHT NOW by texting the word REITODAY to 33444 or visit REI.Today/vault and I’ll provide immediate, free access to this truly powerful info that will make your real estate wholesale deals safer, faster and more profitable! So just text the word REITODAY with no spaces or periods to 33444 or visit REI.Today/vault to get access now… but do it now, as it’s available only for a limited time.
When you do that, you’ll also be able to GROW YOUR NETWORK by interacting with me and your fellow listeners to REI Today… so stop by to ask questions, make comments and network with other investors across the country! Just text the word REITODAY with no spaces or periods to 33444 or visit REI.Today/vault right now for your free membership.
Thanks for listening in. Be sure to listen in to Episode #2, where you’ll learn how to find the 80 PERCENT (that’s right, 80 PERCENT) of awesome wholesale deals that NEVER MAKE IT TO MARKET so that YOU can get started investing without having to compete with the “big guys” in your neck of the woods. It’s available right now on iTunes, Stitcher and at REI.Today, so get it right away!
REI Nation – always remember this: Your best investment is YOUR OWN EDUCATION!
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