http://www.REIClub.com - Income Taxes Can Really Eat Into Your Profits. Here Are A Few Ways To Save On Your Income Tax As Real Estate Investors... Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I’ve got a quick video on ways to save on your income tax. Taxes/Insurance/Utilities – You can deduct all of those real estate tax, insurance and utility charges you have already paid from your income tax. Repairs – Repairs and supplies needed for repairs and upkeep are deductible. Great for income tax savings. Home Office – If you work from your home, you can take the home office deduction. This means you can deduct that portion of your home’s expense, such as mortgage payments, tax and insurance, utility payments, etc., related to your home office. (Separate Meter is usually safer for these deductions, otherwise its a percentage of total home sq.ft.) Depreciation – This real estate tax deduction lets you depreciate your real estate buildings. Every year for 27.5 years you get a deduction just for owning real estate. You can also depreciate the parts that make them habitable - HVAC equipment, hot water heaters, plumbing and light fixtures - depreciate at different rates Office Deductions – Office supplies and equipment are deductible. Cell phone, computer, printer, paper for the printer, envelopes, stamps. If its related to your real estate business, it may be a viable income tax deduction. Business Expenses – Subscriptions, dues and fees are deductible. Internet, newspaper, real estate events, REIA groups, seminars - All likely tax deductible for real estate investors. Mileage – Mileage in your personal vehicle is deductible. SImply keep a log of the miles driven related to your real estate activities and the savings can really add up. There are many income tax deduction advantages available for real estate investors, which means you get to keep more of what you make. Always remember to keep documentation for everything you spend on your business, because its highly likely you will be able to deduct these costs come tax season. If by chance you have an accountant, or know a tax advisor, be sure to check with them if you have any questions. Don’t make up numbers because its the quickest way to get the IRS knocking at your door. Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you’ll be automatically notified when we upload more quick video tips for you. Take care and good investing.
http://www.REIClub.com - The Pros and Cons of Using Direct Mail For Real Estate Investors. Here’s Why Direct Mail Still Works... Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I’ve got a quick video on direct mail marketing for real estate investors Many investors will tell you that direct mail marketing is dead. That it doesn't work well, that there are better ways to get your message out there with higher response rates. My answer to that? You're missing out if you think like that. Direct mail still has its selling points, yes, its not as sexy as some other marketing methods, but its still a great way to find quality leads for your real estate investments. It may cost you $500 to $1,000 to send out 1,000 direct mail pieces, but 1 strong lead (which is 0.1% response rate, very unlikely to be that low), may pay for the marketing 10x. Advantages of Direct Mail Campaigns - Great way to reach new potential customers - Highly Targeted - tailored to specific audience based on specific needs - Personalized - include names, emphasis on foreclosure, mortgage payments - Tangibility - something they can hold - depending how creative you can get - Familiarity - Depending on your audience (say older crowd), they still check physical mail, not internet - Multiple Formats/Customizable - Brochures, catalogs, magazines - Creating direct mail campaign not hard - Easy to design - Many samples online - Generate Traffic - Send people to a website with better conversions, add them to email lists, etc... - Measurability/Tracking - if using a specific call to action - track conversions and response rate - Proven Track Record - Direct mail has been going on for years, it works Disadvantages of Direct Mail Marketing - Costs - Designing highly effective campaigns, or a company to distribute the mail - May be perceived as Junk/Spam mail - Response rates are usually pretty low - but it depends on the piece - Bad mailing lists - address errors, misspellings - Time sensitive promotions - delays may hurt the response - Hard to Test what does or does not work - can't make small adjustments and gain immediate results like internet - Not environmentally friendly - unless you use recycled envelopes/paper, etc... Tip: We all check our mail, we all get spam, advertising, bills, so what entices us to open up something we've never seen before? Exactly that, something we've never seen before. Direct mail is versatile, explore creative ways to get your message out there. (Ex. I received one piece that looked like a paycheck "pay to the order of", it got me to open it.") Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you’ll be automatically notified when we upload more quick video tips for you. Take care and good investing.
http://www.REIClub.com - FSBO Open Houses Are Great For Selling Your Investments. Here Are Tips To Hosting A FSBO Open House For Real Estate Investors... Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I’ve got a quick video on fsbo open houses. Hosting open houses are great ways to effectively market and sell homes. If you are attempting to sell your investments by yourself without the assistance of a professional real estate agent then you need to keep a few essential open house dos and don’ts in mind to really make your open house successful. Do’s - Stage your home if possible - Create as much interest as possible before your open house and make sure you are completely prepared. - Try and make your open house visitors as comfortable as possible; think about serving snacks and refreshments. - Make sure you have printed flyers for potential buyers to take with them. - Make sure you have a guest log to record everyone who comes into your home. - Have available as much detailed information as possible, you should be able to get information on area schools, demographics, business and anything else that is online for free that you can print out. - Let your neighbors know about your open house plans, hopefully they will cooperate and not be throwing parties at the same time. - Follow-up with interested buyers Don’ts - Don’t give your property to Real Estate Agents who want to list your property until you have tried yourself, if they offer you to sell it at a lower commission, something to consider. - Don’t be pushy and try to hard sell visitors, you may come across as being too desperate. - Don’t make any on the spot commitments or sign agreements without taking the time to discuss and think it over. - Don’t make any guarantees or warranties you are unsure of. - Don’t hide information, if its not perfect and you plan on making it better before the buyer moves in, let them know. If choosing to sell your home without a realtor, an open house is a great way to attract potential buyers and receive multiple offers. Many homeowners use a realtor because it allows them to take a hands-off approach, but by putting in some extra effort, and doing it yourself, you can avoid paying hefty Realtor commissions, which can quickly decrease your net profits. Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you’ll be automatically notified when we upload more quick video tips for you. Take care and good investing.
http://www.REIClub.com/va - Virtual Assistant Trainings For Real Estate Investors. Here’s How To Setup A Real Estate Virtual Assistant Training... Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I’ve got a quick video on how to train your real estate Virtual Assistant. Hiring a virtual assistant involves much more than simply posting an ad and delegating tasks. Just like any other employee, your new VA needs training. If you don’t train your VA, he/she is never going to know what they have to do to support you fully. Virtual Assistant Orientation - Video chat - skype - screen share - Go over policies and procedures of your business - Go over expectations and general tasks required by VA - Go over period of employment - trial? part-time? Number of hours a week? - Briefly walk-through sites, tools, and software that they will be using - Answer questions as needed How to Setup The Virtual Assistant Training? - Create instructional videos to further explain step-by-step how to perform each task. (i.e. setting up email, upload listings into craigslist, upload reports to google docs, filling out spreadsheets, using google calendar.) - Create individual videos for each task - Shorter videos are easier to upload. - Create audios (if video is not an option) - YT is easy to use - Create scripts - for phone responses, screening buyers or sellers - Create templates - for email responses, customer service responses - Upload trainings to a central file storage location, organized and easily accessible to your VA. - Email VA links to site they can access training - Very important videos and scripts are step-by-step and do not leave room for interpretation. - Schedule a conference call ONCE a week - Get updates, answer questions, set tasks for week. Clear communication can prevent misunderstandings. What To Avoid with Your Virtual Assistant - Avoid giving tasks away that would best be handled by you. (i.e. Paying bills) - Avoid giving too much upfront responsibility. Test the relationship first. Is work being done on time? How is the quality of work? - Avoid room for interpretation - best to give very clear instructions, and if they are unsure, to contact you - Avoid overreacting to early mistakes - They are adjusting to you, just as much as you are to them. ACcept that you must occasionally accept small failures in order to achieve big wins. Tools - Jing.com - Camtasia.com - Screenflow.com - Dropbox.com - Odesk.com - Google Docs / google calendar - YouTube - (YT allows private videos) - Skype.com Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you’ll be automatically notified when we upload more quick video tips for you. Take care and good investing.
Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I’ve got a quick video about driving for dollars as real estate investors Driving for Dollars is just another way of saying driving around looking for good deals. When you find them, you make money. Why should investors drive for dollars? - affordable way to find deals simply by keeping your eyes open - Great way to train your eyes to locate the best opportunities - Great way to get familiar with neighborhood trends - Rental vs. For Sale, are there a lot of vacancies? - Another way to market for sellers - drop off mailers, or business cards in areas you are investigating - Minimal competition - because many people use the internet now, which don’t show these properties Where and What to Look For? - I wouldn't recommend "war zones" - Boarded up windows, high hassle, low returns areas. Tons of vacancies = harder to sell. Look for working class neighborhoods. - Driving home from work - take a different road every time and look for "signs" of opportunity - "signs" - only trash can not out, un-kept lawn, HUD Papers on the window, lock box, FSBO signs, mail overflowing, neglect, vacancy, etc... - Knock on neighbors doors - if you aren’t sure if the home is vacant - Explore adjoining/adjacent neighborhoods from MLS properties your realtor sends you - Give your business card to the mailman - tell them you have a referral program where you pay $$$. - Rehab/contractors - great way to build a contact - investors or contractors - see quality of work What to do with the leads? - Create a map at home and pinpoint the properties and areas of interest - Document the amount of time you drove around and number of deals you found - put a value on time spent. Focus on areas with best potential. - Take the addresses and put them into the county tax assessor website - you will find the owner - either home owner or investment group/bank. - Use Phone Book - find homeowner - Do your research, and pull comps for the area - Create postcards, use direct mail - Prepare scripts and benefits for when you talk with the homeowner - the "why" they should sell you their house. Driving for Dollars is a great way to find pockets of real estate that aren’t listed to the public. It’s a great way to find properties with minimal competition because the average real estate investor does all their research online: google maps, zillow, county tax records, which are all great, but it won’t find you the same type of deals when driving around. By dedicating that extra bit of effort, you will gain much more from it. In addition to the deals my realtor sends me, I’m always driving around keeping my eyes open for that next deal. Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you’ll be automatically notified when we upload more quick video tips for you. Take care and good investing.
http://www.REIClub.com - The Pros and Cons of 1031 Exchanges For Real Estate Investors. Here’s A Video Explaining A Real Estate 1031 Exchange... Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I’ve got a quick video on Delayed 1031 Exchanges There are different types of 1031 Exchanges, today we will be focusing on “Delayed 1031 Exchanges” What is a delayed 1031 Exchange? The primary advantage of a 1031 exchange is the preservation of investment capital by deferring payment of capital gains taxes. If you sell property (rather than exchanging it) you must pay taxes on any recognized gain. Capital gains tax is usually 20% to 25% of your gain, plus any state taxes. In a tax-deferred exchange, all your profit (both cash and carry-backs) may be used to acquire replacement property. The theory behind Section 1031 is that when a property owner reinvests the sale proceeds into another property, the taxpayer's investment is essentially still the same, only the form has changed (e.g. vacant land exchanged for apartment building). For a delayed 1031 exchange, the IRS allows up to a maximum of 180 calendar days between the sale of the relinquished property and the purchase of the replacement property. Within the 180 day “exchange period,” the investor must also properly identify suitable replacement properties, which they call “like-kind”, within 45 calendar days of closing on the sale of the relinquished property. Benefits of Using a 1031 Exchange - Few techniques available to postpone or potentially eliminate taxes - Scale your business up - houses to apartments to commercial - Leverage - Deferring taxes, more money available to invest in another property. - Cash Flow - Investors can sell a property that is producing little or no income (such as land) and purchase property or properties with greater cash flow performance (such as a retail shopping center). - Management Relief - Investors who no longer want to manage high-maintenance properties can reinvest in properties requiring little or no management. - Increase Depreciation - Investors can exchange from a non-depreciable property (such as raw land) to a property that can be depreciated. - Relocation - If owners move or retire to other locales, they may prefer to relocate property holdings, especially resort properties. Disadvantages of 1031 Exchange - Does not work for all types of transactions - numbers need to work - Complex setup process - More than likely will need to consult with tax professional - Very strict IRS guidelines and deadlines - if not followed, subject to taxation - Additional Costs - Exchange Fees and Hiring a Qualified Intermediary (these are the people who aid in this transaction process, mandatory) - If you decide to sell the replacement property - deferred gain is taxable If you aren’t familiar with Capital gain tax, research it so you can fully understand the benefits of a 1031 Exchange. Every 1031 Exchange transaction is different. Always consult a competent Qualified Intermediary, attorney, or tax advisor to determine how an exchange may best be structured to accomplish your investment objectives. Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you’ll be automatically notified when we upload more quick video tips for you. Take care and good investing.
http://www.REIClub.com - Real Estate Investing ‘Subject To’ The Existing Mortgage. Here’s a Video On Investing ‘Subject To’ For Real Estate Investors... Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I’ve got a quick video on investing subject to the existing mortgage.. What is “Subject To” Investing? To fully understand Subject To investments, we need to first break the process down into two components, the title and the financing. Many investors think they are related in this type of transaction, but that’s a common misconception. In a ‘subject to’ transaction, the seller will Deed the title over to the new buyer, making the buyer the new owner of the property, but the loan remains in the sellers name. The buyer will then make payments on the mortgage in place of the seller. It’s important to understand that a loan does not indicate ownership of a home, the deed does. The property itself is a collateral asset to lenders in case payments are not made by the borrower. There is risk on both sides, for the seller, their credit is on the line, and for the buyer, they could potentially lose the property if not managed correctly, or if the Bank executes the “Due On Sale” clause which we will discuss later in this video. In most situations, buyers/investors will keep the property for themselves as a cashflow investment or a potential Lease Option. Simply, Subject To’s create a way for investors to own property with little or no money out of pocket, or using their own credit. Why would a seller agree to sell you their home using their existing mortgage? They must be Motivated in order for this strategy to work well - They want to stop making payments because they want to move - They are getting transfered to another city, which is paying less - They were given the house and now have 2 mortgages - The house was purchased under a dual income home, divorce, now single income *There many situations that can create a motivated seller, and its not just because they are behind on payments. “Due on Sale” Clause (25 years ago and prior it was not uncommon for ownership of a residential property to change with the financing staying in place.) DOS clause - Varies by lender documents - conventional, FHA, VA - Most contracts state - The Loan balance MAY be called due in full upon sale or transfer of ownership of the property. This is one of the ways lenders protect themselves. In addition to qualifying the initial borrower, the lender required the borrower to pledge the property as additional collateral for the loan. - But, in most cases, but not always, as long as payments are being made ON-TIME, lenders usually won’t care. Even if payments are made in the name of someone who is NOT on the original loan. But it’s still the banks choice. - Once again, this is a risk you need to be aware of, and its important your seller is made aware of this too. The risks of this type transaction vary by state and by lender. Important Tips: When you make payments, be sure to make them directly to the lender, and NOT to the seller. Reason why, you can’t guarantee that the seller will make payments for you, and if they foreclose, YOU lose the property and your money. If the seller asks that checks are mailed to the seller, then ensure the payee is the lender, NOT the seller. And make sure you have a way to verify each month that the payment has been made. Make sure the seller signs documents stating their understanding of this situation. You could even go so far as to videotape their understanding. Do not make any promises about when the seller’s loan will be paid off. The regulations behind ‘subject to investing’ varies per state, so it’s important that you verify that this is a viable investment option for you. Although this is a “no money down” strategy, that doesn’t involve the use of your credit, there are still risks. It’s important you educate yourself on these potential risks before using this strategy. Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you’ll be automatically notified when we upload more quick video tips for you. Take care and good investing.
http://www.REIClub.com - Want To Market To Private Lenders Like the Pros? Here’s Some Information On Attracting Private Money For Real Estate Investors... Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I’ve got a quick video on Marketing For Private Lenders So private money loans allow a real estate investor to lock down great deals due to the ability to close quickly, but the biggest issue is that not many investors know how to get private money. The eBook I want to introduce you to, “Marketing For Private Money” by William Johnson, its a quick read (less than 70 pages), and teaches real estate investors how to effectively advertise and find private money lenders. The topics covered include print advertising for finding private money lenders, direct mail for getting private money lenders, networking to find private money loans, lender luncheons, teaching seminars, search engines, websites, blogs, social media sites and how to manage and follow up with leads acquired. What’s also great about this eBook is that it’s free to borrow from Amazon, if you own a Kindle and have an Amazon Prime account. Otherwise, it’s only .99 cents to purchase. Marketing for Private Money eBook: http://www.amazon.com/dp/B00AEJZCJG If you enjoyed this private money ebook, the author has other similar ebooks available that I encourage you to checkout: http://www.amazon.com/William-Johnson/e/B009GPD462 Lastly, it would be a great help if you left a comment on Amazon about your purchase of Marketing for Private Money Lenders. Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you’ll be automatically notified when we upload more quick video tips for you. Take care and good investing.
http://www.REIClub.com - Ever Worry About Your Real Estate Closings? Here Are Some Tips To Prevent Real Estate Closings From Falling Apart... Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I’ve got a quick video on real estate closings and what you need to do, to have a smooth closing. Remember, not to deal with major issues at the closing table, address them before hand. Step 1: Earnest Money and Contingency Period 7-14 Days - Put down earnest money to secure your interest Contingency - The home inspection not revealing any major problems with the home - Contingent on Funding based on a % rate you can afford Step 2: Secure your Funding - Get your funding lined up (unless you’ve already provided proof of funds) - Many cases, pre-approval for your loan and written confirmation from your bank will be needed Step 3: Find a Title Company - Open escrow for the transaction, or use the sellers - middleman for your transaction - They will perform title searches and let you know if title is clear - If not, address the clouds on title and determine if it is worth it to stay or leave the deal - Maybe seller will fix it, or pay to fix it. Step 4: Find a Real Estate Attorney (optional) - Most of the time when you are dealing with a title company, a transaction is done legitimately - If you have concerns about the contract, or unclear, you can always ask the title company ahead of time - If you are still uncomfortable, consult with an attorney Step 5: Negotiate Real Estate Closing Costs - Title company will usually send you the HUD-1 Settlement Statement a week or more in advance for review - Review it, and make sure you understand what closing costs YOU are paying for and what the other party is paying for - If you have any questions, or would like negotiate some of the costs, do it then, not at the closing table - Can be done by email or phone with the title company Step 6: Complete the Home Inspection - Unless the home is being bought “As-is” - Complete the Home Inspection - confirm everything is up to code - If you find a serious problem - you can either back-out, or ask the seller to fix it or give you credit for it Step 7: Pest Inspection - Suspicion of termites - Separate from Home Inspection - If there is a problem, assess the cost and see if the deal is still worth it - Or if the seller will fix it Step 8: Re-negotiate the offer based on Inspection - Only if there are major problems, see if the seller is willing to lower the price to accommodate for repairs Step 9: Funding Escrow - Either wire them the amount owed to seller, they’ll hold it for you till everything is signed - Or bring a check to closing (Cash Buyers) Step 10: Final Walk-through - Schedule a time with your realtor, or seller to walk through the house one final time to make sure everything is in order - No broken windows, missing window units, holes in the wall, etc... Step 11: Go to Closing - Everything should be in order by the time you get to the closing tables This is a real estate investment closing action plan to assure you that the common real estate closing issues for buyers can be prevented before you get to the closing table. This list is much more simplified for “As-is” Cash Buyers, but for those going through traditional financing, these are the steps you will need to take. If you ignore these things, there is a good chance the deal will fall through, or you will be stuck with a property that may have more problems than you originally planned. Just remember, at any time you are confused, or unsure, don’t be afraid to ask questions. This is a learning process, and more people are willing to help than you think. Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you’ll be automatically notified when we upload more quick video tips for you. Take care and good investing.
http://www.REIClub.com - Real Estate Investing in 2013 is going to be a good year. Watch this video and let me help you with your real estate education for FREE... Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. First of all I would like to say Happy New Year to everyone watching, and thanks for all your support last year. This year... I would like to focus our videos more on what our REIClub.com members want, or would currently find helpful. We currently have hundreds of real estate investing videos in our reiclub channel, covering a variety of real estate topics. So I encourage you to watch them if you haven’t already, here’s why... If there are ANY real estate investment topics you would like for us to further elaborate on, or real estate topics I have yet to cover... I want you to let me know in the comments section below in this video, because your opinions matter to us, and it also allows me to personally better serve you. So watch our videos, let me know what you need in the comments section, and i’ll do my best to make a video about it. Once again, thanks so much for your continued support, and be sure to stay tuned to our weekly videos, because who knows, i may pick your topic. Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you’ll be automatically notified when we upload more quick video tips for you. Take care and good investing.