This is a must do lead generation method to do deals in today’s market at lightning speed. I want to share with you one my favorite fast cash strategies. This technique will put money in your pocket within 30 days and bring you massive amounts of cash flow.
Let’s take a look at the concept first before I tell you how to do it on autopilot.
The managers
Now, I am not going to suggest that you go out there and be a property manager so you can get a few bucks a month. That’s not what I’m about. I’m an investor and I like the equity side of this business I like equity. I like cash flow, I also like down payments from tenant buyers but I don’t really like vacancy cost.
I don’t like maintenance cost and I certainly don’t like risk. So I basically put together a completely new way of doing things to eliminate all my risks, and vacancy expenses. With this method of investing, I’m skyrocketing my monthly cash flow from fewer houses.
I am finding that I am making more cash flow on fewer deals and I’m protecting the backend equity or a profit spread between my buy price and my sell price.
How am I doing it?
First things first, the marketing is still the same to find motivated sellers. I’m usually looking for killer subject to deals gorgeous in medium priced house areas. However, there really is no limit on the low side and the high side in values.
I prefer the nicer house, nicer areas typically in higher values are always going be provide a higher profit spread. The houses which are nicer sell themselves to a better quality tenant. Nicer houses mean are generally a hassle-free option.
I use a performance based lease purchase, also called a NONEXCLUSIVE OPTION agreement.
Here are the contract terms I tell them, simply add them into your contract accordingly:
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If the house is vacant, the owner covers payments in utility expenses while the manager finds a suitable tenant.
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If the rents don’t cover debt service, who eats the negative cash flow? The owner.
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My offer to them is very much the same as a property manager would offer since the owner is still the one taking the risk. It is standard for property managers to keep 10% of the collected rents as their fee.
So why in the world would they consider a real estate investor especially since I am still going negotiate a better deal??
If it’s not rented or if it is rented I have to spend some money on the property, I’m going to keep 10% additional equity when I sell it.
We will start with the how we justify a below market price for our buy price. Usually, I’m knocking my price down 12-15%. That is far from the home run but it is still a good chunk of equity. In my market where the houses are $200,000 dollar selling price, that’s a little over $30,000 at 15% spread. Averaging the retail comparable to backend out normal buy-sell expenses in this market is pretty easy to knock that that amount right out of the top. You don’t have to beat them up on the price
CLICK HERE FOR THE COST TO SELL CALCULATOR
Next, you have to average out the rents for the area. Start by averaging the rents in the in the middle of the range instead of the high end, so you can create a bigger spread. Take 10% while I negotiate a hard number.
Now what I actually collect is something totally different. I am going to marketing this property by creating a rental spread.
Remember:
- I’m not moving into them.
- I have the ability to sub-let them or sub-lease them.
- I got the right to buy it.
- I have a built-in equity spread.
- I’ve negotiated a below market rent payment.
What you do now is to go negotiate an above market rent payment and I offered on the same terms. I offered to a tenant buyer who wants to move in, can’t get finances right now, but has money for a down payment. Typically I’m getting 5-10% above market rent. When I find a tenant buyer, I put cash in my pocket with their down payment as my fee for putting the deal together.
If the house is empty, I don’t cover the expense. If the Utilities are on, I’m not paying for it. If it needs to be cleaned up if something breaks, I’m not paying for it. I pass all minor maintenance to my tenant buyer. If anything goes over that amount, I pass that on to the homeowner, absolutely no risk there.
I get big chunks of cash on the front-end, chunks of cash on the backend, I have no fix-up costs, no headaches, no lenders killing the deal in the last minute and I locking in a large profit in a declining market.
Let me leave you with one example so you can see what’s the numbers are. And this is actually a little bit below medium value in my market.
House values are between 170,000 to 190,000 dollars
Payment on this particular house was $1,200 dollars. This house sat unsold on the MLS for 10 months. The owner was careless and the house was dirty. It had been a rental property. The owner had just never gone around to clean the baseboards or clean the kitchen thoroughly.
I negotiated a purchase price of $156,000, and a $ 900 a month payment.
We then we had our cleaning crew go in there, clean up the house. I passed the bill to the seller.
Within 2 weeks, I had a tenant buyer, not the greatest down payment but we got it quick. They had 2,000 bucks in first month’s rent and they’re willing to pay the 2,000 down $1,295 a month and a purchase price of $189,900. I get a $33,000 plus profit spread. I have $395.00 dollars a month in cash flow and I’ve had up to 6 years to sell this deal.You can also choose to just walk away and let the buyer and seller finish out the contract, and simply pocket the option consideration for your deal making abilities.
For the sake of this example, I am going to stay in the deal and work to get the backend profit as quick as possible but if this goes 6 years, I’m not going be too terribly upset since I have nearly 400 bucks a month cash flow.
If my first buyer doesn’t buy, I get the house back to do this all over again. When it’s vacant, I don’t cover the expenses, I don’t cover the utilities. I will coordinate getting it cleaned up but I don’t have to do it. I don’t have to cover the expenses. As they pass back to the owner.
These deals are VERY easy to find. There are many of these types of houses for sale, and I do not see any limit in site with houses taking longer to sell now. I am getting an amazing amount of positive results.
People love the idea that offsets some of their risks. They get to write off the negative cash just like a typical earning person. That’s just another write off they’ve got. Start exploding your monthly cash flow, eliminating a lot of the risk, dealing in excellent properties which are easy to sell with this type of home ownership option, gorgeous houses you’ll be proud to manage. You make 20-30 thousand dollars on houses with no risks. It just doesn’t get any better than that. There you go. Take that, go out and buy a house and make some money.
“11 Deals In 10 Minutes”
Now, Let’s AUTOMATE THE PROCESS. This method is very inexpensive and simple to do. It’s done using the latest online voice blasting services. I call it “Dialing for Dollars”.
Below is the exact process.
Compiling the Lists :
For sale by owners (FSBOs) are an important segment of the marketplace that you cannot afford to ignore as you search for your property deal. Many times, I have found excellent fixer-upper properties from this source. Take the lead in contacting FSBOs over the telephone can now be automated and when combining it with an internet presence you have a KNOCKOUT PUNCH. What you to take you hours calling each one of these FSBO’s is now a thing of the past.!
The concept is quite simple. You are playing “match the motivated seller with hungry buyers” game. You will simply filter through all the people willing to sell you their home on a rent to own basis.
You negotiate the best deal possible
1. You can keep the house and the cash flow!
2. ASSIGN your OPTION to the Hungry Buyer and collect your fee. I suggest that the Seller sign the lease directly with the Buyer so you have NO RISK at all. All you are doing is providing a matchmaking service and using the OPTION to cover yourself and a method to collect your fee. This is great IF the deal does not cash flow. The “option” is yours!
Let’s Get Started
What’s required:
1. The Online Lead Finder software –
or
2. Get you 10 years old or VA to work from the Sunday classifieds section of your local daily newspaper, the weekly papers, Help-U-Sell listings, or For-Sale-By-Owner websites, then.
The Process
1. Create one excel spreadsheet for “FSBO” and one spreadsheet for “Property for Rent” .
2. Put the telephone numbers into the respective excel spreadsheet. Save it as a “comma delimited” ( CSV file).
3. Upload that file into you www.CallFire.com account. only 3cents a phone call
4. Record your message (script below) and then tell the system which voice file to which spreadsheet.
5. Then simply press dial and watch all the numbers being called at once. This will save you hours of time and also weed through unmotivated sellers. Use the same system to notify your hungry buyers when you have new houses available.
The usual response is to our generic voice blast offer is that 10% of these sellers call us back and asked if we will take their house payment over.
Calling FSBOs is much like many other marketing techniques—it’s a numbers game. Every call you make that is a bust gets you that much closer to the one where you hit the jackpot. Look at it like this: Let’s say you diligently spend one hour each week on this for 50 weeks. That’s 50 hours of your time. And let’s say, as a result of all your effort, you find only one deal. On this one deal, let’s assume you net only $10,000 (this should be a minimum profit target). That means that you made $200 per hour of effort. Are you making that much now in your present job?
Simple! Now go make some money.
Use www.CallFire.com – it’s free to join and only 3 cents a minute. So for 100 calls, just to test this will only be $3. Are you willing to do this to make 3 – 5 K this weekend? You will need a way to handle all the incoming calls.
* Optional – www.RealEstateTeleCenter.com You can sign up for free and try it for 30 days. After that, it’s only 34.95 a month for your very own 800 number and its UNLIMITED MINUTES for inbound calls with UNLIMITED extensions. ( you can put each house you get an extension)
Download RENT TO OWN SCRIPT HERE
Here are the supporting documents I send to Sellers
Download HERE – How to Sell Your House in 7 days,
Download Frequently Asked Questions
Download HERE – Presentation Booklet and Free Report
Download HERE – Lease Option Flyer – Brochure for Sellers
Here are the supporting documents I send to Prospective BUYERS Download HERE ,the lease option report I send to prospective buyers
Here are the forms I use to put the deal together. HERE
You may want to set up your website how I set up mine, please feel free to copy www.EasyBuyAHome.com