Let’s Talk About Income
Income is an important element of any good investment… without it, you have to carry costs such as taxes, insurance, and any interest expense out of your pocket. When you rent to someone else, they cover all those costs plus a return on your investment. But here’s the big news… your income is hedged against inflation. As the value of the dollar declines and prices rise, so does your rental income. If you have fixed costs such as interest on the loan, you benefit from paying back the debt with deflating dollars while your income goes up. And it gets better!
Watch this short video and learn from Lou different strategies on becoming a successful Street Smart Real Estate Investor.
For more valuable information click on this link and watch the complete episode: https://youtu.be/29AjGTLwvdg – “Why Real Estate Is I.D.E.A.L. – “I” = Income – Part One”
If you are JUST getting started in real estate investing, you NEED to attend my ONE-DAY virtual training. I teach it LIVE over ZOOM, and it’s only $1 (yes, one dollar) for SIX HOURS of solid how-to training! https://www.wealthbuilderworkshop.online
If you’re ready for a more in-depth experience, then you owe it to yourself to investigate my THREE- DAY Millionaire Jumpstart Event. I host it four times a year in various locations, and you can attend LIVE and in person. I’m your coach all three days. Find out more at https://millionairejumpstart.com/
You’ll discover how to start investing in real estate (or do it easier and more profitably) at either Wealth Builder Workshop or Millionaire Jumpstart.
Here is an overview of my proven and practical approach to investing in real estate.
* Money Making Secret #1: Getting Motivated Sellers to Call You! No more calling unmotivated sellers and getting rejected more times than a geek for the high school prom!
I’ll show you how for over 28 years, I’ve been able to get deals brought to me and motivated sellers hunting me down to give me their house.
* Money Making Secret #2: The Art of Structuring Deals! I’ve been doing this for 40 years and I love to share how I get sellers to give me the house, a check, and even a jet ski or two.
* Money Making Secret #3: Negotiating Secrets Revealed! I love to negotiate, just ask Matt, one of my hand-picked coaches. We recently went to an estate sale and he witnessed me structuring a deal to buy the house and contents right there on the spot.
* Money Making Secret #4: Trusts Simplified! A little confused on this entire Trust thing? Why to do it? How to do “Subject-To” safely? I’m going to show you my new fundamentals of Trusts training that will simplify the concept of Trusts, so a 9-year-old child can understand it.
* Money Making Secret #5: Develop a Plan for Success in Real Estate. The wealthiest man ever to walk the earth left clues for us on how he amassed his great wealth and kept it.
How to Help People While Helping Yourself – Become a Certified Affordable Housing Provider™
Create Your 10 Million Dollar Retirement Plan – specific formula revealed
Learn Hidden Profits Available in ANY Deal – worth thousand$
How to Take Over the Seller’s Loan with NO Money
How to Have the Seller PAY YOU to Buy Their Home – no kidding!
Buying Without Bank Loans – over forty years and never one bank loan!!
Easy Ways to LEGALLY Raise Big Money for Your Deals
Renovations – Quick Ways to Safely Make Huge Cash Now
Money-Making Management Secrets from a 40 year veteran who manages over 150 now
Accelerating Your Cash Flow – Add built-in “Profit Centers” – extra hundred$ per month
Case Studies: Secrets of How They Were Found, Negotiated and Sold
How to Protect Your Deal from Someone Else Stealing it
Legally Pay ZERO Taxes on Your Real Estate Portfolio – simple structure worth thousands
Having Tenants Leave Your Property in Better Condition than When You Gave It to Them
Why Land and Personal Property Trusts are the Best Privacy and Asset Protection
Benefits of Trusts You Cannot Get With ANY Other Entity
The Due-on-Sale Clause – What it is and How to Avoid it Legally And MUCH More
Need help deciding which power-packed “one-of-a-kind” training on making money in real estate investing is best for you!
Call 1-800-578-8580 or visit us online at https://www.streetsmartinvestor.com
Listen to our Podcast:
Street Smart Real Estate Investing With Lou Brown
Lou Brown:
It was just so exciting and we showed a lot of folks how they could shift and change their lives and have a whole new way to do their business. And I thought I’d give an example today of what happened. Now, while I was looking at a book that I did some years ago, which is “Walking With The Wise In Real Estate Investor.” There I am a few years back, but it’s interesting who is in this book, too. Oh, look, it’s Donald Trump when he was a real estate investor. That’s how old this book is. And Dan Kennedy and just some really cool people from my past and certainly who I learned some great things from. And in this book, I actually had a chapter called “Real Estate Is The IDEAL Real Estate Investment.”
And why do I call it “IDEAL?” I, for Income. D, for Depreciation. E, for Equity buildup. A, for Appreciation. And L, for Leverage, such as for levering your ability to buy more real estate. So we love the idea of the IDEAL real estate investment. So I thought, “Hey, why don’t I do a 5-part series on each one of these items?” because each one has so much value, and it’s so unique to real estate investing because many things that we can do in real estate, we cannot do in other industries or other investments. So when you take the combination of all the different benefits of real estate, you find that it’s the ideal thing to do. Well this week, I’m talking about Income. And of course I’m a big believer in income being the foundation of a very solid business. Why? Because your bills come due every single month, right?
So every single month, one thing you gotta have is income, or you got to have a pile of money to pay those bills that come due. Well, imagine that our entire business revolves around creating multiple streams of income and in fact, dependable, predictable, monthly income. And so that’s kind of our mantra. And when you build your business in a certain way, service-oriented, helping others solve a problem that they’ve got in their world, creates income potentially for you. Well, I’ll give you a great example of what I mean by that. So in our world, we have the Path To Home Ownership. We’re Certified Affordable Housing Providers, and we offer a program called the Path To Home Ownership. And I had a gentleman come to me and he was from Vietnam. Now he didn’t speak any English. So he had an interpreter with him and he found out more about our program.
Well, we had a particular property, it was a new build. It was in a nice area. He saw the house. He said, “I want that house.” And it was available on our Path To Home Ownership plan. Well, when we are acting as the bank for our buyer, then we require a minimum of 10% down of the value of the property. So sure enough, he says, “I can do that.” So we said, “Well, tell us more about your business.” Of course, we have an application process, and we always want to verify that the party that we’re dealing with has dependable, predictable, monthly income themselves because we always want to put people on a success path, not a failure path. We always want to make sure that they can actually afford the place that they’re moving into. Well, sure enough, he owned 2 nail salons. Ladies, are you kidding me?
Wow! There is a lot of money going through the doors of the nail salon. So sure enough, as we’re getting into it, I explained to him that he’s got to have a minimum of 10% now. So the purchase price, the price that we put on this beautiful brick home in a very nice neighborhood was $425,000. Now this was way back in January of 2013. So January of 2013, he came to me and said, “Yes, I’m interested in this property.” We said, “Okay, we’ve got it on our Path To Home Ownership. We’re going to provide financing for you with a minimum of 10% down.” So in this case, that meant $42,500. A little, quick side note, he actually tried to bring me about half of that. And I said, “Nope. But, we can work with you. And we can take that amount,” which let’s say that was the $20,000.
“We can take that amount and put it towards a rent-to-own plan, but we cannot give you the in-house financing program until you bring $42,500.” He says, “Okay, wait, I’ll be back.” Well, sure enough, he comes back with the entire amount. So we were able to close and he was able to purchase property from us on our agreement-for-deed program. So sure enough, he went ahead and put his $42,500 down. And then he began making monthly payments. Now his monthly payments were $3,200.79 plus taxes and insurance on top of that. But as far as principal and interest, that’s what he was paying us. Well, what happened last week, we get a call and we’re getting paid off. Well, we actually knew that he had to put the property on the market for sale, and they called us and contacted us for a payoff of his agreement-for-deed.
So sure enough, after he made his 100th payment. Now that means he paid us for 8 years and 3 months. So basically 8.3 months, he paid us $3,200.79. So that was pretty cool. And what was interesting with the payoff is that’s another payoff of, I believe it’s $368,401.93. So, wait a minute. So we sold him the property for $425,000. He paid us $42,500 down. Now in our world, one of the things we talk about in income is bits and pieces and hunks and chunks. So in our world, the $42,500, that was a hunk of money, right? And then every month, that was a piece of money, the $3,200 coming in every month and the chunk of money, the final money was the payoff of the loan. Well, when you add together his original downpayment, plus his monthly payments accumulated over that 100th payment and the payoff of the loan, you get a grand total of $730,980.93.
So what’s very interesting about this in the income scenario is that I could have sold that property. I could have sold it for cash. Someone could have paid me off. I would have made some profit on that deal. However, because I put it in my Path To Home Ownership program, now we had a great income for a long period of time. So this gentleman that could not even speak English, had the opportunity in this country to be able to purchase a home from someone like myself, someone like you as a Certified Affordable Housing Provider, blessing someone else whose hard work and causing things to happen, causing income, causing their business, hiring people, putting them to work because of that, he was able to live in a very nice home and he was able to enjoy that home now for the last 8 years. Well, what’s the upshot of this whole deal is he sold the property for even more.
So this gentleman, we’ll call him Mr. Vietnam because I don’t have permission from him yet to use his name, but Mr. Vietnam was able to sell this home for $100,000 more. So, in other words, he got almost $500,000 for this property. He was able to get a very, very nice markup on those 500 and something thousand, I don’t have the exact number that he sold it to the new buyer for, but that gave him down payment money. That gave him a big spread to be able to put on another property. Unfortunately, he didn’t ask us for another property. So I’m sure he went and bought something else. But imagine what’s happened in this 8 years, he’s now built up his credit. He’s built up his downpayment. He was able to be in a position to buy anything he wanted to.
And it’s all because of our Path To Home Ownership program. So I love sharing with you today about the Income aspect of real estate and I think you’ll agree with me that the Buy-Hold-Sell strategy is a very great strategy. And when you get a chance, you need to pick up my book. By the way, I’ll give you a $5 off coupon, and you can go to www.StreetSmartWiz.com/BHSbook. And that will get you $5 off if you’re interested in the book, “Buy, Hold, Sell.” It’s an Amazon.com international bestseller and I’d love for you to have a copy of that and a discounted copy of that, too. So definitely you can take advantage of that and learn some more about what I believe is the Ideal Investment.
No comments:
Post a Comment