Reason #1: I have no cash.

The Myth: “You need money to make money in real estate.”

The Truth: Find a good real estate deal, and the money will find you. Ask any seasoned investor and they will tell you that lack of funds is never an issue; lack of good deals is! If you can negotiate a good price on a house, you will find plenty of partners willing to put up the money including transactional and hard money lenders with nothing out of your pocket.

Reason #2: I have no time.

The Myth: “I’ve got a job, a spouse, kids and very little time.”

The Truth: Throw out your television, and you’ll have all the time you need. People spend an average three hours per day in front of the tube. They spend even more time on weekends.

Want to do something fun this Saturday? Load the kids in the minivan and go driving around looking for ugly houses. Make a game out of it giving a dollar to each of your kids that spots an ugly house. Tell them that each ugly house you buy means enough money to take them all to Disney World.

Reason #3: Everyone says this stuff doesn’t work.

The Myth: “That late-night TV stuff doesn’t work.”

The Truth: You can convince yourself that anything won’t work. Henry Ford once said, “Whether you think you can or think you can’t, you are right.”  So get that out of your head because we are living proof this stuff really works!

Every real estate transaction has risks; some risks are realistic, while others are remote. If you listen to the critics, the naysayers and other pessimists, you’ll convince yourself it doesn’t work.

Most people that criticize money-making ideas need to do so for their own ego. After all, if it were true, what’s their excuse for not being successful? Make it a point of not taking financial advice from anyone who makes less than you do.

Reason #4: There’s too much competition.

The Myth: “Too many investors are buying houses to find a good deal.”

The Truth: There are more than enough deals to make everyone rich. At any given time there are hundreds of properties for sale in your market for each investor looking for them. In addition, a majority of people who say they are investors are just sitting on the sidelines waiting for something to fall in their lap. Don’t be one of them – go out and make deals happen.

Reason #5: It doesn’t work in my market.

The Myth: “It doesn’t work in my market.”

The Truth: It works in EVERY market. True, it may work differently in some markets than in others, but there are investors making money in every city, every day of the week. You have to learn your market: the pricing, the trends, the local customs, the real estate agents, other investors the title companies, etc.

Then, learn the techniques and adapt them for your market.

Reason #6: The economy

The Myth: “Certainly, the recession followed by the huge number of layoffs and the decline of the stock market stalled the economy, so anything I buy will go down in value.”

The Truth: Sell cheaper or with attractive terms. When Dell wants to move computers, they drop the price. When GM wants to move cars they offer no interest financing. Be creative and do things that make your houses sell faster.

If the prices are falling, buy way below market and sell just below market. When everyone else is “dooming and glooming”, creativity only clears out the competition.

Reason #7: Realtors won’t cooperate with me .

The Myth: “Real estate agents don’t want to cooperate with investors.”

The Truth: The right agent can be your best friend and #1 source of business. He/she will know exactly what you want and only calls you when there’s a deal.

You need to educate a few agents and let them know exactly what you want. Few agents have repeat customers – you have to make them understand that you will be giving them business over and over again.

Reason #8: I have bad credit.

The Myth: “I need good credit to buy houses.”

The Reality: Good credit helps, but you don’t need it to make money in real estate. Lease/options, owner-financing, flipping properties and other creative techniques will allow you to buy real estate without credit.

You can always use a partner who has good credit. You can also use transactional funding without having good credit. In the meantime, you can work on fixing your bad credit so you can use it as an asset in the future.

Reason #9: I might lose money.

The Myth: Real estate is very risky.

The Reality: Real estate is one of the safest investments you can buy. The stock market is beyond your control. Savings, CD’s and money market funds often don’t give you enough return to make money quickly. You have to be willing to take a calculated risk to make money.

The more you educate yourself, the less risky real estate becomes. However, don’t think you need to know EVERYTHING before taking action.

Reason #10: I don’t know what to do.

The Myth: I need to learn more before I start.

The Reality: You probably know more than enough to get started in real estate. It takes years to learn a lot. You never learn everything.

Success is an ongoing learning process. Read my books, utilize my coaching and go take MASSIVE action. Then, learn some more and take a lot more action. If you are really impatient, enlist the help of others.

Henry Ford said, “Why should I clutter my mind with general information when I have men around me who can supply any knowledge I need?” He was a smart man because he realized that he didn’t need to know it all if he could consult with others that did.

Ronald Reagan’s cabinet was said to be the team of the brightest people in politics. The bottom line is that if you want to succeed faster with less risk, have someone you can call on for knowledge.  Start building your mastermind/success team today!

My secret strategy for quickly selling properties?  Flat Fee MLS listing. That way realtors can contact you directly and you don’t need to deal with a middle-man.

Another nifty little trick I use to move my properties quickly is to give realtors an incentive to show my properties as opposed to other properties. Give them a bonus! On top of the standard 3% commission, I offer a $1,500-$2,500 bonus for the 1st realtor who brings me a deal. Talk about motivation!

Now that I’ve listed my property (with incentives), I anticipate having a buyer within the next few weeks. So check back in to see how well these selling strategies really work!

In the meantime, check out these photos of my “Spiffed & Shined” rehab job! Leave me some comments and tell me what you think!

And remember to check back in to see photos of Dixon all fixed up and to find out my nifty little selling strategy that always works like a charm!

Now here’s the real question…what do YOU think a rehab job on this 1,700 square foot house would cost??? Leave me your estimates below!

Keep checking back to see how much I paid for this rehab and to see the demolition & after pics of this house.

What was once the most pitiful house in the neighborhood is well on its way to being the hottest house on the block!

We’re almost ready to put her back on the market (at a much higher price point obviously). The walls are painted, the carpet is down, the kitchen and bathroom are near completion, and the yard is beginning to look inviting. Now all that’s left are the finishing touches.

Just scroll down to see pictures of the transformation of this ugly house to a pretty house.

Keep checking in and you’ll see how I set myself up to NEVER lose money and ALWAYS make a profit on my rehab jobs…

Leave me a comment and let me know what you think of this house!

The rehab is now under way. We’ve purchased all the materials, completely gutted the kitchen and bathroom, ripped out all the carpet, replaced drywall, prepped and primed the walls and ceiling, are replacing the interior doors and fixtures, and began landscaping the property.

As we all know, time is of the essence- so, when rehabbing, its important to get right to work as soon as you get houses under contract as you will be incurring holding costs every day. So it’s important to minimize expenses and get right to work.

Keep checking in and you’ll see how I set myself up to NEVER lose money and ALWAYS make a profit on my rehab jobs…

Scroll down, check out the pictures, and leave me a comment and let me know what you think of this house!

I’ve decided to let you ‘look over my shoulder’ to get an inside peek of an actual deal that I’m working on. I just acquired this property 11 days ago on March 12, 2011- I’ll call it the “Chelsea House”…and this house was in pretty bad shape. Your know- trash littering the yard and house, holes in the walls, 50-year-old kitchen and bath, unidentified stains on the carpets…not to mention the mysterious smells coming from who knows where.

A home in this condition often scares investors off…not me. I see this as a Gold Mine….

I’ve decided to take you through the entire process of how I purchased, rehab, and sell my homes. You will actually get to ‘look under the hood’ and watch me turn this ugly house into a big profit- in REAL TIME. Like I said, I just bought this house 11 days ago and I plan on having my contractor start the demolition THIS WEEK.  So you’ll get to see the entire transformation from start to finish.

Let me take you back to the beginning… I got a call from my classified ad in the local newspaper, “I Buy Houses”, so I proceed to do what I always do- I take some information from the seller to determine whether or not this person is motivated and if this deal is worth my time. Turns out, it is. We haven’t agreed on a price, but I know we’re in the same ballpark. So not wasting any time, I drive out to the property to meet with the seller and take a walk through the house to estimate its repairs.

The seller walked me through the home, and from what I saw, I determined that the house would probably need around $13,000 to bring it back to pristine condition. I also determine that the house would be worth around $75,000 once it was all fixed up (I came to this conclusion after I drove around the neighborhood and looked at comparable homes PRIOR to meeting the seller at his house).

So now we’re standing in front of Chelsea, and the seller tells me he wants $50,000 for the house. I’ve already done my calculations and know that my MAO (maximum allowable offer) is $37,000…so the negotiations begin. I tell him that I’ll get back to him with an offer later on that day. After 2 phone calls and some wheelin’ and dealin’, I get the house for $35,000- WIN.

Wasting no time, I get my Sales and Purchase Agreement signed and have my Title Company facilitate the closing. I know that I have the luxury of using $35,000 of my own cash to fund the purchase, but since I teach my students to never use their own money and put themselves at risk, I decided to lead by example and get a Private Lender to fund my deal.

So now the Chelsea House is mine, and its time to start bringing her back to life. My next step? Put an ad on Craigslist and start interviewing contractors. I already know my budget, so now it’s just a matter of coming to terms with someone who wants to build a working relationship with me. I interview 3 contractors, and find my Dream Team guy. We agree that the rehab can AND WILL be done for $13,000 – as I had originally suspected. We both agree that the kitchen and bath needs to be gutted, the house needs new interior and exterior paint, new carpet, some new drywall, landscaping, and a little spiff and shine. So now its time to get under way.

This brings us to today- March 23, 2011. I negotiated the sale, got a Private Lender, hired a contractor, and now we’re ready to get to work. So for the next few weeks I’ll be posting before, during, and after pictures of Chelsea’s transformation from the ugliest house in the neighborhood to the hottest house on the block!

I’m going to take you through the entire process…pictures and updates included. Stay tuned and you’ll see how I set myself up to NEVER lose money and ALWAYS make a profit on my rehab jobs…

As you move forward into the business of buying and selling houses, you’ll need to start looking at how successful investors make offers. Let’s say you already have your marketing in place. You’re getting leads, and you know how to pre-screen those leads by asking three questions:

1. Is the house pristine or neglected (pretty or ugly)?

2. Can you buy the house with immediate equity built in the day you buy it, or can you create equity?

3. What is the degree of the seller’s motivation? The way you can answer that is by looking at the WWOW:

W: What is the property WORTH (value)?

W: How much do they WANT (asking price)?

O: How much do they OWE (the loan balance, if any)?

W: WHY are they selling (their motivation)?

Let’s say a lead comes in on a property estimated to be worth $100,000 (after the house is fixed-up) by a certified appraiser, but the seller is asking for $75,000. They owe nothing on the house, and the reason they’re selling it is because it was inherited.

You’ve now got clues to answer all three of the questions above. To the seller, that house is little more than a free pile of money gifted to them from a relative. Not only are they not emotionally attached to it, but they are telling you by their asking price that they are willing to give up $25,000 worth of equity. That immediately answers questions two and three. You know you’ve got them leaning in the right direction. Their motivations are in your favor.

By looking at the average house price in the market of the lead, you can tell whether it’s a pretty house or an ugly house. In this case, let’s say the market average in that area is $200,000. With this house being below market average (because it’s only worth 100k) we would lean toward this probably being an ugly house, most likely needing some degree of repairs. Now there are really only two buying strategies when it comes to buying ugly houses-either All-Cash or Split-Fund!

The other four buying strategies are for pretty houses only because your exit strategy for getting rid of a property that you get a deed on, for example, is to owner finance or lease option that property when you sell it. You’re taking over someone else’s mortgage and then you’re going to create financing with your buyer that wraps around the mortgage that you took over. You are only going to do that with pretty houses because you’ll be selling to a higher-end buyer-they’re usually more responsible and can pay bigger down payments.

Even if you can get a super deal on a house buying all-cash, you never do it on a pretty house because there are only two ways to lose money in real estate-writing a big check to buy a house or signing your name to a big bank loan in the process of buying. Even if you could get an $800,000 house for $500,000 all-cash, you don’t violate those rules. Not that it’s out of the question that this can turn out to your benefit, but it’s rare-it’ll happen maybe once or twice in your entire career as a real estate investor, if at all. As a rule, it’s a safer bet to take an option on a pretty house rather than risk your cash.

So we’re going to focus on the all-cash strategy in this example.Since we’ve determined that it’s an ugly house, we have to consider that it will need repairs. You don’t have to be absolutely accurate about what that estimate will be. In fact, you can underestimate and still not get hurt badly because when you’re using the all-cash formula, you’ll be guaranteed to turn a profit. Based on what the owner says the house needs-new paint, carpets, minor upgrades as such-we can make a ballpark estimate that repairs will cost about $10,000. So what can you offer based on this scenario?

The maximum offer for an all cash purchase is 65% of the ARV (After-Repair Value) of the house.

That leaves a 35% profit, hedge factor, cushion, whatever you want to call it. For this example, let’s say the ARV, based on legitimate comps, confirms that the house is indeed worth $100,000. Multiply that by .65, then subtract the$10,000 in repairs, and your maximum offer would be $55,000.

The reason why we buy at 65% is because we leave open one of our selling strategies-wholesaling. When you wholesale the house to someone, you’re typically selling it to an investor who is going to buy it in cash from you, then rehab it and sell it again. When you buy at 65%, you can typically sell it fairly quickly to an investor at 70%, turning a 5% wholesale profit.

This formula only changes when you write a check and pay cash for a house when you current real estate market conditions declining in value. In such cases, you may want to lower your buying all-cash formula factor down from .65 to .50. Before you make the offer, make sure you have reliable comps on the house and include a repair estimate, a ballpark number that’s reasonably considered. Also, when making an offer, you don’t want to come out of the gate making your MAO (maximum allowable offer). You might want to start out around $48,000 in this case, or wherever you’d like, but you know that the most you will offer is your MAO of $55,000.

If we’re writing a check for anything, we’re either getting it at a great discount or we’re not doing it. As long as the ARV is correct and you factor in repairs somewhat accurately, you will never get hurt using this formula.

If there is one thing I can 100% guarantee….it’s this: Procrastination will kill your dreams.

Every week, as I speak with prospective clients who say they want to improve their lives, I am amazed by how often good people who know exactly what they need to do, choose to do absolutely NOTHING!

People will often rationalize their procrastination, without realizing that as coaches, we hear the procrastination excuses all the time… we can see them a mile away. They are the reasons like this:
- Its not the right time.
- I don’t have enough time.
- I don’t have enough money.
- I need to think about it more. (I certainly hear this one A LOT)

Do any of these statements sound familiar? Do you get easily distracted – perhaps starting a task, only to stop soon after? Is constantly procrastinating and putting things off damaging your work life, education, or FINACIAL SUCCESS? Do you wonder how some people don’t seem to have this problem?

Stopping procrastinating can be difficult, as your habits have built up over many years; they are familiar to you and have seemingly become part of who you are as an individual.

The root of the problem lies within your mind-set and self-image – your habits and behavior patterns are vastly different from those of someone who rarely, if ever, procrastinates.

Procrastinators often have anxiety or doubts about their abilities, or about the perception others have of their abilities. An underlying fear of failure or even a fear of success is very common. Often procrastinators become paralyzed by the inability to make decisions. This is a way of avoiding the accountability that comes with producing results.

You must target these negative aspects of your mind and replace them with the proactive mindset of someone who always gets things done…someone who NEVER procrastinates.

To find success, a definitive decision must be made to re-wire your mind-set and overcome procrastination.

It certainly is not easy, as it requires an honest look at underlying psychological motivations. However, with determination to reverse well-established but dysfunctional habits, procrastinators can learn to stop making things more difficult, squandering their abilities, and preventing themselves from achieving success.

What separates me from every other real estate mentor is that I not only teach how to build a successful real estate investing business, but also that I teach the “Inner Game” mindset required to overcome your fears that are sabotaging your success.

This is why I coined the phrase, “Until you own the 6 inches of Real Estate between your ears, you won’t own any Real Estate beneath your feet.”

As a coach there are few things more rewarding than helping a client get into a state of ACTION, making things happen and moving forward. If you need help to get moving, RIGHT NOW is the time to stop procrastinating and take the 1^st step towards creating a life abundant with success and wealth.

Ready to take that 1st step beyond procrastination, towards your dreams? Look to the right side of your screen under the “Special Offer” tab…Now click on it.

…..Or you could just do it tomorrow…..

I have been asked to be a part of Kenny Rushing’s “Buy American Real Estate Tour” – which will feature 23 of the top real estate gurus, who will be speaking to an audience of over 700 people! Each expert will have 30 minutes to educate the audience on what he or she believes to be their most valuable strategies for success in real estate investing.

I feel incredibly honored to have the opportunity to be a part of this event; however, I must admit that I am also really nervous! Like I said, I will be in the company of 22 other real estate investing gurus-like Than Merrill, Dave Lindahl, Lou Brown, Ted Thomas, and many more. Not to mention, I will be on stage in front of an audience of over 700 real estate hopefuls…and honestly I do not want to disappoint!

This is where YOU come in….

I am having a hard time deciding exactly what to talk about to make the biggest impact, and I need your help. I know you are an eager real estate investor who shares many of the same questions and obstacles as the guests of this conference….well, I want to know what those questions are!  This will help me decide what direction to take my lecture in.

So, if you could sit down and have a one-on-one conversation with me, what 2 questions would you like me to answer for you? What can I help you with?

Just scroll down and leave me a comment with your questions!

Since you will be helping me out, I will do my best to get all your questions answered… So make sure you check back in frequently!

It may even be easier to bookmark it: blog.timtaylorsuccesscoach.com

Thanks in advance for your input!

PS-YES, I am really serious, I do need your help!! So please tell me what you need help with, I really want to know!  Go ahead and leave me a comment!

While it is certainly true that we need to be aware, informed, and discerning about the events unfolding today, we also need to keep in mind that history is replete with examples of similar market breaks and the potential to actually profit from times like these…

In fact, the late Sir John Templeton, one of the most successful investors of all time, made billions based on his investments in countries nobody wanted to touch during the Great Depression and years leading up to WWII. More recently, commodity trader Paul Tudor Jones tripled his wealth on October 19, 1987-Black Monday-when markets around the world crashed.

We have proven examples of people who took advantage whenever everybody else was running for the hills. But we’ll never be able to maximize this truth without first realizing that fear is not the only option to respond to things that are sometimes beyond our control. The alternative is faith.

What is the difference between fear and faith? Both are products of the imagination. Certainly, when your life is in danger, fear is a useful tool in that primal fight or-flight sense. But most of us aren’t in those types of life or death situations on any regular basis. However-and more importantly-we invoke that same primal instinct just about all the time, whether it’s in response to a drop in the Dow or a challenge that presents itself in a relationship.

We know that markets go up and down all the time, just as we know that sometimes we might think the worst of someone’s intentions when it was only a simple misunderstanding. But fear can still be a natural response to both situations, even though neither is actuality based on any real danger, but rather a seeming threat to our identity, to our wants, goals, dreams-whatever matters to us most. The events, as interrupted by us, may in fact have nothing to do with reality at all. In this sense, the old acronym that fear is False Evidence Appearing Real rings true.

Faith, on the other hand, is imagination guided by intention. Faith does not react like fear does.Consistent faith creates a centeredness that says, “No matter what happens, I will find a way to make it through any challenge. I’ve done it before (and we ALL have), I can do it again, and come out even better, stronger, and more fulfilled.” Whether you believe in the concept of God or not doesn’t matter. The evidence is in nature and history itself. Change and challenge are what makes us grow and evolve. Economies have gone through these cycles. So have governments, institutions, nations, ecologies; anything that involves life. The same applies to us personally.

No one knows what the future holds, but the difference between fear and faith is that fear is imagination out of control. It grows like a virus, infecting our emotions and destroying our sense of wellbeing. Faith is imagination directed, giving us the courage to act with the intention of attaining what we really want, not just react to what’s happening-ready to accept the outcome without fearing loss. This is the strength that not only gets you through tough times, but also molds a character that prospers and endures beyond today’s challenges.

Mastering your fear doesn’t mean that it never shows up. It just means that you take control of it rather than it takes control of you. When everyone else is ducking for cover, you’ll be ready to use these times to prosper. When it comes to fear or faith, especially now, is there really a choice?

Chances are, if you’re reading this you’re looking for an edge in real estate investing. If so, sign up to receive a free 30 minute success coaching consultation and learn why 97% of real estate investors fail….and how to become part of the 3% that succeed. http://www.timtaylorsuccesscoach.com/free_consultation.php

You are blessed to be alive. Think of all the things in your life you could really make great if you played full out…Your relationship with your family, your kids, your spouse, achieving perfect health, abundant finances, happiness, laughter, and bliss. Begin your week feeling inspired, holding your head high, KNOWING you are capable of of achieving anything you set your mind to. Today is limitless.

When you don’t have your mind and fears holding you back, see what you are really capable of doing.

This kid did it, and so can you.

It’s pretty amazing what people can do when they really put their mind to it!

As stated, the SEC has many regulations that govern private lending. I’ve selected some of the most imperative ones and listed them below:
1) A promissory note is a security – which therefore requires you to be a securities broker to solicit private lenders.
2) If you want to advertise to lenders, you better be registered with your states SEC.
3) Don’t pay referral fees or commissions to find private lenders unless it is to a licensed broker.
4) Never ever use the word “guarantee” in your advertising.
5) Be sure that every lender gets a copy of your disclosure document.

* I want to pay particular attention to Rule # 5.

Once your private lender agrees to come on board, the very first thing you hand them is a disclosure document.  So, what is a disclosure document? Let’s begin by making this clear – This is a not an option item, it is an absolute MUST.

If you are ever asked by the SEC to show them your disclosure document, you had better be able to produce one, and prove that every lender got a copy of it. If you don’t have one, you need to create one immediately. Just to be on the safe side, run it by a SEC attorney to make sure it’s up to par.

Why is this disclosure document so important?

Well, all investments are risky, and you must be sure to fully communicate that to your private lender via your disclosure document.  If your private lender is not given sufficient disclosure and suffers a loss, he may have a claim against you and your business. The information you give private lenders must be comprehensive, detailed, and accurate. It is therefore important to follow the SEC’s disclosure regulations in your document.
What are some items to include?
* Your Business Plan
* Risk Factors
* Use of Proceeds

* Key Personnel and Shareholder information
* Your Company Financial Statements

Some additional points…
Your disclosure document is where you can give people access to information about your business. If you’re new to this business, give people some conservative projections of what you hope to do with the business in the future. Remember – it’s good business to under-promise and over-deliver. An understated, factual disclosure document can deliver a powerful message to private lenders.

Also, avoid obscure jargon and technical terms, and provide definitions for terms that might not be easily understood. Be simple and to the point. Your goal is not to confuse the private lender.
The bottom line is this – by giving your lender a disclosure document, it will show them exactly what to expect from their investment, which will alleviate some of their fears.

Now its time to overcome your fears of rejection, or what I like to call – “approach anxiety”. Go out and introduce yourself to prospective private lenders. Just be sure to adhere to SEC guidelines. Remember, finding and partnering with a solid private lender can be so simple – and will be the key to your financial autonomy.

* This concludes my series on Private Money Lenders – I hope you found it informative.  I’d love to hear some of your thoughts on this series…. so please scroll down and leave me a comment!

So the big question now becomes, what is all this “information”? Broadly speaking, I’m talking about your Business Plan. The ability to show your potential private lender that you have a rock solid Business Plan is the key to your financial autonomy.  You absolutely must devise a detailed summary of your overall goal, target market, acquisition strategy, marketing plan, and most importantly your financial proposal – in other words, what’s in it for the private lender.

Below is a Q & A formatted summary of some of the material that must be included in your business plan:

• What is your business model – and why do you need this person’s capital?

I Buy deeply discounted homes for cash and close within 30 days. I then Rehab and Resell the properties to motivated buyers.

• Who and/or what is your target market?

Highly motivated homeowners who are in crisis or transition and, must quickly sell their house – and for whom a traditional realtor is not the best solution. My target acquisitions, sometimes called “ugly houses,” are badly in need of repair.

• What is you buying strategy?

*  Acquisition Formula

Determine my Maximum Allowable Offer “MAO”:

1. Determine After Repaired Value “ARV”
2. Multiply ARV by .65
3. Deduct cost of repairs

Negotiations typically start about 5% under MAO. We never pay in excess of MAO; a discipline that ensures profits are built in at acquisition. My formulas and strategies are not for every seller. My business is a niche – I only serve those who are highly motivated and for whom a traditional realtor is not the best solution.

• What is your marketing plan?

The marketing plan is based on establishing market dominance in a single geographical area by applying proven methods for attracting motivated sellers in need of my fast, all cash solution.

Through my direct marketing technique and by working with Realtors, I will build up to, and sustain, 30 offers a week. In addition to making new offers each month, declined offers from previous months will be automatically resubmitted.

• What’s in it for the Private Lender?

Private money lenders will finance acquisition and rehab costs for properties purchased. Each property will have one private money lender who will receive 10-15% interest, secured by a first trust deed, processed through escrow with title and insurance. Lenders may use self-directed retirement accounts. The total value of private lender loans will not exceed 70% of the after repaired value of the house.

Tell the private lender that your goal is to become the “go to” buyer in your market, but you need his or her help before you can attain that title. Additionally, be sure to stress that your private lender will be receiving 10-15% on their investment – this is your selling point.

Ok folks, this wraps up part 2 of my 3 part series on private lending. In Part 3 I will discuss some steps that must be taken once the private lender has agreed to come on board. I will also discuss some of the regulations that govern private lender funding.

Look for part 3 on my Blog in the next few days!

**PS- I’ve been getting tons of emails in response to my articles. I deeply appreciate your input as well as your questions, but I would love for you to post them on my Blog! That way other readers can benefit from your comments, questions, and my responses too!

So scroll down to the bottom of this article and leave me a comment!

The answer?

Private Money Lenders.

Private Money Lenders and Hard Money Lenders are a different breed – so don’t confuse the two.

Private Lending became a very popular investment vehicle after interest rates declined below 5% on traditional Money Markets and CD’s.  People with extra cash started looking for a more lucrative way to invest, and obtain a higher ROI. That started the revolution that you see today regarding Private Money Lenders.

This trend toward private money will keep going strong as long as traditional interest rates remain low and traditional mortgage and hard money remains hard to get.

Although securing Private Lending seems so simple, our government decided to throw a monkey wrench into the mix. When borrowing money from another person with the promise to repay them, that “promise to pay them back” is what’s called a Promissory Note. This Note is considered a Security, and is therefore governed by the Securities and Exchange Commission.

“Why does this matter to me?” you may ask…. well, the SEC has strict rules and regulations that govern exactly how an investor can “use” a Private Lender. One being, you MUST be a licensed Security Broker to approach and proposition a Private Lender for the use of his or her capital to fund your real estate investments.

But fear not, there are exceptions!

The SEC DOES permit the average investor (someone who is not a licensed securities broker) to approach friends, family members and/or acquaintances. Here is where the loophole can be found.

What is an acquaintance?  Well, loosely defined- an acquaintance is “a person known to one, but not a close friend”. In other words, perhaps someone living in your neighborhood, someone you meet at the grocery store, or someone who is sitting next to you at a restaurant.

Now, you may not solicit a private lender for his or her money, but there is no rule against a private lender OFFERING his or her money to you. I’m sure you’re saying “yea, if it were only that easy…” Well folks, it is. The biggest obstacle standing in between you and that private money is your fear of being rejected.  All you have to do is adopt what I call, the “6 foot rule”. Any person that gets within 6 feet of me, I say this:

Tim: “Hi, my name is Tim. What’s your name?… So what do you do for a living ?”

Private Lender: “My name is John and I’m a doctor”

Tim: “Oh yea, what kind of doctor?”

Private Lender: “I’m a Neurosurgeon …”

Tim: “Neurosurgeon huh, that’s interesting…”

At this point, inevitable they will ask you what you do for a living…

Private Lender: “So Tim, what is it that you do?”

—BINGO—

They have approached YOU. Now you are free and able discuss business without fear of repercussions, because they are now an acquaintance.

Tim: “I am a real estate investor who buys and rehabs houses, and at times borrow money from private people, who are looking for better than average rates of return. I typically pay between 10-15% interest for the use of this money, which will fund my acquisition and rehab costs. Do you know anyone who would be interested in something like this?”

This is an indirect approach of talking to prospective private lenders that will eliminate the fear of asking people to lend you their money.

The financially savvy people will say something like this…

Private Lender: “Well Tim, I would actually be interested in an opportunity like that! Please tell me more!”

When they take interest in your offer, set up a meeting for a later date. Get all your material together, and show them your business model. Once you build a relationship with these people, they will become one of your biggest assets to your real estate investing business.

**Look for part 2 of this 3 part series on Private Money Lending in a few days!

***In the meantime, scroll down and give me your thoughts on my article.

It is absolutely in your best interest to search diligently for a title company that will handle this form of closing on a property, so don’t give up when you get turned down. I guarantee that you will call at least15-20 title companies before you find one that will agree to perform double closings. Many title companies will tell you that double closings are illegal. This is a common misconception.

90% of the time it’s just that the title company has a policy against doing double closings because they have been burned by so many real estate investors who have put houses under contract and had the title company perform all of the closing processes, only to have the investor back out of the deal when they couldn’t find a wholesale buyer – thus leaving the title company with incurred expenses. Another reason may be that they just don’t fully understand what a double closing is – so explain the process to them.

These days, most title companies want skin in the game and require “wet funds”, from you, to play. “Wet funds” basically mean that you’re using your own money to purchase the house. The real kicker is this – after you finally find a company that will perform a double closing, you’ll have to ask them if they’ll perform this with “dry funding”- and most will not. “Dry funding” essentially means that in an ‘A-B : B-C’ transaction, the “C” buyer will fund your ‘A-B’ deal.

Kudos to you if you can find that all-star title company that will perform double closings WITH “dry funding” because they are worth their weight in Gold.

If you were able to find a title company that performs double closings but will NOT do it with “dry funding” – fear not, because there are what’s known as Transactional Funding Companies to help us investors fund our acquisitions… (I recommend using Coastal Funding — http://www.coastal-funding.com/). These Transactional Funding Companies lend you the money to make your “A-B” transaction, and then get reimbursed immediately when your double closing “B-C” transaction is complete.

So in essence, they lend you money for 5 minutes and you pay them a minimum or $3,000 or 2% of the money borrowed (whichever is higher) out of your wholesale profits- as fee for the use of their money.

You can see why finding the right title company that’ll do “dry funded”, double closings is so worth it. Be persistent and don’t give up if the first 15 title companies reject you. Do your due diligence, it’ll make (or save) you thousands of dollars!

My New House!

Hey There!

I have some PERSONAL news that I am extremely excited to share with you!

I am usually a bit reluctant about sharing too much of my private life, but I am just bursting at the seams with this news – so I decided it’s time to share this…

After a relentless six-year search to find America’s best city to reside in, (for me anyways- a guy who loves warm weather, boats, and beaches), I decided to fulfill my dream and plant my feet in the sand in sunny Tampa, Florida.

I am absolutely beside myself with excitement for lots of reasons, but let me tell you one of them…

If you follow any of my work, you know that I teach my students to only buy properties that require no money and no credit so that you don’t put yourself at risk.

Well I practice what I preach in my own personal life!

I just acquired a 7,000 square foot, multi-million dollar, waterfront home for myself on an exclusive island in Tampa Bay- with NO MONEY DOWN & NO CREDIT REQUIREMENTS using my Lease Option Strategy. Yes, I guess I am tooting my own horn a bit – but that is only because I am so excited to show you that my strategies really do work, regardless of a home’s value.

And even though I’ve helped hundreds of people with real estate investing, having a success story of my own has piqued my interest to hear about YOUR success stories!

So now I have a simple favor to ask of you… it won’t cost you a cent, just a minute or two of your time. Just scroll down to the bottom of this article and leave me a comment. Please share your real estate success stories with me, because I would love to hear about your personal achievements.

Here’s to fulfilling your dreams!



Many of us find out, even as kids, that we can want something desperately, and then get it, only to become bored with it within days and want something different. As grown-ups, we continue to want what we think will make life better, but do we know for sure that it will be enough to make us happy?

Most people will say they want more money, for example. When you ask them why, it’s usually to buy a new house, a new car, gadgets, travel, and so on. However, a more pointed question is: “What positive experience would you associate with having more money and the things that money can provide?” The answers usually point toward the real wants: more freedom, security, peace of mind, power, pleasure-variables that also satisfy our most basic needs.

Now dig even deeper and consider: does having more money absolutely mean having more freedom, or security, or peace of mind?

Look at today’s jet-setting tabloid celebrity, whose every move is observed and scrutinized. Can they really do whatever they want without their fame and success negatively impacting their personal freedom, peace of mind, or even security? An abundance of money certainly provides thrilling opportunities, but it doesn’t always come without some kind of price to well-being. A tragic consequence of unquenchable tabloid thirst is the late Princess Diana, escaping paparazzi in her last moments of life.

Contrarily, does not having money mean you can’t have freedom, security, and peace of mind-those qualities we tend to associate with happiness? Mother Theresa certainly didn’t think so. But for the rest of us, to be honest and real, having more money will more likely open doors to greater happiness. However, we can also truthfully state that happiness is not tied solely to the amount of money you have in your bank account, or the objects it can buy.

So in the end, what are we really after? What do we really want?

What we’re really seeking is a feeling that the objects of our wants will bring. A new house can give us a sense of comfort. A new car can heighten a feeling of importance. A passionate relationship can bring us love, connection, and ecstasy. Travel and toys can invoke excitement and stave off boredom. Landing the dream job can satisfy our need to achieve and be recognized.

The point here isn’t to say that we shouldn’t want the objects and symbols we think will make us happy. There’s no reason why we shouldn’t have the best of both worlds-the material as well as those intangible feelings. However, it’s important for us to keep in mind that our happiness isn’t limited to the objects of our desires. We don’t have to wait until we get want we want in order to be happy.

We can gain those same feelings we think our material desires will give us in other ways. The more we focus on the positive experiences we want out of life, not only do we tend to produce those more frequently, but also the easier it is to produce the “things” we want. Focusing on money may not make us any more secure or free, yet focusing on producing freedom and security makes it easier to create material success to go along with the inner qualities of fulfillment.

Those feelings and experiences we’re really after are available whether we get our wants or not. Donating some free time to a cause you really care about-from coaching kids’ athletics to numerous kinds of charities-can provide feelings of security and connection among like-minded individuals, and recognition that makes you feel good about yourself for helping others, just as much as earning the income and getting all those nice toys that bring the satisfaction of achievement.

Things get damaged or destroyed. Relationships can end abruptly. Trophies can lose their luster. But when you know what it is you’re really after, you gain a greater understanding that happiness is not primarily in the object, but in the experience and feeling that is available to us now and always.

Chances are, if you’re reading this you’re looking for an edge in real estate investing. If so, sign up to receive a free 30 minute success coaching consultation..

Tim Taylor’s mentorship program offers a proven, turnkey real estate investing business system that provides you with substantial income, flexible  hours and the freedom to pursue your life’s dreams.

Think back to a time in your past-five, 10, 15, 20 years ago. You probably envisioned a happy future making more money, having fun, enjoying romance, or living in a bigger place than you did previously.

Although few things turn out perfectly, or even the way we thought they might, chances are that at least one area of your life saw some growth and improvement out of desire if not necessity. The standards of a 30-something year- old adult are going to be necessarily different than those of a late teenager. In that sense, most of us have undergone economic, social, and career upgrades.

Given today’s economic super storm, faith in the future can seem fanciful. The realities of the current climate are pretty harsh. People are losing their homes, losing their 401Ks-losing faith in their prospects for security and prosperity. “Positive thinking” is often the last thing they want to hear when they’re months behind on their mortgage, the job market tightens, and their retirement is in question. But our lives mirror the cycle of everything that ever was and ever will be-nature and the seasons, governments, bear and bull markets-the world itself. Anything that involves life and/or people is going to go through seasons. We will experience a spring-like bloom, the reaping of summer, the preparations of fall, and the chill and severity that winter brings. This unavoidable cycle occurs in our individual lives and in society as it does in nature.

We are certainly in the midst of a severe economic winter. However, if we can remember that we’ve all experienced times of growth and improvement in our individual lives after a period of lack and want, we can re-adjust back to a mindset that focuses on a future we can look forward to again. That starts with accepting and embracing the now.

This wintry economic season provides an opportunity to hibernate, recover, and start planning for the next spring ahead-the same kind of spring that gave us relief before and will bring us relief again. You can do this by:

1. Defining what you want to create

Be specific. Sometimes luck helps, but there’s no way to get what you want until you’ve defined what that is, and, just as important, why you want it. Your motivations will steer you through this winter storm.

2. Controlling your focus

Worrying does not make dire circumstances better. The problem isn’t going to change any faster by obsessing over it. Focus instead on finding solutions, and focusing on the life you’ll be living once you’ve found them.

3. Taking inventory

List those attributes that enhance the quality of your life right here and now-family, friends, the network of colleagues who might help you take that next step; resources that are helping you get by economically, mentally, emotionally, and spiritually. You might be surprised at just how many resources are at your disposal.

4. Being grateful

For every “negative” thing that may be happening to you, someone else is undergoing more pressing challenges. Gratitude has a way of dispelling fear, anxiety, and a self-defeating attitude. You can’t focus on what you don’t have when you’re grateful for what you do have.

No matter what the conditions, we’ve all made some kind of improvement before, and the truth is that we can and will do it again. How we progress isn’t solely dictated by what we don’t have, or what we might’ve done or not done in the past. It’s about how we use what we do have now, sowing seeds of growth that we can reap later.

If we can recapture the hope and faith that helped us grow throughout our lives, we position ourselves to not only survive this winter, but come out of it happier, healthier, and wealthier than before. Winters are sometimes long, but they don’t last forever. And they aren’t pervasive. Somewhere, right now, someone is enjoying summer. That’s as true for the world as it is in our individual lives. Use this time to hibernate, re-focus, heal, enjoy your blessings, and start planning your next spring now.

Interested in learning more about creating your own successful real estate investing business? If so, complete my free consultation form so I can chat with you, personally, and discuss your goals.

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www.timtaylorsuccesscoach.com Send us a client and we’ll send you a generous check!

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