Ed’s Action Tips: Financing Your Deals
|Hello! We hope you enjoy our monthly newsletter and will benefit from Ed’s real estate investing tips and our students’ experiences ‘in the trenches!’
Steven Wright is a comedian of the absurd. Here are a few of his off-center observations:
• I almost had a psychic girlfriend, but she left me before we met.
• I intend to live forever—so far, so good.
• The problem with the gene pool is that there is no lifeguard.
• Plan to be spontaneous tomorrow.
• I’d kill for a Nobel Peace Prize.
• Bills travel through the mail at twice the speed of checks.
|I’m Ed Rooney, with True Apprentice and I want to give you a few real estate investing tips… just some things I’ve discovered over the years that I hope will help you, as much as they’ve helped me. So lets get started.
Lets talk about financing your houses. That’s another fear my students have. Big question mark. How do I finance the house? Where do I get the money? Hard money lenders can be found just about anywhere. Local newspapers, REIA meetings and investor clubs … but normally they want you to have some experience. If you are working with a mentor, then you are much more likely to get the loan. In most situations, I co-sign for all my students for that reason. It’s very difficult for them to get the loan without me signing with them.
The hard money lenders charge 5 points, 6 points sometimes and 8 points in the extreme. And anywhere from 10-18% I’ve seen for the interest. The note is normally 6 months, but sometimes it can be for a year.
So choose a hard money lender carefully, whether it’s 6 months or 12 months. And beware! Because at the end of the note, whether 6 months or 12 months … you must know how many extra points you could have to pay at that time or face possible foreclosure, by your hard money lender.
Students In The Trenches
“How the New EPA Regulation on Lead Paint Affects You!”
by Paul Lawrence, Rehab Manager
Q: A student asks … The EPA has a new regulation concerning lead-based paint.
Do we have to worry about that, and what do we have to do?
A: Paul responds … Yes we do have to be aware of this new regulation for houses built before 1978. The concern, though, should not frighten you away from an investment purchase. The concern can actually work to your advantage, which I’ll explain in a bit.
New rules from the U.S. Environmental Protection Agency require contractors, doing projects that disturb lead-based paint in pre-1978 homes, child-care facilities and schools to be certified in lead-paint safety practices.
“EPA is trying to make sure people who work with lead-based paint and leaded surfaces understand lead-safe work practices,” said J. Clifford Fox, assistant director of the Center for Environmental Studies at Virginia Commonwealth University.
So, the EPA now requires companies, installers and renovators to register with them, acknowledging they’ve been informed about the guidelines and will take proper procedures to address them.
As an example, window supplier/installation companies have to be class-certified, by going through a full day of training on the conditions of lead based paint.
Upon learning the age of the home, and before executing a window replacement, these companies will charge the site for doing a lead based paint test on each opening that will be disturbed. (Disturbed means that the lead based paint would be chipped or sanded in the process of doing the renovations.)
The company that does ALL my window wrap and replacements, siding and ALL our cabinet needs, will charge us a standard 1st window fee of $60.00 for outside windows. Every other ‘disturbed’ opening will only be an additional $15.00 to test for lead paint.
If the test is negative, they proceed with the installation — business as usual. If the test is positive for lead based paint, they proceed, according to the classroom instructions they learned, during certification. And then they dispose of the lead based product properly.
The same rule will apply to the interior of the home. If there is lead based paint on trims, doors and walls, you must remove and dispose of the trims, doors and jambs. And if your project will support the cost, you remove the wall boards. OR, you cover the walls with new material.
Now, back to the point above, where I said this can actually work to your advantage. The presence of lead based paint can even become a good negotiating point for you, IF you know how to use it.
Ed Rooney recognizes these conditions and many others. The former home owner will also be acutely aware of his lead paint problem, even if he pretends otherwise. Ed will capitalize on this fact and use it to demonstrate to the seller how much their home is really worth, after adding up the considerable expense of getting rid of lead based paint in the home.
So, are the EPA’s new regulations concerning lead paint to be taken seriously? You bet they are. And, if you’ve learned to be a shrewd negotiator, you’ll know how to use that ‘problem’ to your benefit.
Leave a comment/question below, and I’ll do my best to respond!
Are you REALLY Ready to Receive Success?
By Carolyn Permentier
That question may sound a little strange to you, right? “Of course, I’m ready to receive success, why do you think I’m working so hard to learn all I can in real estate investing,” you may ask?
Yet, there is a strange phenomenon that exists in millions of people. And that is deep down inside many of us don’t really believe we deserve success. And when I say ‘deep,’ I do mean deep. It’s unconscious, actually.
Do you think you suffer from an unconscious belief that somehow prevents you from being successful? Even though you’re very intelligent and have enjoyed some modicum of success in your life, does the ‘BIG WIN’ always seem to allude you … just slightly out of your reach?
Remember the line from the C&W song … “If it weren’t for bad luck, I’d have no luck at all.” Most folks, though, have no clue that they are the ones creating whatever they experience … good or bad, based on what they believe to be true.
I know, from my personal experience, this unconscious belief will wreak havoc in your life, if you don’t become aware of it and ACTIVELY re-program yourself to ACCEPT good things into your life.
Have you ever heard the ole saying, “Well, I’ll believe it when I see it!”? The truth is just the reverse, however …
You’ll see it ONLY when you believe it!
What does that mean, exactly? It means that when you know (believe) deep down, beyond a doubt, that you deserve all the good that life has to give … you will SEE it. It will manifest in your life!
It you wait and wait and keep waiting for success to come to you, without KNOWING (belief to the 10th power) it is on its way … you will never see it. NEVER!
After you KNOW you WILL be a successful real estate investor (or anything else you want), you continue to HOLD that vision, unwavering, until you create it.
This is not my rule. This is a Universal law.
If you don’t believe, deeply believe in yourself, your talents and abilities – and in your God-given right to BE successful and to have all the good to flow into your life … YOU WILL NOT SEE IT.
So believe you deserve. SEE it already done in your mind. Take ACTION toward your goal. And DON’T STOP, until you achieve it!
A great, timeless book on this subject is “Think & Grow Rich,” by Napoleon Hill. It’s a classic, withstanding the test of time because it embodies Universal truths … and they don’t go out of style!
Leave a comment/question below, and I’ll do my best to respond!
|Read what our students have to say about the True Apprentice program and how it turned ‘theory’ into money in their pockets!
Brad and Betsy Clark- Haymarket, VA
Fear is the one thing that was holding us back from becoming real estate investors. We had attended a number of seminars and bootcamps and, while we had learned a lot, Ed was the one who really got us taking action. As a very successful investor himself, Ed took us through the steps of finding, buying, rehabbing and selling our property. He even negotiated the deal for us while we were watching and learning.
Dan Oxenburg- Woodbridge, VA
Ed Rooney, what can I say? Intense, no nonsense, encyclopedic knowledge of real estate and all the tricks of the trade to make it happen and to make money. I was a cocky real estate broker, until I met Ed Rooney. We’ve been working together a little over a year and have already purchased 9 houses. And we flipped one to another investor. Ed has shown us how to market for best results, how to seek/contract with hard money lenders, how to negotiate with sellers for best results. He has also taught us how to close the deal when it’s a good one and when to walk away when it’s not. I love doing deals, with Ed Rooney. Nothing is left to chance. And, at times, he can even be fun!
May was a busy month of new student orientations.
Here are some of our new students!