By Simply Doing These Simple Things I’ve Been Getting So Much Real Estate Business – Local Records Office

LOCAL RECORDS OFFICE – LOS ANGELES, CA – When I first started in the business I loved doing fix and flips, but wasn’t so keen on selling houses to strangers. I sold enough houses to get by, and focused on the flips since those were much more fun. I always thought it would be smart to buy rental properties, but I was young and not very good at saving money.

 

Then in 2008, I started selling REOs and completing broker price opinions for banks. I loved the REO side of selling houses and I have become very successful at it the last few years. I am a HUD listing broker as well and love HUD, I can’t buy HUD homes myself, but I have a great article on how investors can great deals ion HUD homes here. I think the reason I love REO is because I can communicate through email and I am a natural introvert (another popular forum discussion). With REO came more money, more savings and a desire to grow that money into something more. I did a lot of research on franchises, business, the stock market, bonds and decided rental properties were the best investment out there.

 

When I was doing fix and flips with my father, we bought most of our properties at the public trustee auction and it did not matter if we had our Real Estate license or not. When we sold our homes, we saved 3% on each transaction, because we did not have to pay a listing agent a commission.   When I started buying rental properties for myself in 2010, I bought everything off MLS and saved a commission on each purchase.   We are buying more flips off the MLS now as well, we are now saving a commission on the buy side and the sell side.

By Simply Doing These Simple Things I_ve Been Getting So Much Real Estate Business – Local Records Office 1

Even though we save a ton of money on commissions by being agent that is not the biggest advantage to having a Real Estate license. The biggest advantage is having a huge advantage buying properties over those that do not have a license.

 

Saving Money on Commissions

 

I will take you through an example of how much we save on a typical flip. The savings is similar on a long-term rental purchase, except there won’t be any commission on the sale since we are holding the property. Let’s assume we purchased a flip on an REO property for $100,000, fixed it up and then sold it for $170,000.   The bank offered a 3% commission to the Real Estate agent that represented the buyer on this property. Sometimes banks do not like it when the buyer is also the Real Estate agent and they may have stipulations they won’t pay a commission in these instances.   We use an LLC to purchase our flips and my dad will usually sign for the LLC and I will be the agent on the deal. That way the agent is different than the end purchaser and the bank will pay a commission.

 

On the purchase end we can structure the deal so we get paid $3,000 for our commission or we will waive our commission and pay $3,000 less for the property. The benefit to getting the $3,000 is the extra cash in our pockets for repairs or other investments. The benefit to reducing the price is, we won’t have to count the commission as income and pay taxes on it. It saves money in the long run to reduce the price if that is an option.   However, many brokers will only allow agents to take no commissions on one or two deals a year. We can do it as much as we want, since we are on a 100% split and the monthly fee brokerages may allow you to make as many no commission deals as you want as well.

 

On the sell side we save the 3% as well since we are the listing agents and do not have to pay someone else to sell the property for us. Again, commission are negotiable and you may be charged more or less for an agent to sell your home.   Three percent of $180k is $5,400 that we save by not hiring another agent. We structure this as a no commission deal, since we will not have to pay taxes on the income again.   Total savings is $8,400 on this one deal alone. We flip about ten homes a year, and it is easy to see we save a lot of money by being agents.

 

Finding Deals

 

The biggest reason I would suggest every Real Estate investor get their license is because of the advantage it provides when finding deals. I still buy most of my long-term rentals off of MLS and we buy flips on MLS as well. We purchase short sales, a few REOs and even a few fair market sales off the MLS system. As an agent I have access to MLS and an investor without their license does not. Most properties listed in MLS are listed on other sites like Zillow, Realtor.com and others, but the information is not as accurate or updated as quickly.

 

If I were not an agent, my time frame for making an offer would be much longer. I would have to do more work to find new listings on Zillow or another website. Once I found a great deal, I would have to contact my agent. I would have to wait for them to find time to set up the showing and show me the property. Then I would have to wait for them to write the contract and I would have to come in and sign the contract, before it was submitted. I have to hope they understand they importance of time and getting that offer in ASAP. Even if they are a super fast, great agent, it may take them half a day or an entire day to get all that done. Someone else could have already submitted an offer and had it accepted before my offer was submitted.

Knowledge of the Market

 

As a Real Estate agent MLS also provides me with a wealth of sold information. I can look up sales from 10 years ago if I want to, as long as the sale was completed through MLS. MLS is a great tool for me to determine value quickly, and easily.   I am also constantly around houses as a Realtor, I am constantly determining values for my sellers and buyers and I almost always know the market without having to pull up sold info. Knowing values is the most important thing for a Real Estate investor to know an being a Real Estate agent gives me a huge advantage.

 

Connections in the Business

 

As a Real Estate agent I am constantly talking to lenders, other agents, title companies, buyers and sellers. I found my portfolio lender, because other agents referred me to them. My portfolio lender is awesome and will give me as many loans as I want as long as I qualify. That may change at some point, but without them I would be struggling to finance properties, especially now that I have 10 mortgages.

 

Other agents have referred me to sellers looking to get out of their homes, because they know we buy flips. I know the best title companies, the best lenders and the best Realtors. I also know which companies and Realtors to steer clear of, because they may kill a deal with their incompetence.

 

Disadvantages to Being an Agent

 

There are some disadvantages to having a Real Estate license and being an investor.

 

The biggest one for me, is I am limited to what houses I can purchase, but this won’t apply to 99% of agents. Since I am a HUD broker I cannot buy any HUD homes no matter who has them listed. None of my immediate family or any agents and their immediate family can buy a HUD home either. Bank of America will not allow me to buy any of their listings or even short sales because I list REO for them. There are a few other companies I work with that have the same policies and I can never buy an REO that I have listed. It is a clear conflict of interest for me to purchase I home I listed that I determined value on for the banks.

 

  • I have to disclose I am Realtor when I market to sellers. I don’t think this is a big disadvantage, but some people on the forums think they get a better response if they are not an agent.

 

  • Some people feel a code of ethics is too restricting for Real Estate investing, I do not feel this way. If you are a Real Estate agent, it is easier for buyers or sellers to file a complaint against you with Real Estate commission or whatever body governs Real Estate in your area.

 

  • The biggest reason most do not get their license is the cost and time it takes. Getting a license is not easy in most states, it takes hours and hours of classes and tests and the tests are not easy. Once an agent has their license, they have to take continuing education, keep insurance, pay for MLS, pay board dues, pay to hang their license or split their commission.

 

 

Conclusion

 

It can cost thousands of dollars a year to be a licensed Real Estate agent, but one or tow deals a year will easily make up for that money. Not only are you saving commissions, but the biggest advantage is the deal you get, because you were faster than everyone else. To a flipper, one deal can mean $20k, $30k, $40k or more in profits. To an investor buying long-term rentals, one deal can mean thousands of dollars a year in cash flow.

The House That the Dealer Abandoned – Local Records Office

LOS ANGELES – Once upon a time there was this 3 bedroom, 1 bathroom rancher set back from a busy road in an extremely desirable area of town. The home, purchased for $289,000 two years before at the peak of the market, was barely worth what the owners had paid for it. But the owners, a lovely husband and wife, had found themselves having to move away and sell the home.

 

The realtor, wanting her clients to come out ahead on the deal after they paid her commission initially listed the home for $329,000 at the start of 2010.

 

For Sale

 

This home, with its striking red door, caught our attention the minute the “For Sale” sign went up but we didn’t pay much attention to it until a few months later we noticed the sign said “Price Reduced!”

 

We pulled over so I could call the realtor. The realtor explained that the property was now reduced to $319,000. We made arrangements to see the property the next morning.

 

We went and viewed the home, and while it is in good condition, showed very well and was one of the lowest priced homes in the area, it’s only a 3 bedrooms and 1 bathroom home. Having a second bathroom is pretty important in this market. But the price, for that area, was interesting. I asked a lot of questions and discovered that the sellers would probably go to $305,000 because the realtor had agreed to cut her commission so they could still make money on the deal. Turns out, she’s the one that sold them the home at the peak of the market.

 

I told the realtor we could probably do something around the $300,000 mark – maybe $305,000 – if the seller would be willing to carry a second mortgage on the property for us.

 

After a long chat, we left, and she agreed to contact me about the second mortgage option.

 

A few days later, I actually sent HER an email to follow up because I hadn’t heard from her. She said that VTB’s are hard for people to understand. I wasn’t sure if that meant that the sellers wouldn’t do it or if she had even talked with them about the option. Either way, it didn’t sound like $300,000 was a go for them.

 

The market really started to move in late March and early April but still, the home sat there. On April 8th, the price dropped to $309,900. I didn’t hear from the realtor before the price dropped but I didn’t think anything of it since I had made it clear that I was only going to play at $300,000.

 

How the Realtor Lost the Deal

 

Here’s the kicker though … and here’s where the real estate agent really failed to make this deal happen:

In May the list price dropped down to $299,000.

My phone didn’t ring. My inbox didn’t fill up with emails from her. I didn’t hear a thing. Of course, we follow the market closely so we knew it had dropped, but most folks wouldn’t know that. Yet, she never bothered to call. She had my business card; we had exchanged phone calls and emails. She should have had my contact information. But I didn’t hear a single thing from her.

 

By this time we had our hands full with 3 other deals so I wasn’t about to chase this one down. Instead, we kept an eye on it.

 

But then something sad happened last week … something I have seen happen so many times … the sellers changed real estate agents and the new agent listed the home at $284,000 with the caption “PRICED TO SELL”!

 

Is the Home Sold?

 

So this poor home that we would have considered buying at $300,000 is now probably going to sell for $278,000. And at that price, it’s under it’s market value. But it will sell down there for the simple reason that the market has slowed down again and now everyone looking at it is wondering why it’s been on the market for nearly 6 months when it’s in such a good area!!

 

The sellers are going to take a loss, the realtor that tried to sell it won’t make a penny, and the whole story could have ended differently if only she’d made one single phone call.

 

There’s a Japanese proverb that says, “Money grows on the trees of persistence“. Or, put another way, money rots on the trees of laziness. I can’t say for sure we would have purchased it … but I know Dave, my husband and investing partner, was pretty keen on this home. And if she would have called I can guarantee she would have had an offer in her hand at the very least.

 

Instead she lost the listing, and she lost me. I won’t ever deal with her and I certainly would never recommend anyone I know use her.

 

This is a great failing on her part, and she’s not the first to make this mistake. My Grandma’s words ring through my head reminding me that this home wasn’t meant to be for us which is why she never called. I couldn’t agree more. Even now, at such a low price, I am tempted but not that tempted, for the simple reason that it’s going to be tough to rent out with only one bathroom. So it wasn’t meant to be for me, but who was looking out for the sellers?

 

Follow Up

 

In the short term a single phone call could mean the difference between doing a deal or not doing a deal. In the long run it’s your reputation and your deals at stake.

 

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The Smelliest House I Blindly Invested In – Local Records Office

The story of the worst house I’ve came across in my life . . . Some of the articles I have written lately have been on topics of a more serious nature so I thought I would write about an abandoned house that I discovered a few years ago that was so unbelievable…. Well it was unbelievable. I thought I would tell this true story to show the lighter side to the business.

Fishy Smell That Would Give You a Headache

I was out searching for abandoned houses with my cousin, Peter Christenson, one hot summer day in July of 2016. I remember the temperature was over 100 and that meant that any abandoned house we found would be extremely hot inside. Inspecting the upstairs of a 2-story house, with no air conditioning, in the dead of a Texas summer, well that’s just not something they glorify on the infomercials. The house we happened upon is a perfect example of one of those properties you never hear about on TV.

Abandoned House With the Smell of Death

We found a house that we determined was abandoned. When we got about 10 feet from the door, we had to step back because there was one of the most foul, unpleasant odors coming from the inside…And we could smell it from outside. All the windows and doors were closed and it still smelled something awful.

We had to take turns running in the house, while holding our breath, to open a window and then run back out to gasp for fresh air. We both ran in & out of the house for an hour or so and yet the stench was still present. Airing the house out was not working so after another 30 minutes, we decided to run to Home Depot and buy some respirators so we could get in and inspect the house without gagging.

We opened up every closet door, every cabinet door and looked just about anywhere we could think of where the smell could be coming from. The house was totally empty but we began to think that the previous occupants had maybe buried an animal nearby or maybe they had buried a dead body under the house. It was such a horrible smell that our curiosities had us determined to find the source of it all.

Searching for the Smell

After we had searched just about every inch of the house and still came up with nothing, we looked at the ceiling and then we looked over at each other, eye to eye and without saying a word we set out to find the access to the attic. Since I was the lighter of the two of us, he propped me up and I got up through the hole and into the attic. I reached back for Peter and pulled him up through the hole. It was HOT up there! I’m not sure what the temperature was but I am sure it was in excess of 125 degrees.

We slowly started to crawl across the ceiling joists with our spotlights. We got across the main part of the house and came up to a double wall that separated the garage from the rest of the house. The open void between the two walls was about three to four inches of open space. When I got directly over the void and looked down with my spotlight… I froze right there after seeing what the light was revealing. I slowly looked over at my cousin, who had also stopped dead in his tracks. He slowly looked up and over at me and then rolled his eyes back down into the wall void. We had found the source of one of the most god-awful odors we had ever encountered.

It seems the previous occupants wanted to go out while leaving a statement. Something that would really get the attention of anyone that set foot in the house after they left.

Smell We Couldn’t Escape

It got our attention! The occupants had gone through the considerable trouble of getting up in to the attic, crawling across the ceiling joists to get to the void in the wall. At that point, they had actually dumped thousands and thousands of…. FISH! Yes, FISH! Tons of them! None of them were really that big but most of them were the size of Sunfish. We couldn’t believe it. It must have taken them weeks to haul that much fish up into the attic to dump between the walls. That was the only way anyone could have got anything into that space.

We came down out of the attic and went to talk to the neighbors. They told us that the house had been vacant since March and it was July when we discovered the house. That was a good five months for all that fish to fester and bake in the hot Texas heat.

Criminal Charges?

We later learned that the lender had pressed criminal charges against the previous owners because what they had actually done was intentionally destroy the property.

The fish had been in the house long enough for the smell to penetrate every part of it and it was eventually bulldozed because to get the smell out, all the drywall and the wood in the frame would have had to be removed and replaced. I guess the insurance adjuster figured it was a total loss.

Conclusion

Experiences like that, is why I love real estate. There are no two houses alike. And anytime I think I have seen it all…. I stumble upon a house like the “Fish House” and think to myself… “Wait ‘til everyone hears about this one!” So the next time you happen upon a house where something seems “fishy” grab your flashlight and go look in the attic.

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What Do Real Estate Realtors REALLY Do? Local Records Office

LOCAL RECORDS OFFICE: Being a Real Estate Agent is interesting work; every day is different often with new clients and different properties, says, ‘Local Records Office’. But what exactly do Real Estate Agents do? Well this article will shed some light on the topic.

A Realtor’s job starts with meeting people. After a client relationship is created then the responsibilities depend on if the client is a home seller, buyer or both. Whichever the case maybe, there is a lengthy list of tasks that must be met.

What Do Real Estate Agents Professionals Do?

Local Records Office says, “There are many ways in which a client relationship can be made, probably the most common is by referral”. This is when a person tells a friend or family member about a positive experience they had buying or selling a home with a real estate professional. This source is often the strongest and easiest way for an agent to meet a client.

Other methods involve more work, financial investment, and time and may not have as strong results. Some of these methods include but are not limited to cold calling, hosting open houses, and knocking on doors, mailing literature, social media and more. To give you an understanding of how these processes work I will explain a scenario. Say a Realtor has a home to sell in an area he or she would like to do more sales says, ‘Local Records Office’. A common course of action would be to hold the home open on weekends so that neighbors and other interested parties can see the home and get the seller maximum exposure. Once the property is sold, the agent will assemble a “Just Sold” post card and mail it to every home in the neighborhood. The agent would be wise to sort out property owners, tenants, land lords then have every piece of mail address each individual accordingly. Once the mailer has arrived the agent may choose to walk the neighborhood and knock on doors introducing them self to people and talk about real estate. Through this process the agent is hoping to meet more people and develop relationships in the community.

The Relationship Between Agents and Clients

Once a client, agent relationship is established it must be determined what the client’s real estate goals are and how the Realtor can best help. If the client is looking to sell then a listing presentation is put together and entails the agent compiling a group of like properties that are for sale and recently sold in the area. With this information what is known as a CMA can be made. This tool is used to derive a value for the subject home. Once the client has decided to hire the agent then the contract and other disclosures must be compiled and signed. The sellers must disclose anything that could be considered a negative attribute for the home of the immediate area. And anything about real estate agents relationships, which could be confusing to the general public, must also be disclosed. Once all the paper work is done the agent and seller can develop a strategy to show case the home says, Local Records Office. This plan will involve things like possibly painting the home, cleaning the carpet, removing items, staging the home and figuring out when and how the home can be shown to prospective buyers.

Real Estate and Escrow Companies

When a home seller receives an accepted offer then an account must be opened with an escrow company to hold any money involved in the transaction. Generally speaking the homebuyer and seller will each have their own realtor representing them. Each party will have to coordinate on their client’s behalf. Things that will require attention during this time are a home inspection, termite inspection, negotiating repairs, an appraisal will need to be conducted and a final walk through of the property by the buyers says, ‘Local Records Office’. After all conditions have been satisfied then each Realtor will review the payments escrow will be responsible for and confirm the figures. Among many other things this is what a Realtors job consists of.