Epic Real Estate Investing - EPREI 006 : Is It Stealing Your Opportunity, Also?

Episode Date: July 6, 2011

What you don't know can rob you of everything you're working so hard to build. Awareness is power! On this episode, Matt reveals every beginning investor's biggest obstacle and how to bust through it. Learn more about your ad choices. Visit megaphone.fm/adchoices

Epic Real Estate Investing Podcast, episode six. You're about to meet a man that can show you how he took control of his life and financial future and how you can do the same. He's never been on TV. He's not a millionaire, and he does not know Donald Trump. He is a full-time real estate investor, newly discovered offer, and family man. He does not report to a boss. He creates his own schedule and takes his family on a few vacations every year.

He got started investing in real estate with almost no money in a really crummy credit score, and he's going to show you exactly how he did it and how he continues to do it. You will have to work. You will have to be responsible. However, laying by the beach sipping fruity drinks is a reasonable goal without further delay. Your guru. Sorry. Your guide to a better life through real estate investing. Matt Terrio.

Hello and greetings from the Epic Real Estate Investing podcast, the podcast that will show you how to create wealth through conventional and creative real estate investing, so you will have the option to realistically retire in the next 10 years or less and enjoy the good life while you're still young enough to do so. My name is Matt Terrio, author, full-time real estate investor, and family man. This is your first time listening to the show. You'll want to do two things. One, go back and listen to episode one to get the gist of what the show is about and why we're here.

Everything we discuss is going to make a lot more sense after you do that. And two, download the free real estate investing course, how to do deals, no money required, at free real estate investing course.com. It's a step-by-step course of which I reveal everything that I do, everything that I say, everything that I use, including the documents and contracts to invest in real estate using no money or credit. and that's yours for free at free real estate investing course.com. Okay, so up until last episode, we haven't got into any real nuts and bolts yet, but we will.

We'll cover a lot of how to on this podcast. We'll discuss multiple strategies as well, both acquisition and exit strategies, some conventional but mostly creative. You know, to me, that's the fun part. When you can acquire real estate using more terms and less money. I mean, real estate investing gets really, really fun when you start to figure out all the different ways that a different way, that a deal can be put together, and it makes for good stories too.

But regardless of what your real estate investing strategy will ultimately be, all of the strategies have four steps in common. Step one, you have to find the deal. Step two, you have to analyze the deal. Step three, you have to secure the deal. You have to put under contract. And step four, you have to find the money in close. It's very simple, and it's very straightforward.

However, most investors, they have a tendency to let one thing get in their way. the one thing that messes everything else up. And it's often the biggest obstacle for investors, one that literally stops them dead in their tracks. They focus on step four. Find the money in close. They focus on it with such intensity and regularity that they never actually take the first three steps.

Or even step one for that matter. They never even attempt to find a deal because they're waiting for their funding source to appear. They don't have an answer to the money question. I mean, they're so concerned that they do. don't have the money or they won't be able to find the money and close their deal that they never take that first step. They never look for a deal. Well, they may look for a deal, but they have no intent of taking any action until they know where they'll get the money to buy the property.

They'll say things like, if I only had the money or if I could only find a private investor, I mean, I could really take charge of this market. I hear those types of things being said all the time. What they don't understand is that the money is much easier to find if they'd only take the first three steps. If they'd actually go out and find the deal, if they'd actually go out and analyze the deal, and if they'd actually go out and put the property under contract, if they'd go out and secure the deal. If they would just take those first three steps, they could take charge of their market. You know, there's a really good reason that we're on episode six of this podcast, and just last episode did we actually get into some how-toes, how to generate leads and find deals. And here's why.

Although I say real estate investing ain't easy. I say that a lot. I know I do. That's really not the truth. It is easy. I mean, all you have to do is just go out and find a deal, open escrow, and close escrow. It's that easy. And I can show you how to do all of that in a matter of minutes. I mean, I can show you how to write that yellow letter in 30 seconds. I can show you how to place an ad on Craigslist probably even faster. What makes real estate investing difficult is the reason why you won't get up every day and do it. It's your thinking. It's your mindset. It's your fears that make real estate investing difficult. That's why I've touched so much on mindset up to this point.

I've talked so much about your thinking. I've talked so much about personal development. You see, I can teach you how to knock on a pre-foreclosure door in about 15 seconds. But it can take weeks, months, or even years for your fears to disappear, if they ever do, so you'll actually go out and knock on that door and do it again and again and again so that you actually get results. The reason why most won't do that has nothing to do with them not knowing how. It has everything to do with their things.

It has everything to do with their mindset and with their fears. It's their fears that stop them from doing what they know. You know, after teaching real estate investing for a while and trying different approaches of getting people to get out of their own way, I discovered a significant area where the breakdown and communication had been. I discovered that they actually didn't understand their rights as a buyer. They didn't understand how they're protected by the purchase agreement. They didn't understand how they could structure their deal so that they could virtually

eliminate their risk and liability in a deal. I mean, their fear was disguised as basically unfamiliarity with the purchase agreement. And because they're unfamiliar with the purchase agreement, they lack a strategy or a complete plan. And when you don't have a plan, I mean, it's no wonder so few experience any success in real estate investing.

Most people are literally paralyzed by the unknown. So I took those four basic steps that I mentioned in the beginning and I created an acronym for them of which incorporates not only those four states, but a system and a strategy as well. It's an overall approach to doing deals that can eliminate a great deal of the fear that stops most investors. It's an overall approach to doing deals of which I call the epic approach.

Now, the E stands for, evaluate and decide. And what that means is to conduct a preliminary evaluation of a deal, to determine an initial opinion of value, initial opinion of value, and to decide based off of that initial initial opinion, decide if there's potentially a deal there to be had or not. And that's it for the first step. This is not the time to conduct your thorough due diligence. Just determine an initial opinion of value of the deal and then decide whether there is potential for you to make some money or not.

If there's not, move on to the next deal. Don't waste your time there. Don't go into a deep property analysis trying to squeeze out a few nickels and dimes because you want that deal to happen. Either there is a deal there or there's not. Don't be emotionally attached. And don't waste your time there if there's no potential for you to make some decent money there. It's not worth your time.

There's plenty of deals out there. If there is some potential, then move on to the next step. The P in our epic approach stands for, present and get consent. Now, if you've established that there is a potential to make some money, write up an offer and present it. Simple. And I show you exactly how simple it is to do that inside the free real estate investing course, how to do deals, no money required. And we'll discuss us some more.

but for now I want you to understand the intent. The intent is not to execute this deal right now. The intent is to get the property under contract. Once you're under contract with a seller, you have control. And a lot of investors, particularly new investors, don't understand the amount of control that they have. It's like this. Imagine you have a painting that you want to put up for auction,

and you have your choice of two auction houses. Auction House A has been in business for several years, and anytime they have an auction, they have a minimum of 1,000 people in the auction house to place bids. Very successful auction house. Auction house A. Now, auction house B, they just opened up for business. In fact, this is going to be their very first auction,

and they only have one person on their mailing list. So they can promise you that one person at your auction. So as the seller of your painting, which auction house would you want to represent your painting? Auction House A, right? they're going to have at least 1,000 people in attendance to bid on your painting. And when you have those types of numbers, you have competition. And when there's competition, the price of your painting is going to be driven up,

getting you a great price for your painting. So you would definitely go with auction house A as the seller of the painting. But what if you were the buyer of the painting? Which auction house would you hope got the gig of selling the painting? Well, as a buyer, you'd want to be an auction house B, right? I mean, there's no competition there. You're likely to be the only person in the auction house. And if you are, you can essentially name your price for the painting and get a great deal.

So what does this have to do with getting a property under contract? Well, you see, as the buyer, when that property isn't under contract, you are in auction house A, where all the competition is. I mean, there's competition everywhere, and the competition is going to drive up that price. So as a buyer, you're not going to get a good deal in auction house A. However, once you put the property under contract, you just move from auction house A to auction house B. You've essentially eliminated your competition. You've locked them out.

The seller can't enter a contract with anyone else while they're in contract with you. And since they can't, now is when you can move to the next step. The I in our epic approach stands for investigate and negotiate. Investigate meaning more frequently referred to as due diligence, meaning investigate the property. Investigate it physically, investigate its title, investigate the neighborhood, investigate in greater detail of the market conditions, and based on what you find, you can go back for a second round of negotiating. Yes, just because you're under contract doesn't mean you can't negotiate four concessions.

You can still negotiate. And what's so great about this round of negotiations is, you're the only one in the auction house. No competition from other buyers. And I'll show you exactly how to do that, but I want you to really get the intent here. The intent here is to get the property under contract so that you can now take your time during your due diligence without outside pressure, without outside competition. You see, if you conducted all this intensive due diligence in the beginning,

someone could have snuck in and stole the property right from you while you're still trying to figure it out. That's why you want to put it under contract. And you can conduct your due diligence. You can take your time without the outside pressure or distractions. The seller can't back out. The seller has to deal with you. because you're in contract.

You, however, come back out any time that you want. That's where the fear of the unknown comes in, or that's where the unknown creates fear, I should say, where most investors don't realize that they have that type of power. I mean, if you have the CYA clause in your agreement, of which reads,

this contract is contingent upon the buyer having the right to, one, inspect all aspects of the property that would directly or indirectly affect its value, and two, engage a professional inspector or inspectors to determine the structure and condition of the house. The inspection reports must be satisfactory to buyer, or all deposit monies will be immediately refunded and all contract obligations considered null and void. The inspections shall be conducted and the contingency concluded within 14 working days from the date of acceptance of this contract. Any removal of contingencies must be in writing.

That clause right there, that C-Y-A clause, pretty much says you can cancel this contract for any reason that you want whenever you want inside of those 14 days. You can back out at any time because of that clause. And you don't need to rewind and write that down. I included it in How to Do Deals, no money required. There is a document there of which you can just simply copy and paste it into your contracts. But with this clause in place, you are never at risk. And we'll cover that more in the very near future. but once you've completed your investigation and you've renegotiated a final price and terms,

you can then now move on to the C of the epic acronym. Coming with the cash and close the deal. But don't worry about where you're going to find the cash right now. I know, easy for me to say, guess it is, but it's easy for you to say too, as I will show you how to find it. I promise that I won't leave you hang it. But that is the entire point of this episode today. Don't worry about it. And just go out there and find some deals.

Go out there and analyze the deals. and then start putting those deals under contract. I mean, if you have your CYA clause in place, you have nothing to lose, and you have everything to gain. So just follow these steps one at a time. Travel those first 200 feet, and when you get there, you'll see the next 200 feet. Have some faith.

I've been there, I've done that. I wouldn't steer you wrong. And if this just isn't clicking for you, well, let me ask you, how's the alternative working? I'll walk you through each step. Just keep moving at the speed of instruction. It's that simple. and you'll see how the money you may or may not need.

That's a hint, by the way. You might not even need any money at the end. How that money will almost magically take care of itself. And if you're skeptical on how this is going to play out, good. Skepticism is the beginning of faith. And faith makes all things possible. It's your faith that will eventually turn into belief. And belief?

It's a force multiplier. I'm going to take you as far as you can see. and when you get there, you will see further. So next episode, we'll start working our way through the epic approach in detail and get into the details of how to. We'll take it from the top and discuss the E of the epic approach

and discuss it in great detail on how to evaluate and decide, how to tell whether you have a good deal or not, and how to tell if you got that good deal or not and do it in a matter of minutes. It's in the evaluation where fortunes are made or lost. Until next time, and as a very wise man once said,

for those who believe no proof is necessary, for those who don't believe, no proof is possible. To your success, I'm Matt Terrio, living the dream. Thank you for spending this time with Matt Terrio and the epic real estate investing podcast. When you have a moment, stop by iTunes to leave your comments and let us know what you think of the show.

And if you haven't done so already, Get started investing today by visiting free real estate investing course.com. To access Matt's free course, how to do deals, no money required. Until next time, to your success. This podcast is a part of the C-suite Radio Network. For more top business podcasts, visit c-sweetradio.com.