Epic Real Estate Investing - The Best Use of $100,000 for Building Your Real Estate Portfolio | Financial Freedom Friday

Episode Date: September 12, 2014

Today, Matt is explaining the best use of the extra money you may have for investing, and you might be surprised at his advice. I mean, this is a real estate investing platform, so most viewers are expecting him to suggest buying couple of rental properties outright, or using the money for down payments on many different properties. But that’s not his suggestion.   And the reason why he doesn’t suggest spending your money on properties is very powerful, and is likely to shift your mindset on wealth building and financing strategies. So take it to heart and then take action on what you’ve learned. To your success!   ------- The free course is getting a facelift and the new version will be released soon! To access to the two fastest and easiest strategies to a paycheck in real estate, go to FreeRealEstateInvestingCourse.com or text “FreeCourse” to 55678. What interests you most?   E ducation P roperties  I ncome C oaching   Learn more about your ad choices. Visit megaphone.fm/adchoices

It's time for Financial Freedom Friday with Matt Terrio. Here's a scenario for you. Joe recently started building his wealth and real estate. And today he holds a few cash flowing rental properties and he has $100,000 liquid to invest. How should he best use that $100,000? What should Joe do? I mean, what do you think? Well, the most important detail of this scenario is that Joe is currently in the

wealth building phase of his real estate career. See, in the building phase, you want to get control of as much real estate as possible and responsibly leverage as much as you can by using other people's money. Other people's money, that can mean banks, it can mean hard money, private money, the existing financing on a property or seller financing, you know, whatever's not coming out of your pocket. That's what I'm talking about. You see, just because you have money doesn't mean you have to use it.

it to acquire property. You know, instead of Joe using his $100,000 to buy more property, personally, I mean, I probably hold on to the majority of that money and use it to manage the properties that he does acquire. So if you're not going to dip into your own disposable cash, whose money are you going to use? I've got some ideas for you, five of them actually. Right now, the cheapest money available today will be through the banks. I mean, it's pretty tough to beat the low rates they're currently offering. And if I could, I'd take as much of their money as they'd give me, and I'd take it right away. Now, if banks aren't an option, and even if they are, at some point they will not be, I'd start looking for seller finance deals. I mean, just look

on Craigslist. It's very simple. Or ask realtors. Every realtor you come in contact with, ask them this, do you know of any listings where the seller is willing to carry back financing? It's a very powerful question. Now, another place to look is your friends, your family, your associates who are dissatisfied with the current returns on their investments. I mean, don't you think Aunt Marge, who's earning a 0.7% on her CD would be very interested in an 8% return, or even a 6% or 4% for that matter? Yeah, I think she might. And let's not forget your own assets as a means of money. I mean, do you have any assets that are underperforming?

Do you have an old 401k that you forgot about or an IRA? How about some gold or silver line around? Maybe you have a couple jet skis in the garage that don't get used anymore. I mean, anything that you have a value that's no longer serving you or not serving you as well as it should, utilize that. And lastly, always be negotiating. I mean, your negotiating skill has actual monetary value. You can turn your intellectual currency into actual currency.

I mean, if you ask a seller a very simple question like this, what's your bottom line? And they respond back with $10,000 less than what they originally asked for, that's $10,000 you don't have to leverage. Or perhaps a combination of any of the five things I just mentioned. Here's where it gets really creative and fun. Let's say, for example, Joe goes out and he finds a single family home with an owner who's willing to seller finance 60%. Well, if he negotiates that up to 70%, then he sells the jet skis for an additional 10%, and then Ant Marge decides to step in and finance the remaining 20%.

Joe's now got 100% financing and control of another cash flowing property in his portfolio, doesn't he? Yes, and he still has his $100,000 in the bank, right? Maybe he uses a couple grand of that to improve the place a bit and then puts, I don't know, another 3,000 into a separate bank account for incidentals. now Joe is out of pocket just say $5,000 and he's sleeping very well at night knowing everything's taken care of and he's got ownership of another property.

Then tomorrow he can get up and go do it all over again. I mean, right now, if you're building your wealth, you want to get your hands on as much property as possible using as little of your own money as possible. And keep a good chunk of cash in the bank to back up the properties that you do acquire. I mean, you'll rest easy knowing that your assets are covered, and you can continue to build your wealth until it's time for phase two.

That would be preservation of the wealth that you've created, which is a conversation for another episode. Anyway, that's what I would do if I were in Joe's shoes. And I don't know, what would you do? Maybe you want to do the same thing. And if you do, maybe you don't know where to start. Well, try taking a trip over to cash flow savvy. Start there.

Click on the Hot Properties tab, and take a look at our current seller-financed income properties. no banks involved, positive cash flow from day one. So check that out. Maybe it's for you, maybe it's not. I don't know. You tell me. Cashflow savvy.com.

I'm Matt Terry of Epic Real Estate, and I'll see you next week on another episode of Financial Freedom Friday. This podcast is a part of the C-suite Radio Network. For more top business podcasts, visit c-sweetradio.com.