Mike's Blog

What, should Realtors with kids and bills get a part time Job???

Should they consider the fact that the market is like a sharp pencil poking a balloon, and its not getting better for normal business. Working harder won't patch a hole like this, your own bills have to be paid no matter what. RIGHT??

I began pushing this mantra a year ago, and was booed off the stage for being negative...Sorry, not negative, just realistic...I was also one of the first here to talk about dealing in short sales and foreclosures, and was booed again for being a bottom feeder making a living off other peoples misfortunes...I kept paying MY BILLS THOUGH....

Fast forward to now, short sales make up a lot of the chatter here as the accepted norm, and there are tons of Realtors working in a related industry( selling cars, managing computer stores, etc)  that allows them to maintain their license and still do some business.

I still buy distressed deals, and see the names of many Realtor/Investors on the lists... Sorry, not my fault they waited to long to cut their losses.

I took a salaried job with a local developer who agreed &  opened a RE brokerage there as well. We began working strictly with cash investors and now are again ahead of the curve as NO One seems to be able to get normal loans done..However Investors with cash are rushing in now to find deals in the depressed market, and aren't buying foreclosures, but rather REOs in bulk directly from the banks, thru us.... In many markets the agents who do not find a way to create consistent cash flow will be doing a dis service to thier own credit rating and to their families...I don't see it getting better for at least a year.

While people may not like it, it wont get better until the markets clear up and come back to realistic pricing of homes that people can afford, it will continue to fall...

The new banking rules will not allow any other way to get a loan from here on........Kinda like it was for years, when you actually had to be able to afford a house before you could get a loan... Do you remember there used to be a rule of thumb that you COULD NOT EXCEED 30% of your monthly salary for a mortgage payment...

I see people, Realtors too, who are in 400,000 dollar mortgages with 50k salaries...There is no sense in whining about this, this is not a situation that can do anything but fail...This loan should never have happened. I was talking to a landscaper who wanted to see if any of my investors would pay him for his house before he lost it...Its worth about 120k, he owes over 225k...plus a credit line of over 20k for his lawn business..... Sorry friend, but your grandma would tell you not to live beyond your means.. Same goes for Realtors...find a way to pay you bills and at some point it will be a heyday in this business again...

But not right now

I continue to see posts in here that bash the agents that do not

answer the phone every time it rings... 

Wow....I am in the minority.I have an office were we have a great secretary/assistant......I have a lot of meetings, conference calls, and I have a rule that if you want to deal with me again then don't interrupt our meetings for a cell phone call. We start early to prepare for our day and have agendas to maintain or others are waiting on us..If that is too Professional or rigid, I will understand that we see business differently and leave it at that.

I have noted in my travels that the top of the heap pros DO NOT have their cell phones numbers plastered everywhere. I see them doing business on a set schedule, dealing with what makes them money and having an assistant line up the rest of the new stuff in order of priority.

I was in a Local Chamber Meeting when a well known Realtor not only took a call, but put it on speaker so that she could have both hands free to take notes.The other 45 people in the room really appreciated her interrupting the meeting. I say if you are that indispensable, I say you need to re examine how you have set up your business model.

I have had my fill of agents that stop a set appointment to take a call from ...what ever...we just had an appointment with a Realtor to discuss assigning  aprox 25 REO listings in her area.....after the 4th time she said excuse me, I have to take this call, we decided she was not organized or set up well enough to take on another 25 homes....

Has anyone but me seen the rest of the room that has to wait while one person talks to someone on a sign call, a home inspector, an angry tenant in a rental......I guess if you live in an "Its all about me World", you probalbly think everyone should wait until you are ready to give your undivided attention....that is until the next major earth shattering crisis comes ringing in.

Trust me, we do a lot of business, and if you make an appointment with our firm you will get our undivided attention. Meanwhile, our assistant is screening calls, handling faxes, and taking messages. When I do call you back I have the info needed, research done, not whispering so as not to disturb the rest of the room.

We have appointment calendars and we keep them..part of our appointment calendar is scheduled time for call backs, again when we have had time to make an intelligent decision as to the callers request for info.

Thats just my view, and I am entitled to this opinion, as others are entitled to theirs....But, maybe you should ask you current clients,  co-workers, family members and spouses...I think those that are honest with you would tell you its a bit rude to constantly interrupt them with random calls. I have learned that dealing 100% with whats in front of me is always better than trying to do a poor job of dealing with everything at once, and not giving full attention to anyone.

How do you think your family feels during the little time you spend with them and then you are constantly taking calls. Thanks hon, that was a nice lunch of not talking to ME...I look forward to doing this again...NOT!!!

Here is a new twist of what banks are doing to hold cash...they are limiting credit lines, pulling credit lines, changing dates on when your payments are due....

If you have credit cards with a low interest rate, there is a new game that is getting more prevalent...they are changing the date when your payments are due. They also are now taking up to 2 business days to post payments, and then posting after 2 pm because the new computers don't work on weekends....I actually had this line given to me!!!

I have had a line of credit with Bank Of America for quite some time, and have been known to use it. If I can use 10 grand for a deposit on a deal or some venture, then why not use it...But suddenly the payments come due on a different day every month....The only way to do this is go on an auto pay, but now the autopay has to be set up 2 months in advance and done thru the mail... I recently did an on line payment on the 12th of the month for a payment due on the 16th....it posted on the 17th and my low interest rate was removed according to a letter sent out immediately. Luckily my wife( she is so wonderful) always wants a paper copy for our files and I could reference the transaction...It showed we requested the payment on the proper day, from our Bank of AMerica account to the same bank...they said they could not guarentee to get payments posted on the same day.....Finally, two supervisors later, they relented, and put my status back to where it was, and dropped the changes...  Yes, charges...my 2.99% had gone to over 20% plus a fee for late payment....

There is no doubt that lines of credit are real problems , they can be pulled at any time. 

I had a deal not long ago where the buyer put up a hundred grand off a line of credit, the check cleared, and was then PULLED from the deposit..Yes it can happen. We thought it was impossible, but I saw this really occur.

I now am using an attorney with an automatic sweep account for any furher transactions..Its just too crazy now to wonder what these institutions are going to do.

Wachovia is not much better::On a more personal note, I just transferred 2000 to my wifes account. earlier in the day I had bought gas and bought a new blackberry. FOR MY SAFETY AND SECURITY my Wachovia bank bounced the deposit to my wifes account....apparently I am not allowed to do more than 2000 in a day without thier permission...FOR MY SAFETY AND SECURITY>>> I  told them that bouncing a check to my wife does not do much for my safety and security!!!!!!!!!!!!!!

Trust me, you really don't want to bounce a check to your wife....ANd yes, we had the money, it did not show as NSF, it said UCF-Other...  I was told that is not as bad as NSF...Excuse me...thats like telling me that getting hit in the head with front side of the hammer is better than getting hit with the claw side of the hammer...and I had to go in and sign for a waiver allowing me to do more than 2000. per day out of my account.....crazy stuff, crazy stuff

Over the last 20 years I have been involved in well over 100 remodeling jobs. Quite a few of them were my own deals. Trust me, nothing teaches you fixer-upper math like spending your own money.

More recently, I have been involved in the decision making process attatched to buying and remodeling  REOs and foreclosure homes, and most recently, short sales. I don't claim to be the final decision maker, just have been in the loop. Some of the decisions I have seen are based on guesses, based on some whim or wild estimate that does not take simple math into the process. It really is just simple math.

Those of us in Real Estate know that we cannot be all things to all people. So while I can make recommendations, based on a background of doing more remodels  than most, I certainly can't force someone to use basic math skills.

One of my first mistakes in doing remodels on my own rentals years ago was to make un-necessary repairs. My next most common mistake was buying materials like I would in my own home, such a nice carpet when vinyl would do for half the price, with twice the expected life.

I learned to always buy very good paint, plumbing, and electical supplies. There is no money saved by scrimping on these items!!

Following that was the complete and utter failure to do a room by room master plan of exactly what we planned to do,price out labor and materials,  and then stick to the plan.

Finally, I made the major mistake of trying to work the remodel into my own schedule and do much of the work myself. While I am a decent carpenter, plumber, roofer and electrician, I am not as fast or proficient as crews of experts who come in and knock the jobs out.

So, I have learned that If I ( or my clients) buy right, we can do what we do best,(make deals)  and then hire crews, get permits, and get the jobs done properly and on schedule..Maybe...Ok, maybe not on schedule, but you will have a better shot this way than trying to work on nights and weekends..

We take after repaired value vs before repaired value. the difference is of course the cost of repairs plus value added by the repairs being all done. What was that??? Example.......

Many clients cannot see the vision of the home getting all fixed up, its either done or its not..thats why a $1000.00 paint job can bring 5000 more on the  price of the house....and 10,000. less if its not done, for a spread of 15 grand. Thats a good test of if the repairs are worth making..look at the spread just like this on everything you consider replacing if its not broke.....if it brings back an anticipated higher after repaired value pricing, then by all means do the upgrade.

So, if the nieghborhood would support a price of 450k all fixed up, and actual repairs would cost 100k, then anywhere between the spread would be where you wanted to be........minus profit , commisions,holding costs and other expenses added in.

or 450k retail  x 85% wholesale minus commisons, repairs, profit, and expenses minus unexpected holding costs equals maximum bid price....and you should start lower than that by at least 10-20 %

Ok, lets get started on the Math!!!!

First, do a comp on the neighborhood. If the home you are looking at were to be in great shape, what would it be worth in the current environment?? Do the math... If it were the prettiest house on the street, all fixed up, what would it sell for fast??? This is your after repaired highest maximum value

Second, get expert bids on doing the work, room by room, and get the bids in writing on what it will take to make the home liveable, or sellable..Resist any urges to invest in expensive upgrades on rental properties, just get it clean and safe, start your bids here and then see if there is any room later to add premium touches that will be noticed.

Third. Take the costs of all the repairs, your anticipated profit, taxes, holding costs, and other expenses and subtract them from your after repaired value price. Then take another 20% off the remainder and submit your bid on the property.

If you have done your process properly, you will arrive at a price that will make money if you win the bid. If you don't win the bid, then good. Better to miss the bid than lose money on a project that is doomed to fail.

Happy Bidding........and Be careful on what you buy, its worth taking the time to get it right before you purchase!!

Who knows, but we figure differently than that.

Its another Busy day at the office Of Blount Development Group.

And we are proud to announce that we are finally direct to several banks, and have created quite a contact list.We are working with quite a few attorneys now from accross the country, it seems they hold the keys to many of the distressed assets.

Our new website at  www.AssetsClearingHouse.com has brought in another few leads from buyers agents looking for the elusive REO properties. We are also dealing in NPS and other Notes, but that is another story.

You know, the ones that can be bought for 35 cents on the current BPO, and are in my neighborhood so I can go by after lunch to look at them. I talk to all of them, and remember that there was a time when I was looking for basic knowledge as well.

But, all in all, we have found some very qualified people thru our new site, and we have deals in the works as of this moment from these people. Others are just curious, and are very interested in learning in this phone call or email what it has taken me over a year of intense research to learn.

But yesterday, I had a very nice lady who said that she was calling for her husband, and she was to get infomation and then if he was interested, he would call me back.

Poor Lady, and then she said it.   "Now, I don't want to get this wrong, so how exactly do you spell REO??"

You really hate to laugh when the other party is being so serious, but I really can't help it. In the midst of a very busy time of extremely serious conference calls and high finance, this nice woman has got my full attention now.

Gathering my composure, I say very carefully , Ok Mrs *****, do you have a pen?  ALright, Its R   E    O.  Did you get it that time? Great, I will send out a welcome packet for you and hour husband to look over, and our minimum is 5 million, so have a nice day and tell your husband we appreciate the call.

I haven't heard back.  I hope she didn't shoot her husband .

Its another Busy day at the office Of Blount Development Group.

And we are proud to announce that we are finally direct to several banks, and have created quite a contact list.We are working with quite a few attorneys now from accross the country, it seems they hold the keys to many of the distressed assets.

Our new website at  www.AssetsClearingHouse.com has brought in another few leads from buyers agents looking for the elusive REO properties. We are also dealing in NPS and other Notes, but that is another story.

You know, the ones that can be bought for 35 cents on the current BPO, and are in my neighborhood so I can go by after lunch to look at them. I talk to all of them, and remember that there was a time when I was looking for basic knowledge as well.

But, all in all, we have found some very qualified people thru our new site, and we have deals in the works as of this moment from these people. Others are just curious, and are very interested in learning in this phone call or email what it has taken me over a year of intense research to learn.

But yesterday, I had a very nice lady who said that she was calling for her husband, and she was to get infomation and then if he was interested, he would call me back.

Poor Lady, and then she said it.   "Now, I don't want to get this wrong, so how exactly do you spell REO??"

You really hate to laugh when the other party is being so serious, but I really can't help it. In the midst of a very busy time of extremely serious conference calls and high finance, this nice woman has got my full attention now.

Gathering my composure, I say very carefully , Ok Mrs *****, do you have a pen?  ALright, Its R   E    O.  Did you get it that time? Great, I will send out a welcome packet for you and hour husband to look over, and our minimum is 5 million, so have a nice day and tell your husband we appreciate the call.

I haven't heard back.  I hope she didn't shoot her husband .

Hello all

Its been a while, but DevelopersCapitalRealty.com   has gotten a make over on its old website.

Now, its not perfect yet, just much better. We have big plans, and its just in the beginning stages.....

We are working on some things, like auto responders and the contact me forms, but all in all, its a cleaner look.

We are also working on the Fla Deals page, which will showcase Fla properties and bulk purchase opportunities available to some qualified buyers.

We will soon have an auction page, full of details and final dates to get in your bids.

I will of course love to listen to any feedback.

Thanks, and I will see you at DevelopersCapitalRealty.com

Hey all you Active Rainers...I have been working on a new website.

Its just getting off the ground, and we are now getting the actual content squared away, the links working, and are looking forward to the pic tables that will actually do button rollovers , meaning that a "button will react in different ways when the mouse just rolls over the area..

We we playing with other types, but the loading times were not acceptable. The roll over buttons give just enough info for someone to get the idea, and load in apporox 1 second..Thats quick enough!

http://www.assetsclearinghouse.com

Whats http://www.assetsclearinghouse.com ?

Its a website that is and will be a source for distressed properties, notes, and REOs to be showcased in one spot. Right now, the bugs are being worked out, but its just a matter of time before the fine tuning is done.

Right now we are working on setting up more local Broker partners to work with us across the state, and soon we will be looking for partners across the country.  Lets work together to make some deals happen!!

WE HAVE GREAT NEWS.

After months of effort, We have finally gotten into a reliable source for NATIONAL REOs. We are primarily working in the FL market as of today, but we will be dealing on a national level within weeks. Like anything, its all in the details.

As of right now, accredited buyers that would be interested in acquiring great deals on below market properties should register at the website. The minimum amounts are in increments of 5-25 million, but we are working on a program that will allow smaller accredited investors to pool resources to arrive at these minimums and retain the volume discounts.

Due to laws and criteria above my pay grade, I am not going to go into these details, but your local attorney can assit in putting this together for you.  The best deals are starting at higher levels of packages, and some are down to 50% of current BPO pricing, plus fees and closing costs...

Well, back to the deals. We are very limited on what we can say about the deals until all the paperwork is completed.  If you have a client that is interested in REO bulk packages in any area of the country, and are tired of all the bull that we have all been thru, then this is the right time to get with us here.

There are very stringent protocols to go thru, please don't be offended when at some early part in the conversation where I have to ask for your email address to send you a package. Without all the Paperwork, all we can have is a nice talk about the weather.  But, with the paperwork done, we are ready to get down to serious business.

http://www.assetsclearinghouse.com

There is a contact page here for information abut you, and why you may wish to join us, or just would like to know more...fill it in and I will get back with you soon.

Earlier in the day I saw I had a comment directly from Mr Andy..For whatever reason.

he has decided to pull his persona from this humble platform.

So, to those who do not know, in the way of Prince to that symbol, Mr Andy J Lenza has gone to "Blogger To Be Named Later"

Mass deleted???? Can't you just see the souls of over 6000 little email comments  as they are purged, clinging on to that last desperate glimpse of electronic life....and then ZZZZZZZAAAPpppppppppp   its all gone...

Like the Matrix movie only without all the Goo

Its so easy, even a grandson could do it. Even a grand son with red fingernail polish from spending the morning with his twin 7 year old cousins.....  Just press the delete button boy..........it will all be gone