Real Estate Mailbag

A Concerned Son Writes In

Dear Mailbag

My parents have been trying to sell their house for about a year now. They have had some interest, but nothing very solid. For the first several months they listed the house with an agent, but after getting very few leads they tried the FSBO route. Now they have gone back to another agent and are beginning to get more and more frustrated. The house itself is very nice and located in a GREAT area. Do you have any suggestions to help get the house sold??

Thanks

Concerned Son

Dear Concerned:

Tryingto sell a house in a relatively flat market can be a difficult and frustrating experience.  As such, it is important to ask yourself(or your parents, in this case) if there are factors that are prohibiting a quick sale.  Some things to consider are:

1) Is the house overpriced comparable to other properties in the neighborhood?

2) Does the house show well?

3) What marketing strategies are being employed to generate interest in the home?

These are questions that should be asked to the realtor directly.  Additionally, it is important to point out that a house which is priced appropriately SHOULD sell in a reasonable period of time(read: 90 - 180 days).  However, it also depends on the caliber of realtor that is being used.

Some things to think about are as follows:

1) Are you using the most powerful realtor that you can?  I have found that using the top ranked local realtor can assist in generating sales interest.

2) Another possible avenue of exploration is to consider the 'Five Day' sale, as outlined in Bill Effros' book "How to Sell Your Home in 5 Days" by Workman Press.  This book outlines an interesting auction strategy for selling single family homes.  Be warned, though: the steps are very specific regarding making the sale and the process leading up to the sale.  I once tried to sell a house using this system for a colleague and he refused to follow the rules - and he failed.

There are many alternative approaches you can take to working on selling your home.  If it is priced competitively and shows well you should be seeing some activity.  Take time to consult with respected local professionals and see what tweaking can be done to help your parents selling performace.  Good luck!

The Bag

Just Getting Started

Dear Bag

I'm getting started in real estate investing and have been reading a lot of books.  My credit is good, and I have some cash to invest but not a lot.   I've just joined a real estate investing association but I need something to get me going.

Any advice?   

Rookie

Dear Rookie:

Congratulations on your decision to get involved with investment real estate.  This decision is not one to be taken lightly.  The most important step is to join your local REIA, which you have already done - this will prove to be an invaluable source of information for you as you journey down the path of making your first investments.  Also, remember that your REIA is a great place to learn and, more importantly, to ask questions from people who are more experienced than you.  This can help you avpid making painful errors that other people have made before you.

Now, as far as getting started, I would take a look at a Single Family Residence, or what is essentially called a 'rental home'.  This conservative investment is easy to manage because:

1) It is in demand by renters, and therefore easy to rent

2) There is an ample supply of homes in the US today of this type, allowing you better chances of finding a superior 'deal'.

3) It is easy to insure and manage.

When you are looking for your first investment, I found that there is a great guide that helps you evaluate properties and try to hit a home run with your first deal - check it out at www.realestatepowercourse.com.  This guide gives you all of the parameters that you need to acquire superior rental proeprty in a low - risk and hassle free manner.

Good Luck!

The Bag

Missed Payments

Recently, I got this message from a concerned reader in Memphis.

Dear Bag

I'm a real estate investor.  My wife pays the bills and I just got turned down for a loan because the lender said one of my mortgages is reporting 60 days late.   Now I've never had a late payment before and I'm deeply concerned.  What are my options here? 

                                                               Worried

Dear Worried:

I am guessing from your message that your wife probably 'forgot' to send in those pesky mortgage payment.  If this is the case, the first thing I would do is open a bottle of good wine, and don't worry: you can toast all of your on - time payments as your good credit score waves goodbye to you.  It should only drop about 200 points minimum, nothing to be TOO concerned about.

As far as your wife goes, ask the following questions:

1) Why did you miss the payment?

2) How do you plan on 'handling' this?

3) Do you plan on taking care of all of the family finances from now on since I cannot get a loan for the next two years? And if so, will you be getting a second job since YOUR credit is still unblemished?

Other than that, I have heard you can call your lender and beg them to take it off your credit report.  Good luck with that.  Alternatively, you can give them back all of your houses and flee to Panama.  Anita's Pizza by the Exodar bookstore on Villa Espana still has 80 cent beers and 3 dollar pizzas.

Cheers!

The Bag

Mobile Home Query

Dear Bag:

Someone once told me that you are an expert in paper mache, as well as real estate.  Is this true?  And do you really love to buy and sell mobile homes?   How can this be profitable?

                                                                           SIncerely,

                                                                    Mobile Home Investigator

Dear Mobile:

While I did fail most of my elementary school education, I truly do love the feel of paper mache on my bag strap.  Also, I do feel mobile home secondary paper can be an incredibly profitable way to get into real estate investing with minimal cash and substantial returns.  Check out www.lonniescruggs,com, the undisputed master of mobile homes, to get the skinny on mobile home paper.

The Bag

The Bag Gets Personal

My days are made interesting because of the readers who send in interesting mail and questions that may not be real estate related, but nevertheless allows me to show a more personal side of being a bag.  Consider:

Dear Bag:

I think you are so insightful and witty.  I have been looking for someone as suave and refined as you.  Are you single?  And, which Latin Amercian country do you prefer, Panama or Columbia?

                                                                                 SIncerely, Bagless

Dear Bagless

Thank you for your observations, I am,in fact, both insightful and witty.  I am single as well, as single as a bag can be.  And of course, Columbia is truly a land of exotic treasures, although Panama has a rich and varied history as well.  Recently, I was in Panama City for a two week stay.  Check out Casino Fiesta in the El Congrejo district on a Saturday Night for a rocking good time.  Also, La Bodeguita on Calle Uruguay has some special surprises as well.

                                                                                       The Bag

From The Bag

Thanks for coming to the site, and Welcome to The Real Estate Mailbag!  Why would we put a site together that is strictly for answering questions from users?  Simple - today's real estate world is ever changing, and a full - time on duty mailbag is waht people need.  Didn't you know that?  I mean, imagine if it is 3 AM and you and your spouse just had an argument over money and finances.  You think you have no one to talk to, but wait:  the mailbag is always available!  Consider this letter that recently came in:

Dear Bag:

Hey, I am glad you are up - I feel like you are my only friend right now, it is 3 AM and my wife and I are having an argument.  My wife says that, to be a real estate investor, you need cash or credit, which both of us don't have.  But, we want to get out of debt and stop worrying about finances and bills.  Is this possible?   Or is real estate investing limited for only the chosen wealthy few?

                                                                                                     Looking For Answers

Dear Looking:

The fact that you are up at 3 AM is good: you are obviously concerned about your finances and that is step one.  While many people want to think that you need cash and credit to get into real estate investing, that is simply not true. One of the simplest ways to get into real estate investing is through wholeslaing of houses, whcih is where you find greatly discounted properties and resell them to other investors who are looking for deals.  Without getting into too much detail, a wholeslaer can make anywhere from 2k - 10k per deal if they structure it properly.  The only problem is that you need to study with some good wholeslalers if you want to try this approach and be effective.

Other ways you can get started with no cash and no credit is through 'bird dogging'(finding deals for investors for a nominal fee), property management(you can rent houses for an upfront fee plus monthly residual, although you may need a license) or buying and selling 'notes', which are mortgage paper secured by real estate.  Check out charterfinancial.com for a great home study course on note buying.  Additionally, you could just find a 'money partner' to assist with your finances while you are getting on your feet and trying to buy your first imvestment.

The most important thing is to join your local REIA, or Real Estate Investor Association.  Eductaion and exposure to more experienced investors is the path to success.

Hope This Helps!

The Bag

Welcome To Real Estate Mailbag!!!

Real Estate Mailbag is your ONE source for all of your real estate questions answered. It provides a forum for users to generate questions, add comments and techniques on acquisition strategies, and more importantly, to get a humorous perspective on what can be at times a very serious business. Look at our articles and archives to search for a specific topic, or just enjoy our daily mailbag from our readers who are investors of all experience levels. Regardless of your question, The Bag has the answers.