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The article below is from the LA Times and Professor Brent T. White is echoing my thoughts on upside down loans/mortgages.  If you are upside down on real estate you should consider walking away. Do not look at it emotionally… it needs to be a business decision.  He touches on the ego and moral issues that the lender uses but it is even easier than that to describe… when the loan was taken out the agreement was if the borrower did not make the payments the lender would foreclose on the house and trash your credit (and possibly pursue shortages depending on the state you live in).  But the reality is most lenders are not chasing foreclosure shortages because it does not make financial sense. So the deal was if you don’t pay they get the house and trash your credit and if you are down 50k, 100K, 250K the best deal you can take may be to let the house be foreclosed.

Big Legal Disclaimer: I’m not an attorney nor do I give financial advice, etc. Consult an attorney, accountant, psychic, OBGYN or anybody else you deem necessary to help you make the right decisions.

Enjoy,

Gerald Romine

Professor advises underwater homeowners to walk away from mortgages

Brent T. White, a University of Arizona law school professor, says that it’s in the homeowners’ best financial interest to stiff their lenders and that it’s not immoral to do so.

Reporting from Washington -

Go ahead. Break the chains. Stop paying on your mortgage if you owe more than the house is worth. And most important: Don’t feel guilty about it. Don’t think you’re doing something morally wrong.

That’s the incendiary core message of a new academic paper by Brent T. White, a University of Arizona law school professor, titled “Underwater and Not Walking Away: Shame, Fear and the Social Management of the Housing Crisis.”

White contends that far more of the estimated 15 million U.S. homeowners who are underwater on their mortgages should stiff their lenders and take a hike.

Doing so, he suggests, could save some of them hundreds of thousands of dollars that they “have no reasonable prospect of recouping” in the years ahead. Plus the penalties are nowhere near as painful or long-lasting as they might assume, he says.

“Homeowners should be walking away in droves,” White said. “But they aren’t. And it’s not because the financial costs of foreclosure outweigh the benefits.”

Sure, credit scores get whacked when you walk away, he acknowledges. But as long as you stay current with other creditors, “one can have a good credit rating again — meaning above 660 — within two years after a foreclosure.”

Better yet, homeowners can default “strategically”: Buy all the major items they’ll need for the next couple of years — a new car, even a new house — just before they pull the plug on their current mortgage lender.

“Most individuals should be able to plan in advance for a few years of limited credit,” White said, with minimal disruptions to their lifestyles.

What kind of law school professorial advice is this? Aren’t mortgages legal contracts? In so-called anti-deficiency states such as California and Arizona, mortgage lenders have limited or no legal rights to pursue defaulting homeowners’ assets beyond the house itself, White said. In other states, lenders may decide that it is not worth the legal expense to pursue walkaways, or consumers may be able to find flaws in the mortgage documents, disclosures or underwriting to challenge the original contract.

The main point, he said, is that too often people’s emotions get in the way of clear financial thinking about mortgages, turning them into what he calls “woodheads” — “individuals who choose not to act in their own self-interest.” Most owners are too worried about feelings of shame and embarrassment after a foreclosure, and ignore the powerful financial reasons for doing so.

Buttressing these emotions is a system that White labels “the social control of the housing crisis” — pressures and messages continually sent to consumers by the “social control agents,” namely banks, government and the media. The mantra that these agents — all the way up to President Obama — pound into owners’ heads, White said, is that “voluntarily defaulting on a mortgage is immoral.”

Yet there is an inherent imbalance in the borrower-lender relationship that makes this morality message unfair to consumers, White says: Banks set the rules during the housing boom, handing out home loans with no down payments, no income checks and inflated appraisals. Now that property values have dropped 20% to 50% in many areas, banks have been slow to modify troubled mortgages and reluctant to reduce principal debts.

Only when homeowners cut through the emotional fog and default strategically in large numbers, White argues, will this inequitable situation be seriously addressed.

How does White’s 52-page manifesto go over with mortgage lenders? Predictably, not well. Officials at Fannie Mae and Freddie Mac — investors who fund the bulk of all new mortgages in the country — disputed White’s characterization of how quickly after foreclosure a walkaway borrower can obtain a new loan. It’s not three years, they said, it’s a minimum of five years, absent extenuating circumstances such as medical or employment problems that caused the foreclosure.

“Borrowers who walk away from their mortgage obligations face serious consequences,” including severely depressed credit scores for extended periods, said Brian Faith of Fannie Mae.

In addition, he said, “there’s a moral dimension to this as homeowners who simply abandon their homes contribute to the destabilization of their neighborhood and community.”

The markets are coming back quickly and the statistics in my market show things are turning very quickly!  Areas that were tanking just 3-6 months ago have heated up and are not the fastest moving segments on the market.  Truly unbelievable.

While forecasting results is a guessing game the statistics don’t lie. Business Week’s article PENDING HOME SALES RISE FOR THIRD STRAIGHT MONTH is further proof that the markets are now coming back.

To summarize the article:

• Low interest rates are pushing sales
• First time homebuyers are active
• The Northeast is the hottest geographic region
• The only decrease in sales was in the South region
• “The market has already bottomed in some areas.”

What we are seeing in the markets is that a bottom is forming! This “floor” is likely to represent the bottom of staggeringly low levels and present a phenomenal opportunity to buy real estate at prices we are unlikely to see ever again.

Three Super Simplistic Steps For Success

1.      Start looking for houses.
You have to learn your market and there is no substitute for getting active and looking at houses. See what is available.

2.      Determine values.
Right now home values are all over the board and this can be very confusing.  As a buyer you want to focus on the best buys which are currently REO’s and pre-foreclosures (short sale investing).  To determine the best buys in the market start by looking at REO listings which should be the lowest priced properties for sale in the area and serve as a benchmark for the lowest comps you can find. You’ll want to buy at or below the recent sales of those homes.

3.      Line Up Your Money.
Even if you are flipping or wholesaling houses you may need to line up your conventional, private, or hard money.  If you’re looking to live in the house yourself get qualified with a lender. If you need private or hard money line it and be ready to go.

With those three steps in place you are ready to start evaluating deals and making offers.  If you are buying property as an investment make sure you are buying based on your CASH ON CASH RETURN. More investing knowledge can be found in “Real Estate Magic 101 - How To Get Rich In Real Estate Even If You’re Dead Broke!”

Author: Gerald Romine

About The Author:

Gerald Romine is a nationally recognized real estate expert that has been featured across North America sharing the stage with political leaders, film stars, and business leaders. Since 1989, Gerald has been involved with real estate as a real estate agent, broker, rehabber, investor, and builder and has been involved with everything from houses to apartments. For more information about Gerald’s products or services visit www.kickassrealestate.com

This post is about the past, and the future…

Starting with the past is was just a few short years ago that real estate investing was all the rage and everybody was doing it. It was a fad and it seemed as if you could buy anything, mark up the price, and turn it for a quick profit.

During these times everybody buying and selling was making money and seemed to be a genius. Over time people started to realize that investing fundamentals were being broken and a chain reaction ensued… and the bottom fell out of the real estate market.

Loans dried up faster than a desert oasis. Properties stopped selling quickly. Builders stopped building. And then people stopped making payments… then foreclosures… then REOs… and then prices started falling faster than a bad souffle (yeah… the “Kick Ass” guy used the word souffle)!

What began as a strong real estate market quickly turned into a buyer’s market and the housing market has taken down the US Economy. The idiots running Washington are clueless and if you are thinking they have any answers then know that I believe in Darwinism (survival of the fittest) and am hopeful your gene pool is heading towards extinction.

So the real estate markets have changed, new challenges have risen, and a new market is upon us.

Yes, we are in a buyer’s market but the question is for how long?

The Future. Have We Hit The Bottom?

Phoenix Arizona is one of the hardest hit falling real estate markets in the US and there is evidence that we have reached the bottom.

Let’s be clear… I do not believe in forecasting(guessing) so for me to even put in print that we may have reached a bottom is huge.

Here’s what I’m seeing that leads me to believe the bottom may have been reached:

1. Prices are trending up. Especially for properties under 200K

2. Inventory is decreasing. In the last 60 days their has been a major shift if inventory. Unbelievable.

3. REO’s are stabilizing. One agent I know of is getting an average of 8 offers per REO and people are in price wars.

When looking at the various stats for the market one thing has become evident… The markets are changing and strengthening very quickly. Even builders are coming back and Maricopa County (Phoenix) is seeing a rise in building permits.

And that’s why I’m so excited to share this news with you… The markets are changing and you need to participate if you are going to take advantage of what may be the end of the biggest buying opportunity we have ever seen.

It is very likely that we are at or just past the bottom right now. And if we are things then watch out when the lenders make it easy to get money again because their will be a surge in buyers!

Author: Gerald Romine

About The Author:
Gerald Romine is a nationally recognized real estate expert that has been featured across North America sharing the stage with political leaders, film stars, and business leaders. Since 1989, Gerald has been involved with real estate as a real estate agent, broker, rehabber, investor, and builder and has been involved with everything from houses to apartments. For more information about Gerald’s products or services visit www.kickassrealestate.com

Some get it and some don’t! The metaphors are flying (and appropriate) so let’s get right into it. Sorry, I couldn’t help myself.

There are a lot of useful comparisons between real estate investing and sex so we are going to have a candid article with the intention of furthering your success as a real estate investor. If you’re a little squeamish you might want to surf to your next real estate investing website.

Great sex isn’t easy… ask anyone who has been the recipient of a mediocre experience. The concept is simple enough but the reality is most people are not very good and never will be unless they take the time to study and learn. Not surprisingly the better you are, the more success you will have, the better you will become, and you will become experienced and successful.   In fact, when you become skilled at your craft there will be no shortage or opportunities.

Same principle applies to real estate investing - you may be able to go out and get lucky once in awhile but if you want to have long term success you are going to need to learn how to solve the seller’s needs. In other words, you are going to need to have a specialized knowledge. Having the advice of knowledge from someone who has the investing experience is the quickest way to learn and become profitable as a real estate investor.

There is a famous Zen saying that is very appropriate: “To know and not to do is to not yet know.”  Whether we are talking about sex or real estate investing theory is not enough… you need to get out there and take action.  With real estate investing many people have dabbled in it a little bit but those that are truly successful have earned their success because they take action consistently as well as increase their investing knowledge.

Unfortunately there is a lot of misinformation and scams which can complicate things for those wanting to learn real estate investing. First, you should understand that all businesses involve selling and that includes those businesses selling real estate information or your business as a real estate investor.  In fact almost everything you do involves selling in one form or another and even a person working a 9-5 job is selling their time for money and the resume that got them the job was selling their benefits as an employee.

Who should you learn from? Who should you trust? Should you invest money? How much?  Those are all tough questions but the first thing I would tell you to do is to ask yourself “how much of your time and effort are you willing to commit to your success?”  If you are unwilling to commit a set amount of time and effort to yourself then don’t buy any book, course or system because if you are unwilling to work then no matter what you touch it will not work either!

But, if you are the type of person that is willing to make a commitment and take action then following a good “guru” will likely produce good results.  If you were new to real estate investing and asked if my books, courses, or software would make you successful  I would tell you that I believe unequivocally in my products and that they could help you but YOUR success is ultimately up to you.

It all comes down to common sense.  You might consider reading Real Estate Magic 101, How To Get Rich In Real Estate Even If You Are Dead Broke because that will give you a ton of information for a very low cost.  Then, if you are successful with that information and have results you may want to consider other tools and resources because they will likely give you even more success.  Another option before you spend any money is to sign up for a person’s free newsletter and real estate investing tips and get a feel for what the person is about.

In conclusion sex and real estate have a lot in common because what you put into it you will get out of it.  Nobody is great to start with but the skills and knowledge can be learned and with practice you can become an expert.

About The Author:

Gerald Romine is a nationally recognized real estate expert that has been featured across North America sharing the stage with political leaders, film stars, and business leaders. Since 1989, Gerald has been involved with real estate as a real estate agent, broker, rehabber, investor, and builder and has been involved with everything from houses to apartments. For more information about Gerald’s products or services visit www.kickassrealestate.com

It’s been almost 10 years since I’ve gone to visit my Mother in Oregon so last week I decided to show up un-announced. My Mom is a hard German woman who shows very little emotion and this really surprised her in a good way.

While in Oregon I was able to visit what many call the 8th Wonder of the World - Crater Lake. It’s absolutely beautiful!

If you’d like to check out some amazing pictures they are posted in my Facebook account. Just search for Gerald Romine.

My Mother is a real estate broker and Klamath Falls was hit hard like most of the nation but right now foreclosures and REO’s are what’s hot and selling in today’s real estate market. In the week I was there she had a flurry of activity with multiple offers coming in and a rush of new activity. All good things for her and good signs for real estate investors.

And… I’m big on the opportunities for short sales and REO’s. Right now they are the hottest thing on the market (that will change over time) and you should be looking here for deals. I’ve got a huge resource site that is absolutely free at www.kickassshortsales.com that you should check out because it has more info there then you can find in most short sale courses.

By,

Gerald Romine

From time to time I login to spot check support tickets for our kick butt software. I like to know what’s going on and see how things are being handled by our support team plus I’ll answer the tickets while I’m at the help desk.

Yesterday one of our great customers asked the following question:

I see other gurus advocate giving the seller cash for items in the house (washer, dryer, etc) on short sales but Gerald Romine does not. Why? Banks even give sellers “Cash For Keys.”

The short answer is “I don’t want to go to jail.”

If you give the seller money for itmes that you would not have otherwise purchased if it were not for the possibility of a short sale you could be found guilty of mortgage fraud which is a felony. The lender can offer cash for keys because they are a principle in the transaction.

If it smells like a fish it probably stinks!

Think about it… Does buying personal property from the seller at an inflated value (5K 10K, etc) make any sense if you were before the judge on 5 counts of felony mortgage fraud? When opposing counsel starts asking questions is the story going to hold water? How did you and the seller meet? How long have you known each other? Would you have bought the property if not for the foreclosure and short sale possibility? Do you consider yourself a real estate investor? Would you have even met the seller if you were not looking for real estate deals? You get the idea.

Be careful who you listen to because there are alot of so called experts giving out advice that could land you in jail.

Now Go Buy A House!

Author: Gerald Romine

PS - One of the best sites I’ve ever created is www.kickassshortsales.com. It’s a resource site and currently all of the info is free AND it’s more complete then most short sale courses and systems that people are selling.  Enjoy.

Some people just don’t get it.

I’m in DC at a huge seminar to further my education and I take it very seriously.  Last night we had a social tie/tux dinner with a “casino” night afterwords. (At these seminars the real business and insider tips can take place in the social environments/activities… often at the bar over drinks.)

The dinner and conversation was enjoyable.  When the casino night started I made a social walk around the place to say hi to a few friends then called it a night at 10:30 - no gambling for me… it’s just not my thing.

I‘m sure the festivities and drinks continued long into the night. For me the night was over.

This morning there was a session at 8:00 AM and the room was less than half full. Sad, because the speaker was 72 years old with a phenomenal amount of wisdom/information and was flown in from England.  Nothing was being sold… just great information and in my opinion EVERYONE should have been in the room.

Funny how people pay good money for education then don‘t even show up!

It‘s amazing what‘s out there if you have your eyes open and show up.  Sadly half of the people didn’t show up and have no idea what they paid for and missed.

Because I don’t want you to miss out I‘d like to tell you about a 100% Done-For-You real estate investing/marketing system with NO Setup Fees that doesn’t take ANY time to set up, implement, or run.

If “easy” isn’t good enough, it cranks out HUNDREDS of motivated seller submitted leads every week for less than a cup of Starbucks a day. That should be more than enough leads stuffing your inbox everyday with quality deals.

I think you‘ll be glad I told you about this…

If you need leads/deals this is your answer! - Check it out.

Author: Gerald Romine

P.S.  Really…if you need leads/deals coming to you that are fresh and that you can take action on right away check it out. My guess is this is something you should be interested in.

P.S.S - You can even test out the system for a week with no strings attached. Thought you might want to know that too.

Last week I was hanging out with Jesse James and Desmond Howard in Baja Mexico. Check out the pictures and short movie I did with Jesse In MY FACEBOOK ACCOUNT.

Baja was a killer experience and racing across the dessert at 90 MPH is awesome! Combine that with the business sessions and meetings and you have an unforgettable experience!

The baja racers are fitted with a special helmet that has radio communications with your group (when you press a mic button) and constant communication between the car’s driver and co-pilot. So imagine haulin’ ass through the dessert and getting lost because your just carrying on a conversation. That’s exactly what happened when I was riding with Jesse and I learned quite a few things about Jesse and his wife Sandra Bullock.

You might want to catch Donald Trump’s next celebrity apprentice because Jesse’s on it and I can guarantee you it will be very interesting. Jesse shared a few colorful things with me that I can’t repeat… and I was rolling when he described some of the other apprentices. He doesn’t mince words.

And speaking of not mincing words… you should be on my webinar tonight.

I’m in the middle of a huge product launch and before we shut it down I’ve agree to do a FINAL LIVE webinar, answer the TON of questions that have come in, and spill the beans in a no holds bar session. Plus… I’m even going to give away two laptops on the call!

Monday, February 9th:
Eastern:   (8:00-9:00)
Central:   (7:00-8:00)
Mountain:  (6:00-7:00) and Arizona
Pacific:   (5:00-6:00 )

Register for Gerald’s Last LIVE WEBINAR - LINK

I’ll be taking questions and answering emails that he’s received over the last few days about the Ultimate Real Estate Investing 2.0 System and exactly what’s included with the 11 built in real estate investing systems.

Here’s the best part…

I’ll be giving away two… yes two… killer laptops to people on the call. Everyone who asks a question will be eligible to win and the winners will be announced LIVE on the call!

This will be your last chance to take advantage of The Ultimate REal Estate Investing 2.0 System. What’s more is you get 15K in real bonuses, but only if you take action during this launch..

Register for Gerald’s Last LIVE WEBINAR - LINK

Be on the call tonight,

Gerald Romine

PS - About flipping you off… Well… let me explain the picture on facebook… Jesse wasn’t cool with being put into a headlock by me and suggested we show the picture you see on facebook. He’s got a “bad boy” image to keep up!  Be sure to check out all the pictures and my movie with Jesse James on Facebook.

My mind is spinning so fast from my most recent Mastermind Session. Gotta love it!

I live and die by the quote “You are the same person now that you will be in 5 years except for the people you meet, the books you read, and the new information you acquire!”

Hollywood, Florida. 4:00 PM.  - I arrive for a 2 day mastermind session with Yanik Silver and friends. Walking into the Hollywood Hardrock I stumble upon my buddy Justin Tupper who invites me out for dinner with a “Power” group of friends, fellow masterminds, Mavericks, and international Businessmen.

At 8:00 we jump into the super stretch limo and head out for dinner.

A lot of you may recognize my good buddy Craig as an international fitness expert from his articles and columns in Muscle and Fitness magazines and his best selling book “Just Say No To Cardio”.  I love hanging out with Craig - the guy’s got a phenomenal business mind and knows his fitness. Craig is famous for NOT working out at the gym but staying in phenomenal condition.

Some of the other superstars that night:

• Perry Lawrence - The “Ask Mr. Video” guy. Responsible for producing some big time infomercials.
• Barry Dunlop - One of the Biggest Publishers in Britain.  Th guys a riot!
• Justin Tupper - He’s got the next big thing in golf with revolutionary swing for anyone.
• Carrie Wilkerson - The girl behind The Barefoot Executive & a super success story.
• Mike Dillard - An Internet Marketing Machine
• Mike Hill - This guy scares me… he can drive internet traffic that literally melts servers.

What I love about mastermind groups and just hanging out with superstars is how much you learn. There’s no better way to get new and fresh ideas than sharing a meal, drinks, and a having a night out with superstar entrepreneurs.

The last two days I’ve been surrounded with ambitious, smart, and creative entrepreneurs moving ahead in their businesses and reporting growth, and breakthroughs in sales and profit increases… It is great to be distanced from the economic chaos dominating CNN and the news headlines.

Sure, there is an economic crisis and uncertainty sweeping the nation with enormous uncertainty hanging over the economy and future. As an investor you might have experienced reversals of fortune, personal hardship, maybe even experienced hard times. But……

Could there be a better time to be investing in yourself, your real estate education, and in real estate?  Given that everything else is outside of your control… shouldn’t you take control of your life and your situation?

Right now people ARE buying houses at 50% of market value. People ARE flipping houses for quick profits. People ARE cash flowing properties.

This is an exciting time and YOU and you alone dictate your future.

Author: Gerald Romine

PS - If you need a blueprint for success get Real Estate Magic 101: How To Get Rich In Real Estate Even If you Are Dead Broke.  It can change your life.

Should You Let A House Go To Foreclosure?

Last week I had lunch with a good friend of mine who is a successful real estate investor and in the last several years he’s bought, sold, flipped, rehabbed and rented countless houses.

But the times have changed and he now finds himself owning several houses that he does not want.

With the values dropping/correcting he owes more than the houses are worth plus he has negative cash flow. Let’s just say with all the houses he owes 500K more than the houses are worth.

Financially he’s doing very well and has plenty of cash. His credit score is in the 700’s.

There is no bailout for him nor should there be. Nobody forced him to do anything. Nobody expected values to drop so fast or hard. It is what it is.

He asked me what he should do and my answer may surprise you.

I told him to make a business decision and asked him the following question…

Would it be worth 500K to trash your credit?

The answer should be obvious.

The challenge for many is pride and ego. The truth is when the loans were taken out the agreement was if the loan was not paid the lender could foreclose and the borrower will lose the property. As much as I am against losing a home to foreclosure tough decisions must be based on an intelligent decision and not emotion.

The markets have changed. If you are carrying negative equity you should consider making the best business decision available and this may include letting a house go to foreclosure. You could literally owe 200K today and buy back the same house or one like it for 100K as a foreclosure or REO on the same street.

Donald Trump has had companies file for bankruptcy several times and even the Governor of Texas filed for bankruptcy while they were governor.

These are changing times and even though my friend is well off financially he has to decide if it is worth 500K or more to lose several houses to foreclosure and rebuild his credit. The alternative is to keep losing more and more money every month.

What would you do?

Please post a response in the blog below.

Author: Gerald Romine

A real estate investor buddy of mine is doing a short sale where Countrywide has a 30K second and the property is overfinanced. The offer to Countrywide was 3K which is a very generous offer for a junk second that will be wiped off at the upcoming foreclosure sale.

Their response is unbelievable. “Insufficient Offer.”

But it gets better. Countrywide said they would prefer to write off the entire amount than take 3K on a short sale!

It makes no sense and it is no wonder the financial institutions of America are begging for handouts.

My friend called me up and asked what I thought. My answer was as soon as they sait they wanted to write off the entir amount I would have said “DEAL! I’m amending my offer to nothing for you and will submit it right away.”

I’m not joking.

Aside from changing the offer to zero I would remain calm and follow up as the foreclosure date approaches because the closer to sale date the more willing the lenders.

Short sales continue to be VERY LUCRATIVE.

The 4 keys to short sale success:

1. Followup.
2. Be non chalauent with an almost “who cares” attitude.
3. Be working several short sale deals at a time.
4. Play the short sale game.

If you need more information on short sales check out a totally free resource at www.kickassshortsales.com.

Author: Gerald Romine

Since you’re up to your ears in standard Happy T-Day and Holiday wishes I thought we could skip ahead to new year’s resolutions.

Personally, I love the new year because I get to look back on my successes and look forward to the next 365 days. It’s mind boggling how fast time passes. My kids are now 10 and 7 and it seems just like yesterday…

This year has been very interesting year with the economy and I know cash-flow has been an issue for some.

It is in these times of change that the greatest transfer of wealth happens.

You have so much possibility for abundance right now if front of you. Real estate investors are at an all you can eat deal buffet and most people are fasting! It would be a waste to be in the same place 3 years from now, let alone 20 years from now.

I hope you have some HUGE plans for 2009 because the opportunities for success (for those willing to do a little work) may not have ever been greater.

So to get you started here are 3 Success Tips:

1. Less Talk, More Action.
There are an endless number of hot air blowers that are full of talk and BS. Don’t be one of them. So quit talking about it and start doing!

2. Act Now, Not Later.
Have you ever noticed that when you get a great idea you’re real excited but as time passes the enthusiasm quickly wanes, details get hazy, and eventually you forget the entire idea?

Successful people take action quickly and you need to put action in place immediately. Next time you have a great idea write down the ACTION STEPS you WILL take. Your success depends on it.

3. Be Accountable To Yourself.
I know it sounds simple but it’s not. How many times have you told yourself you’re going to do something then don’t do it? Maybe it’s working out, eating better, etc. Every time you make a commitment to yourself and don’t keep it you are making it easier not be a man of your word.

This is personal… this is your integrity. You need to become a person of honor and uphold the commitments you make to yourself. In short if you tell yourself you are going to do something do it.

It’s habit forming and your success will skyrocket.

If you put these 3 things into practice, I can almost guarantee that you’ll be a winner in 2009.

Here’s a little theme music for 2009.

Author: Gerald Romine

Normally I am the bearer of good news but today is not one of those days.

The hard cold reality is that the economy sucks. 

People are losing their houses to foreclosure. Companies are laying off people. Banks are shutting their doors. A new President is coming which will bring in even more change and uncertaintity.

In short things are rough for most people.

But here’s where we have to draw the line in the sand and YOU need to decide which side of the line you’re gonig to be on. The dumb and broke side or the smart real estate investor and getting richer side.

My question to you: Are you going to crawl up into the fetal position and cry like a baby and whine with everyone else over the economy? 

Most people will and statistically that includes you. Sorry to be so blunt but it’s decision time and you’re either going to step up or get rolled over.

Me? I’ve decided I’m not going to participate in the bad economy! Sorry… it’s simply not for me. 

So here’s 2 things I want you to do right now. (Take 15 WHOLE minutes to be by yourself).

1. Ask yourself… Am I satisfied with where I am going in my life? (if yes you are done)
2. Decide what you are going to do differently to get where you want to go in life.

I know… sounds simple but the sad truth is the dumb and broke people will do nothing and stay dumb and broke. They don’t have to buy anything, go anywhere, or do anything another than think and take fifiteen measely minutes of their time to participate in something that could be life changing. 

Pick your side of the line.

There’s your short and direct message from me to you. I’m hoping your in the 5% that take action.

Author: Gerald Romine

What a Crazy Week.

My good buddy Joe Barton was in town this week and it’s always a pleasure to hang out with him. Joe’s a leader in natural health and alternative remedies and you can check him out at http://www.bartonpublishing.com/blog/.

Last Saturday night we went out for a nice steak dinner at Monti’s Steakhouse with his team then headed over to Dave & Busters which is a Chuck E Cheese’s for adults with video games, basketball shooting, and an endless amount of video games all stuffed into a huge sports bar and restaurant.

Chery,David, Joe Barton, Ben, Todd, and Gerald Romine

My video game playing days have long since passed me by… but when we get together the guy camaraderie and competition comes out and we head straight to the Nascar Racing or anything that is head to head competition. We had a blast acting like big kids and it was a great way for his team to cut loose and have some fun.

Gerald Romine With Joe Barton at Dave & Busters

Tuesday night found me in an “A League” softball tournament that was play and stay until a champion was crowned. First game we won easily. Second game we struggled and managed a 7 run rally in the third inning to win the game and advance. Third game we were beaten in the Championship Game by a better team that played error free softball.

But I have a confession… three games of back to back competitive softball was a serious physical workout. Man… my legs were sore for days but that had more to do with hitting three infield home runs and having to ‘boogie’ around the bases. Heck, I even slid head first into home plate which is a rarity for me because I don’t like to hit the dirt unless it is absolutely necessary. After the game we grabbed a few drinks at a sports bar and in no time it was midnight and I had to be up in a few hours to hike a mountain.

Wednesday Morning: Joe asked me to join his team and hike Camelback Mountain bright and early. And since I had agreed prior to thinking out the effects of a softball tournament, post game celebrations, and sleep deprivation I was not feeling 100% that morning.

Camelback may soundseasy because it is only 1.2 miles to the top… but to get there you gain over 1200′ in elevation, climb rocks, scramble over boulders, navigate rocky trails, and it starts off mean and just keeps getting worse. I must be a sado masochist because I hike camelback a few times a month and on this day I was thankful for the liesurly pace to the top.

Joe Barton & Gerald Romine On Camelback Mountain

Side note: A good time on Camelback Mountain is 30 minutes or less and there is an informal “Under 30″ club which is for the elite few. The best of the best can make it to the top in the low twenties.

While most people struggle to do Camelback 1 time there is one old timer in his 70’s(I think) known and loved by the regulars who hikes Camelback 2-3 times per day almost every day of the year. Just after this picture another hiker says “trip him… I’m trying to catch him.” The old timer is unbelievable and my hat goes off to him because I believe I could beat him up the mountain 1 time but know there is no chance of keeping up with for all three trips in the same day. There’s a lesson in humility and inspiration.

Gerald Romine With 2-3 Per Day Camelback Pro

Combine that with real estate, internet projects, and taking the kids out on Haloween and it’s a very full week. Life is great! And with tomorrow comes one more softball tournament!

My story is told in Real Estate Magic 101: How To Get Rich In Real Estate Even If You Are Dead Broke and I can’t recommend it enough. While many people are struggling in these financial times I learned real estate investing in a market that had zero appreciation at a time when I had no money for down payments and no ability to qualify for loans. Sound familiar? The best part is the book is a “how to” guide to teach you how to be successful in today’s market and for a lifetime.

Author: Gerald Romine

How To Prepare Short Sale Packages

Lenders are freaking out and stressing out with short sales because of the current market conditions. In fact, there has been a major paradigm shift and lenders are accepting ridiculously low short sale bids and not even balking at paying real estate commissions.

The key is short sale contracts/offers must be packaged and presented to the lender/investor/loss mitigator/decision maker in the right format with all of the right documents to streamline and speedline the process.

To accomplish this give lenders a short sale package that does their job for them and makes it easy to sign off on your package without having to do research (www.kickassrealestatesoftware.com prepares perfect packages in 5 minutes instead of 5 hours).   All you want the lender to do is review your short sale package, order the BPO, and declare the deal a go!

The next step is to find a professional title company or closing attorney that specializes in short sale closings because they are worth their weight in gold.

How Much To Offer On A Short Sale

Because nobody knows how much further prices are going to fall it makes sense to make VERY LOW short sale offers to the lenders and it is not uncommon for lenders to accept 30% of the defaulted loan balance.

Let’s be clear… this is an aggressive short sale offer and MOST will be turned down but when you get one super short sale offer accepted it makes up for all the declines. You’re looking for killer deals and doing just a few per year will make you a wealthy real estate investor.

Take Action. Right now there are PHENOMENAL DEALS available in short sales and REO’s. With the glut of inventory you can make offers so low you will feel ‘weird’ until you experience the joy of success.

Make it happen then tell me about your success.

Author: Gerald Romine

Bar Stool Economics:

Suppose that every day, ten men go out for beer and the bill for all
ten comes to $100. If they paid their bill the way we pay our taxes, it
would go something like this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that’s what they decided to do.

The ten men drank in the bar every day and seemed quite happy with the
arrangement, until one day, the owner threw them a curve. ‘Since you
are all such good customers,’ he said, ‘I’m going to reduce the cost of
your daily beer by $20.’Drinks for the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes so
the first four men were unaffected. They would still drink for free.
But what about the other six men - the paying customers? How could they
divide the $20 windfall so that everyone would get his ‘fair share?’
They realized that $20 divided by six is $3.33. But if they subtracted
that from everybody’s share, then the fifth man and the sixth man would
each end up being paid to drink his beer. So, the bar owner suggested
that it would be fair to reduce each man’s bill by roughly the same
amount, and he proceeded to work out the amounts each should pay.

And so:
The fifth man, like the first four, now paid nothing
(100% savings).
The sixth now paid $2 instead of $3 (33%savings).
The seventh now pay $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).

The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four
continued to drink for free. But once outside the restaurant, the men
began to compare their savings.
‘I only got a dollar out of the $20,’declared the sixth man. He pointed
to the tenth man, ‘ but he got $10!’

‘Yeah, that’s right,’ exclaimed the fifth man. ‘I only saved a dollar,
too. It’s unfair that he got ten times more than I did!’
‘That’s true!!’ shouted the seventh man. ‘Why should he get $10 back
when I got only two? The wealthy get all the breaks!’

‘Wait a minute,’ yelled the first four men in unison. ‘We didn’t get
anything at all. The system exploits the poor!’
The nine men surrounded the tenth and beat him up. The next night the
tenth
man didn’t show up for drinks, so the nine sat down and had beers
without him. But when it came time to pay the bill, they discovered
something important. They didn’t have enough money between all of them
for even half of the bill!

And that, boys and girls, journalists and college professors,
is how our tax system works. The people who pay the highest taxes get
the most benefit from a tax reduction. Tax them too much, or attack
them for being wealthy, and they just may not show up anymore. In fact,
they might start drinking overseas where the atmosphere is somewhat
friendlier.

David R. Kamerschen, Ph.D.
Professor of Economics
University of Georgia

For those who understand, no explanation is needed .

For those who do not understand, no explanation is possible.

The stock markets are taking a beating. Media is hyping a recession. The place for safe money is in long term rentals that CASH FLOW. If you have not been shopping the markets start looking because the current prices are unbelievable in many parts of the country. A real estate investor just bought a 1400 SF 4/2 in the Phoenix area for 65K as an REO and that same house was over 250K three years ago! It will cash flow even with bad financing!

Now is the time to be on the hunt. You don’t need your own cash either. For more info join my newsletter at http://www.kickassrealestate.com.

Author Gerald Romine

As the saying goes, I will eat steak tomorrow night as I choose regardless of what you do or don’t do; regardless of whether you eat steak or beans.

The same is true for the economy, the financial crisis, and the so called recession. Some people will be eating steak and others will be eating beans. Is this a harsh wake up call for you?

KNOW AND UNDERSTAND THIS

The same ocean of money is in constant motion; it just flows in different directions from time to time. It’s up to you to move where it is flowing!

Have the economic times changed? Absolutely. Is it harder to near impossible to get loans? Yes. This is the constant motion I’m talking about and if you’re old business model required loans then it is time to change models. It is up to you to move to where the money is flowing.

Right now short sales and REO’s are hot and if you are playing in this arena you need to have money to close or real estate investors to flip to and here’s a big surprise: People are still flipping houses and doing very well. Need proof… check out an auction or two and you’ll see folks paying a lot more than you would which means they are a source of potential buyers.

OPPORTUNISM

You, yes you, need to capitalize on the opportunity delivered by the so called financial crisis. Know that all UBER SUCCESSFUL Entrepreneurs and Real Estate Investors are opportunists. There is no difference between “good” or “bad” events in the value offered to opportunists because opportunists take action on the events given without prejudice.

If you are a real estate investor just starting out or even a seasoned pro be sure to get my FREE Online Real Estate Investing Course. There’s no strings attached so you don’t have any excuses.

Author: Gerald Romine

I’m against the $85,000,000,000.00 bailout of AIG.  In fact I am against ANY bailout at all but will admit that if you can’t beat them join ‘em and I will as a real estate investor find ways to profit from what I’m calling the “GREAT Socialistic Bailout.”

So to bring a point home let me share an alternative bailout program that makes more sense.

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Original Author Unknown:

Instead, I’m in favor of giving $85,000,000,000 to America in a We Deserve It Dividend.

To make the math simple, let’s assume there are 200,000,000 bonafide U.S. Citizens 18+.

Our population is about 301,000,000 +/- counting every man, woman and child. So 200,000,000 might be a fair stab at adults 18 and up..

So divide 200 million adults 18+  into $85 billion that equals $425,000.00.

My plan is to give $425,000 to every person 18+ as a We Deserve It Dividend.

Of course, it would NOT be tax free.  So let’s assume a tax rate of 30%.

Every individual 18+ has to pay $127,500.00 in taxes.  That sends $25,500,000,000 right back to Uncle Sam.

But it means that every adult 18+ has $297,500.00 in their pocket.  A husband and wife has $595,000.00.

What would you do with $297,500.00 to $595,000.00 in your family?

• Pay off your mortgage - housing crisis solved.
• Repay college loans - what a great boost to new grads
• Put away money for college - it’ll be there
• Save in a bank - create money to loan to entrepreneurs.
• Buy a new car - create jobs
• Invest in the market - capital drives growth
• Pay for your parent’s medical insurance - health care improves
• Enable Deadbeat Dads to come clean - or else

Remember this is for every adult U S Citizen 18+  including the folks who lost their jobs at Lehman Brothers and every other company that is cutting back. And of course, for those serving in our Armed Forces.

If we’re going to re-distribute wealth let’s really do it…instead of trickling out a puny $1000.00 ( “vote buy” ) economic incentive that is being proposed by one of our candidates for President.

If we’re going to do an $85 billion bailout, let’s bail out every adult U S Citizen 18+!

As for AIG - liquidate it.  Sell off its parts.  Let American General go back to being American General.  Sell off the real estate. Let the private sector bargain hunters cut it up and clean it up.

Here’s my rationale. We deserve it and AIG doesn’t.

Sure it’s a crazy idea that can “never work.”

But can you imagine the Coast-To-Coast Block Party!

How do you spell Economic Boom?

I trust my fellow adult Americans to know how to use the $85 Billion We Deserve It Dividend more than I do the geniuses at AIG or in Washington DC .

And remember, The “We Deserve It Dividend” plan only really costs $59.5 Billion because $25.5 Billion is returned instantly in taxes to Uncle Sam.

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Now Go Buy A House,

Gerald Romine

Note: I did not write the above article and the math error has been left intact.

Last week the Bush Administration proposed a $700 billion to $1 trillion rescue plan for the financial and real estate industry.  The heart of the plan is to purchase bad debt/loans from the lenders thereby relieving their bad loans so they can concentrate on making good loans (talk about a bailout funded by the taxpayer). Personally it is appalling that the government is going to spend 1 trillion dollars of tax money to bail out the banks.  This is the equivalent of you or I running up $250,000 of credit card and short term debt and the government wiping the debt clean.   Sure… it is great for the bank but don’t forget the bill is being footed by you and I the taxpayer. Plus, pumping huge amounts of dollars into the economy is a devaluation of our currency giving us less buying power. I’ve been a broken record that there has never been a housing crisis… just a money shortage that has been manufactured. Setting aside my personal opinion if we look at this from a purely selfish business standpoint as a real estate investor it can be a very good thing. The Banks Make Money Making Loans. If you don’t understand Fractional Reserve Banking you are handicapped in understanding the big picture - there is a good definition at http://en.wikipedia.org/wiki/Fractional-reserve_banking. To summarize fractional reserve banking means the bank’s loan money without having any of their own money collateralizing the loans then the banks collect interest and fees money created out of thin air.  If you deposit $10,000 the bank is able to make a loan of $80,000 and the bank collect points, interest and fees on money that did not cost them anything.  Their investment is ZERO in the loan.  I know this might sound crazy… but look it up and research the subject. The important thing to remember is banks are in the business of making loans.  With the tightening of money lending the strong banks are not only surviving but they are now getting government bailouts and when they start lending again in mass the surviving banks will have increased profits because of decreased competition. The one trillion dollar bailout for the economy signals a green light for the banks to start lending.  The government is not only taking the banks bad debt off the books but the government has taken over Fannie Mae and Freddie Mac which currently buys approximately 90% of the loans on the open market.  The translation is we have a taxpayer bailout AND the taxpayer through Fannie Mae and Freddie Mac will be buying the majority of the new loans! What To Do Right Now? Realize that a speeding locomotive does not stop on a dime.  Foreclosures will continue to rise and be offset by buyers coming back into the markets.  With time the course of direction will be turned as buyers rush to the market and properties will regain their values quickly. As a real estate investor stay close to the action.  Be on the lookout for real estate deals that can be bought for a fraction of their value, bought ’subject to’ and kept as profitable rentals, or for your own personal residence that can be bought at prices not seen in over a decade.  If you need to analyze deals or create any of the necessary paperwork check out The Ultimate Real Estate Investing System. Author: Gerald Romine

Today I received an email from Ralph Coslet who shared an inspirational story with me about Nick Vujicic - a giant of a man born without limbs. Ralph knows I love inspirational stories and this one is truly amazing.

Ralph thought of me because Nick Vujicic said the following:

“I want to become financially independent by the age of 25, through real estate investments, to modify a car for me to drive and to be interviewed and share my story on the ‘Oprah Winfrey Show’! Writing several best-selling books has been one of my dreams and I hope to finish writing my first by the end of the year. It will be called ‘No Arms, No Legs, No Worries!’”

Here’s a video about Nick you might enjoy:

After watching the video I called Nick’s office to volunteer my real estate investing software and counseling to Nick Vujicic if he is sincerely interested in real estate investing. He’s was out at a speaking engagement so I was only able to leave a message with his executive assistant and we’ll have to see what happens.

No matter what, Nick Vujicic is an inspiration and I hope you enjoy his story as much as I did.

If you think you have obstacles in your life this really puts things in perspective.

Author: Gerald Romine

Last night I played coed softball and we were beaten badly.  The coed league is a lower level league and the emphasis is on fun and having a good time which certainly was true for me.I’m naturally competitive and when I take an objective look at the team the reason we lost is clear.  Almost every player on the team is out of shape and not prepared to play.  I mean no disrespect to the other players but looking at their physical condition the problem is evident. They are out of shape and their performance is a direct reflection.  At 38 I’m one of the older players and in the best condition of anyone on our team.  Because I am physically prepared to play I’m able to excel.

Some people might see that as a harsh or egotistical statement but it is simply a statement of fact.  Those who are prepared thoroughly do better than those who are not.

The same holds true for real estate investing.  Those that are prepared with knowledge and systems will excel as a real estate investor while others fail. The question becomes how prepared are you for investing in real estate?

If you are unprepared and buy houses without having an understanding of the market, conditions, and sound investing principles it only makes sense that your success is based more on chance than making a sound investing decision. You’re failure is expected!

This is critically important in today’s real estate investing world.  If you look at the investors that are making money you will see that they have a system in place and are doing the same successful things over and over.

Why.

Because in real estate investing the math is critical. If you are buying a rental property what is your return on investment? If you are flipping properties what are your buy and sell ratios? In other words what are wholesale buyers paying for a property and if something goes wrong are you certain you can move the property for less and still make a profit?

My ULTIMATE Real Estate Investing System will go a long way in helping you become a great investor that makes sound financial investments. It will analyze your deals, prepare all of the paperwork, and open you up to a world where real estate investing is easy and systematic.

If you are serious about investing be sure you have and use this system.
www.kickassrealestatesoftware.com

Author: Gerald Romine

The worst is not over and if you think the real estate markets are in bad shape now it’s going to get a lot worse! Bad news for some and good news for investors that understand how to capitalize on the ever changing real estate markets.

Foreclosure rates are continuing at record levels and there is no end in site. Investors and homeowners of financial means have been hanging on and clinging to the hope and dream that things will soon turn around and get better. Many have been hanging on because they are financially sound, they are too proud to lose a home to foreclosure, or they were dreaming that somehow things would work out. They are waking up to reality in a cold sweat!

The homeowners and investors that have been hanging on and bleeding to death financially by supporting upside down houses are quickly coming to the conclusion that it is financially more prudent to lose a house to foreclosure because there is no point in riding the titanic to the bottom of the sea. If you have negative equity of 50K, 100K, or 250K it does not make sense to make payments on the loan when it would take years and years to recapture the losses by hanging on and hoping the prices return. Foreclosure has become a financial decision that now makes sense.

Walking away from an upside down house may ruin your credit now but many are discovering it is worth it to be rid of the negative equity that would lock them into losses for years! Because of this realization people are walking away from portfolios of houses that will be lost to foreclosure. The good news for investors is we can buy foreclosures and REOs for pennies on the dollar.

The next major setback for the market is effective October 1^st the Housing Act prohibits seller-assisted financing (presumably this includes the Nehemiah program) and this will lock millions of would be homeowners out of the market and add steam to the housing melt down. How many buyers do you know that have 10% available for a down payment?

The good news? Seller financing will return in force. Banks will be forced to accept lower offers on short sales and REO’s as a matter of necessity and many will carry their own financing. Investors will dominate because they have the means, skills, and ability to buy properties.

In fact, it is already happening and there are greater opportunities now in this emerging market that investors can exploit. In many areas it is now possible to buy newer houses at price levels not seen since the 1990’s. Lenders are negotiating as low as 30% of the defaulted debt amounts. Houses are selling for amounts that provide great cash flow for rental properties.

The best part about the so called housing crash is that it has all been manufactured and is not a real reflection of the market. Bold words… maybe. But if you look at the situation intelligently you can see that there is no shortage of people who want to buy houses. What has created the ‘housing crash’ is the money supply has been turned off which prevents buyers from getting loans and buying houses.

It’s just like a water faucet and the availability of money has been turned off and a draught has ensued. And like a water faucet the availability of money can be turned on at any time and when that happens there will be a rush of buyers to take advantage of the lower prices and the rebound will be in full swing. Imagine the popularity of a new President that ‘turned on’ the money supply and rescued the housing markets. It could happen that fast.

With the changing times there will be a changing of wealth as there has always been throughout history.  While most become victims of choice a few will become wealthy by taking action and seizing  the opportunity.

Author: Gerald Romine

The Real Estate Pain Campaign For Sellers

Pain and problems dominate the lives of people every day and as a result we are constantly looking for solutions to our pain and problems.

In real estate marketing we would be wise to use a formula to attract buyers and sellers. The PAS formula is a great model.

What is the Problem - Agitate - Solve Formula?

I first learned of this formula years ago from a copywriting guru and it has served me well over the years.

Identify a problem. Agitate the problem. Solve the problem.

The fact is people respond better to pain which is why so much marketing revolves around solving painful problems. Next time you are watching TV watch the ads closely and you’ll see they follow the PAS formula to the ‘T’ and focus on the problem, agitate the problem, then solve the problem which is to buy their product.  (a good example are the ProActive commercials dealing with the problem of how people feel ugly, feel embarrassed, but then by using ProActive they become beautiful and sexy).

In your real estate marketing be sure to fully capitalize on the PAS formula. Show the problem. Agitate the problem. Solve the problem.

For those of you using the ULTIMATE Real Estate Marketing System I’ve just added ‘The Pain Campaign’ and you can request it at no charge through the support desk.

This email campaign includes three letters that go out 6 days apart and not only follows the PAS formula but includes emails that capitalize on headlines with pictures that grab the seller’s attention.

The first email “Is Trying To Sell Your House Giving You A Headache?” has a picture of Bayer Aspirin and is built around the pain and headache of selling your house.

The second email is “Are You Getting Indigestion Trying To Figure Out How To Sell Your House?” has a picture of Pepcid Antacid and is build around how upsetting it is to try and sell a house in today’s market.

The third email is “Who else is sick and tired of hearing their friends complain about not being able to sell their house?” and has a picture earplugs and is built around hearing from friends and the media about the dismal real estate markets.

Now you can see why we call it the “Pain Campaign”! This email can also be converted to a letter campaign and top marketers will replace the pictures with inexpensive product samples making it a bulky/grabber campaign.  Both work exceptionally well.

Author: Gerald Romine

Questions keep coming at me about the the power meeting we just had with guys like Frank McKinney, Carl Banks, Aymen Boughanmi, Yanik Silver, Mike Filsaime, Carrie Wilkerson, Terry Wygal, Rich Desich, and the rest of the Mavericks. Some names you may recognize and others have build massive businesses very discretely.

This select group comes together to share business ideas in an intimate setting. It’s just hard to build a better business and friendship relationships than experiencing fun and extreme events together.  How can you compare a boardroom to riding a bus for 3 hours and talking business then mountain biking together.  The conversations, business ideas, and friendships are formed quickly in an environment that is hard to replicate anywhere else.

I roomed with Doug Doubler and he’s famous for selling over 200 million dollars worth of condo’s using just 20K in google ads.  Crazy!  The insights he has on the business and what he shared were amazing.

Check out the video and you’ll get a taste of the most powerful business meeting I’ve ever attended.

Side Note: The music is from the movie “Deliverance” and for those on the trip it has a special meaning.  (Yanick, you’re twisted… but we’re all laughing now.)

Author: Gerald Romine

It is Monday and I’m back from a wild business adventure in Aspen Colorado!

Imagine hanging out with some of the best businessman in the world to talk business then taking off for some White Water Rafting, Rock Climbing, Rappelling, Extreme 4 Wheeling and some pretty wild mountain biking. My body is beat up. (Later I‘ll tell you about the wasp attack I experienced when I stuck my hand in their nest while rock climbing)

Talking Real Estate With Frank McKinney (Gerald Romine - Black Hat)

Later this week I‘ll post some pics from the trip including my “Double Heisman” with a two time Superbowl winner!

I’m part of several mastermind groups that come together with one purpose in mind. Business! And while we may partake in some fun activities we take our meetings and education very seriously! Not only do we share ideas amongst ourselves, we bring in some of the finest businessmen in the world to help us with their experience and knowledge. All done in a small and intimate setting.

Frank McKinney – The Maverick Daredevil Artist

Graduating high school with a 1.8 GPA and digging sand traps by hand Frank is not the guy you would have picked as most likely to succeed.  After teaching tennis in Florida(Frank and I have teaching tennis in common) Frank realized the money was in real estate and became a RE investor back in 1986 and made $7,000 of his first fixer.

After playing in the fixer business for years he moved into the spec house business and has gone on to sell a 50 million dollar spec houses and currently has a 130 million dollar spec house for sale.  Talk about brass balls… they guy‘s got them because when you build a 130 million dollar spec house that means you don‘t have ANY buyer in mind.

The best part about our mastermind groups is the intimacy that can be found with 30 people. An informal setting. The ability to speak one on one with everybody. And sharing dinner, drinks, and conversations with like minded individuals and superstars like Frank McKinney.

The Key Points I Took From Frank McKinney:

1. Read the book: Blink: The Power of Thinking Without Thinking by Malcolm Gladwell
2. Frank controls the marketing of his properties.  He does not and will not delegate the marketing of his houses to anybody else. While his time is valuable on of the most important things he does is write the copy to sell his houses!
3. Be A Market Maker.  If Frank would not of believed in himself and believe what others said he would have never made it.
4. Don’t Live Between The Railroad Tracks.  You have to get out of your comfort zone. Things happen when you make them happen.
5. Be Overhead Adverse.  Funny coming from a guy that builds a 135 million dollar house be Frank is absolutely overhead adverse and constantly monitors expenses to make sure things stay in check.

My head is still buzzing from the last week! Luckily I survived the wasp attack and I’ll be sure to fill you in on what’s happening in the real estate investing world and why Frank McKinney and I are excited about the market and what’s coming.

Author: Gerald Romine

PS – Frank and I agree that the news media is full of BS and does not accurately reflect the market and what is really happening.  Frank hasn’t slowed down and you shouldn’t either!

I like to talk straight with people and it seems that every guru is talking about this being a great time to buy properties. That’s true. But most of the so called guru’s are offering the same old tired crap that worked great in 2005 but ain’t working now.

Remember when you could buy any house and turn it for a profit? Remember when people were buying spec houses and the values were going up 50-100% in the time it took to complete construction? Those days are gone. What’s more is those days were filled with a lot of risk because if you bought at the wrong time you were left holding the bag. Many were, and many still are nursing their wounds.

Today it is a foreign market to most people. BUT, for those of us that have been in the game for a long time it is simply a return to a market where you buy based on real investing fundamentals with one major difference. Money is a lot harder to come by for investors, for homeowners refinancing, and for new home buyers.

There are three main ways to make money in today’s real estate market.

One. Flip Houses. Contrary to popular belief flipping houses is alive and well. Focus on DEEP discounts and moving houses fast to investors that can close quickly. There are fewer REAL buyers so you need to have a strong deal to move properties quickly.

Two. Buy and Hold. Yea, that’s right being a landlord is and has always been profitable. Sexy it’s not but profitable it is. IF you live in an area where you can cash flow properties after all expenses are taken into account(management, maintenance, taxes, insurance, repair allowance, debt service, etc) owning properties is very lucrative.

Rehab and Retail. Right now I have buddies making a killing with rehab properties in the current market while everybody else is whining and crying. How do they do it? They have a simple model to buy blue collar houses that are at the bottom of the median price range where the labor class of America lives. They only buy houses at a deep discount, spend approx 10K with a “blow and go” rehab, then retail the property as the best house in the area for less than what other houses are for sale. In short they are selling the best house in the neighborhood for a steal of price and can do so because they bought right.

THE KEY TO SUCCESS

The secret to being successful in today’s market is sorting through all the junk properties (or bad financing on good properties or over financed

properties) for sale and focusing on properties that can be bought that meet your criteria. Put another way the key is target marketing so attract properties that can be bought at the right price or terms.

Unfortunately most people rely on themselves to find deals and that simply does not work. You’ve got to have a SYSTEM in place where you can throw a bunch of leads into the system and wait for the good deals to call you up already pre-qualified.

I know you’re skeptical that such a system exists. I don’t blame you.You can’t just go believing everything that anybody says… especially on the internet.

I know that people like you want PROOF that the ULTIMATE Real Estate Marketing System is a top product.

That’s why I posted real videos and screenshots of the system in action on this page…

www.kickassrealestatemarketing.com

There are over 17 videos, pictures, and even an email from the system to show you how it works. Check them out and you’ll see that the ULTIMATE Real Estate Marketing System is everything I say it is!

Author: Gerald Romine

A question I’m commonly asked is what effect does a short sale, deed in lieu of foreclosure, or foreclosure have on my credit and when can I buy another house?

Believe it or not a short sale, deed in lieu of foreclosure, and foreclosure all have roughly the same impact on your credit score. In other words your credit score is going to be hammered.

Most new loans are resold to Fannie Mae and Freddie Mac and beginning August 1 Fannie Mae generally will not buy loans to borrowers involved in a short sale in the last two years. A deed in lieu of foreclosure is 4 years. A foreclosure is 5 years.

Although your credit score will be treated the same your ability to buy a house will vary greatly since most lenders sell their loans to Fannie Mae and Freddie Mac.

Why Do Short Sales Get The Best Treatment

Short sales are the preferential loss to lenders because it saves them the trouble of having to sell the house!

This is POWERFUL information because it gives owners an incentive to work with you for completing a short sale because they have a better chance of buying a home in two years instead of 5 years if the home is foreclosed on! And when you can complete short sale packages in minutes negotiating short sales because easy and routine.

Author: Gerald Romine

The news is filled with doom and gloom about real estate, real estate investing, and the economy.  Home values dropping. Foreclosures at record highs. Mortgage rate is up, etc.

If you read the news don’t believe the hype because contrary to popular belief we are in transition to a new economy, and you must choose whether to make the transition or to stand still. People are making money, big money right now.

Just last week a good friend of mine made over 30K on one little house deal. Here are his steps. 1) Bought REO. 2) Blow and Go (quick rehab normally 10K or less spent). 3) sell best property a little lower than comps(about 10-15K).  It’s quick and easy and the biggest catch is you might have to hold the property 90 days to meet lender’s seasoning requirements.

How To Make Money With Bad News In The Media

When you see a short article that serves your purpose (like the one below) send it to the lender with your short sale or REO offer.  Simply highlight the most important parts and let the article speak volumes for you.

In this case one paragraph talks about houses losing 25% of their value and that goes a long way to justify a low offer!

Author: Gerald Romine

Recently I was asked to co-author a book with several other Maverick Entrepreneurs. This small group of entrepreneurs can be best described as people who blaze their own trail, overcome obstacles, find unconventional solutions, and simply writes their own rules for success. I was asked specifically to author a section about my rules for success.

My rules come from the significant life events I’ve experienced.

As I write this, I am now 38 years old, and during my life thus far I suspect that I’ve encountered more significant life events than most people ever dream about. Here’s some information about me:

I grew up in a lower middle class family in Prunedale, California. I’ve earned everything I ever received and very little was given to me.

I’ve worked for as long as I can remember. Whether it was milking goats, mowing grass, selling Amway(8 years old), cleaning houses, minimum wage fast food jobs, construction, licensed tennis teaching pro, Marine Corps, I’ve always been making my own money and way in life.

I’ve been very fortunate in my life.

Not all experiences have been desirable and my life has not been a fairy tale. But from all my experiences I have strived to learn something and moved forward towards bigger and greater things. I’ve found success as a real estate investor, professional speaker, author, and software developer and throughout all of life experiences, I have accumulated a number of rules that I live by. Well, I call them the 10 Commandments!

I’ve read and understand that original ideas are rarely original. My work is no different. The only credit to which I can claim is that I have learned from others and put their ideas to work for me.

Here are the 10 Commandments I Strive To Live By:

1. The Only Thing That Matters Are Results.
There are only two things in life, results and excuses and life does not care about the excuses.

2. Approach Everything You Do With Integrity.
Of all the things we have integrity is the only one you can give away and never get back.

3. Life Isn’t Fair.
You make your own breaks. The only definition fair should have to you, is something that you pay when you get on a bus (i.e., fare).

4. You Must Have A Dream.
We all have a dream, but most people give up on their dreams and then lose the ability. Without dreams there is little to strive for. If you don’t have a dream you can’t make your dream come true! As long as you have your dreams you have a reason for life! Never lose your gift of dreaming.

5. Learn Continually.
When you stop learning you start dying. Always embrace self improvement.

6. Be Accountable To Yourself.
Don’t blame the problems in your life on other people. You made your life what it is by the decisions you have made; take credit for the good and the bad. Life is self manifested, make it what you desire.

7. The Price Is The Price.
There is a cost(time, money, effort, etc) associated with everything. The real question becomes: “Are you willing to pay the price to get what you want?”

8. Of All Your Talents Determination Is The Most Important.
Determination alone accounts for more success than all the talents of men combined. The reality is talent is relatively easy to find, but determination is a treasure few possess or are willing to develop.

9. Success Is A State Of Mind.
One is not successful because of what they achieve; they are successful because of how they feel.

10. Be Humble.
Judge yourself at least as harshly as you judge others.

Author: Gerald Romine

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