Hello DG Members,
I really enjoy posting in the "my deals" section because it is a chance to help other DG Members learn how we were able to find a real estate deal. The last few months have been nothing short of tremendous with real estate investing for us. We are having so much fun and enjoying doing real estate together. I see the glimmer of sunlight in the distance that is my journey’s destination to be able to leave my job and become a real estate investor 100% of my time.
I really enjoy my day job, but I have fallen in love with real estate investing. I often visualize my last day of work, saying good bye to co-workers that I have worked with for several years. Often I image my co-workers saying “I should have purchased that Dean Graziosi’s book last year when Joe told me about it!” This will feel better than winning the lottery and we have Dean to thank for sharing his knowledge and inspiration in his books, programs, events and the DG website!
After we completed Deal #6, the 100% financed bank REO, I knew I had to start contacting more local banks and asset managers about their REOs. I made an effort to contact at least 2 to 3 new REO bank asset managers per week. I had a total of about 8 new asset managers that I had established contact with either by a phone call or through email.
During the past few months that followed I have had a smorgasbord of REO properties presented to me from a bulk package of 14 homes, to single family homes, to multi units to commercial buildings, to a developed 40 lot subdivision foreclosure, to a bed and breakfast to a very large restaurant building with 2 additional lots and a home, to a 500 acre land parcel REO. I had been running the numbers and making offers. The key is starting with low offers, asking for 100% financing and including things in your offers that were bargaining chips to trade off with the banker.
This past Sunday we even went to look at a multi-unit property that had around 100 units. As I drove into the complex my mind was going a mile a minute because the value of the land was probably worth more than 75% of the asking price alone. I realize that a few more hours in the day would be my greatest asset for future acquisitions.
Once again I have to state that it is the old saying of patience is a virtue is so true! During the past several weeks I have been discussing a multi-unit building and a small commercial building that a different local bank owned as an REO. I went back and forth with a few offers and the bank wanted me to look at various other properties they had too. Thus, I was busy looking at their other REOs, several other bank’s REOs my realtor’s listings and a few dozen other properties I had on my radar.
The traffic on the radar was getting a little heavy so I realized I needed to land a few deals soon. I made various offers and I thought I would not get them accepted. I made an offer at 70% of their asking price with additional requested things I thought they would not agree to such as 100% financing and a 30 year locked interest rate tied to the prime rate currently at 3.25%. Then I got the email today that my 2 offers were accepted by the bank’s senior management. I honestly almost fell off my chair with excitement. We just acquired a multi-unit building in ready to rent condition and a small commercial building that does need some minor work.
You may ask how did this deal happen? I developed and cultivated a relationship with a local bank REO asset manager. I have made countless emails during the past few months. I even got busy with work during the past few weeks and the asset manager inquired if I could make another offer to be considered. Thus, I was not stalling but this delayed tactic created a little motivation on the bank’s part. I knew it was time to craft an offer. I crafted an email offer with 3 different offer options for each property. I offered an extremely low 30% of asking price all cash offer, a low offer price with higher interest and great terms and finally a slightly higher offer with low interest and great terms. Any of these offers would cash flow nicely as we planned to keep these properties for buy and hold rental properties. This was all done over email.
I did not receive an acknowledgement of my offers for almost a week and then the email arrived today! I am so excited because this bank has various other properties and this may be opening the door to several other properties
I want everyone to know that they can do this too! That is why I am providing the amount of detail to help you in your local area do the same type of deal! Dean, thank you for all your inspiring guidance and we really appreciate all the inspiring members on the DG website too! Good luck on all your deals! Believe and Achieve! - Joe and Stacey
"I am naive enough to think that I can do my part in helping change the world, and if that's a bad thing, then, so be it, the Question is....who's coming with me?"
- Dean Graziosi
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Joe Jurek CPA