***NEW UPDATED VERSION INTERNET SAVVY***

Step-By-Step Instructions Show You...

$0 Down Real Estate
Investing With
No Credit!
No Money!
No Job!
No Experience!

You now possess the first comprehensive investment
plan ever written that will show you the secrets of
purchasing real estate for immediate cash flow AND
excellent long term profits! You will learn how to do
this without a down payment or the need to borrow
money from a bank!


By
Joe Crump


Crump Publishing, Inc.
2113 E 62
nd
St, Ste 202
Indianapolis IN 46220-2311
Revised 2010



Copyright 2000-2010 Crump Publishing, Inc. - All Rights Reserved

Table Of Contents
(Click on the blue links to go
to the chapter indicated)

Introduction

Vital Information That Tells You Why This
System Works Like A Cash Machine!

The two techniques revealed in Section 1 and Section 2
are, in my opinion, the perfect diversifications of
techniques for the investor starting out with no capital
and/or bad credit.

First, you will learn how to create chunks of capital with
short-term "flip" deals.

Second, you will discover how to replace your current
monthly income and create a long-term investment
strategy by purchasing and holding real estate rental
property.

Read the entire book before setting out on this journey to
real estate wealth.

Some of the issues I cover in one section are not
repeated in another to avoid redundancy. But all of the
ideas and techniques are part and parcel of the whole.

Once you understand the basics I've outlined, you will be
ahead of 99.9% of all the other wanna-be real estate
investors.


There is no substitute for knowledge! Read this book from
cover to cover and then TAKE ACTION!



Section One


Chapter 1
Technique #1 - Immediate Cash Flow...
Make Thousands Of Dollars In A Few
Short Weeks With This Technique.

Sound too good to be true? Read on for the details....

This chapter teaches you how to obtain the rights to sell
properties without actually paying for them.

You will sell this real estate for a profit and walk away
from closing with cash in your pocket!

You can use this technique over and over again,
never spending OR risking a dime of your own
money!


Chapter 2
Finding The Properties - Where Do You
Find Profitable Deals? Profile The Perfect
Property




Chapter 3
Inspections -
How To Keep From Losing Your Shirt


Chapter 4
Making The Offer (Step-by-step dialogue)
Questions To Ask, Answers To Give


Chapter 5
The Contracts -
You Can Print And Use Them


Chapter 6
Finding Investors To Buy Your Properties

How To Find A Few Investors Who Will Buy From You
Over And Over Again!

This is so easy you'll laugh with delight when the
phone calls start coming in!


Chapter 7
Systematize Your Business So You Can
Repeat This Process Every Single Day...
Effortlessly!



Section 2



Chapter 8
Technique #2 - Monthly Income... Replace
Your Income With Rental Property And
Quit Your Job!

Learn how to purchase homes with zero down payment
and no credit check.

Then, rent or lease-option them to make a healthy
monthly income that will continue to grow until you
die!


Chapter 9
Finding Sellers Who Will Let You Buy
Their Home With Zero Down Payment
And No Credit Check.

Purchasing homes subject to the existing mortgage.
Learn how to do this so you are protected and to
maximize your profits.


Chapter 10
Inspection Tips

Many of these homes will be less than 5 years old, so
inspections become less of an issue.

Chapter 11
Making The Offer
(Step-by-step dialogue)

Questions to ask Answers to give Smart ways to get
the best price possible!


Chapter 12
The Contracts -
You Can Print And Use Them


Chapter 13
Selling The Homes You Purchase To New
Buyers Using The Lease Option
Technique!

Learn how to get 5-10% more for the homes you sell,
along with higher-than-market rent!

Also, learn how to get non-refundable lease option
money from your tenants rather than a security deposit
you have to give back to them at the end of their lease.

Lease option money can pay for your vacancies once
you know how to structure your contracts!


Chapter 14
Find Qualified Renters FAST!


Special techniques used by top management
companies to obtain renters who have better credit and
better jobs than you! These are the people you want
renting your homes.

How to get top rental income for your properties.


Chapter 15
Financing The Sale Of Your Properties
For An Investor Or A New Buyer

This is the most important chapter in the book. If you
understand financing, you will succeed as a real
estate investor.

Structuring your deals so they are attractive to the Buyer
is the easiest way to sell your properties fast and for
top dollar.


Chapter 16
Putting It All Together - A
Step-by-Step Guide To Success.

This chapter helps you understand what to do first, what
to do second, what to do third... and so on.

You will discover the simple steps to follow for true
success in this business.

Most "business opportunity" type books are so
unclear on how to actually proceed that no one is able to
follow through. This chapter changes all of that.



***** UPDATED SECTION *****

Chapter 17
Using The Internet To Get Highly
Motivated Sellers To Call You

This updated chapter will show you how to increase the
response to your advertising by 300-500%! It is an
awesome new way to track down motivated Sellers
who are willing to give you a great deal.

Ill even show you how to use my web site so you dont
have to become a web designer to make it work.

This new technique is the most exciting Ive used in
years and it is dramatically increasing the profits of my
coaching students.





Two FREE Bonus Books

(Value of $109.85 if purchased separately!)



FREE Bonus One
How To Get Wealthy Buying And Selling
Single Family Homes.

This book is worth $29.95 by itself.

It is full of useful moneymaking techniques on how to be
successful as an investor and landlord of single-family
homes.


FREE Bonus Two
Real Estate Marketing Techniques I Used
To Place Myself In The Top 1% Of ALL
Real Estate Agents In The World!

Learn these techniques and you will succeed in ANY
business you undertake.

They are the root of all great businesses, and provide
essential information for anyone thinking of starting
their own real estate investment business.

I've sold this course to Realtors for $79.90 by itself!



FREE Unadvertised Bonus
How To Structure Zero Down Deals
Transcript From Joes
Hands-On Workshop
RAW UNCUT UNEDITED



Appendix
Every Contract And Form In
This Book Is Here


Property Profile Sheet
Inspection Form
Purchase Agreement
Counter Offer
Inspection Response
Investor Agreement
Investor Qualifying Sheet
Quitclaim Deed
Tenant Application
Lease Agreement
Investor & Buyer Qualifying Sheet

Option To Buy Real Estate (used in
conjunction with a lease for a Lease-Option
Sale)

DISCLAIMER: The information in this book is solely
advisory and should not be substituted for legal, financial
or tax advice.

Any and all financial decisions and actions must be done
through the advice and counsel of a qualified attorney,
financial advisor and/or CPA. This book is not intended to
solicit properties already listed by a real estate agent.

Joe Crump (the author) and United Home (the publisher)
have made their best effort to produce an accurate,
informative and helpful book.

Nevertheless, they make no warranties of any kind with
regard to the completeness or accuracy of the contents of
this book.

They accept no liability of any kind for any losses or
damages caused or alleged to be cause, directly or
indirectly, from using the information contained in this
book.



ALL RIGHTS RESERVED: Reproduction or translation of
any part of this work, by any means, electronic or
mechanical, including photocopying beyond that
permitted by Copyright Law, without the permission of the
publisher, is unlawful.

Copyright 2000-2010 - United Home

Introduction

Vital Information That Tells You Why
This System Works Like A Cash
Machine!

One of the first lessons I learned in the business world
was never to take advice from anyone unless they are
doing better than you.

This is pretty sage advice no matter what the topic. If I'm
buying a computer, I don't ask for help from the high
school student at the "Best Buy" store down the street.

Instead, I will solicit the competent opinion of
somebody I trust to give me insight on my purchase.

When financial planners approach me and want to help
with investing my money, the first question I ask them is
how much money they have. If they have more than I do,
I will consider their offer. If not, I tell them to come back
when they do.

So, since I'm in the position of giving you advice, let me
tell you what makes me so smart. I have been in the
real estate industry since 1986.

I have personally purchased and disposed of over $17
million dollars of real estate in my career (most of it
with very little cash down).


As a real estate broker, I've helped hundreds of people
purchase tens of millions of dollars in property. You might
say I've been around the block.

I've also made every mistake possible... sometimes
more than once. I've had both good and bad
experiences, but I've always come out on top.

You see, I don't look at my failures as "failures." Rather, I
see them as "tests."

I just kept testing until I got it right.

But ultimately, it's not just about the money...

It's about a lifestyle you love and a business you enjoy
going to every morning.

It's about having the people you love around you and
being able to give them the opportunities they deserve.

I have a great life.

I don't work on weekends.

I rarely work 40 hours a week (and very few of those
hours actually feel like work).

I take off four to six weeks a year for fun and I make
a healthy income.

Let me share with you a little piece of my typical day. I am
not doing this just to tell you how great I am. I believe
anyone can have the kind of life I enjoy and that they
can develop it in a very short time.


Now, your idea of the great life may be very different than
mine, but the concept is that you can have any life you
want. Real estate can make it happen.

Now, back to my typical day. My wife Nancy and I get up
in the morning and help the kids get ready for school. We
eat, we laugh, and we talk about what we're going to do
that day.

I drive the kids to school. We like to arrive a little early so
we can read a few pages of "Harry Potter, The
Chronicles of Narnia or The Lord of the Rings." When
the school bell rings, Alex and Katie rush off to class (they
are 9 and 6 years old) and I go back home to play at my
office.

I usually do something different every day, but I always
ask myself "Is this activity productive or fun? If it is
neither, can it be delegated? If it's not making me money
or I'm not having fun, I don't do it.

Most of my work is on the phone or the computer. It is not
very difficult work if you have the expertise and the
knowledge.

So, enough about me. Let's talk about you.

Are you the right person for this book?

Will you take the information I give you and implement
even a small portion of it?

If you do... you will succeed.

The beauty of this book is that these are simple ideas
that can be used by anyone.

It doesn't matter how much education you have.


It doesn't matter what culture you come from.

It doesn't matter what you look like.

It doesn't matter how much money you have.

It doesn't matter how bad your credit is.

It doesn't matter if you have a job.

It doesn't matter how good you are taking tests.

It doesn't matter if you've never succeeded at
anything before in your life.

You are not your past.

You do not have bad luck.

Your life does not have to be the same as it has
always been.

A wise man once said, "If you do the same things
you've always done, you'll get the same results you
always got."

It's time to make a change.

By the time you finish this book you will have the tools to
succeed. But it is up to you to grab the bull by the horns
and take action.

If you will follow me on this journey, I will take you to
places you have probably never been. I will introduce you
to ideas you may have heard before, but never
understood how to fit them into the big picture of your
life.


I am going to teach you how to do two specific things.

One: You will learn how to create chunks of capital with
short-term flip deals.

Two: You will discover how to replace your monthly
income and create a long-term investment strategy by
purchasing and holding real estate rental property.

You are going to learn how to do these things with no
money, no credit, no job and no experience.

I am not just going to show you how to make money with
real estate. I am going to show you how to build a
successful real estate business from the ground up.

If you are just looking for a quick fix, you will get that
here. But a quick fix is so much less than what you
should take from this course. I want you to look at it as a
complete package.

I am going to teach you about business systems. I know
it sounds as boring as watching mud dry, but once you
get into it you will realize how important it is to the
success of any business.

It is also important in helping you create the lifestyle you
want.

Just so you know what I'm talking about, let me give you
and example of an amazingly successful business
system... McDonald's.

This company has created a system that churns out
consistent results wherever you go in the world.


No matter how you feel about their product, you always
know what to expect when you go to a McDonald's. They
have taken each process in their business and made it
simple enough for the lowest level of skill worker to be
able to accomplish their task consistently, over and over
again.

This is what I have done in my business and it's what I'm
going to teach you to do in yours.

In the pages of this book, you're going to learn how to find
property you can buy with no money down, no credit
check and no job.

You will learn specific techniques on how to find these
unique pieces of real estate. You can NOT go to your
local real estate agent and have him or her pull these up
on his Multiple Listing Service.

Next, you will learn how to make offers on these
properties.

I will teach you exactly what to say.

I'm going to provide hypothetical dialogues with the
Seller to use as a guide.

Then I will show you how to fill out the purchase
agreement so you are protected.

I will show you what to look for during an inspection and
how to word your contracts so you don't get burned with
a problem property.

You'll also learn about how to sell your homes and how
to get top dollar for your property even in rough
neighborhoods or during times of recession.


Marketing and financing are the keys to making money
in real estate. If you understand these two concepts,
you will make money in any business you choose,
now and in the future.

So, let's get started.

Here comes the good stuff.

Soak it in and make it a part of who you are.

Think about it every day and it will become a part of
you.

You are what you think.

Let's start thinking about money!




Section 1


Chapter 1

Technique #1 - Immediate Cash
Flow... Make Thousands Of Dollars In
A Few Short Weeks With This
Technique.

Sound too good to be true? Read on for the details....

In this chapter, you will learn

1. How to obtain the right to sell properties without
actually paying for them.

2. How to sell this real estate for a profit and walk
away from closing with cash in your pocket!

You can use this technique over and over again and
never spend a dime of your own money!

I am going to teach you two ways to do this.

The first is by finding real estate that is available for sale
at less than 85% of market value. I will show you
several simple, proven, marketing techniques for doing
this in Chapter 3.


The second way to make short-term chunks of cash is
by finding homes at full market value, but negotiating
100% financing with the Seller.

This is easier to do that it sounds.

You do it by buying a property "subject to the existing
loans."

The most likely Seller you'll find who will do this is
someone who can no longer afford to make his or her
payments. There can be many reasons for this

Divorce
Serious Illness
Death in the family
Loss of job
Simple irresponsibility.

I will show you how to be a hero to these people.

You're goal should be to make a minimum of $3,000 per
deal.

This may not sound like much, but if you do two or three
of these per month, it starts looking very attractive...
especially since you will have no money and very little
time into each deal.

To make this work, you need to know five things

1. How to find the real estate.
2. How to inspect it.
3. How to write an offer and negotiate the best
deal.
4. How to find investors to purchase the properties
you find.

5. How to turn it all into a well oiled machine that
makes you money over and over again.

Before I get into the five subjects above, let me explain
how the deals on the two types of investment properties
are structured.

Let's start with real estate that you find for 85% or
less of market value.

I am going to get down to basics here, so if you already
have a little experience with this stuff, stick with me.

If you have a home worth $100,000, you want to be able
to buy it for no more than $85,000.

This is 85% of its market value (.85 X 100,000 = 85,000)
also known as 85% Loan To Value (LTV).

The lower the LTV, the more money you and your
investor will make, but finding properties less than 80%
to 85% LTV is not that easy in a stable real estate market.

Let's be conservative and assume you will only be able to
purchase properties at 85% LTV.

Using the above example, let's say you find a property
worth $100,000 and you are able to purchase it for
$85,000.

Lets also say that the only way the Seller will agree to
this price is if you pay him all cash.

You are going to negotiate a purchase agreement with
the Seller of the property using the forms I provide to do
this.


It will be very similar to a standard real estate purchase
agreement, except for the fact that you as the Buyer will
write into the purchase agreement that you have the
right to assign your interest to another Buyer.

Then, you bring in an investor (I will show you how to
find them in Chapter 6) who will take over your contract
on the property and pay $3,000 to you for signing over
your interest.

The investor will purchase the property anyway he or
she chooses and you will go on to the next deal.

If you can consistently find undervalued properties,
finding investors will be easy. I will show you how to
find these properties in Chapter 2.

Remember, there's no such thing as a textbook deal.

Every deal you make in real estate will be different than
the previous one.

You need to understand these concepts and the
structure of the deal, so you can replicate it in your
hometown.

Prices are different all over the country. Some areas will
be higher, some lower, but every deal will work using
these principles.

Investors, along with wanna-be investors, don't know how
to find undervalued real estate.

They will be happy to pay you a finder fee for helping
them.

I know it works because they answer my ads every
day.


The second type of property you will buy will be at
market value.

The unique thing about these properties is you will
purchase these homes "subject to the existing
mortgage or trust deed."

What this means is, you are looking for property that is
mortgaged at full market value (100% LTV).

So, lets take a $100,000 home again.

Suppose this home has a mortgage of $100,000.

It has mortgage payments of $865 per month.

The market rent for the area is $1100 per month.

The Seller has to move. The reason doesn't really
matter. It may be a job transfer, a divorce, a death in
the family, whatever... it has no impact on you.

They can't sell the home without coming up with
$6,000 or $7,000 to pay a real estate agent and they
don't have $6,000-$7,000.

This means they must rent out the property and become a
landlord (which most people don't want to do) or they can
sell it to you.

If they choose to sell, you will take it off their hands and
begin to make payments on their mortgage.

Before you make your first payment, you will either sell
the property to an investor or find someone to lease
option the home.


Either way, you can put $3,000 in your pocket,
immediately!

The most common type of Seller for this type of deal is
someone who has purchased a new home in the past
two or three years.

Because homebuyers typically pay a premium for new
construction, they may have to wait up to five years
before they can sell their home and break even (after
they pay their real estate agent).

The value of the home has to go up about 9% for
them to break even.

What this means for you is you will be able to purchase
homes that are almost new.

This cuts way down on maintenance and repair costs.
It also makes it easy to find renters or investors to buy
from you.

Have I get your attention yet?

Let's move on to the five things you need to know to
make these deals work.

Chapter 2

Finding The Properties - Where Do
You Find Profitable Deals?

Finding enough properties to create a constant string of
activity has always been the most difficult part of
investing in real estate.

You are about to learn some simple foolproof methods
to get your phone ringing. Within a few short days, you
will have Sellers calling you and asking you to take their
property.

Here are some of the simple things I do that really work.

Classified ads: This is an old standard. If you look in
your Sunday real estate section of the newspaper, you'll
find five or ten of these ads.

The last time I checked, there were twelve in my local
newspaper.

They all said just about the same thing.

When I ran my ads, I tried to find something that would
set them apart from the others. I tried putting a black
box around the ad or CAPITALIZING the first line.

But you can also create other distinctions. Most of the ads
in my local paper said something like this...



Cash for your home
in 24 hours! 222-2222

Or

We buy homes for
Cash- 222-2222

They all seem to be about the same, but they run every
week so I assume they're getting calls.

I wanted to set my ads apart. Here is what I run.

Joe and Jeannie will buy your
Home today for cash. Give us a
Call at 222-2222

Or

I Will Make An Offer On Your
Home Today! Call Joe 222-2222

These tiny distinctions increase my ad response 200%
to 300%. There's no way to know for sure why it works,
but I've tested it and it does.

I think it's because the first one is more friendly and easy
to identify with. The second one shows you're ready to
take action immediately.

You should be able to get ads like this for less than $20.
You don't have to run them in a huge newspaper like
the L.A. Times.

Put them in local papers if you are in a large
metropolitan area.


NEVER spend a lot of money on ads unless you know
they work. Test! Test! Test!

It won't be long before you know how much it costs you
to get one deal.

Remember this, the people who answered your ad are
probably in a big hurry to sell. Give them what they want
and they'll beat a path to your door.

The second technique is...

Small plastic signs: You can have small plastic signs
printed out for about four dollars apiece.

Go to a local sign company, the ones who print the local
real estate signs, and ask them to make 30 bright yellow
signs.

Make them the same size as a sheet of typing paper,
about 8-1/2 x 11.

Have the sign company print them on yellow corrugated
plastic, also known as coreplast.

Take your 30 signs, along with a staple hammer, and
drive around the neighborhood where you want to
purchase real estate.

Hammer these signs on telephone poles at major
intersections. Try to get the sign up 7 or 8 feet so it is
hard to tear down.


I love this technique. I get better, more targeted
responses from this method than any other I use.

Your sign should say something like this...
Cash for your home
222-2222



The third technique takes a little longer to
get established.

It is...

Getting referrals: When people find out that you are a
real estate investor, they will start bringing you deals.

It won't be long before you have more properties than
you know what to do with.

Ask everyone you know if they know of property for sale.
When your business gets up and running, this will
probably be the only method you need.

In the meantime, start advertising today.



BEFORE YOU ADVERTISE
Read Chapter 17 in this book. It is a new
UPDATED Section that shows you how to

use web pages to dramatically increase
the response you get on all of your
advertising.


Property Profile Form

The following form will help you ask the right
questions when someone calls and wants to sell you
their home. All of these questions will help you
determine the viability of the investment and the
motivation of the Seller.

Property Profile Form

Where is the property located?


How much do you want for it?


What kind of condition is it in?
Do all of the major functions (mechanicals)
work?
Furnace
Water Heater
Roof


How long have you owned it?


How much did you pay for it?


Do you have a mortgage, if so, how much do you
owe?


How much do you think it is worth? Why?


Why are you selling?


Are you moving out of the area?


Do you have to sell or would you consider keeping it?


Chapter 3

Inspections -
How To Keep From Losing Your Shirt

There are two situations where you are going to want to
do an inspection on the property you intend to purchase.

The first inspection comes before you make your initial
offer.

This is a cursory inspection you do yourself or have a
knowledgeable friend do.

You need to feel pretty confident any problems with the
property won't exceed your budget for the repairs.

There's no fixed number here. Let's say you find a
property worth $100,000. The Seller is asking $80,000
and it needs $5,000 of repairs.

This means that you will have $85,000 into the property
and a $15,000 profit margin after buying and selling
expenses.

On the other hand, take the same property valued at
$100,000... you are able to buy it for $70,000, but this
time it has a $7,000 foundation problem in addition to
the $5,000 of cosmetic work.

In this scenario, you will only have $82,000 into the
property and $18,000 in profit after buying and selling
expenses.

Personally, I love foundation problems.


They scare the heck of most people, but all you have to
do is have a firm bid from a contractor who can do the
work.

It will be very difficult for the Seller to unload a property
like this without making a special deal because no one
else wants to mess with it or is afraid of it.

The second inspection comes after the Seller has
accepted your purchase offer.

If you use the contracts included in this package, there is
verbiage in them that gives you the right to do an
inspection.

A Buyer will have fifteen days to do a full inspection of the
property and respond to the Seller in writing.

There are forms for the response. The Buyer has the right
to ask the Seller to fix any major defects.

The Seller has the right to refuse to do the repairs, but if
he refuses, the Buyer has the right to back out of the
deal and receive a refund of his earnest money.

As the Buyer, it is important to know what condition the
major functions of the house are in.

As an investor, you need to know how much it will cost
you to fix the problems if the Seller refuses to do so.

Sometimes, in order to get a good deal on a property, the
Buyer must accept the property in "as is" condition.

Just because you accept it in "as is" condition, does not
mean at you shouldn't do an inspection. If it is understood
the Seller will do no repairs, you (as the buyer) must

have a contingency to get you out of the deal if the
repairs turn out to be too extensive.

There are many questions you must ask
when doing an inspection on a property
you are planning to purchase.

(For a complete form that you can fill out while doing your
inspection, scroll down to the end of this chapter)

Does the roof leak? Is the wiring safe?

These questions, along with many others, are going to
require professional help to answer.

If you are a competent contractor and feel secure in
your knowledge of every major function of a home, then it
makes sense to do the inspection yourself.

It only costs $200 or $300 to get a professional home
inspection and it may well save you thousands.

According to the industry experts, there are at least 33
physical problems that will come under scrutiny
during a home inspection. Weve identified the 11 most
common of them, which, if not identified and dealt with,
could cost you dearly in terms of repair.

In most cases, you can make a reasonable pre-
inspection yourself if you know what youre looking for.

Knowing what youre looking for can prevent little
problems from growing into costly and unmanageable
ones.




1) Defective Plumbing
Defective plumbing can manifest itself in two different
ways: leaking and clogging. A visual inspection can
detect leaking and an inspector will gauge water pressure
by turning on all faucets in the highest bathroom and then
flushing the toilet.

If you hear the sound of running water, it indicates that
the pipes are undersized.

If the water appears dirty when first turned on at the
faucet, this is a good indication that the pipes are
rusting, which can result in severe water quality
problems.

2) Damp or Wet Basement
An inspector will check your walls for a powdery white
mineral deposit a few inches off the floor and will look to
see if you will be able to store things right on your
basement floor.

A mildew odor is almost impossible to eliminate and an
inspector will certainly be conscious of it.

It could cost you $300-$1,000 to seal a crack in or
around your basement foundation depending on
severity and location.

Adding a sump pump and pit will run you around $1,000
and complete waterproofing (of an average 3 bedroom
home) could add up to $8,000-$15,000. You will have to
weigh these figures into the calculation of how much
money you want to net from your property.

3) Inadequate Or Improper Wiring and Electrical
The home should have a minimum of 100 amps service
and this should be clearly marked.


Wire should be copper, aluminum or knob and tube.
Home inspectors will look at octopus plugs as
indicative of inadequate circuits and a potential fire
hazard.

4) Poor Heating and Cooling Systems
Insufficient insulation and inadequate or poorly
functioning heating systems are the most common
causes of poor heating.

While an adequately clean furnace without rust on the
heat exchanger usually has life left in it, an inspector will
be checking to see if your furnace is over its typical life
span of 10-15 years.

For a forced air gas system, a heat exchanger will come
under particular scrutiny, since a cracked one can
emit deadly carbon monoxide into the home. These
heat exchangers must be replaced if damaged - they
cannot be repaired.

5) Roofing Problems
Water leakage through the roof can occur for a variety of
reasons such as physical deterioration of the asphalt
shingles (e.g. curling or splitting) or mechanical
damage from a windstorm.

When gutters leak and down spouts allow water to run
down and through the exterior walls, this external problem
becomes a major internal one.

6) Damp Attic Spaces
Aside from basement dampness, problems with
ventilation, insulation and vapor barriers can cause
water, moisture, mold and mildew to form in the attic.


This can lead to premature wear of the roof, structure
and building materials. The cost to fix this damage could
easily run over $2,500.

7) Rotting Wood
This can occur in many places (door frame, window
frame, trim, siding, decks and fences). The building
inspector will sometimes probe the wood to see if
rotting is present - especially when wood has been
freshly painted.

8) Masonry Work
Brickwork can be costly, but left unattended, these repairs
can cause problems with water and moisture penetration
into the home, which in turn could lead to a chimney
being clogged by fallen bricks or even a chimney that
falls onto the roof.

The cost to rebuild a 5 ft chimney is approximately $500.
To repoint a 5 x 10 area would run around $250.

9.) Unsafe or Overfused Electrical Circuit
A fire hazard is created when more amperage is drawn on
the circuit than was intended.

15 amp circuits are the most common in a typical home
with larger service for large appliances such as stoves
and dryers. It will cost you about $600 to replace your
fuse box with circuit panel.

10) Adequate Security Features
An inspector will look for basic safety features that will
protect a house such as: proper locks on windows and
patio doors, dead bolts on the doors and smoke
detectors in every bedroom and on every level.

To install a Carbon Monoxide Detector would run around
$200. Youd need to invest about $150 to install 2

deadbolts and another $150 to install 3 to 5 smoke
detectors.

11) Structural/Foundation Problems
An inspector will certainly investigate the underlying
footing of the home because structural integrity is
fundamental to a good house. It would cost you about
$300 to add a new footing and install a post. It will cost
around $1,000 to replace a 40 ft beam.

When you buy a home or put one of your investment
properties on the market, you dont want any
unpleasant surprises that might cost you the sale.

By understanding these 11 problem areas and doing a
proper inspection and walk-through of your home,
youll be arming yourself against future disappointment
and expense.

Inspection Form

Use the following form to help you analyze the condition
of the property. Print this form out and take it with you to
the home. Look at each item on the list.

This form is very similar to the forms used by
professional home inspectors. If you don't know what
some of these items are, make sure you get a book
on home maintenance and find out before you
continue.

Inspection Form

ROOF Inspected from _____________ Covering_________ No. Layers______________
Approx. age________________ Vents_________________ Chimney Mtl.______
Flues________________________________________Facia_________________
Roof Covering__________________________________________________________________
Flashings______________________________________________________________________
Vents_________________________________________________________________________
Valleys_______________________________________________________________________
Ridges________________________________________________________________________
Gutters________________________________________________________________________
Chimneys_____________________________________________________________________

EXTERIOR Siding______________ Masonry________________ Trim____________
Doors___________________ Windows___________
Storms/Screens____
Electrical svc_______________________ Raceway/cables____________
Siding________________________________________________________________________
Masonry______________________________________________________________________
Trim__________________________________________________________________________
Doors_________________________________________________________________________
Windows______________________________________________________________________
Crawl Space vents_______________________________________________________________
Basement wells_________________________________________________________________
Eaves_________________________________________________________________________
Electrical______________________________________________________________________
Hose hydrants__________________________________________________________________
Lighting_______________________________________________________________________
Receptacles____________________________________________________________________
Other_________________________________________________________________________

SITE-GROUDS Walks___________________ Steps______________ Patio______
Porch_______________ Driveway____________ Culvert___________ Ditches_______
Swales_____________ Retaining walls____________________ Fences______________
Evidence of buried tanks______________ Out-buildings__________________________
Driveway______________________________________________________________________
Walks________________________________________________________________________
Steps_________________________________________________________________________
Patio_________________________________________________________________________
Porch_________________________________________________________________________
Retaining walls_________________________________________________________________
Drainage______________________________________________________________________
Fences________________________________________________________________________
Vegetation affecting house________________________________________________________
Other_________________________________________________________________________
Out-buildings inspected?_________________________________________________________

Visual adjacent property problems?_________________________________________________
Downspouts/Splash blocks/Underground drain?_______________________________________


EXTERIOR
FOUNDATION WALLS

General
Condition_____________________________________________________________
Settling_______________________________________________________________________
Drainage/grading_______________________________________________________________
Surface condition_______________________________________________________________
Vegetation problems_____________________________________________________________
Physical damage________________________________________________________________

HEATIG-COOLIG Air cond./Heat pump manuf.________________________
Electrical power_________________ Gas Meter_________________________ Oil tank______
Furnace/fan coil unit manuf_______________________________________________________
Air cond.
operation_____________________________________________________________
Air cond. Appearance____________________________________________________________
Air cond. piping________________________________________________________________
Gas/oil piping__________________________________________________________________
Oil tanks______________________________________________________________________
Heating operation_______________________________________________________________
Furnace
appearance____________________________________________________________
Needs cleaning_________________________________________________________________
Air filter______________________________________________________________________
Flue__________________________________________________________________________
Drain_________________________________________________________________________
Secondary drain above ceiling_____________________________________________________
Heat
exchanger_____________________________________________________________
Burners_______________________________________________________________________
Controls_______________________________________________________________________
Humidifier_____________________________________________________________________
Air cleaner_____________________________________________________________________
Combustion air_________________________________________________________________
Outside air
intake_______________________________________________________________
Piping/insulation________________________________________________________________

Grilles/diffusers/convectors_______________________________________________________
Air ducts/insulation______________________________________________________________
Clearances to combustibles________________________________________________________
Clearance from doors/windows/roof_________________________________________________
Aux. heaters/wall heaters/unit
heaters_______________________________________________

PLUMBIG Potable water supply_______________________ Waste______________

Well location_____________________ Septic location______________ Water heater________
Water flow
operation____________________________________________________________
Drain flow operation_____________________________________________________________
Well system operation____________________________________________________________
Septic system operation__________________________________________________________
Faucets_______________________________________________________________________
Drains________________________________________________________________________
Valves________________________________________________________________
Pipes_________________________________________________________________________
Vents_________________________________________________________________________
Water heater_______________________________________________________________
Temperature-pressure relief valve/piping_____________________________________________
Water softener/filter equipment____________________________________________________
Sewage/waste
pumps____________________________________________________________
Sump pumps___________________________________________________________________
Water heater in garage raised 18 above floor?________________________________________
Floor drains____________________________________________________________________
Bath tubs______________________________________________________________________
Showers_______________________________________________________________________
Sinks_________________________________________________________________
Water closets___________________________________________________________________
Spas/hot tubs__________________________________________________________________
Bidets________________________________________________________________________
Booster pumps_________________________________________________________________

ELECTRICAL Panel locations___________________________ Size,
amps_____
LIGHTIG No. breakers/fuses_______________________________________

Wiring in service
panel___________________________________________________________
Wiring in attic__________________________________________________________________
Wiring in basement______________________________________________________________
Wiring in crawl space____________________________________________________________
Wall switches__________________________________________________________________
Receptacles____________________________________________________________________
Receptacles, GFI________________________________________________________________
Light
fixtures_______________________________________________________________
Appliance receptacles____________________________________________________________
Appliance safety switches_________________________________________________________
Appliance disconnects___________________________________________________________
Appliance operation, permanent only________________________________________________
System grounding_______________________________________________________________
Clearances for
safety_____________________________________________________________
Clearances for service____________________________________________________________

KITCHEN
Appliances: Oven__________ Range___________ Disposal________ Refrigerator_________
Microwave__________ Dishwasher______________ Other_____________________________
Smoke detectors__________________ Exhaust fan_______________ Compactor____________

Walls___________________________________________________________
Floors________________________________________________________________
Ceiling________________________________________________________________________
Counter tops___________________________________________________________________
Cabinets_______________________________________________________________________

Sink plumbing__________________________________________________________________
Stains/leaks___________________________________________________________
Doors________________________________________________________________
Windows______________________________________________________________________


LAUNDRY
Walls_________________________________________________________________________
Floors________________________________________________________________________
Ceiling________________________________________________________________________
Counter tops ___________________________________________________________________

Cabinets_______________________________________________________________________
Dryer
vent__________________________________________________________________
Sink plumbing__________________________________________________________________
Washer plumbins_______________________________________________________________
Ironing board___________________________________________________________________
Shelves_______________________________________________________________________
Dryer gas service________________________________________________________________

BATHROOMS Half baths____________________ Full Baths________________
Master bath____________________________________________
Walls_________________________________________________________________
Floors________________________________________________________________________
Ceiling________________________________________________________________________
Counter top____________________________________________________________________
Sinks_________________________________________________________________________
Sink plumbing__________________________________________________________________
Water
closet________________________________________________________________
Bath tubs______________________________________________________________________
Showers_______________________________________________________________________
Spas/Jacuzi____________________________________________________________________
Fans__________________________________________________________________________
Heaters_______________________________________________________________________
Doors________________________________________________________________
Windows______________________________________________________________________
Shut-off valves_________________________________________________________________
Stains/leaks____________________________________________________________________
Tile__________________________________________________________________________
Caluking______________________________________________________________________

OTHER ROOMS Living room_____ Dining room _____ Family Room _____
Great room _____ Bedrooms_____ Hallways_____ Entry _____ Vestibule_____ Porch _____
Sun room _____ Enclosed pool_____ Basement room_____ Balcony_____

Walls_________________________________________________________________
Floors________________________________________________________________________
Ceiling________________________________________________________________________
Counter top____________________________________________________________________
Cabinets_______________________________________________________________________



Shelving______________________________________________________________________
Railings_______________________________________________________________
Sinks______________________________________________________________________
Sink plumbing__________________________________________________________________
Aux heaters____________________________________________________________________
Exhaust fans___________________________________________________________________
Doors________________________________________________________________
Windows______________________________________________________________________
Paneling_______________________________________________________________________
Trim__________________________________________________________________________
Partitions/screens_______________________________________________________________
Fireplaces_____________________________________________________________________

GARAGE
Walls_________________________________________________________________
Floors________________________________________________________________________
Ceiling________________________________________________________________________
Doors_________________________________________________________________________
Window_______________________________________________________________________
Over-head doors________________________________________________________________
Door
openers_______________________________________________________________
Firewall/separation______________________________________________________________
Aux. heaters___________________________________________________________________

ATTIC Number of areas__________
Access type____________________________________________________________________
Framing_______________________________________________________________________
Insulation______________________________________________________________________
Roof
sheathing_____________________________________________________________
Vents_________________________________________________________________
Flues_________________________________________________________________________
Chimneys_____________________________________________________________________
Plumbing/vents_________________________________________________________________
Exposed electrical wiring/devices___________________________________________________
Lighting_______________________________________________________________________
Evidence of
leakage_____________________________________________________________
Evidence of moisture condensation_________________________________________________


BASEMENT
Walls_________________________________________________________________________
Ceiling/joists-subfloor____________________________________________________________
Floors________________________________________________________________________
Windows______________________________________________________________________
Doors________________________________________________________________
Floor
drains________________________________________________________________
Sump pump____________________________________________________________________
Sinks_________________________________________________________________________
Evidence of flooding_____________________________________________________________

Mildew_______________________________________________________________________
Termites______________________________________________________________________
Mice/vermin___________________________________________________________
Radon________________________________________________________________________

CRAWL SPACE
Access________________________________________________________________________
Framing_______________________________________________________________________
Subfloor_______________________________________________________________________
Walls_________________________________________________________________________
Footings______________________________________________________________
Soil
conditions_____________________________________________________________
Leaks in plumbing_______________________________________________________________
Leaks in walls__________________________________________________________________
Evidence of flooding/standing water________________________________________________
Foundation vents________________________________________________________________
Air ducts______________________________________________________________________
Piping________________________________________________________________
Electrical wiring/devices__________________________________________________________
Settling of walls/footings_________________________________________________________
Termites______________________________________________________________________
Mildew/fungus_________________________________________________________________

OVERALL

TERMITES / Wood Destroying Insects _____________________________________________

OTHER/NOTES
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________
_____________________________________________________________________________________________

Sketches

Chapter 4

Making The Offer -
A Step-by-Step Dialogue -
Questions To Ask - Answers To Give

So, now that you have found the property, made a
cursory inspection and feel comfortable with the
amount of work that needs to be done in order to rent it
or resell it, you need to make an offer.

Your intention is to secure the property under
contract with the Seller, then assign your rights to
purchase to an investor who has the capital to
purchase it with cash or a new loan.

I will discuss how to get investors to purchase these
properties in a later chapter.

The investor will pay you $3000 for the right to
purchase the property. This is a separate agreement
that you will have with the investor (see chapter 5).

Right now, we will focus on the Seller of the property
and the offer you are going to make them, so you will
have a reasonable chance of it being accepted.

Never offer more than you can afford to pay.

Don't get caught up in the idea that you are going to make
it work no matter what. Let's face it, some deals just
won't work and you have to let them go.


Ultimately, the person who gets the best deal is the
person who is the least motivated. You have lots of
potential homes to purchase. The Seller only has one
home to sell.

Work up the numbers.

First, you need to know what the current market value of
the property is.

Do this by going to your title company. You can choose
to use any one you want, just look them up in the yellow
pages.

Title companies have access to comparable sales
(comps) of homes in the neighborhood.

Look for homes that are very similar to the one you are
preparing to purchase.

Value the home you are going to buy based on how it
compares to the homes that have sold before it.

Only use comps that are twelve months old or less.

There are two types of real estate we want to deal with
here.

The first type is property you can purchase for cash for
at least 15% under market value. You will sell these
contracts to an investor to complete the deal.

Every investor out there is looking for this type of
property and will gladly pay a fee to get it.


The second type of deal will be discussed in detail in
Section 2 of this book. This type is purchased for full
market value by taking title to the property "subject to
the existing loans."

I will fully educate you on to make an offer on this type of
property.

You don't need an investor to purchase these houses, but
you can make quick cash from them if you do by using
the "Agreement with Investor" forms that I give you in
Chapter 5. They are also extremely easy to sell at a profit
to investors.

So, let's start with property you find that is being sold at
less than market value. Let's say you found a property
that you think is worth $100,000. The Seller is asking
$80,000.

Now you start negotiating.

The first rule of negotiating a real estate deal is to never
negotiate verbally.

For a real estate transaction to be valid, it must be in
writing.

Even negotiating verbally in order to come to an
agreement before you write it down is a bad idea.

Use the purchase agreement as a negotiation tool.

Call the Seller on the phone and ask to meet with him.
Tell him you are bringing an offer on his real estate.
Don't tell him what the offer is over the phone.


Tell him you would like to sit down with him and explain it
in person.

Using the contracts you will find in the contract chapter, fill
out the purchase agreement. I'm will go into great detail
about how to fill out these forms in Chapter 5. Right now,
I'm just going cover the highlights.

Here's a short dialog with the Seller, which demonstrates
how to present the offer when you're sitting across the
table from the Seller.


Making The Offer (Dialogue)

You: Thanks for seeing me. I brought the offer with me.
Can I go over it with you?

Seller: Sure, and you may as well know right up front that
I won't take a penny less than the $80,000 we have
already discussed.

You: I understand. I am offering the $80,000, but I need
some help in order to get it closed. I am trying to
purchase this property with as little down payment as
possible. The lender requires us to come up with 10%
down payment, but they will allow the Seller to pay my
closing costs. Those costs are $2500. I've written that in
right here.

Seller: I don't want to pay your closing costs. Why should
I pay something for you?

You: The only way I can purchase this property is if I can
keep my cash into the deal at a minimum. Everything else
about the contract is pretty standard. This is the only

unusual thing about the deal and it is done every day in
the real estate world.

If I can't finance it, I can't buy it... that's all there is to it.
The whole reason we're buying this property is to either
fix it up and resell it or rent it out. Either way, my partner
and I are going have to spend more money on the
renovation above our down payment.

NOTE: If the Seller won't work with you on this, you can
always raise the price by 2500 dollars so that he will net
the same. For example, if you pay him $82,500 and ask
for $2,500, it still nets him the $80,000 that he wants. Just
make sure the there is enough profit in the deal to make it
worth doing for an investor.

You: You will receive cash at closing. I'm not asking you
to carry back a second or sell it to me on contract. It is a
very clean deal.

I would like to have possession of the property at closing.
I also want to be able to do an inspection even though I
will purchase it in "as is" condition. If I find a major
problem in the inspection, you will not be required to fix it
if you don't want to, but I do want to have the right to get
out of the deal. I have already looked at the property and I
don't anticipate any real problems. Do you know of
anything that I should be aware of?

Seller: Well... the furnace is no good and it probably
needs a roof in three or four years. Other than that, it's
just cosmetic problems.

You: None of those problems are deal killers for me, but I
do know that I need to spend money to get those things
fixed before I rent or sell it.


We will prorate the taxes, which means you pay for the
taxes up until the day of closing. After that, all taxes due
will be my responsibility. And finally, we can close it in 60
days.

Are these things acceptable to you?

Seller: It sounds OK to me.

You: I may get the loan in the name of my partner or he
may just pay cash. I have made this contract assignable
by me to another Buyer. This makes it possible for him to
get the loan in his name.

Seller: Who is this partner?

You: I work with three different people who buy
everything that I find in exchange for a piece of their
profit. Each of them is qualified to purchase this property.
To protect myself, I don't go to them until I have secured
the property with a purchase agreement.

Seller: Don't you trust them?

You: It's not a matter of trust, they are all good people, I
just think it's good business to cover your butt and keep
everything in writing.

Note: If this is at least the second time that you have
done this, let the Seller know... it will give him some
confidence that you can do it again.

End of Dialogue


Making the offer is not really very difficult. The type of
offer that you are making has very few unusual aspects.

It's really pretty straightforward and won't scare Sellers
or their Realtors (if they have one).

Once the Seller accepts your offer, make sure you get
his signature in all the proper places. Have copies
made so he can have a set.

Now it's time to call your investors.

Chapter 5 explains the contracts in detail. Chapter 6
shows you how to get investors for these properties.

Chapter 5

Contracts: Full Instructions On How
To Fill Them Out. You Can Print
These And Use Them.

Here is the list of contracts that you need to do the deals
in Section #1

1. Purchase agreement
2. Counter offer
3. Inspection amendment
4. Response to inspection amendment
5. Agreement with investor

The first half of this chapter is an explanation of the
forms with all of the blanks filled in. I have used red bold
type to distinguish between the contract and the part that
is filled in.

I have also included all MY NOTES in purple type so you
know it is not part of the contract.

Following the filled out copy of the form, you will find
a BLANK copy that you can print out and use for your
own transactions.









BEFORE YOU BEGIN THE NEXT CHAPTER, PLEASE
READ THE FOLLOWING DISCLAIMER!

DISCLAIMER:
Let me state again that I AM NOT AN ATTORNEY.

As a matter of fact, I don't even play one of TV. ;-)
These contracts are an example and not necessarily
complete for your purposes or needs concerning
your specific situation.

Please have a qualified attorney review any contract
that you enter into.


I am going to fill out the following forms in red and
explain why I did what I did, in purple.

PURCHASE AGREEMENT


Date: _____August 14, 2020__________________


1. BUYER: ___Joe Crump_______________________________________________________
(Buyer) agrees to buy the following property from the owner (Seller) for the consideration
and subject to the following terms, provisions, and conditions:
2. PROPERTY: The property (Property) is known as ____123 Main Street _______________
____________in ________Boone____________County, _______Moneyville_______ City,
_________ET______________State, and legally described as: _______Beauville Manor
Springs, Section 7, Lot 134_________________________________ together with any
existing improvements and fixtures attached, such as, but not limited to, electrical and/or gas
fixtures, heating and central air-conditioning equipment and all attachments thereto, built-in
kitchen equipment, sump pump, water softener, gas grills, central vacuum equipment, window
shades/blinds, curtain rods, drapery poles and fixtures, ceiling fans and light fixtures, towel
racks and bars, storm doors, windows, awnings, TV antennas, satellite dishes and controls,
storage barns, all landscaping, mailbox, garage door opener with control(s) AND THE
FOLLOWING: ____________Includes Refrigerator, Washer and Dryer_________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
_______________________________________ All items sold shall be fully paid for by Seller
at time of closing the transaction. MY NOTES: The first part of the
Purchase agreement is pretty self-explanatory. To get the legal
description, talk to your title company. I will be discussing Title
Companies a bit later in this contract. The important part here is
about the refrigerator. Many states do not consider appliances as
fixtures and they must be named independently on the contract.
You can often get these appliances by simply asking for them.

3. PRICE: Buyer will pay the total purchase price of $_____115,000.00__________ for the
Property. MY NOTES: Pick a price. Remember that we are going to
be asking for closing costs and rehab expenses later in this
contract. Find out what the average percent of the asking price
homes sell for in your town (ask a real estate agent). If the
average home sells for 97% of asking price (as it does in my
state) and you offer full asking price, but ask for the Seller to pay
$5500 of your closing costs (as we do here), you are really
offering $109,500 or 95% of asking price. If the property is priced
right to start with (i.e. 85% of real value), you would be doing well

to get it at this price. If it is too low for the Seller, you can always
go above asking price in order to get the cash back that you need.
Just make sure that all of the numbers in the transaction work.
4. EARNEST MONEY: Buyer submits $ _______500.00___________ as earnest money which
shall be applied to purchase price. The "Seller" shall deposit earnest money into an escrow
account at _____Chicago Title__________________Title Company, within two (2) banking
days of acceptance of this Agreement and Title Company will hold it until time of closing the
transaction or termination of this Agreement. If Buyer fails for any reason to submit earnest
money, Seller may terminate this Agreement. Earnest money shall be returned promptly in the
event this offer is not accepted. If this offer is accepted and Buyer fails or refuses to close the
transaction, without legal cause, the earnest money shall be forfeited by Buyer to Seller as
liquidated damages, and Seller may pursue any other legal and equitable remedies. The Title
Company holding any earnest money is absolved from any responsibility to make payment to
the Seller or Buyer unless the parties enter into a Mutual Release or a Court issues an Order
for payment. If the parties do not mutually consent to the release of the earnest money, then
they agree that the Title Company holding the earnest money may file an interpleader action
with a Court regarding disposition of the earnest money and that the payment of the Title
Company's resulting costs (including attorneys fees) incurred in connection with such
interpleader are a priority claim against the earnest money regardless of the Courts
apportionment of the balance of the earnest money. MY NOTES: Earnest money
sits in a holding account at the title company that you and the
Seller agree upon. It applies to your down payment at closing.
You do not have to have earnest money in most states to have a
valid contract. The amount of earnest money is determined by
what you can negotiate with the Seller. Keep it as low as possible.
If, for whatever reason, the deal falls apart, the only way the
earnest money is release back to you is if you have a "Mutual
Release" (provided by the title company) signed by BOTH Buyer
and Seller. If there is a dispute over who should get the earnest
money, it will sit in the escrow account until the Court issues an
Order for Payment. As a Buyer, you have several contingencies in
this contract. You or the person you assign must be able to get
financing and you also are protected by the inspection clause. I
will go into more detail about this later.
5. METHOD OF PAYMENT: (Circle appropriate paragraph letter)
A. CASH: The entire purchase price shall be paid in cash and no financing is required.
B. NEW MORTGAGE: Completion of this transaction shall be contingent upon the Buyer or
the Buyer's assigns, ability to obtain a
_X_ Conventional ____ Insured Conventional ____ FHA ____ VA ____Other
___________________ first mortgage loan for _Best Available LTV__ % of purchase price,
payable in not less than _____30___ years, with an original rate of interest not to exceed
__Best Available Rate__ % per annum and not to exceed __Best Available___ points.

Buyer shall pay all cost of obtaining financing, except__Seller to pay $2500 of any of Buyer's
Costs To Purchase Property At Closing______________________ Notwithstanding any
other provisions of this Agreement, any inspections and charges which are required to be
made and charged to Buyer or Seller by the lender, FHA, VA, mortgage insurer, or closing
agent, shall be made and charged in accordance with their prevailing rules or regulations and
shall supersede any provisions of this Agreement. MY NOTES: You must specify
the type of financing you are using. Remember, you are not
personally financing this transaction, you are going to assign this
contract to an investor and he will get the loan or pay cash for the
property. You are going to ask for closing costs in this
transaction to help your investor purchase this home with a lower
down payment. The figure above will cover closing costs for most
non-occupied loans, but check with your lender before you write
your offers to make sure you have allotted enough. LTV stands
for "Loan To Value."
C. OTHER METHOD OF PAYMENT: (Attach Financing Addendum)
TIME FOR OBTAINING FINANCING: Buyer or Buyer's assigns agrees to make written
application for any financing necessary to complete this transaction or for approval to assume
the unpaid balance of the existing mortgage within _15_ days after the acceptance of this
Agreement and to make a diligent effort to meet the lenders requirements and to obtain
financing in cooperation with the Broker and Seller. No more than ______60______ days after
acceptance of the Agreement shall be allowed for obtaining favorable written commitment(s) or
mortgage assumption approval. If a commitment or approval is not obtained within the time
specified above, this Agreement shall terminate unless an extension of time for this purpose is
mutually agreed to in writing. MY NOTES: This just says you have 15 days
to apply for a loan and 60 days to get loan approval. So your
investor must have loan approval before the 60 days is up.
6. CLOSING: The closing of the sale (the Closing Date) shall be on or before __October 14th,
2020__________, or this Agreement shall terminate unless an extension of time is mutually
agreed to in writing. If the method of payment for this transaction is cash, assumption or
conditional sales contract, the closing fee shall be paid by __X_ BUYER ___ SELLER ___
shared equally. MY NOTES: The date is 60 days from the date the offer
was made. Closing fees are usually paid for by the Buyer
everythings negotiable.
7. POSSESSION:
A. The possession of the Property shall be delivered to Buyer _X__ at closing ___ within
________days after closing. If Seller does not deliver possession by the date required in the
first sentence of this paragraph, Seller shall pay Buyer $ _____75.00____________ per day as
liquidated damages until possession is delivered to Buyer; and Buyer shall have all other legal
and equitable remedies available against the Seller. MY NOTES: This says that
you want possession at closing and that if they don't vacate the

property, they owe you $75 per day. This helps them get out in a
timely manner. Don't make this figure too high; a court won't
honor it if it is not reasonable.
B. Maintenance of Property: Seller shall maintain the Property in its present condition until its
possession is delivered to Buyer, subject to repairs in response to any inspection. Buyer may
inspect the Property prior to closing to determine whether Seller has complied with this
paragraph.
C. Casualty Loss: Risk of loss by damage or destruction to the Property prior to the closing shall
be borne by Seller. In the event any damage or destruction is not fully repaired prior to
closing. Buyer, at Buyers option, may either (a) terminate this Agreement or (b) elect to close
the transaction, in which event Sellers right to all insurance proceeds resulting from such
damage or destruction shall be assigned in writing by Seller to Buyer.
D. Utilities/Municipal Services: Seller shall pay for all municipal services and public utility charges
through the day of possession.
8. SURVEY: Buyer shall receive a (check ONE) _X_ SURVEYOR LOCATION REPORT, which
is a survey where corner markers are not set, ___ BOUNDARY SURVEY, which is a survey
where corner markers of the Property are set prior to closing; ___ WAIVED, no survey
required, at (Check ONE) _X__ BUYERS expense; ___ SELLERS expense. The survey
shall (1) be received prior to closing and certified as of a current date; (2) be reasonably
satisfactory to Buyer; (3) show the location of all improvements and easements; and (4) show
the flood zone designation of the Property. MY NOTES: Most lenders want a
survey done of the property before they will give a loan. This
protects them from encroachments onto the subject property...
i.e. if the next-door neighbor built the corner of his garage on
your side of the property line.
9. FLOOD AREA/OTHER: Buyer __X_ may ___ may not terminate this Agreement if the
Property requires flood insurance or Buyer _X__ may ___ may not terminate this Agreement if
the Property is subject to building or use limitations by reason of the location. MY NOTES:
If you didn't know it was in a flood plain and the numbers don't
work because you have to pay flood insurance to get a loan, you
can get out of the deal.
10. INSPECTIONS: BUYER RESERVES THE RIGHT TO HAVE THE PROPERTY INSPECTED
(Including Lead-Based Paint) independent of and in addition to any inspections required by
FHA, VA, or Buyers lender(s). All inspections are to be at Buyers expense (unless noted
otherwise or required by lender) by qualified inspectors or contractors selected by Buyer within
the following time periods.

12. INSPECTION/RESPONSE PERIOD: Buyer shall order all INDEPENDENT INSPECTIONS
immediately after acceptance of the Purchase Agreement. Buyer shall have _25__ calendar
days beginning the day following the date of acceptance of the Purchase Agreement to
respond to the inspection report(s) in writing to Seller (see Buyers Response) except:
(check appropriate paragraph(s)
_X__ Buyer shall have __25__ calendar days to receive and respond in writing to the written
lead based paint inspection and/or risk assessment report.

_X__ Buyer shall have __25__ calendar days to receive and respond in writing to the written
Radon Report.

Inspections may include but are not limited to the condition of the following systems and
components: heating, cooling, electrical, plumbing, roof, walls, ceilings, floors, foundation,
basement, crawl space, well/septic, water, wood-eating insects and organisms, lead-based
paint (note: intact lead-based paint that is in good condition is not necessarily a hazard), radon
tested at lowest livable area either currently finished or unfinished) and/or the following:
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
_________If the Buyer does not comply with Inspection/Response Period or make a written
objection to any problem revealed in the report within the Inspection/Response Period, The
Property shall be deemed to be acceptable. If the Buyer, in the reasonable discretion, believes
that the Inspection Report reveals a MAJOR DEFECT with the Property and the Seller is
unable or unwilling to remedy the defect to the Buyers reasonable satisfaction before closing
(or at a time otherwise agreed to by the parties), then this Agreement may be terminated by
the Buyer or such defect shall be waived by the Buyer and the transaction shall proceed
toward closing. BUYER AGREES THAT ANY PROPERTY DEFECT PREVIOUSLY
DISCLOSED BY SELLER OR ROUTINE MAINTENANCE AND MINOR REPAIR ITEMS
MENTIONED IN ANY REPORT TOTALLING NO MORE THAN $ ______250________ TO
REMEDY, SHALL NOT BE A BASIS FOR TERMINATION OF THIS AGREEMENT. MY
NOTES: You have the right to have the property inspected by a
professional home inspector. If you find a MAJOR DEFECT, (in
this case defined by a cost of $250), you have the right to ask the
Seller to fix the problem. The Seller has the right to say NO. But, if
he says NO, you have the right to back out of the contract and get
your earnest money back. (Of course, the Seller must still sign a
Mutual Release for you to get your money). As an investor, you
probably won't make use of this contingency... you are buying
under value and should expect the home to be in less than perfect
shape. It may even be in terrible shape. You just need this clause
in case there are any surprises.
13. TITLE APPROVAL: Prior to closing, Buyer shall be furnished _X__ a commitment for
title insurance in the amount of purchase price or ___ an abstract of title continued to date
showing marketable title to the Property to pay mortgage policy. Any encumbrances or defects
in title must be removed and Seller must convey title free and clear of any encumbrances and
title defects, with the exception of any mortgage assumed by Buyer and any restrictions and
easements of record which will not materially interfere with Buyers intended use of the
Property. Seller shall order the commitment _X__ immediately ___ after mortgage approval.
Seller agrees to pay the cost of obtaining all other documents necessary to perfect title
(including the cost of the deed and vendors affidavit), so that marketable title can be conveyed.
MY NOTES: Title Insurance guarantees that you are getting the

property free and clear of any liens or encumbrances that may
have been placed against the property. It is paid for by the Seller
and is vital to this type of transaction.

14. TAXES: All taxes assessed for any prior calendar year and remaining unpaid shall be paid by
Seller, and all taxes assessed for the current calendar year shall be prorated between Seller
and Buyer on a calendar-year basis as of the day immediately prior to the Closing Date. If the
tax rate and/or assessment for taxes assessed in the current year have not been determined
at the closing of the transaction, the rate and/or assessment shall be assumed to be the same
as the prior year for the purpose of such proration and credit for due but unpaid taxes and this
shall be a final settlement.

If at the time of closing the tax bill for the Property for the succeeding year has not been
issued, taxes payable by either party shall be computed based on the most recent tax rate
and/or assessment available to the closing agent.
WARNING: The succeeding year tax bill for recently constructed homes or following
reassessment periods may greatly exceed the last tax bill available to the closing agent. MY
NOTES: This just says that the property taxes for the home will be
prorated to the day of closing. They will pay up to the day of
closing. You will pay starting with the closing date.

15. PRORATIONS AND SPECIAL ASSESSMENTS: Insurance, if assigned to Buyer, interest on
any debt assumed or taken subject to, any rents, all other income and ordinary operating
expenses of the Property, including but not limited to, public utility charges, shall be prorated
as of the day prior to the Closing Date. Seller shall pay any special assessments applicable to
the Property for municipal improvements previously made to benefit the Property. Seller
warrants that Seller has no knowledge of any planned improvements which may result in
assessments and that no governmental or private agency has served notice requiring repairs,
alterations or corrections of any existing conditions. Public or municipal improvements which
are not completed as of the date above but which will result in a lien or charge shall be paid by
Buyer. Buyer will assume and pay all special assessments for municipal improvements
completed after the date of this Agreement. MY NOTES: The government can
assess property owners for improvements to the area. Typical
improvements for homeowners include sewers and water lines.

16. TIME: Time is of the essence. Time periods specified in this Agreement and any subsequent
Addenda to the Purchase Agreement are calendar days and shall expire at midnight of the
date stated unless the parties agree in writing to a different date and/or time.


17. HOMEOWNERS ASSOCIATION/CONDOMINIUM ASSOCIATION: Documents for a
mandatory membership association shall be delivered by the Seller to Buyer within __7___
days after acceptance of this Agreement. If the Buyer does not make a written response to the
documents within __25____ days after receipt, the documents shall be deemed acceptable. In
the event the Buyer does not accept the provisions in the documents and such provisions
cannot be waived, this Agreement may be terminated by the Buyer and the earnest money
deposit shall be refunded to Buyer promptly. Any approval of sale required by the Association
shall be obtained by the Seller, in writing, within __15____ days after Buyers approval of the
documents. MY NOTES: If there is a MANDATORY Homeowner's
Association, the Seller is required to give you all of the
documents pertaining to it within 7 days. You then have 25 days
to respond if you don't like something in them... Let's say you
wanted to park an RV in the driveway, but the Association forbids
it. You could get out of the contract with this objection.

18. ATTORNEYS FEES: Any party to this Agreement who is the prevailing party in any legal or
equitable proceeding against any other party brought under or with relation to the Agreement
or transaction shall be additionally entitled to recover court costs and reasonable attorney'
fees from the non-prevailing party.

19. MISCELLANEOUS:

A. Unless otherwise provided, any prorations for rent, taxes, insurance, damage deposits,
association dues/assessments, or any other items shall be computed through the date of
closing.
B. Conveyance of this Property shall be by general Warranty Deed, subject to taxes,
easements, restrictive covenants and encumbrances of record, unless otherwise agreed.
C. Seller represents and warrants that Seller is not a foreign person (individual entity) and,
therefore, not subject to the Foreign Investment in Real Property Tax Act.
D. Any notice required or permitted to be delivered shall be deemed received when personally
delivered, transmitted by facsimile or sent by express courier or United States mail,
postage prepaid, certified and return receipt requested, addressed to Seller or Buyer or the
designated agent of either party at the address set forth below the signature of the party.
E. In case any provision contained in this Agreement is held invalid, illegal, or unenforceable
in any respect, the invalidity, illegality, or unenforceability shall not affect any other
provision of this Agreement.
F. This Agreement constitutes the sole and only agreement of the parties and supersedes any
prior understandings or written or oral agreements between the parties respecting the
transaction and cannot be changed except by their written consent.
G. All rights, duties and obligations of the parties shall survive the passing of title to, or an
interest in, the Property.

H. Buyer discloses to Seller that Buyer is licensed and holds Real Estate License
#_______________________. MY NOTES: If you are a licensed Real
Estate Agent, you must disclose this to the Seller.

20. FURTHER CONDITIONS: _____SELLER TO PAY BUYER $3,000 AT CLOSING TO
COVER ADDITIONAL COSTS FOR REHAB OR CARPET ____________________________
___________________________________________________________________________
_THIS CONTRACT MAY BE ASSIGNED BY THE BUYER TO AN ALTERNATE BUYER ___
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
MY NOTES: The $3000 is what the Investor is going to pay you at
closing. You will have a separate agreement with the Investor.
The Assignment clause makes it possible for the investor to take
over this contract. Not every Seller is going to like this clause.
The savvy ones will have one big objection... can the person who
this contract is being assigned too QUALIFY for the loan? You
need to help them understand that you work with several
investors and that they all have been prequalified to purchase
your homes.
21. EXPIRATION OF OFFER: Unless accepted by Seller and delivered by Buyer by ___5:00____
____A.M. / P.M. (circle one), the _____15____ day of __August______, 20__20____ , this
Purchase Agreement shall be null and void and all parties shall be relieved of any and all
liability or obligations. MY NOTES: I think 24 hours is plenty of time for a
Seller to make a decision about your offer. If he needs more time,
give it to him. But make the response time short in writing to keep
the ball rolling. Don't let it languish for a week... If you do, it will
probably die.
22. CONSULT YOUR ADVISORS: Buyer and Seller acknowledge they have been advised that,
prior to signing this document, they may seek the advice of an attorney for the legal or tax
consequences of this document and the transaction to which it relates. In any real estate
transaction, it is recommended that you consult with a professional, such as a civil engineer,
environmental engineer, or other person, with experience in evaluating the condition of the
Property.. MY NOTES: Talk to an attorney! I'm not just saying this to
cover my butt. I mean it.


This Agreement may be executed simultaneously or in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the same
instrument. The parties agree that this Agreement may be transmitted between them by
facsimile machine. The parties intend that faxed signatures constitute original signatures and
are binding on the parties. The original document shall be promptly delivered, if requested.

_Joe Crump________________8-14-2020_ _______________________________________
BUYERS SIGNATURE DATE BUYERS SIGNATURE DATE

__Joe Crump____________________________ _______________________________________
PRINTED PRINTED

________________________________________ _______________________________________
BUYERS SOCIAL SECURITY #/FEDERAL I.D. # BUYERS SOCIAL SECURITY #/FEDERAL I.D. #

_____________________________________ ________________________________________
MAILING ADDRESS ZIP CODE MAILING ADDRESS ZIP CODE


_____________________________________ ________________________________________
(Area Code) TELEPHONE NUMBER (Area Code) TELEPHONE NUMBER


___ A. As the Seller(s) of the property described herein, the above terms and conditions are accepted
this ____ day of ___________ at ___________ __ A.M. ___ P.M. ___ Noon


______________________________________ _________________________________________
SELLERS SIGNATURE DATE SELLERS SIGNATURE DATE

_______________________________________ ________________________________________
PRINTED PRINTED

________________________________________ ______________________________________
SELLERS SOCIAL SECURITY #/FEDERAL I.D.# SELLERS SOCIAL SECURITY #/FEDERAL I.D.

________________________________________ ______________________________________
MAILING ADDRESS ZIP CODE MAILING ADDRESS ZIP CODE

_______________________________________ ________________________________________
(Area Code) TELEPHONE NUMBER (Area Code) TELEPHONE NUMBER

MY NOTES: Fill out this bottom section entirely. You must have the
Seller's signatures on this page for this offer to be a valid "accepted"
offer.

The following is a BLANK "Purchase
Agreement" Form that you can print, fill out
and use. After that, we will discuss the
"Counter Offer Form."

PURCHASE AGREEMENT


Date: _______________________


1. BUYER: ____________________________________________________________________
(Buyer) agrees to buy the following property from the owner (Seller) for the consideration
and subject to the following terms, provisions, and conditions:
2. PROPERTY: The property (Property) is known as ______________________________
______________________________ ________in _________________________County,
_________________________ City, _________________________State, and legally
described as: ____________________________________________________________
_______________________________________ together with any existing improvements and
fixtures attached, such as, but not limited to, electrical and/or gas fixtures, heating and central
air-conditioning equipment and all attachments thereto, built-in kitchen equipment, sump
pump, water softener, gas grills, central vacuum equipment, window shades/blinds, curtain
rods, drapery poles and fixtures, ceiling fans and light fixtures, towel racks and bars, storm
doors, windows, awnings, TV antennas, satellite dishes and controls, storage barns, all
landscaping, mailbox, garage door opener with control(s) AND THE FOLLOWING:
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
_ All items sold shall be fully paid for by Seller at time of closing the transaction.
3. PRICE: Buyer will pay the total purchase price of $_______________________ for the
Property.
4. EARNEST MONEY: Buyer submits $ ______________________ as earnest money which
shall be applied to purchase price. The "Seller" shall deposit earnest money into an escrow
account at _______________________Title Company, within two (2) banking days of
acceptance of this Agreement and Title Company will hold it until time of closing the
transaction or termination of this Agreement. If Buyer fails for any reason to submit earnest
money, Seller may terminate this Agreement. Earnest money shall be returned promptly in the
event this offer is not accepted. If this offer is accepted and Buyer fails or refuses to close the
transaction, without legal cause, the earnest money shall be forfeited by Buyer to Seller as
liquidated damages, and Seller may pursue any other legal and equitable remedies. The Title
Company holding any earnest money is absolved from any responsibility to make payment to
the Seller or Buyer unless the parties enter into a Mutual Release or a Court issues an Order
for payment. If the parties do not mutually consent to the release of the earnest money, then
they agree that the Title Company holding the earnest money may file an interpleader action
with a Court regarding disposition of the earnest money and that the payment of the Title
Company's resulting costs (including attorneys fees) incurred in connection with such
interpleader are a priority claim against the earnest money regardless of the Courts
apportionment of the balance of the earnest money.
5. METHOD OF PAYMENT: (Circle appropriate paragraph letter)
C. CASH: The entire purchase price shall be paid in cash and no financing is required.

D. NEW MORTGAGE: Completion of this transaction shall be contingent upon the Buyer or
the Buyer's assigns, ability to obtain a
__ Conventional ____ Insured Conventional ____ FHA ____ VA ____Other
___________________ first mortgage loan for __________ % of purchase price, payable in
not less than __________ years, with an original rate of interest not to exceed ________ %
per annum and not to exceed __________ points. Buyer shall pay all cost of obtaining
financing, except _____________________________________________________
Notwithstanding any other provisions of this Agreement, any inspections and charges which
are required to be made and charged to Buyer or Seller by the lender, FHA, VA, mortgage
insurer, or closing agent, shall be made and charged in accordance with their prevailing rules
or regulations and shall supersede any provisions of this Agreement.
C. OTHER METHOD OF PAYMENT: (Attach Financing Addendum)
6. TIME FOR OBTAINING FINANCING: Buyer or Buyer's assigns agrees to make written
application for any financing necessary to complete this transaction or for approval to assume
the unpaid balance of the existing mortgage within ____ days after the acceptance of this
Agreement and to make a diligent effort to meet the lenders requirements and to obtain
financing in cooperation with the Broker and Seller. No more than ______________ days after
acceptance of the Agreement shall be allowed for obtaining favorable written commitment(s) or
mortgage assumption approval. If a commitment or approval is not obtained within the time
specified above, this Agreement shall terminate unless an extension of time for this purpose is
mutually agreed to in writing.
7. CLOSING: The closing of the sale (the Closing Date) shall be on or before
________________________, or this Agreement shall terminate unless an extension of time is
mutually agreed to in writing. If the method of payment for this transaction is cash, assumption
or conditional sales contract, the closing fee shall be paid by ___ BUYER ___ SELLER ___
shared equally.
8. POSSESSION:
E. The possession of the Property shall be delivered to Buyer ___ at closing ___ within
________days after closing. If Seller does not deliver possession by the date required in the
first sentence of this paragraph, Seller shall pay Buyer $ ___________________ per day as
liquidated damages until possession is delivered to Buyer; and Buyer shall have all other legal
and equitable remedies available against the Seller.
F. Maintenance of Property: Seller shall maintain the Property in its present condition until its
possession is delivered to Buyer, subject to repairs in response to any inspection. Buyer may
inspect the Property prior to closing to determine whether Seller has complied with this
paragraph.
G. Casualty Loss: Risk of loss by damage or destruction to the Property prior to the closing shall
be borne by Seller. In the event any damage or destruction is not fully repaired prior to
closing. Buyer, at Buyers option, may either (a) terminate this Agreement or (b) elect to close
the transaction, in which event Sellers right to all insurance proceeds resulting from such
damage or destruction shall be assigned in writing by Seller to Buyer.
H. Utilities/Municipal Services: Seller shall pay for all municipal services and public utility charges
through the day of possession.
9. SURVEY: Buyer shall receive a (check ONE) ___ SURVEYOR LOCATION REPORT, which
is a survey where corner markers are not set, ___ BOUNDARY SURVEY, which is a survey
where corner markers of the Property are set prior to closing; ___ WAIVED, no survey
required, at (Check ONE) ___ BUYERS expense; ___ SELLERS expense. The survey shall
(1) be received prior to closing and certified as of a current date; (2) be reasonably satisfactory

to Buyer; (3) show the location of all improvements and easements; and (4) show the flood
zone designation of the Property.
10. FLOOD AREA/OTHER: Buyer ___ may ___ may not terminate this Agreement if the
Property requires flood insurance or Buyer ___ may ___ may not terminate this Agreement if
the Property is subject to building or use limitations by reason of the location.
11. INSPECTIONS: BUYER RESERVES THE RIGHT TO HAVE THE PROPERTY INSPECTED
(Including Lead-Based Paint) independent of and in addition to any inspections required by
FHA, VA, or Buyers lender(s). All inspections are to be at Buyers expense (unless noted
otherwise or required by lender) by qualified inspectors or contractors selected by Buyer within
the following time periods.

12. INSPECTION/RESPONSE PERIOD: Buyer shall order all INDEPENDENT INSPECTIONS
immediately after acceptance of the Purchase Agreement. Buyer shall have _____ calendar
days beginning the day following the date of acceptance of the Purchase Agreement to
respond to the inspection report(s) in writing to Seller (see Buyers Response) except:
(check appropriate paragraph(s)
___ Buyer shall have ____ calendar days to receive and respond in writing to the written lead
based paint inspection and/or risk assessment report.
___ Buyer shall have ____ calendar days to receive and respond in writing to the written
Radon Report.

Inspections may include but are not limited to the condition of the following systems and
components: heating, cooling, electrical, plumbing, roof, walls, ceilings, floors, foundation,
basement, crawl space, well/septic, water, wood-eating insects and organisms, lead-based
paint (note: intact lead-based paint that is in good condition is not necessarily a hazard), radon
tested at lowest livable area either currently finished or unfinished) and/or the following:
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
_________If the Buyer does not comply with Inspection/Response Period or make a written
objection to any problem revealed in the report within the Inspection/Response Period, The
Property shall be deemed to be acceptable. If the Buyer, in the reasonable discretion, believes
that the Inspection Report reveals a MAJOR DEFECT with the Property and the Seller is
unable or unwilling to remedy the defect to the Buyers reasonable satisfaction before closing
(or at a time otherwise agreed to by the parties), then this Agreement may be terminated by
the Buyer or such defect shall be waived by the Buyer and the transaction shall proceed
toward closing. BUYER AGREES THAT ANY PROPERTY DEFECT PREVIOUSLY
DISCLOSED BY SELLER OR ROUTINE MAINTENANCE AND MINOR REPAIR ITEMS
MENTIONED IN ANY REPORT TOTALLING NO MORE THAN $ ______________ TO
REMEDY, SHALL NOT BE A BASIS FOR TERMINATION OF THIS AGREEMENT.
13. TITLE APPROVAL: Prior to closing, Buyer shall be furnished ___ a commitment for title
insurance in the amount of purchase price or ___ an abstract of title continued to date showing
marketable title to the Property to pay mortgage policy. Any encumbrances or defects in title
must be removed and Seller must convey title free and clear of any encumbrances and title
defects, with the exception of any mortgage assumed by Buyer and any restrictions and
easements of record which will not materially interfere with Buyers intended use of the
Property. Seller shall order the commitment ___ immediately ___ after mortgage approval.

Seller agrees to pay the cost of obtaining all other documents necessary to perfect title
(including the cost of the deed and vendors affidavit), so that marketable title can be conveyed.

14. TAXES: All taxes assessed for any prior calendar year and remaining unpaid shall be paid by
Seller, and all taxes assessed for the current calendar year shall be prorated between Seller
and Buyer on a calendar-year basis as of the day immediately prior to the Closing Date. If the
tax rate and/or assessment for taxes assessed in the current year have not been determined
at the closing of the transaction, the rate and/or assessment shall be assumed to be the same
as the prior year for the purpose of such proration and credit for due but unpaid taxes and this
shall be a final settlement.

If at the time of closing the tax bill for the Property for the succeeding year has not been
issued, taxes payable by either party shall be computed based on the most recent tax rate
and/or assessment available to the closing agent.
WARNING: The succeeding year tax bill for recently constructed homes or following
reassessment periods may greatly exceed the last tax bill available to the closing agent.

15. PRORATIONS AND SPECIAL ASSESSMENTS: Insurance, if assigned to Buyer, interest on
any debt assumed or taken subject to, any rents, all other income and ordinary operating
expenses of the Property, including but not limited to, public utility charges, shall be prorated
as of the day prior to the Closing Date. Seller shall pay any special assessments applicable to
the Property for municipal improvements previously made to benefit the Property. Seller
warrants that Seller has no knowledge of any planned improvements which may result in
assessments and that no governmental or private agency has served notice requiring repairs,
alterations or corrections of any existing conditions. Public or municipal improvements which
are not completed as of the date above but which will result in a lien or charge shall be paid by
Buyer. Buyer will assume and pay all special assessments for municipal improvements
completed after the date of this Agreement.
16. TIME: Time is of the essence. Time periods specified in this Agreement and any subsequent
Addenda to the Purchase Agreement are calendar days and shall expire at midnight of the
date stated unless the parties agree in writing to a different date and/or time.
17. HOMEOWNERS ASSOCIATION/CONDOMINIUM ASSOCIATION: Documents for a
mandatory membership association shall be delivered by the Seller to Buyer within _____ days
after acceptance of this Agreement. If the Buyer does not make a written response to the
documents within ______ days after receipt, the documents shall be deemed acceptable. In
the event the Buyer does not accept the provisions in the documents and such provisions
cannot be waived, this Agreement may be terminated by the Buyer and the earnest money
deposit shall be refunded to Buyer promptly. Any approval of sale required by the Association
shall be obtained by the Seller, in writing, within ______ days after Buyers approval of the
documents.
18. ATTORNEYS FEES: Any party to this Agreement who is the prevailing party in any legal or
equitable proceeding against any other party brought under or with relation to the Agreement
or transaction shall be additionally entitled to recover court costs and reasonable attorney'
fees from the non-prevailing party.


19. MISCELLANEOUS:
I. Unless otherwise provided, any prorations for rent, taxes, insurance, damage deposits,
association dues/assessments, or any other items shall be computed through the date of
closing.
J. Conveyance of this Property shall be by general Warranty Deed, subject to taxes,
easements, restrictive covenants and encumbrances of record, unless otherwise agreed.
K. Seller represents and warrants that Seller is not a foreign person (individual entity) and,
therefore, not subject to the Foreign Investment in Real Property Tax Act.
L. Any notice required or permitted to be delivered shall be deemed received when personally
delivered, transmitted by facsimile or sent by express courier or United States mail,
postage prepaid, certified and return receipt requested, addressed to Seller or Buyer or the
designated agent of either party at the address set forth below the signature of the party.
M. In case any provision contained in this Agreement is held invalid, illegal, or unenforceable
in any respect, the invalidity, illegality, or unenforceability shall not affect any other
provision of this Agreement.
N. This Agreement constitutes the sole and only agreement of the parties and supersedes any
prior understandings or written or oral agreements between the parties respecting the
transaction and cannot be changed except by their written consent.
O. All rights, duties and obligations of the parties shall survive the passing of title to, or an
interest in, the Property.
P. Buyer discloses to Seller that Buyer is licensed and holds Real Estate License
#_______________________.

20. FURTHER CONDITIONS:
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
21. EXPIRATION OF OFFER: Unless accepted by Seller and delivered by Buyer by _________
____A.M. / P.M. (circle one), the _________ day of ______________, 20______ , this
Purchase Agreement shall be null and void and all parties shall be relieved of any and all
liability or obligations.
22. CONSULT YOUR ADVISORS: Buyer and Seller acknowledge they have been advised that,
prior to signing this document, they may seek the advice of an attorney for the legal or tax
consequences of this document and the transaction to which it relates. In any real estate
transaction, it is recommended that you consult with a professional, such as a civil engineer,
environmental engineer, or other person, with experience in evaluating the condition of the
Property.


This Agreement may be executed simultaneously or in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the same
instrument. The parties agree that this Agreement may be transmitted between them by
facsimile machine. The parties intend that faxed signatures constitute original signatures and
are binding on the parties. The original document shall be promptly delivered, if requested.

________________________________________ _______________________________________
BUYERS SIGNATURE DATE BUYERS SIGNATURE DATE

________________________________________ _______________________________________
PRINTED PRINTED

________________________________________ _______________________________________
BUYERS SOCIAL SECURITY #/FEDERAL I.D. # BUYERS SOCIAL SECURITY #/FEDERAL I.D. #

_____________________________________ ________________________________________
MAILING ADDRESS ZIP CODE MAILING ADDRESS ZIP CODE


_____________________________________ ________________________________________
(Area Code) TELEPHONE NUMBER (Area Code) TELEPHONE NUMBER


___ A. As the Seller(s) of the property described herein, the above terms and conditions are accepted
this ____ day of ___________ at ___________ __ A.M. ___ P.M. ___ Noon


______________________________________ _________________________________________
SELLERS SIGNATURE DATE SELLERS SIGNATURE DATE

_______________________________________ ________________________________________
PRINTED PRINTED

________________________________________ ______________________________________
SELLERS SOCIAL SECURITY #/FEDERAL I.D.# SELLERS SOCIAL SECURITY #/FEDERAL I.D.

________________________________________ ______________________________________
MAILING ADDRESS ZIP CODE MAILING ADDRESS ZIP CODE

_______________________________________ ________________________________________
(Area Code) TELEPHONE NUMBER (Area Code) TELEPHONE NUMBER

The Seller has THREE ways they can respond
to your offer.

One: Accept it as written.
Two: Tell you to get lost... reject it
outright.
Three: Make a counter offer. We will
discuss the counter offer next.

COUNTER OFFER # ___1___
MY NOTES: The counter offer can be made by the Buyer or the Seller.
If the Seller doesn't like the original offer, he or she can counter the
offer with an alternative.
If the Buyer doesn't like the Seller's counter, he or she can counter
again. That is why there is a blank line at the top... to tell you which
counter you are on.
For a contract to be valid, a complete path through the counter offers
must be signed. For example, if the Seller counters your original offer,
that is counter offer #1.
If you counter their counter #1, your counter is counter #2. Let's say
that the Seller decides to counter your counter offer #2 with counter
offer #3 and you decide to accept Counter #3... here is how the forms
must be signed.
The Buyer signs the original offer. The Seller signs counter #1. The
Buyer signs counter #2. Both Buyer and Seller sign counter offer #3.
That is a complete contract.

_____August 14th_______________________, 20__20___ ___ A.M. __5___ P.M.

The undersigned makes the following Counter Offer to the Purchase Agreement Dated ________
August 14th , 2020____________________________ concerning property commonly known as
_______________123 Main Street _______________________________________________
____________________________ in _______________________________________ Township,
__________________________________ County, _________________________________ City,
__________________________________State, between: _______________________________
_____________________________________ as Sellers ________________________________
______________________________________as Buyer(s)
MY NOTES: The above is pretty self-explanatory. Just fill in the vital
info for this purchase.

________________________________________________________________________________
1. Price to be $120,000.____________________________________________________________
________________________________________________________________________________

________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
MY NOTES: In the spaces above, you fill out the changes you want to
make in the original contract. Let's say the Seller liked everything
about the offer except the price. He simply raises the price in the
counter offer. Everything else about the contract stays the same.

Note: Seller has the right to accept any other offer and Buyer has the right to withdraw any offer prior
to written acceptance and delivery of such offer/counter offer.

All other terms and conditions of the Purchase Agreement and all previous Counter Offers shall
remain in effect except as modified by this Counter Offer.

This Counter Offer # ___________ is void if not accepted in writing on or before
____________________ ___ A.M. ______P.M. on (date) _______________________________.

This agreement may be executed simultaneously or in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the same instrument. The
parties agree that this Agreement may be transmitted between them by facsimile machine. The
parties intend that faxed signatures constitute original signatures and are binding on the parties. The
original document shall be promptly executed and/or delivered, if requested.



____________________________________ _________________________________________
SELLERS/BUYERS SIGNATURE DATE SELLERS/BUYERS SIGNATURE DATE

____________________________________ ________________________________________
PRINTED PRINTED

____________________________________ ______________________________________
SELLERS SOCIAL SECURITY #/FEDERAL I.D.SELLERS SOCIAL SECURITY #/FEDERAL I.D.

____________________________________ ______________________________________

MAILING ADDRESS ZIP CODE MAILING ADDRESS ZIP CODE

__________________________________ ________________________________________
(Area Code) TELEPHONE NUMBER (Area Code) TELEPHONE NUMBER
MY NOTES: The Buyer has a specified amount of time to respond to
the counter. I happen to like 24 hours because it keeps things moving,
but sometimes you have to be flexible and give more time.
ACCEPTANCE OF COUNTER OFFER # _________

The above Counter Offer # ____________ is accepted at __________________________ ___ A.M.
___ P.M. ___ Noon ___ Midnight __________________________ Receipt of a signed copy of this
Counter Offer is acknowledged.



_____________________________________ _______________________________________
SELLER /BUYER SIGNATURE DATE SELLER /BUYER SIGNATURE DATE

_____________________________________ _____________________________________
PRINTED PRINTED

_____________________________________ _____________________________________
SELLERS SOCIAL SECURITY #/FEDERAL I.D.SELLERS SOCIAL SECURITY #/FEDERAL I.D.
MY NOTES: If the counter is acceptable, fill in the time and dates, sign
it and you've got a deal. If the numbers don't work, try to counter back
and see what happens. Don't do a deal just to do a deal. Make sure you
have a reasonable chance to profit. The strongest position you have,
as a Buyer, is that there are many properties to buy... the Seller just
has one property to sell.

On the following page is a BLANK "Counter
Offer" form that you can print, fill out and use.
In the next section, I will fill out an Inspection
Amendment form to help you understand the
inspection process.

COUNTER OFFER # ______

____________________________, 20_____ ___ A.M. _____ P.M.

The undersigned makes the following Counter Offer to the Purchase Agreement Dated
____________________________________ concerning property commonly known as
_______________________________________________________________________________
_____________________________ in _______________________________________ Township,
__________________________________ County, __________________________________ City,
__________________________________State, between: ________________________________
_____________________________________ as Sellers _________________________________
______________________________________as Buyer(s)

________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

Note: Seller has the right to accept any other offer and Buyer has the right to withdraw any offer prior
to written acceptance and delivery of such offer/counter offer.

All other terms and conditions of the Purchase Agreement and all previous Counter Offers shall
remain in effect except as modified by this Counter Offer.

This Counter Offer # ___________ is void if not accepted in writing on or before
____________________ _____ A.M. ______P.M. on (date) _______________________________.

This agreement may be executed simultaneously or in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the same instrument. The
parties agree that this Agreement may be transmitted between them by facsimile machine. The
parties intend that faxed signatures constitute original signatures and are binding on the parties. The
original document shall be promptly executed and/or delivered, if requested.





____________________________________ _________________________________________
SELLERS/BUYERS SIGNATURE DATE SELLERS/BUYERS SIGNATURE DATE

____________________________________ ________________________________________
PRINTED PRINTED

____________________________________ ______________________________________
SELLERS SOCIAL SECURITY #/FEDERAL I.D.SELLERS SOCIAL SECURITY #/FEDERAL I.D.

____________________________________ ______________________________________
MAILING ADDRESS ZIP CODE MAILING ADDRESS ZIP CODE

__________________________________ ________________________________________
(Area Code) TELEPHONE NUMBER (Area Code) TELEPHONE NUMBER

ACCEPTANCE OF COUNTER OFFER # _________

The above Counter Offer # ____________ is accepted at __________________________ ___ A.M.
___ P.M. ___ Noon ___ Midnight __________________________ Receipt of a signed copy of this
Counter Offer is acknowledged.



_____________________________________ _______________________________________
SELLER /BUYER SIGNATURE DATE SELLER /BUYER SIGNATURE DATE

_____________________________________ _____________________________________
PRINTED PRINTED

_____________________________________ _____________________________________
SELLERS SOCIAL SECURITY #/FEDERAL I.D.SELLERS SOCIAL SECURITY #/FEDERAL I.D.



Once you have an accepted offer, it is time to
bring your investor in to do his inspection.
I go into detail about how to find investors for
your properties in Chapter 6.
We are now going to discuss inspections and
inspection amendments.

IDEPEDET ISPECTIO RESPOSE
BUYERS INSPECTION RESPONSE # ______________

Date: __________________________
Property Address:
______________________________________________________________________________
A. Buyer agrees to: (Initial one)
1. ____________ Waive inspection(s) and rely upon the condition of the Property based upon
Buyers own examination.
2. ____________ Accept the Property in the condition reported in the Inspection Report(s).
3. ____X________ Accept the Property provided Seller corrects the following condition(s):
________________________________________________________________________
1. Seller To Replace Faulty Furnace Before Closing. __________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
______ on or before ____________________________________________ ___ A.M.
___ P.M. _______________________________, or within ___________ days after
______________________, whichever is later, and the Buyer shall have the right to
inspect and accept Sellers repairs ___ prior to closing.
4. __________ Other: _____________________________________________
MY NOTES: Once you have had a competent inspector look at
your property, you will know if there are any MAJOR DEFECTS
that you weren't aware of before.

If there are and you are unable or unwilling to fix them, you must
ask the Seller to fix them. Give them enough time to respond and
to get a bid on the work if necessary.

Just because you write on this amendment that they have to
respond in 2 hours or you are going to back out of the deal
doesn't necessarily mean that a judge would agree with you.

You have to act in good faith and be reasonable.

__X__ A complete copy ___ Appropriate page(s) of the Inspection Report is/are attached
(including lead-based paint and/or radon, if applicable).

MY NOTES: If you used a professional inspector, show the Seller
the paperwork that proves your position. He may have thought

that old furnace was still working fine. Written documentation is a
real persuader sometimes.
B. If a Response is required, the Seller shall respond on or before
______________________________________________________________.
C. After compliance with selected item above, the Buyer releases the Seller named in
Purchase Agreement from any and all liability relating to any non-latent or disclosed
latent defect or deficiency affecting the Property; provided however, this release shall
not apply to any known but undisclosed latent defect(s) or misrepresentations affecting
the Property, which shall survive the closing.
D. This inspection Response may be executed simultaneously or in two or more
counterparts, each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument. The parties agree that this Response may be
transmitted between them by facsimile machine. The parties intend that faxed
signatures constitute original signatures and are binding on the parties. The original
document shall be promptly delivered, if requested.



____________________________________ _______________________________________
BUYERS SIGNATURE DATE BUYERS SIGNATURE DATE

____________________________________ _____________________________________
PRINTED PRINTED


SELLERS INSPECTION RESPONSE # _____________

A. Seller responds as follows: (Initial one)

1. ____________ Seller agrees to correct condition(s) in Item #3 ___ prior to closing the
transaction or ___ within _______ days after _______________________________
________________________________________________________________________
2. ____ Seller is unable or unwilling to make the corrections requested by Buyer.
3. ____ Seller agrees to correct the following condition(s) at Sellers expense ___ prior to
closing the transaction or ___ within ________ days after
______________________________________________

4. ____ Other:
______________________________________________________________________
____

B. If Item #3 and/or Item #4 is/are selected, the Buyer shall reply on or before
_________________________ ____ A.M. ____ P.M. ____ Noon
____________________________________.
MY NOTES: The Seller can counter offer the inspection response also.
It works just like the original negotiations.


_________________________________ _______________________________________
SELLERS SIGNATURE DATE SELLERS SIGNATURE DATE

_________________________________ ______________________________________
PRINTED PRINTED

BUYERS INSPECTION REPLY # ____________
A. Buyer replies as follows: (Initial one)

1. ___ Buyer accepts Sellers Response.
2. ___ Buyer rejects Sellers Response, deems the Purchase Agreement void and
requests that the earnest money be returned.


________________________________ ________________________________________
BUYERS SIGNATURE DATE BUYERS SIGNATURE DATE

________________________________ ________________________________________
PRINTED PRINTED
MY NOTES: If the Seller counters, the Buyer must accept the counter
by signing above or counter again. You can also ask for your earnest
money back if you want out of the deal and the Seller is unable or
unwilling to remedy the problem.

The following is a BLAK "Inspection
Response" Form that you can fill out and use

INDEPENDENT INSPECTION RESPONSE
BUYERS INSPECTION RESPONSE # ______________

Date: __________________________
Property Address:
______________________________________________________________________________
A. Buyer agrees to: (Initial one)
1. ____________ Waive inspection(s) and rely upon the condition of the Property based upon
Buyers own examination.
2. ____________ Accept the Property in the condition reported in the Inspection Report(s).
3. ____________ Accept the Property provided Seller corrects the following condition(s):
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________ on or before
____________________________________________ ___ A.M. ___ P.M.
_______________________________, or within ___________ days after
______________________ , whichever is later, and the Buyer shall have the right to
inspect and accept Sellers repairs ___ prior to closing.
4. __________ Other: _____________________________________________

____ A complete copy ___ Appropriate page(s) of the Inspection Report is/are attached
(including lead-based paint and/or radon, if applicable).

B. If a Response is required, the Seller shall respond on or before
______________________________________________________________.
C. After compliance with selected item above, the Buyer releases the Seller named in Purchase
Agreement from any and all liability relating to any non-latent or disclosed latent defect or
deficiency affecting the Property; provided however, this release shall not apply to any known
but undisclosed latent defect(s) or misrepresentations affecting the Property, which shall
survive the closing.
D. This inspection Response may be executed simultaneously or in two or more counterparts,
each of which shall be deemed an original, but all of which together shall constitute one and
the same instrument. The parties agree that this Response may be transmitted between them
by facsimile machine. The parties intend that faxed signatures constitute original signatures
and are binding on the parties. The original document shall be promptly delivered, if requested





____________________________________ _______________________________________
BUYERS SIGNATURE DATE BUYERS SIGNATURE DATE

____________________________________ _______________________________________
PRINTED PRINTED



SELLERS INSPECTION RESPONSE # _____________

A. Seller responds as follows: (Initial one)

1. ____________ Seller agrees to correct condition(s) in Item #3 ___ prior to closing the
transaction or ___ within _______ days after _______________________________
________________________________________________________________________
5. ____ Seller is unable or unwilling to make the corrections requested by Buyer.
6. ____ Seller agrees to correct the following condition(s) at Sellers expense ___ prior to
closing the transaction or ___ within ________ days after
______________________________________________

7. ____ Other:
______________________________________________________________________
____

B. If Item #3 and/or Item #4 is/are selected, the Buyer shall reply on or before
_________________________ ____ A.M. ____ P.M. ____ Noon
____________________________________.


_________________________________ _______________________________________
SELLERS SIGNATURE DATE SELLERS SIGNATURE DATE

_________________________________ ______________________________________
PRINTED PRINTED


BUYERS INSPECTION REPLY # ____________
A. Buyer replies as follows: (Initial one)

1. ___ Buyer accepts Sellers Response.
2. ___ Buyer rejects Sellers Response, deems the Purchase Agreement void and
requests that the earnest money be returned.


________________________________ ________________________________________
BUYERS SIGNATURE DATE BUYERS SIGNATURE DATE

________________________________ ________________________________________
PRINTED PRINTED


Chapter 6

Finding Investors To Buy Your
Properties They Will Buy From You
Over and Over!

This is so easy, you'll laugh with delight when the
phone calls start coming in.

This next step in the process is inexpensive and easy do.
All it takes is a simple classified ad. I suggest you run it
in your Sunday real estate section under "investment
property." The ad should cost 15-25 dollars.

Ad #1

Fixer Upper Homes with 20%
Equity- You need 10% down.
Must Qualify - 222-2222

This type of ad will bring you investors who have good
credit and enough money for a 10% down payment.

You can go to just about any mortgage company in town
and get a non-owner occupied, investment loan for 10%
down. The borrower must have good credit and at
least two years in the same line of work. Income
doesn't matter as long as you can get a lease on the
property before you close.

This is the type of investor who wants to fix up the
property and resell it at a profit. There are lots of people
who want to buy a fixer upper, but don't know how to
go about finding them and financing them.


Ad #2

Zero down rental homes -
No qualifying necessary.
Positive cash flow
222-2222

This ad will get you so many calls, you might want to
leave out the "no qualifying" part. This type of investor will
purchase any of the homes that you buy subject to the
existing mortgages.

The downside to selling to this type of Buyer is you don't
get your money up front. You will have to carry a second
mortgage on the property.

The upside is that you can sell it for more than it's worth,
typically 10% above market value.

So, if you have a home worth $100,000, you purchase it
from the Seller by taking over the current mortgage for
$100,000 and then you sell it to the investor for $110,000.

You take back a second mortgage for $10,000 and
charge the Buyer 11% simple interest with a balloon
payment due in 3 years.

That means the they will have to pay you $1100 per year
(or $91.67 per month) for three years and then pay
you $10,000 at the end of the three year period.

Rather than doing a second mortgage, you can lease
option this property. It doesn't matter if the Buyer is an
investor or someone who wants to occupy the home.


In some ways an owner occupant may be a better risk
with a lease option because it is where they live. I am
going to get into lease options in detail in section two,
Chapter 13.

Ad #3

$3000 Down, Rental Homes
No Qualifying Necessary
Positive Cash Flow
222-2222

The Buyer who responds to this ad is very much like the
Buyer who responded to Ad #2, except for one vital
thing... he has $3,000 to give you at closing.

You will do the deal exactly the same as above except,
instead of taking a second mortgage as your profit, you
take $3,000 cash in your pocket.

With these three different types of ads, we are dealing
with three different types of investment real estate
Buyers.

1. An investor who has money for a down payment and
has good credit, but wants to get a good deal.

2. An investor who has no money for a down payment
and bad credit and doesn't care what kind of deal he gets
as long as he gets a piece of real estate.

3. An investor who has some money for a down
payment, but may have credit problems.


Each of these investors can make money with the
properties you sell them, if they pay attention and do
their best to keep them rented.

When you get calls on these ads, explain the type of
program you have available. Tell them you find
properties to resell to investors.

Explain to them how you make your money. With ad
number 1 and 3, you charge a flat $3,000. With ad
number two you are charging more but carrying a note
for your profit.

If they are interested in working with you, put their name
on your list and call them as soon as you get a
property that fits their criteria. I think you'll be surprised
at how easy it is to get them to purchase these
properties from you.

PreQualifying The Investor

Use the information located in Chapter 15 to qualify
your investor. I have included an "Investor Qualification
Form" that will help you remember the right questions to
ask.

Investor Agreement Form

The following form is an Assignment agreement between
you and the Investor. You need to have this agreement in
order to get paid and to release yourself of the contract.

Assignment of Real Estate Contract

This Assignment of Contract ("Assignment") is made on (date)______________, by and between
_________________________ ("Assignor"), and ____________________________("Assignee").

Assignor is a party to the "Real Estate Purchase Agreement" dated, ___________________ with
(Seller) ____________________________, regarding property located at: __________________
________________________ in the city of _____________________, in the State of _________.
(A copy of which is attached hereto (the "Contract").

Assignor now desires to assign its interest in the Contract to Assignee, which Assignee desires to
acquire.

NOW, THEREFORE, for the sum of $ _______________, to be paid by the Assignee to the Assignor
and in consideration of the mutual agreements of the parties, it is agreed:

1. Effective Date.
Assignment of Assignor's rights in the Contract and other benefits and obligations in this Assignment
are effective (date) _______________________.

2. Assignment.
Assignor is a party to the Contract. Assignor does hereby grant, bargain, sell, convey, transfer and
assign to Assignee all of Assignor's interest in the Contract.

3. Assumption by Assignee.
Assignee assumes and agrees to perform all of the duties of Assignor in the Contract, which accrue
and become due on or after the effective date. Assignee will indemnify, protect, defend and hold
Assignor harmless from and against any and all loss, cost, damage and expense arising out of or in
any way related to a breach or default of the Contract after the effective date. Assignor will indemnify,
protect, defend and hold Assignee harmless from and against any and all loss, cost, damage and
expense arising out of or in any way related to a breach or default of the Contract on or before the
effective date.


__________________________________________
Assignor Date


__________________________________________
Printed


__________________________________________
Assignee Date


__________________________________________
Printed


Chapter 7

Systematize your business so you
can repeat this process every single
day... effortlessly!

Here is the step-by-step system that shows you how to
put it all together.

I am going to try making this a simple as possible with an
easy to follow list of actions you must take to succeed.

This system does not work by itself... you must be
involved and you must pay attention.

1. Run two classified ads in the Sunday real estate
section. (see Chapter 2)
a. One ad is to find Sellers.
b. One ad is to find investor Buyers.

2. Have 15-20 small yellow corrugated plastic signs
printed with "I buy homes for cash" and your phone
number.

3. Staple the signs on telephone poles at major
intersections all over town.

Note: make sure you have an answering machine to
capture any calls that come in. Don't let your twelve year
old kid answer the phone... it really weakens your
credibility. You can get a separate voicemail from the
phone company for about $10 a month.


4. When Sellers answer your ad, ask them the
questions from the "property profile" form (Chapter 2).
5. If the property fits the profile you are looking for, make
an appointment with the Seller to inspect the real estate.
Use the inspection form to note any obvious problems
(See the form in Chapter 3).

6. At the same time you're getting calls from Sellers, you
will also be getting calls from investor Buyers. Keep
running the Buyer ads until you get five or six investors
who you think our serious Buyers. Make sure you get
several in each "ad type" category. Use the "Investor
Qualifying Sheet" to qualify the Investors (see Chapter 6
for a copy of the form).

7. If you like the property and you like the deal, write an
offer, meet with the Seller and present the offer in person
(use the contracts in Chapter 5).

Note: It is always advisable to have an attorney review
your contracts before you present your offer. Make sure
you are complying with local laws.

8. Have a full home inspection done by a qualified
professional inspector (unless you are sure you are
competent to do it yourself). If there are any major
defects, you must decide whether or not to continue with
the transaction.

If you think the defect is too costly, ask the Seller to
repair it. If they repair it, great, you've solved the problem.
If they don't want to repair it, you can back out of the
transaction.


Note: Often, the main reason the Seller is giving you his
property for less than market value, is because it is in
less than market condition. He is not expecting you to
beat him up over minor or cosmetic repairs.

9. Once you have an accepted purchase agreement with
the Seller and are satisfied with the inspection, call your
investors and tell them you have a property for them
to look at. Don't call just one, call all of them and let them
know you are calling all of your investors.

You want them to understand that you are selling this
property on a first come - first served basis. Create an
urgency to go look at the property today. Give the
investors a copy of your home inspection. They need to
know what the defects are in the property... if any.

Note: Never tell your investors about a property until you
have secured a signed and accepted purchase
agreement. You don't want them by passing over your
head and purchasing the home directly from the Seller.

10. As soon as one of your investors shows interest in
your property, meet with them to write up the Investor
Agreement (Chapter 6).

11. The closing should take no more than 30 days if the
investor is paying cash or getting a new loan. If your
investor is simply taking title subject to the existing
mortgages, you can close the property in a matter of 2-
5 days.

12. Get your money and do it again, and again, and
again...

That's it!


Here are a couple of things to keep in mind as you go
through this process.



1. Never stop running your ads. It's easy to get
discouraged if you run an ad two or three weeks in
a row and get no response. Hang in there.

2. Look at the ads in the paper that are running every
week and copy them. If an investor runs the same
ad over and over again, he is probably getting a
decent response.

Just remember, if it costs you $200-$300 in classified
ads over a 2 or 3 month period to find your first
property and you make $3,000 gross profit, you have
just made ten times your investment! Any business
would be thrilled to have that kind of return.

The nice thing about this business is the more you do,
the easier it is to get good deals. Before you know it,
people will be calling you with their homes to sell.

The reason investors are willing to pay you to find
property for them is because they don't know how to do
it themselves.

They may have run an ad once or twice and didn't like the
response they got, so they stopped. Don't give up... keep
trying. This program really works if you set about it in
a methodical, systematic way.

There Are No Failures In
Business, Only Tests.


Everything you do is a test. The information I am giving
you here is a proven guide that has worked many times
in the past. You may have to tweak it a bit, but it will
work for you too.



Section 2



Chapter 8

Technique #2 - Monthly Income...
Replace Your Income With Rental
Property And Quit Your Job!

This chapter will teach you how purchase homes with
zero down payment and no credit check.

You can rent or lease option these homes and make a
healthy monthly income that will continue to grow
until you die.

Once you own these homes, you can also sell them for a
profit as I described in Section One, Chapter 6.

You are now going to learn how to purchase homes
"subject to" the existing loans, mortgages or trust
deeds.

What this means is, you're going to take over the
existing loans of a property without "assuming" the
loans with the lenders. This means you don't have to
qualify for the loans to purchase the properties.


The biggest risk in purchasing a home using this method,
is the fact that most mortgages and trust deeds have
"due on sale clauses."
A "due on sale clause" states that if the property is
transferred or sold, the loan must be either paid off, or
assumed.

Non-qualifying assumable loans have not existed
since 1989. It is unlikely that you will find a property
with a no qualifying assumable loan.

What the Seller is going to be doing is breaking the
contract he has with his lender. It is not, I repeat, NOT
illegal to break a contract. It can create a lawsuit
between the lender and the Seller (borrower). The lender
will not be going after you, they will be going after the
Seller (their original Borrower). And I doubt that they
would go after their Borrower. They would go after the
home instead and file foreclosure proceedings.

In my experience, I have never seen the lender "call
the loan due" and force a payoff by the original borrower.
It is probably very unlikely that it will happen to you as
long as the loan is paid up every month. Just make sure
you write the contract with the clause that lets you
monitor that the loan payments are being made.

I think it is preferable for you as the Buyer to make
payments to the original lender yourself. This makes it
possible for you to monitor the loan, insuring that all of
the payments are being made in a timely in manner.

The Seller will also want to be comfortable that the
payments are being made, so you may have to set up a
notification process for him as well.


If the mortgage or trust deed holder does call the loan
due, they would foreclose on the property (assuming you
couldn't pay off the loan in full). This foreclosure would
not be reported on your credit report. It is a risk the
Seller is taking. All you would lose is any equity you
might have in the property.

NOTE: Please keep in mind that I am not an attorney
and my opinion is not the opinion of someone who
has been trained in legal matters. If you have any
questions about this process, please consult an
attorney.

I did run into a situation once were the lender would not
take the check with the new Buyer's name on it. They
wanted a check directly from the borrower.

I've only seen this happen once.

You may question why any Seller would accept this
type of transaction, because it does carry a bit of risk
for them.

The reason is this. Normally, the only type of Seller who
will accept this type of offer is someone who is sitting on
a distressed property they can't sell any other way or
pay off.

It is not at all unusual to see Sellers in a tight situation
agree to this type of risk. After all, if you have to choose
between the risk of foreclosure and the certainty of
foreclosure, most intelligent people would take the
risk.

I personally don't believe you are taking advantage of
these Sellers. Instead, I believe you are helping them out
of a jam they got themselves into, without your help.


Here is a possible scenario for this
type of transaction.

You find a Seller who owns a home that is worth
$100,000. He bought the house NEW, two years ago for
$100,000 using a VA (Veteran's Administration) loan.

A VA loan requires no down payment and you can
finance 100% of the value of the property. For this
example, let's say the home did not appreciate in value.

His monthly payment, including taxes and insurance, is
$956. The market rent for this home is $1100 per month.

If you buy it from him, take over the existing mortgage
payment and rent it out, you will have a small monthly
cash flow.

You will also be gaining equity as the loan is paid off,
the rent goes up, and the value goes up with inflation.
Not to mention the benefits of depreciation.

This technique is awesome.

It requires little or no money to implement, is very low
risk, and these properties are fairly easy to find. One of
the best sources is a home that is only two or three
years old.

Most new construction homes are priced at a premium,
just like new cars. In most of the United States, you must
own an existing home for two years before you can sell it
and have enough money to pay your Realtor fees and
other expenses of selling.


With new construction, (since you paid a premium to
purchase it) you might have to wait five years before you
can sell and break even.

What this means is, if someone purchases a new home
and decides to sell it before five years are up, they
must come to closing with money to pay their Realtor
and closing costs. Many people just aren't in a position
to come up with $5,000 or $10,000 to sell their home.

This system will make you their hero.

Chapter 9

Finding Sellers Who Will Let You Buy
Their Home With A Zero Down
Payment And No Credit Check!

Purchasing a home subject to the existing mortgage.

Learn how to do it so you are protected and at the same
time, maximize your profits.

Use all of the techniques in Chapter 2 to find these
properties. Those methods will bring you many
different types of Sellers in many different types of
situations.

I am going to give you another classified ad (which you
can also put on a sign and stick up in the areas you are
interested).

The target market for this ad or sign is folks who can no
longer pay their mortgages, who are considering
foreclosure or bankruptcy.

Here's the ad.

Can't Pay Your Mortgage?
Need Help? Call 222-2222

Or

Can't Pay Your Mortgage?
I will make your payments

& save your credit. 222-2222

Or

Need Money To Pay Your
Mortgage? Call 222-2222

These are great ads because they get attention. They fill
the need and relieve the pain these Homeowners are
feeling.

They are also ambiguous as to how you are going to fix
the problem, so it creates curiosity. It makes them
wonder, "Maybe this is something that we haven't heard
about before."

Use the questionnaire ("Property Profile Sheet") in
Chapter 2 to ask the Sellers questions about their
home.

Qualify these homes and get as much information as
possible before you go out and look at them. If they don't
fit a profile you can use, don't waste your time driving
all over the city just to avoid hurting the Seller's feelings.

If it doesn't work on paper, it sure won't work in
reality.

Here are some things to look for with this type of
property.

It doesn't matter if you pay full market value for the
home. You can even pay a little more than market
value and still make a killing if you can rent it for a little
above the mortgage payment.


If the home has 2 mortgages on it and together they ad
up to $100,000, you can take over the existing loans
and have tenants make the payments for you.

Sometimes you will run into people who haven't made
their payment in a few months. These still might be good
properties.

You can either pay to bring them up to date with their
payments, or you can show them how to negotiate
with their bank to make partial payments to bring it
up to date.

It is not very difficult to get a lender to cooperate with a
borrower. They do not want to foreclose or do a "short
sale" (where they settle for less than they are owed).

Most lenders have "Loss Mitigation" departments who
handle this type of situation and have specific policies
about how flexible they can be.

Just have the Borrower get on the phone and find out
what the Lender will do. If they are 2 months behind in
their payments and owe $2000 in payments and late fees
in addition to the upcoming month's payment... ask the
lender to spread out the $2000 payment over the next
year.

They won't let you keep screwing the payments up, but if
you act in good faith and make the payments on time
from then on, the Lender will be content.

If you make things easy for the Seller by understanding
their situation, empathizing with them and showing them
how to get out of it, you will succeed in buying their
house with zero down payment and no credit check!


Use the "Property Profile Form" from Chapter 2 to get
all of the necessary information on the prospective
property.

In Chapter 11, I am going to show you how to explain
the deal to the Sellers and answer their objections.

Before I do that, I'm going to briefly cover inspections on
this type of home.



Chapter 10

Inspection Tips

Many of these homes will be less than five years old
so inspections will become less of an issue.

Here is the situation. In the United States, it takes an
average of 2 years of waiting before a homeowner can
sell the home they purchased, pay the Realtor fees,
closing fees, and break even or make a profit on the sale.

So, if you buy a home today, you must wait 2 years
before you can sell it and not lose money. This statistic is
for existing homes.

If you buy NEW construction, you pay a premium for
the home, just like buying a new car. It can take up to 5
years before you are able to resell new construction and
break even on the sale.

What happens to people who originally buy their
homes with little or no down payment?

They can't sell their home without coming to closing
with a big chunk of change.

Take our $100,000 home example. Let's say they bought
it 2 years ago for $100,000, have a Veterans
Administration Zero Down Loan of $100,000 on the
property and want to sell.

They call an agent, who tells them they can probably get
$100,000 for their property. This is terrible news.


The Realtor charges 6-7% and closing costs will run
about 1-3%. It looks like our Seller's have to come to
closing with $10,000 to be able to sell their nice new
home.

If they have to sell, but don't have the money (they didn't
have it when they bought the house, why would they have
it now?), you are their very best option.

My purpose for explaining all of this is, with this type of
purchase, you will find a lot of newer construction.
Newer construction is less likely to have inspection
problems.

Do your inspections, but don't think for a minute these
people are going to pay any money to fix their home up
for you to buy it. Remember, they are in this fix
because they don't have any money to begin with.

Make sure you use the "Inspection Form" I provided in
Chapter 3.

Chapter 11

Making The Offer "Subject To" The
Existing Loan.

(Step-by-Step Dialogue)
Questions to ask, Answers to give.
Smart ways to get the best price possible.

When you get calls on the ads and signs you have placed
out there, use the "Property Profile Sheet" found in
Chapter 2.

My approach is to ask the questions on the form. When
you are the one asking the questions, you keep control of
the conversation.

Don't start talking about Quit Claim Deeds and taking
mortgages "Subject To" the existing loans. This will only
scare them off.

They need to understand the process first and you need
to know if it will work with their particular property.
You can't know unless you have more information.

Here is how a phone call might go when
they call on your ad:

You: Hello?

Seller: I saw your ad in the Sunday paper. Do you buy
homes?

You: Yes, I do.


Seller: Well, I've got a nice home in Valley Creek
Subdivision. The homes around here are listed for
$105,000, but I'll sell mine for $100,000. All I need to do is
pay off the mortagage.

NOTE: At this point you start asking the questions on the
questionnaire. If the property and the situation sound like
something that will work, make an appointment to go see
it as soon as possible.

If the Seller asks how you buy (cash, loan, buying on
contract), tell him that it depends on the property and you
need to see it before you know for sure.

Get off the phone as soon as you get the appointment
set.

The next script is for the visit at the home. The Seller is
showing you his house and telling you about all his
upgrades.

Seller: We used the heavy-duty nails in the roof and I
spent last summer putting drywall and insulation in the
garage. (It's not really this bad, but almost. Sellers seem
to think that anything they have done to the property is a
major improvement.)

You: The home looks very nice. How long after you sell
before you can be out?

Seller: We're flexible, but we'd like 30 days to get out. I've
got to be in Dallas with my new job in 6 weeks.

NOTE: Before I go on, I just want to remind you that you
have already prequalified this Seller. You know he needs
to sell. He has a loan that is as high as the value of the
home. He can't afford to hire a Real Estate Agent and
he's have difficulty making the payments.


You also know the home has the value he claims and you
can rent it for more than the monthly mortgage payment.

By the way, if you are in Los Angeles or New York, or
another place in the country where property values are
high, you can still do this program. You can either have
negative cash flow (not particularly attractive) or you can
buy property out of town. It's not that big a deal to drive
an hour if you want to make money.

You: I'll buy your home for the amount you owe on your
mortgage. I'd like to assume the mortgages and just make
payments like you are now.

Seller: That would be great.

NOTE: He thinks it's great because he thinks assuming
the property will get him off the loan and he can go on his
way without worrying about it again. Now is the time to
help him understand the reality of his situation. True
empathy for him is the only way you will help him make
the right choice of letting you take over the property.

You: The way it works is like this. I take over the property
"subject to" the existing mortgages. That means I will be
making your payments in your place. It won't cost you
anything to sell this way, like it would if you used a
Realtor. The downside for you is the loans are still in your
name. You won't have to make any payments. I'll be
doing that, but the bank will still consider you the
responsible party.

Seller: I would much rather sell it and just pay off the
loan.


You: It doesn't make sense for me to do that. If the
purchase price was substantially below market value, I
wouldn't mind getting a new loan or selling it to one of my
investor partners. Since you have to have full value for
the property, I'd be nuts to buy it as an investor without
something making the deal worthwhile for me. Does that
make sense to you?

Seller: Sure, I guess. I was just hoping...

You: Has anyone else offered to buy your home?

Seller: Yes, I called those other "We Buy Homes" ads
and another guy came out. He only offered me $85,000. I
don't have $10 or $15 thousand to spend. The move to
Dallas is going to be pretty expensive and I'm not working
for the next 6 weeks.

You: You can rent the house out. Although being a
landlord from out of town isn't a particularly pleasant
thought.

Seller: I wouldn't want to be a landlord even if I was in
town. My Aunt was a landlord and she hated it.

You: Well, what happens if you don't sell it?

Seller: I don't know. I guess the bank would take it back. I
can't afford to make payments on it.

You: If I were to take it over, you'd deed the property to
me and I'd be the one making the payments and I'd be
the one renting it out. I don't mind being a landlord
because it's what I do.


Your Job Is To Make Them Comfortable With You!
If you were they, would you loan you $100,000?

This kind of dialogue can go on for a while. You just need
to help the Seller see the situation clearly. If there is a
better option for them, great. You go find another
house. If there isn't a better option, they need you.

Don't pressure them... encourage them. If they are
reasonable, they will decide in your direction. It is a good
option for them as long as you hold up your end of the
bargain. If they accept your proposal, you have their
future credit rating in your hands.

Try to make them feel comfortable with who you are,
your position, your trustworthiness, your ability to keep
the property rented.

When they do accept your offer, sit down with them and
fill out the "Quit Claim Deed." Prorate the mortgage
payment from the day that they move out. Try to get
them to stay in the home for 2-4 weeks.

During that time, put a sign in the yard and find a
renter or a lease option Buyer. Your goal is to have the
renter pay your first month payment.

Also remind them that interest is paid in arrears. Rent is
paid in advance. That means the August 1st payment
covers the interest from July 1st until July 31st.

If you take possession on August 1st, your first payment
shouldn't be until September 1st. Of course, it's not

always going to work this way. Sometimes, they just
won't have the money.

Do your best with what you've got.

Chapter 12

Contracts For This Section
You can print these, fill them in, sign them and
have valid sales and transfer contracts.

I know I sound like a broken record here, but...

Talk to an Attorney before you sign anything! I'm
giving you the most accurate information I have, but I
am NOT trained as legal counsel.

The first document is a "Quit Claim Deed." This is the
transfer document to change ownership from the
current owner to you. There is no warranty with a quit
claim deed. There is no title insurance. It is possible that
there are liens on the property that the Seller is not
telling you about.

You can have a title company do a basic search for
you or you can go down to the courthouse and look
in the public records yourself.

The worst-case scenario is you keep the property for a
few years and you finally discover that there was a
judgement on the property from the time before you
bought it.

Not likely, but possible. You would lose the property and
any equity built up, but the lien does not transfer to you
personally... it stays with the real estate. Do a judgement
search to make sure it is clear.

Filling Out The Quit Claim Deed


Filling out the form is pretty straightforward. You need to
do it in front of a Notary. Any stationary shop will have
one for $10. Change the names on the form, Buyer and
Seller, to the appropriate names.

After it is signed, hand carry it down to the county
recorders office and pay the $5 to record the deed.
The only people who will then have a stronger claim to
the property will be the lenders (they would have a
stronger claim than you even if you were on the loan).

Quitclaim Deed

This Quitclaim Deed made [Date]__________________, by ___________________
_____________________________ [Seller] ("Transferor") ____________________
_____________________________________________________[Seller's Address]

to:
___________________________________________________ [Buyer] ("Transferee")
___________________________________________________ [Buyer's Address]

Transferor, in consideration of One Dollar and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, remises, releases, and
forever quitclaims to Transferee all of the interest of Transferor, if any, in an to that real
property located in the County of ___________________________________ [Property
County], and State of _______________________________ [Property State], and
more certainly described as follows: ___________________________________
____________________________________________ [Legal Description of Property].
To have and to hold, all and singular the described property, together with the
tenements, hereditaments, and appurtenances belonging to such property, or in
anywise appertaining, and the rents, issues, and profits of such property to Transferee,
and Transferee's heirs and assigns forever.

IN WITNESS WHEREOF, Transferor has executed this Quitclaim Deed on the date
first above written.
______________________________________
[Signature] Seller

Acknowledgment

State of ________________)

County of ______________)

On this _________________ [Date], before me personally appeared _________
_________________[Transferor], to me know to be the person described in and who
executed the foregoing Quitclaim Deed and acknowledged to me that ________
__________________________[Transferor] executed the same as [His/Her] free act
and deed.

______________________________
Notary Public


Chapter 13

Selling The Homes You Purchase To
New Buyers Using The Lease Option
Technique!

Here you will learn how you can get 5-10% more for the
homes you sell AND get higher than market rent!

You will also learn how to get non-refundable lease
option money from your tenants rather than a security
deposit that you have to give back to them at the end of
their lease.

Lease option money can pay for your vacancies if you
know how to structure your contracts!

For those of you who aren't familiar with the process of
Lease Option, here it is.

You grant a tenant the option to buy your property at
a specific price and within a specific time period.

In exchange for the option to buy, the tenant pays a non-
refundable lease option fee.

Often, a portion of their monthly payment and their lease
option money will apply to their down payment when and
if they purchase.

If they don't exercise their option to buy within the time
period allotted, the option monies and any payments
made toward the house are forfeited.

Surprisingly, I have found that only a small percentage of
Lease Option buyers will actually the exercise the option.




Renting VS. Lease Option

There are advantages and disadvantages to both renting
the properties you own and doing lease options.

The typical person who Lease Options a home, does so
because they cannot figure out how to purchase any
other way. This means that they probably have credit
issues, time on the job issues, income issues or no down
payment.

A typical renter, on the other hand, can be found with
good credit and a stable job.

The quality of tenant you get is the only real advantage
that I see with renters. Lease Options have some other
real benefits.

First of all, you can get more monthly rent for a home that
you sell with a Lease Option (typically 10% more than
market). This 10% is what you would apply to the seller's
down payment if they do buy, so you haven't lost anything
in that area.

Instead of getting a refundable deposit (like you would get
from a renter), you get non-refundable option money. I
suggest charging about the same as you would charge for
the deposit, typically 1 month's rent.

Since it is likely the tenant will never exercise their option,
being able to keep the option fee will cover most of the
cost of getting the property re-rented or leased after
the current tenant moves out.

You can also sell the home for more than market
value, typically 5%-10% more. If they do buy, it will be a
good deal for you. If they don't buy, you just go out and
find another tenant.


Another nice thing about Lease Options is you can
usually get a longer lease. If the option has a 3-year
term, you can get a lease for the same period. On the
other hand, renters will usually only give you a one-year
lease.

The longer the lease the better.

If a tenant wants to move out before their lease is up, they
still owe you the balance of the lease. This protects you
and puts you into a strong negotiating position. Any
concession you make for them is your decision.

If someone wants to move out before his or her lease is
up, here is what I suggest.

Make them continue to pay their rent until the new
tenant moves in. They can either make it available to
show before they move out or wait for you to rent it after
they move out. Either way, you won't lose money, plus
you get to keep the lease option deposit.

If you are in this situation with a tenant (not folks who are
lease optioning), treat them the same way and give them
their deposit back if they leave the home clean.

Treat people fairly, just like the old golden rule says,
and it will benefit you in the long run.

One last benefit of Lease Options is when a tenant
believes they are buying a home (rather than renting) they
will treat it better. A homeowner is more likely to fix up a
property to protect their investment.


Finding Buyers For Your Lease Option


This is not a difficult process. I would use two marketing
systems... classified ads and yard signs.

They should both say something like this.

RENT TO BUY!
3 bd home w/huge yard
$1200 month. Why rent
when you can own?
222-2222

Use classifieds that are cheap. Local papers are often
the best.

For your sign, I suggest buying a sturdy real estate agent
metal frame and then buying some yellow corplast
(corrugated plastic - a sign company will know what you
are talking about). Write your message with a black
marker. It doesn't have to be pretty. I think ugly may
even be better.

When people call, use the qualifying sheet to find out
what their situation is. You must decide if they are good
choices for your home.

I also suggest doing a credit report on them just like
you would any tenant. Tell them that credit is not the only
factor that you are considering in your decision.


Setting Up A Lease Option

You need to use three of the forms in this book to make a
Lease Option legal. You can find all of these forms in the
Appendix.

Purchase Agreement
Residential Lease Agreement
Option To Purchase Property


Simply fill them out and cross-reference them. Use
verbiage like, "This "form name" is part of a Lease
Option Agreement. Also attached find, "name the
other documents."

Lease Options are a fantastic tool in your real estate
investment arsenal. Use them often and you will get
long-term tenants that have an interest in keeping
your property in good condition.




















OPTION TO PURCHASE PROPERTY

Date:____________
This option to Purchase Property is entered into between____________________________________________
_______________________________________________________(Seller), located at __________________
_______________________________________________________________________________________and
_________________________________________________________________________________(Buyer),
located at _________________________________________________________________________________
______________________________________________ in consideration of and subject to the following terms
and conditions.

1. GRAT OF OPTIO
Seller grants and conveys to Buyer the exclusive and irrevocable option to purchase (the Option) the
following real estate property (the Property) located in __________________________________City
_____________________________________, State, and is legally described as: _____________________


2. OPTIO MOEY
Buyer pays Seller the sum of ______________________________________________________
Dollars ($____________________________) (the Option Money), the receipt of which Seller
acknowledges as consideration for the Option.

3. TERM, EXERCISE/OTICE
A. TERM. Buyers right to exercise this Option shall commence on the above date and shall continue until
__________________________________and including the _____________________________ day of
__________________________________(the Option Period).

B. EXERCISE/NOTICE. This option shall be exercised by Buyers written notice to Seller of Buyers
intention to purchase. The notice shall be deemed received when personally delivered, transmitted by
facsimile, sent by express courier or sent by United States mail, postage prepaid, certified and return
receipt requested, addressed to Seller or the designated agent of Seller, as the case may be, at the address
set forth in this Option of any party prior to the expiration of the Option Period.

4. CLOSIG AD DISPOSITIO OF OPTIO MOEY
If Buyer exercises this Option as described above, the transaction shall be closed in accordance with the
terms and conditions of the attached Purchase Agreement.
The Option Money shall be credited to the purchase price.
If the Option is not exercised, then Seller shall retain the Option Money as consideration for the granting
of this Option.
5. TERMS BIDIG
All terms and conditions are included and no verbal agreements shall be binding.


Initials Buyers _______________ Initials Sellers __________________

Page 1 of 2


6. ACKOWLEDGEMETS
This Option may be executed simultaneously or in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same instrument. The parties
agree that this document may be transmitted between them by facsimile machine. The parties intend
that faxed signatures constitute original signatures and are binding on the parties. The original
document shall be promptly executed and/or delivered, if requested.

___________________________________________ _______________________________________
BUYERS SIGNATURE DATE BUYERS SIGNATURE DATE

___________________________________________ _______________________________________
PRINTED PRINTED

___________________________________________ _______________________________________
BUYERS SOCIAL SECURITY BUYERS SOCIAL SECURITY

___________________________________________ _______________________________________
SELLERS SIGNATURE DATE SELLERS SIGNATURE DATE

___________________________________________ _______________________________________
PRINTED PRINTED

___________________________________________ _______________________________________
SELLERS SOCIAL SECURITY SELLERS SOCIAL SECURITY



Page 2 of 2



Chapter 14

Find Qualified Renters FAST!

Special techniques used by top management
companies to obtain renters who have better credit and
better jobs than you!

These are the people you want renting your homes in
order to get top rental income for your properties.

What Is The Minimum Amount Of Work I Need To Do
To Get My House Ready To Rent?

It makes good sense to try to buy homes that require the
least amount of work, but sometimes the best deals are
on homes that need some or a lot of attention before they
are ready to rent.

Do not make the mistake of trying to rent a home if it is
not in good condition. The only tenants who will be
willing to rent it are messy and figure that since the house
isn't in good condition anyway, it doesn't matter if they
trash it.

So what does good condition mean?

INSIDE- The two best things you can do, that make the
biggest difference for the least amount of money (in
addition to a thorough cleaning), are carpet and paint.

Fresh carpet and paint make a house smell, feel, and look
new inside. As for color, go with something neutral,
nothing flashy.

For paint, use an off-white with a beige tint for a soft, cozy
feel. Don't use gray - it gives a cold and drab feeling.


Never put up wallpaper, you will regret it down the
road!

For carpet, go with something in the beige-brown range
that is neutral, yet will hide some wear and tear. Use a
low to mid range carpet with a higher end pad.

The nicer pad doesn't cost much more and it makes the
cheaper carpet feel like a more expensive carpet. It also
makes it last longer.

OUTSIDE- The idea here is to "gingerbread" the exterior
to give it what is referred to as "curb appeal". The house
should look nice and well kept. The kind of place people
would want to live.

The first thing to do is paint the outside if it needs it.
Again, you should use neutral colors that are common to
other homes in the area.

As you buy more and more houses, you can save
money and confusion by buying large cans of paint
and painting all of your houses the same colors. It
makes touch ups easy because you never have to try to
remember what color you painted it!

Other items include, having a nice looking front door,
mowing the grass, trimming the trees and bushes,
planting flowers, etc.

Many people elect to do the repair work themselves,
which may make sense in some cases. Never take time
off from work to do the repairs if you have a high
paying job.

It is silly to take off from a job where you make $30
per hour to do a repair job that you could hire
someone to do for $10 per hour.


Often when you hire the job out, it gets done much
faster, meaning less time making the payments on an
empty house. Plus, when you hire it out to get done, you
can write off the entire cost of the job.

When you do it yourself you can only write off the
materials.

BUY-FIX-SELL- Many people like the idea of buying
houses, fixing them up and then selling them, hoping to
make a profit.

First, once you buy the property, you need to fix it up.
Depending on the amount of work, this can take a
couple of weeks or a couple of months.

During this period you are not only paying for the repairs,
but also the mortgage payment. Once the repairs are
done, it can take several more months to sell the house,
which means more payments on a vacant house.

That is why I suggest you sell the property to an
Investor who has the capital to carry the property.

Survival Strategies For
Managing Your Houses

Good management is critical to being successful at
investing in single-family homes. In fact, even if you do
everything else properly, you've got big problems if you
don't know how to manage the houses and the
tenants.

Finding and buying the house is only part of the job.
Paying attention to your properties is the rest of the
battle.

Those who don't pay attention will go broke. I've seen
it happen MANY times.

Repairs and vacancies are the two biggest problems
you will face, and too much of either will turn a good
investment into a bad one. Both of them are the result of
bad management.

Record keeping is critical. Make sure you have
everything for tax time and in case of an audit.

Fortunately, once you learn the "tricks of the trade, you
can easily put together a system that will allow you to
avoid most of the management nightmares.

Selecting tenants is, without a doubt, the most critical
management decision you will make.

The profitability of your investment depends on it.

So how do you find good tenants?

You can turn the whole job over to a professional
management company or do it yourself. The first option is
certainly easier, but a professional will usually charge you
around 10% of the gross rent every month.

This may be all right down the road when you have plenty
of equity and a large cash flow to afford it, but investors
starting out can be well served to learn the ropes
themselves.

The two most frequently used methods to actually find the
tenants are a classified ad in the newspaper and a FOR
RENT sign in the yard. In most cases these methods will
be adequate.

The Most Important Thing To Learn Is
How To Screen And Qualify Your Tenants


You may be tempted to just take any renter who comes
along without any background check because they
"seem nice enough."

NEVER, EVER, EVER, MAKE THIS MISTAKE!

People are not always what they seem.

It is better to have a vacancy than a bad tenant.

The first step is to tell all prospective tenants that call you:

"Thanks for calling. The home is an excellent one and it is
still available. I'd be happy to show it to you. First, I should
tell you that we require a $35 non-refundable application
fee and that all references and past landlords are
checked, in addition to a credit report.

Prior to move in we require the first month's rent, a
security deposit of $XX, and a refundable cleaning
deposit of $75. Do you still want to see it??"

You will eliminate most all of the bad tenants right
then and there. If they know you are going to check them
out, and they have a lousy record, they won't even waste
their time (or yours).

You may be thinking that by following these rules you
might not get any tenants. NOT TRUE. Nice, sharp
looking homes in good areas are always in demand.

Before you agree to meet a prospective tenant at the
house, make sure to get their name and phone
number.

Not only can you call them if you get delayed, but they
are much more likely to show up (or call you if they
can't make it) if they know you have their phone number.


Will These People Take Care
Of Your Investment?

When you do meet a prospective tenant at the house,
always be polite and respectful (this goes for on the
phone as well).

Take a look at their car. If it is filthy and full of trash and
half eaten hamburgers, that is probably how your
house would end up looking if you rented to them.

Let them in and allow them to take a look for themselves,
without you breathing down their neck. Don't say stupid
things like "this is the kitchen".

You should casually mention any features or benefits that
are not obvious. You need to let them know you are a
serious investor, and you will make any necessary
repairs promptly.

Strike up a conversation by asking questions such as:

"How long have you been in town?"

"Where do you live now?"

"Why are you moving?"

"How long of a lease are you looking for?"

"Where do you work?"

"How many of you would be occupying the home?"

Listen to how they answer these questions. If they say
something like "We are moving because our last landlord
was impossible to deal with," you may have cause for
concern.


If they are sincerely interested, you'll know it. Don't try to
oversell the place; you will only come across as
desperate.

Ask if they want to fill out an application. If so,
encourage them to fill it out on the spot and collect their
$35 application fee. Tell them it usually takes less than 24
hours to process and you'll call them promptly either way.

If they prefer, give them an application to take with them
and bring back to you later.

If you are managing a lot of houses, you may want to
get an account with a credit bureau to run credit
checks yourself. Otherwise, it makes sense to use an
outside service. Many of these services will run the
credit check, call and verify past landlords,
employment, and bank accounts for around $18-35
(that's what you use the application fee for).

It's a good idea not to put too much weight on what their
current landlord says about them. If they have been
problem tenants, some landlords will lie and tell you they
are great so you will take them, and they won't have to
deal with them anymore.

It's best to go back to the landlord prior to the current
one, if possible. Remember, people are creatures of
habit. If they have been slobs or slow payers in the
past, they most likely will continue to be.

If the prospective tenant checks out O.K. and you don't
have any bad feelings or other concerns, call them and
let them know the good news- they've got a house!

Arrange a meeting for them to sign the lease agreement
and pay the required up front money.

Be careful not to call the security deposit the last month's
rent, and do not make it equal to a months rent. If the

monthly rent is $1,000, make the security deposit $1,250
or so.

The reason is that at the end, when they are going into
their last month, you don't want them to think they can just
use the money they paid at the beginning.

Make them pay the rent for their last month at the
beginning of that month as usual.

After they move out, if everything is all right, refund the
security deposit. They will be a lot more careful and
leave the house in better condition if they know their
deposit is on the line.

Beware Of Scam Artists

If they are paying by check, never allow the tenant to
move in prior to making sure that it clears.

If the check is drawn on a local bank, go there and cash
it. If the move-in date is within a day or so, require them
to give you cash, money order, or a cashier's check.

This meeting is also the time to let the tenant know what
you expect of them, and what they can expect from you.
You will avoid a lot of problems if you spell
everything out in the lease agreement.

Since the goal is to find long-term tenants, you don't
want to accept anything shorter than a one-year lease,
longer if you can get it.

Every time a tenant moves out you have wear and tear on
the house, a vacancy, cleaning, repairs, and the hassle
of finding another tenant.

The best tenants are the ones who stay for years
without ever causing you any problems. If you live in a

cold weather state where it may be difficult to find a
tenant in December, January, or February, don't make
the lease expire in those months.

Run the lease for 14 to 16 months if necessary and
explain why to the tenant.

Make The Rules Crystal Clear...
Then Stick To Them

Let the tenant know you are serious about your
investments and you follow your policies strictly. As long
as they follow the rules, the two of you will have a good
relationship.

If they don't, you will swiftly take action to protect your
investment. (Please note: Landlord-tenant laws vary
widely from area to area. Before implementing any rules,
make sure that you are not violating any local or state
laws).

Be very clear that rent is due on the 1st of the month and
if it's not in your hands by the 5th, you will immediately
start eviction proceedings.

No matter how tempting, do not ever accept partial rent
payments, as you may have to start the entire eviction
process over, and it sets a bad precedent.

There is a $20 per day late fee after the 5th. There is a
$30 charge for a returned check, and once they bounce a
check, they must pay with money orders or a
cashier's check from then on.

Do not allow them to sub-let the house. Put a limit on
how many people can occupy the house (i.e. 2 adults and
2 children). They pay for any legal fees incurred in
your having to go to court to enforce the agreement.


It is best not to allow pets, and put this in writing. If
you do allow them, state how many, what type, and get a
bigger security deposit.

Smoking should not be allowed in the house -
PERIOD! It's just not worth it. It stinks up the house, turns
the walls brown, soaks into everything, causes burn holes
on the carpet and on the counters and sinks, not to
mention the risk of burning the whole place down!

The tenant should be responsible for any repairs
under $50 or so. You don't want the tenant to call you for
every silly little repair. On the other hand, don't set this
amount too high or the tenant will simply ignore the
necessary repairs and let the house slowly go downhill.

Your Tenants Will Help You
Maintain Your Investment

The tenant should be responsible for replacing the
heating/cooling system filters, maintaining the lawn and
landscaping, snow removal, etc.

The tenant must notify you immediately of any major
problems needing repair.

Tell the tenant that any extra appliances like refrigerators
and washers and dryers are there only as a
convenience. They are strictly "AS-IS" and you take no
responsibility to repair or replace them.

The key to avoiding vacancy and related problems is
to have good, long-term tenants. Try to get them
attached to the house. Encourage them to work on it.
Offer to supply the materials if they want to do some
worthwhile improvements to the place.

If you are paying for part of an improvement, never allow
them to deduct it from the rent. Get copies of the receipts

and then write them a separate check. This is much
better from a tax standpoint.

You can also tell them that when you are ready to sell it,
you will give them the first right to buy it. This would be
good for you because you would have no vacancies,
real estate commissions, etc.

The goal is to create a psychological attachment
between the house and the tenant. The tenant will take
much better care of the house if they think it might be
theirs someday. You should drive by the house
frequently, and go inside to check at least every 3-4
months.

Try to make fairness your guide in dealing with the
tenants. Enforce your rules strictly, but treat them with
respect.

Once they know your position, they will be unlikely to
break the rules because they know the consequences if
they do.

Take Care Of Your Good Tenants And
You Will Have Fewer Vacancies

You may want to reward good tenants by not raising their
rent, or giving them $50 or $100 off of their rent in
December. Often the little things can mean a lot.


Tenant Lease Application

The following form is an application that you must
have filled out by everyone you intend to rent to.


You should use a service like the "National
Tenant Network" to do a full credit report and
criminal background check.

They are not in every state, but there are other
companies like them everywhere.

They charge about $35 for a full check (which you
make the person who is going to lease your
property pay).

Their website is located at: www.ntnnet.com
























Lease Application

Please fill out this application completely, sign at the bottom and
submit funds for the application fee (which pays for your credit
report(s)).

Name (primary applicant):

_______________________________

Social Security: __________________________


Name (secondary applicant):

______________________________

Social Security: __________________________

Current Home Address:_____________________

City: ____________________________________

State: ______________ Zip:______________

Phone (home): _____________________

Phone (his wk): _____________________

Phone (her wk): _____________________

Current Landlords Phone: _____________________

Previous Address: _______________________________

City, State and Zip: ______________________________

Previous Landlord's Phone: _______________________



Employer (primary): ___________________________
Address: ____________________________________
City, State, Zip: _______________________________

Employer (secondary): _________________________
Address: ____________________________________
City, State, Zip: _______________________________

Gross Annual Income:
$ ________________

Monthly Obligations: (not including rent)
$ ________________

I hereby submit $ ____ for a credit report and criminal
check. I give my permission for Prospective Landlord to
have this information accessed by a credit information
provider.


______________________________________________
Primary Signature Date


______________________________________________
Secondary Signature Date

LEASE AGREEMENT

This Residential House Lease Agreement ("Lease") is made and effective this
__________________ [Date] by and between ________________________
___________________[Landlord] ("Landlord") and ____________________
________________________________[Tenant] ("Tenant," whether one or
more). This Lease creates joint and several liabilities in the case of multiple
Tenants.

1. PREMISES.
Landlord hereby rents to Tenant and Tenant accepts in its present condition the
house at following address:
______________________________________________________________
_____________________________________(Address of House) (the "House").

2. TERM.
The term of this Lease shall start on ____________________[Move-in Date],
and end on [Lease End Date]. In the event that Landlord is unable to provide the
House on the exact start date, then Landlord shall provide the House as soon as
possible, and Tenant's obligation to pay rent shall abate during such period.
Tenant shall not be entitled to any other remedy for any delay in providing the
House.

3. RENT.
Tenant agrees to pay, without demand, to Landlord as rent for the House the
sum of _______________________ [Monthly Rental Amount] per month in
advance on the first day of each calendar month, at ______________________
[Address for Rent Payments], or at such other place as Landlord may designate.
Landlord may impose a late payment charge of _________________ [Late Pay
Charge] per day for any amount that is more than five (5) days late. Rent will be
prorated if the term does not start on the first day of the month or for any other
partial month of the term.

4. SECURITY DEPOSIT.
Upon execution of this Lease, Tenant deposits with Landlord [Security Deposit
Amount], as security for the performance by Tenant of the terms of this Lease to
be returned to Tenant, following the full and faithful performance by Tenant of
this Lease. In the event of damage to the House caused by Tenant or Tenant's
family, agents or visitors, Landlord may use funds from the deposit to repair, but
is not limited to this fund and Tenant remains liable.





5. QUIET ENJOYMENT.
Landlord agrees that if Tenant timely pays the rent and performs the other
obligations in this Lease, Landlord will not interfere with Tenant's peaceful use
and enjoyment of the House.

6. USE OF PREMISES.
A. The House shall be used and occupied by Tenant exclusively as a private
single-family residence. Neither the House nor any part of the House or yard
shall be used at any time during the term of this Lease for the purpose of carrying
on any business, profession, or trade of any kind, or for any purpose other than
as a private single-family residence.

B. Tenant shall comply with all the health and sanitary laws, ordinances, rules,
and orders of appropriate governmental authorities and homes associations, if
any, with respect to the House.

7. NUMBER OF OCCUPANTS.
Tenant agrees that the House shall be occupied by no more than ______ [Total
Number of Occupants] persons, including no more than ________ [Maximum
Number of Children] under the age of eighteen (18) years, without the prior
written consent of Landlord.

8. CONDITION OF PREMISES.
A. Tenant agrees that Tenant has examined the House, including the grounds
and all buildings and improvements, and that they are, at the time of this Lease,
in good order, good repair, safe, clean, and tenantable condition.

B. Landlord and Tenant agree that a copy of the "Joint Inspection," the original
of which is maintained by Landlord and a copy provided to Tenant, attached
hereto reflects the condition of the House at the commencement of Tenant's
occupancy.

[Include Lead Paint Disclosure If Required]

9. ASSIGNMENTS AND SUBLETTING.
A. Tenant shall not assign this Lease, or sublet or grant any concession or
license to use the House or any part of the House without Landlord's prior written
consent.

B. Any assignment, subletting, concession, or license without the prior written
consent of Landlord, or an assignment or subletting by operation of law, shall be
void and, at Landlord's option, terminate this Lease.



10. ALTERATIONS AND IMPROVEMENTS.
A. Tenant shall make no alterations to the House or construct any building or
make other improvements without the prior written consent of Landlord.

B. All alterations, changes, and improvements built, constructed, or placed on or
around the House by Tenant, with the exception of fixtures properly removable
without damage to the House and movable personal property, shall, unless
otherwise provided by written agreement between Landlord and Tenant, be the
property of Landlord and remain at the expiration or earlier termination of this
Lease.

11. DAMAGE TO PREMISES.
If the House, or any part of the House, shall be partially damaged by fire or other
casualty not due to Tenant's negligence or willful act, or that of Tenant's family,
agent, or visitor, there shall be an abatement of rent corresponding with the time
during which, and the extent to which, the House is untenantable. If Landlord
shall decide not to rebuild or repair, the term of this Lease shall end and the rent
shall be prorated up to the time of the damage.

12. DANGEROUS MATERIALS.
Tenant shall not keep or have on or around the House any article or thing of a
dangerous, inflammable, or explosive character that might unreasonably
increase the danger of fire on or around the House or that might be considered
hazardous.

13. UTILITIES.
Tenant shall be responsible for arranging and paying for all utility services
required on the premises, except Landlord will provide:
__________________________ [Services Provided by Landlord]. Tenant shall
not default on any obligation to a utility provider for utility services at the House.

14. MAINTENANCE AND REPAIR.
A. Tenant will, at Tenant's sole expense, keep and maintain the House and
appurtenances in good and sanitary condition and repair during the term of this
Lease. In particular, Tenant shall keep the fixtures in the House in good order
and repair; keep the furnace clean; and keep the walks free from dirt and debris.
Tenant shall, at Tenant's sole expense, make all required repairs to the
plumbing, range, oven heating apparatus, electric and gas fixtures, other
mechanical devices and systems, floors, ceilings and walls whenever damage to
such items shall have resulted from Tenant's misuse, waste, or neglect, or that of
the Tenant's family, agent, or visitor.

B. Tenant agrees that no signs shall be placed or painting done on or about the
House by Tenant without the prior written consent of Landlord.


C. Tenant agrees to promptly notify Landlord in the event of any damage, defect
or destruction of the House, or the failure of any of Landlord's appliances or
mechanical systems, and except for repairs or replacements that are the
obligation of Tenant pursuant to Subsection A above, Landlord shall use its best
efforts to repair or replace such damaged or defective area, appliance or
mechanical system.

15. ANIMALS.
Tenant shall keep no domestic or other animals in or about the House without the
prior written consent of Landlord.

16. RIGHT OF INSPECTION.
Landlord and Landlord's agents shall have the right at all reasonable times during
the term of this Lease and any renewal of this Lease to enter the House for the
purpose of inspecting the premises and/or making any repairs to the premises or
other item as required under this Lease.

17. DISPLAY OF SIGNS.
During the last thirty (30) days of this Lease, Landlord or Landlord's agent may
display "For Sale" or "For Rent" or "Vacancy" or similar signs on or about the
House and enter to show the House to prospective purchasers or tenants.

18. HOLDOVER BY TENANT.
Should Tenant remain in possession of the House with the consent of Landlord
after the expiration of the Term of this Lease, a new tenancy from month to
month shall be created which shall be subject to all the terms and conditions of
this Lease, but shall be terminable on thirty (30) days by either party or longer
notice if required by law. If Tenant holds over without Landlord's consent,
Landlord is entitled to double rent, pro-rated per each day of the holdover, lasting
until Tenant leaves the House.

19. SURRENDER OF PREMISES.
At the expiration of the Lease, Tenant shall quit and surrender the House in as
good a condition as it was at the commencement of this Lease, reasonable wear
and tear and damages by the elements excepted.

20. FORFEITURE OF SECURITY DEPOSIT - DEFAULT.
It is understood and agreed that Tenant shall not attempt to apply or deduct any
portion of any security deposit from the last or any month's rent or use or apply
any such security deposit at any time in lieu of payment of rent. If Tenant fails to
comply, such security deposit shall be forfeited and Landlord may recover the
rent due as if any such deposit had not been applied or deducted from the rent
due. For the purposes of this paragraph, it shall be conclusively presumed that a

Tenant leaving the Premises while owing rent is making an attempted deduction
of deposits. Furthermore, any deposit shall be held as a guarantee that Tenant
shall perform the obligations of the Lease and shall be forfeited by the Tenant
should Tenant breach any of the terms and conditions of this Lease. In the event
of default, by Tenant, of any obligation in this Lease which is not cured by Tenant
within fifteen (15) days notice from Landlord, then in addition to forfeiture of the
Security Deposit, Landlord may pursue any other remedy available at law, equity
or otherwise.

21. ABANDONMENT.
If at any time during the term of this Lease, Tenant abandons the House or any
of Tenant's personal property in or about the House, Landlord shall have the
following rights: Landlord may, at Landlord's option, enter the House by any
means without liability to Tenant for damages and may relet the House, for the
whole or any part of the then unexpired term, and may receive and collect all rent
payable by virtue of such reletting; Also, at Landlord's option, Landlord may hold
Tenant liable for any difference between the rent that would have been payable
under this Lease during the balance of the unexpired term, if this Lease had
continued in force, and the net rent for such period realized by Landlord by
means of such reletting. Landlord may also dispose of any of Tenant's
abandoned personal property, as Landlord deems appropriate, without liability to
Tenant. Landlord is entitled to presume that Tenant has abandoned the House if
Tenant removes substantially all of Tenant's furnishings from the House, if the
House is unoccupied for a period of two (2) consecutive weeks, or if it would
otherwise be reasonable for Landlord to presume under the circumstances that
the Tenant has abandoned the House.

22. SECURITY.
Tenant acknowledges that Landlord does not provide a security alarm system or
any security for the House or for Tenant and that any such alarm system or
security service, if provided, is not represented or warranted to be complete in all
respects or to protect Tenant from all harm. Tenant hereby releases Landlord
from any loss, suit, claim, charge, damage or injury resulting from lack of security
or failure of security.

23. SEVERABILITY.
If any part or parts of this Lease shall be held unenforceable for any reason, the
remainder of this Agreement shall continue in full force and effect.

24. INSURANCE.
Tenant acknowledges that Landlord will not provide insurance coverage for
Tenant's property, nor shall Landlord be responsible for any loss of Tenant's
property, whether by theft, fire, acts of God, or otherwise.


25. BINDING EFFECT.
The covenants and conditions contained in the Lease shall apply to and bind the
heirs, legal representatives, and permitted assigns of the parties.

26. GOVERNING LAW.
It is agreed that this Lease shall be governed by, construed, and enforced in
accordance with the laws of the State of ____________________________.

27. ENTIRE AGREEMENT.
This Lease shall constitute the entire agreement between the parties. Any prior
understanding or representation of any kind preceding the date of this Lease is
hereby superseded. This Lease may be modified only by a writing signed by
both Landlord and Tenant.

28. NOTICES.
Any notice required or otherwise given pursuant to this Lease shall be in writing;
hand delivered, mailed certified return receipt requested, postage prepaid, or
delivered by overnight delivery service, if to Tenant, at the House and if to
Landlord, at the address for payment of rent.

IN WITNESS WHEREOF, the parties have caused this Lease to be executed the
day and year first above written.

______________________________________________
Tenant Signature Date

______________________________________________
Tenant Signature Date

______________________________________________
Landlord Signature Date

Chapter 15

Financing The Sale Of Your
Properties For A New Buyer Or
Investor

This is the most important chapter in this
book. If you understand financing, you will
succeed as a real estate investor.

Structuring the deal so it is attractive to a Buyer is the
easiest way to sell your properties fast and for top
dollar.

A Behind The Scenes Look At The Banks!

Keep in mind that banks are in the business of loaning
money in order to make lots of money.

Ironically, most banks lend money to people who really
don't need it. Just try getting a loan from a bank when
you desperately need it!

For the most part, banks are in the risk-avoidance
business. Bankers are paid bonuses and get promotions
based on the quality of the loans they approve. If they
have even the slightest problem with a loan, it's usually a
"no go" on your loan application.

You see, your banker will still get his/her paycheck every
two weeks, whether they approve your loan or not! They
are hesitant to approve a loan if they feel it can go bad
down the road and cost them extra money.

Is it any mystery why banks are typically so hard to
work with?


Investment homebuyers are advised to work with
mortgage specialists or brokers who tend to be very
motivated and work hard to help you. They are
motivated because their income is based solely on
commission.

If you don't get the loan, they don't get paid.

In this day and age, you have to be careful. Not all
mortgage companies are on the up and up.

Make sure you get references and check with the
consumer fraud division before giving them any
application fees.

Getting your investors and buyers pre-approved
shouldn't cost you any money or fees.

They will have to pay between $50 and $60 for a
mortgage credit report. That money does not go to the
lender. It should go to the credit research company.

If someone asks you to pay a pre-approval
application fee in addition to this, get out of there and
go elsewhere!

Be sure to read any contract or application, or have an
attorney help you. We've seen everything, and we want to
stress again that you can't be too careful!

For example, some brokers will take your application (and
money) and tell you that you are locked into a certain
rate, but when you go to closing, they pull out a
mortgage with a higher rate or more points.

Unfortunately, this really happens. Not all the time, but
enough to make one become somewhat leery!

This is a perfect example of where many novice real
estate investors have been hit hard.


Make sure you get your investors and buyers pre-
approved proceeding with a transaction, but know
whom you're dealing with!

Preapproval Will Help You Negotiate Your Best Price.

Since the closing of the deal is not contingent upon
financing when you are preapproved, the seller sees your
offer the same way they would see a cash offer. It is a
very strong position to negotiate from.

Sell Your Property Fast And For Top
Dollar!

I've often heard it said that you make the most money in
real estate on the day you buy your property.

Although I agree with this statement, you need to know
that if you don't have a good selling strategy, you
won't make money.

Here are few tips to help you sell property fast and for top
dollar.

Make Your Properties Extremely Easy To Buy!

There two types of buyers that come in abundance

1. Buyers with bad credit.
2. Buyers with no money for a down payment.

You can help both of these types.

You will hear me repeat this over and over again. To
be successful as a real estate investor, you must
understand financing.

It is the "Be All" and "End All" of this business.

Zero down and low down payment financing is
available from many sources. Go to the Sunday real
estate section in your newspaper and look at the ads for
Mortgage and Trust Deed Brokers.

Call five of these companies and I guarantee you will find
at least one zero down, owner occupied, real estate
financing program.

You'll also find mortgages and trust deeds available

for people with bad credit. Ask the loan originator
exactly how they work.

These programs require the buyer to have a larger
down payment, or the seller to carry a second
mortgage.

One of the low down payment programs for people
with reasonably good credit is FHA-HUD financing.

With this program, the buyer can purchase a home with
3% down payment and the seller can pay 100% of the
buyers expenses to purchase the home.

Why do you want to pay the buyer's expenses? The
answer is simple; it will make it possible for more people
to buy your home. Build the buyer's costs into the sale
price of the home.

Let's say you have a house you have rehabbed and want
to sell for a profit.

You think the home is worth $100,000 maximum.

Put a sign in the front yard that says:

$3000 Down Payment
$856 per month
Call 222-1234

This sign will get noticed, especially since you wrote this
message in black marker on a bright yellow sign. It
doesn't matter if it's ugly, it does matter if it gets
noticed.

There are other ways to make your property easy to
buy

Lease it with an option to buy (I cover this method
in Chapter 13).


Carry back a second mortgage or trust deed and
then sell the mortgage at a discount to a private
note buyer.

Sell it on contract with no qualifying necessary.


The easier you make your property to finance, the
more likely you will get top dollar in the shortest
possible time.

There is no need to under price your property just to
move it quickly.

Buyers will gladly pay top dollar for a property that is
easy for them to buy if they cannot qualify with
conventional terms or down payments.




Financing Real Estate Investments

Real estate financing is amazingly complex. You've got
Fannie Mae, Freddie Mac, and Ginnie Mae. There are
conforming loans and non-conforming loans.

There is A paper, B paper, C paper and D paper. You've
also got credit bureau scoring (fico scores and beacon
scores). You have LTV and CLTV. You've got front and
back end debt ratios.

Lets discuss one small part of the real estate
financing spectrum conforming, non-owner
occupied loans.

Typically, these loans are used for purchasing rental
properties with one to four units. Most lenders will not
allow more than 90% loan to value. This means you need
at least a 10% down payment (i.e. to purchase a
$100,000 investment property, you or your investor would
need $10,000).

To qualify for these mortgages, you must have good
credit. This means you can't have any late payments,
bankruptcies, judgments or liens in the past year. You
must also have established a record of good credit.

You must have two years on the job. It doesn't have to
be the same job, but it does have to be the same line of
work.

If you're self-employed, you must be able to show two
years of tax returns. They will average the last two years
to determine your qualifying income.

It doesn't really matter what your income is when you buy
rental property. The rental income of the property can
qualify you.


Here's how it works

75% of the income from the property must be enough
to pay the debt service on the loan.

So, if you have a property that has $1,000 per month
income, the lender will allow $750 of it to apply toward the
payments on the loan.

They figure the other 25% will go to cover vacancies and
repairs. If the payment is less than $750, you do not
need additional income to qualify for the loan.

But, what if the debt service (loan payment) is $800 per
month? Your income must be able to support $50 per
month.

Here's how the bank determines whether or not your
income can support a particular payment.

The lender uses front and back and debt ratios

The back end ratio is what matters most. Back end ratios
are the total amount of revolving debt the lender will allow
you to have. The back end ratio should be 41% (or less)
of your gross monthly income (income before taxes).

It's really not as hard as it sounds.

To figure your back end ratio, simply take your gross
monthly income for a particular month and multiply by .41.
If you make $2500 per month, your back end ratio would
be 2500 X .41 = $1025.

So, if you have a house payment (your personal
residence) of $700 and a car payment of $200 and a Visa
Card payment of $50, that totals $950.


If your total back end ratio is $1,025, subtract $950 and
you will find that you qualify for an additional $175.

If your income ratios look like this, you are going to need
a lease, or intent to lease, on the rental property you
purchase.

Don't be too concerned if you don't fit into the guidelines
of these loan programs.

These are the qualifying terms that Investors and
Buyers of your properties will need if they are going
to qualify for conventional financing.


Investor & Home Buyer Qualifying Form

Use the form on the following page to qualify the
investors and buyers who respond to your ads. This
chapter has given you all thats necessary to
understand WHY you are asking the questions
indicated on this form.

If they fit the profile as an Investor Buyer or a Home
Buyer (owner occupant), have them get PRE-Qualified
with a competent lender.

The lender will be able to pull their credit report and
verify their debt and income.''

Don't let yourself get into a transaction only to find
out that your buyer doesn't qualify for the loan!

Investor & Home Buyer
Qualifying Form

CREDIT HISTORY

Do you have good credit?

Bankruptcy more than 2 years discharged?

Any late payments in last 12 months?

If no established credit, do you have an apartment
lease in your name with cancelled checks showing
on-time payments?


DOWN PAYMENT

How much money do you have for a down payment?


TIME ON JOB

Do you have 2 years in your current line of work.

If just out of school, are you performing the job for
which you trained in school?

If self-employed, do you have 2 years of Tax Returns
showing consistent or growing income? Average the
past 2 years for qualifying income.


INCOME

What is your gross annual income?

28% of gross? (front end ratio)


41% of gross? (back end ratio)

Income of the subject property? (This is something
you will already know)

75% of the subject property's income (is it enough to
cover debt service?)


TYPE OF PROPERTY THEY WANT

What type of income property are you looking for?

Do you want to be put on my investor list to be
notified when I find a suitable property?


IF THEY FIT THE PROFILE YOU NEED


Name:


Address:




Phone (wk):

Phone (hm):

Email:


How you found this lead?

Date you added this lead to list?

Chapter 16

Putting It All Together - A
Step-by-Step Guide To Success
For SECTION 2

This chapter helps you understand what to do first, what
to do second, what to do third... and so on.

You will discover the simple steps to follow for true
success in this business.

I find that most "business opportunity" type books are
so unclear on how to actually proceed that no one is able
to implement them. This chapter changes all of that.

I am going to make this a simple as possible, with an
easy to follow list of actions you must take to succeed.

This does not work by itself... you must be involved
and you must pay attention.

1. Run two classified ads in the Sunday real estate
section (see Chapter 9).
a. One is to find Sellers.
b. The other is to find investor Buyers.

2. Have 15-20 small yellow corrugated plastic signs
printed with "I buy homes for cash" and your phone
number.

3. Staple the signs on telephone poles at major
intersections all over town.

Note: Make sure you have an answering machine to
capture any calls that come in. Don't let your twelve year
old kid answer the phone... it really weakens your

credibility. You can get a separate voicemail from the
phone company for about $10 a month.

4. When Sellers answer your ad, ask the questions from
the "property profile" form (Chapter 2).

5. If the property fits the profile you are looking for, make
an appointment with the Seller to inspect it. Use the
inspection form to note any obvious problems (see the
form in Chapter 3).

6. While you're getting calls from Sellers, you will also be
getting calls from investors (Buyers). Keep running the
Buyer ads until you get five or six investors who you
think our serious. Make sure you get several in each "ad
type" category. Use the "Investor Qualifying Sheet" to
qualify the Investors (see Chapter 11 for a copy of the
form).

7. If you like the property and you like the deal, write an
offer, meet with the Seller and present the offer in person
(use the contracts in Chapter 5).

Note: It is always advisable to have an attorney review
your contracts before you present your offer. Make sure
you are complying with any local laws.

8. Have a complete home inspection done by a qualified
professional inspector (unless you are sure you are
competent to do it yourself). If there are any major
defects, you must decide whether or not to continue with
the transaction.

If you think the defect is too costly, ask the Seller to
repair it. If they repair it, great, you've solved the problem.
If they don't want to repair it, you can back out of the
transaction.

Note: Often, the main reason the Seller is giving you his
property for less than market value, is because it is in

less than market condition. He is not expecting you to
beat him up over minor or cosmetic repairs.

9. NOW YOU HAVE THREE OPTIONS

Sell to a Owner Occupant Buyer using the Lease
Option technique (Chapter 13)

Rent the property using the techniques in Chapter
14

Sell to an Investor and make immediate cash


Sell to an Owner Occupant Buyer Using The
Lease Option Technique

Make sure the home is clean and tidy. Put the sign in the
yard and run the ads (as suggested in Chapter 13).
Qualify your buyers and show the home.

Always get your money in the form of a cashiers check,
or give yourself 2 weeks to allow a personal check to
clear BEFORE you allow the tenant/buyer to move in.

Rent The Property

Use the techniques in Chapter 14 to get the property
rented. Run the ads and place the sign in the yard. Try to
get the home rented BEFORE you start making payments

Sell to an Investor and make immediate cash

Once you have an accepted purchase agreement with the
Seller and are satisfied with the inspection, call your
investors and tell them you have a property for them
to look at. Don't call just one, call all of them and let them
know you are calling all of your investors.


You want them to understand that you are selling this
property on the first come first serve basis. Create an
urgency to go look at the property today. Give the
investors a copy of your home inspection. They need to
know what the defects are in the property, if any.

Note: Never tell your investors about a property until you
have secured a signed and accepted purchase
agreement. You don't want them by-passing you and
purchasing the home directly from the Seller.

10. As soon as one of your investors shows interest in
your property, meet with them to write up the Investor
Agreement (Chapter 6).

11. The closing should take no more than 30 days if the
investor is paying cash or getting a new loan. If your
investor is simply taking title subject to the existing
mortgages, you can close the property in as little as
2-5 days.

12. Get your money and do it again, and again, and
again...

That's it!

There are a couple of things to keep in mind as you go
through this process. Never stop running your ads. It's
easy to get discouraged if you run them two or three
weeks in a row and get no response. Hang in there.

Look at the ads in the paper that are running every week
and copy them. If an investor runs the same ad over and
over, he is probably getting a decent response.

Just remember, if it costs you $200-$300 in classified
ads over a 2 or 3 month period to find your first
property and you make $3,000 gross profit, you have

just made ten times your investment! Any business
would be thrilled to have that kind of return.

The nice thing about this business is the more you do,
the easier it is to get good deals. Before you know it,
people will be calling you with their homes to sell.

The reason investors are willing to pay you to find
property for them is because they don't know how to do
it themselves.

They may have run an ad once or twice and didn't like the
response they got, so they gave up. Don't give up... keep
trying. This program really works if you set about it in
a methodical, systematic way.

Once Again....

There Are No Failures In
Business, Only Tests.

Everything you do is a test. The information I am giving
you is a proven guide that has worked many times in the
past. You may have to tweak it a bit, but it will work for
you too.

***** UPDATE SECTION *****

Chapter 17
Using The Internet To Get Highly
Motivated Sellers To Call You

This updated chapter will show you a new technique my
coaching students and I have been working on over the
past months.

It is the most powerful tool for real estate investors I have
ever seen and is designed to help you find motivated
Sellers of great real estate.

Motivated Sellers mean GREAT DEALS for you as the
Investor.

It also means GREAT FINANCING TERMS.

To me, "great deals" means real estate that is
substantially under market value.

"Great financing terms" means the properties are
available with zero down payment and no credit check.

Remember, there are only two types of real estate
transactions that make sense for you as an investor.

They are:

1. Properties substantially Under Market Value, or...
2. Available On Terms At Market Price Or Below.

If they don't fit either of these criteria... don't waste your
time.


If you want to buy real estate investments with no risk to
your credit or pocketbook, you need to buy with Seller
financing. That is what this whole book has been about.

Even if you have money for down payments and good
credit, I still suggest you start with this type of deal.

The reason is, It is VERY Safe

I have coaching clients who are millionaires. I have a
doctor who makes $400,000 a year in his practice. I have
an Internet businessman who sold his company for a
boatload of money.

I tell them the very same thing I tell my clients who have
no money, no job and bad credit. The more you have to
start with, the more you have to lose.

Don't risk losing everything because you are a greenhorn
investor.

I speak from experience, because that is exactly what
happened to me. I built a huge real estate business ($20
million in assets in the first 3 years) and then I lost it all. It
wasn't *all* my fault, the market dropped 30% in Los
Angeles (where I was living and investing in 1992).

If I had known what I know today, I wouldn't have fallen
into that big hole. I would have invested in smarter, safer
deals. Maybe I wouldn't have built such a big business. I
would have built a much more stable business.

The reason there is so little risk with Seller financing is
because the loans are not in your name, so you never risk
a ding on your credit report. The other reason is you have
no money into the deal, so you have no money to lose.
The most you can lose is your time.

The negative part of Seller financed deals is they typically
make you less money per deal than some conventional

deals (like Sheriff Sales - which I cover in detail in Week
11 of the 26 Week Coaching Course).

But you have to start somewhere, and you need to build a
solid foundation you can grow on. Once you learn how to
do the "virtually-no-risk" deals with Seller financing, you
can move on with confidence to other types of investing.

So... whether you are rich or poor, whether you have
good credit or bad... I suggest that you start your
investing business with Seller financed property.

BUT... as Ive said before,

The biggest problem with Seller financing is...

Finding Sellers Who Will Do It!

If you have bad credit and no income, there are *no*
conventional lenders that I know of that will loan 100% of
the purchase price of an investment property. There are
some hard money guys that come pretty close, but it's still
not zero down. (I cover hard-money lenders in Week 19
of the 6 Month Coaching Course.)

The big trick is finding Sellers who will sell to you with this
type of financing. A big portion of this book shows you
exactly how to do just that... step-by-step.

The property does not have to be a fixer (although I've
made good money on fixer upper homes) and you can
take full title using "subject to" (although it may be in your
best interest to take title in some other manner). Ive
shown you how to make this decision in a previous
chapter.

My system is all about finding the Sellers who will accept
these deals as their best option, sellers who have high
motivation and few choices. You don't have to push them

into something that is against their best interests. You will
be their best choice or they will take another route.

There are more motivated Sellers out there than you may
think and they are not that difficult to find, but, as Ive said
before, you won't find them in the MLS or the Sunday
paper. You must advertise for them and know how to
present your offer in a coherent, viable manner.

That is where having your own
Web page comes in.

You can use the one I have created or you can create
your own.

With a powerful web page like the one I have created,
your advertising will be 33% more effective (based on
tests that I have performed).

If you use a web site for potential Sellers to go and read
about your program, you will get more leads, more
SELLERS.

You can get 33% more calls (or more) on your ads, your
flyers, your signs, your billboards, your business cards...
on any type of advertising that you do.

That means that it will cost 1/3 LESS to find a motivated
Seller! Imagine what this will do to your bottom line profit.

Here Is How It Works...

One of the first things I tell you to do in the "Step-by-Step"
chapter is to run some classified ads and have some
signs made.

Here is an example of a Seller ad.



I Will Make An Offer On Your
Home In 24 Hours! Go To:
www.WeWillBuy.com/1
Or Call: 317-598-1220

My tests show that 3 to 5 people will go to the web site for
every one who calls your phone number.

That means if you don't have a web site similar to this,
you will only get 66% of your Seller leads.

When they go to the web address in your ad, this is the
page they will see (click here to see the page or go to:
www.wewillbuy.com/1).

This page is designed to give them enough information
about how you work to build curiosity and credibility.

But the main purpose of the page is to get them to click
on the "submission page" and give you the information on
the house they have for sale.

Click here to see the "submission page" or go to:
www.wewillbuy.com/offer.html

When they fill out the information on the submission page
and click on the "submit" button at the bottom of the page,
the information they have entered will be sent to you and
the Seller will get an autoresponse message thanking
them for the submission.

Why don't you go to the submission page now and fill out
the form. Type in your real name and real email address
and type "test" into all of the other form fields.

When you hit the "submit" button, you will be sent the
"thank you for submitting" email that a Seller would
receive if they had filled out the form. Make sure to put in
your real email address when you fill out the form or the
email will not arrive.

A Motivated Seller Submits A Property To You

After a Seller sends you their information, you can contact
them and make an offer on their property using the
techniques I gave you in Chapter 4.

The offer you make will fit one of the following criteria:

1. Substantially Under Market Value
2. Available On Terms At Market Price Or Below.

With either of these types of deals you can make money.

If you don't have good credit or any capital to work with
and you find Sellers with properties "substantially under
market value," but available only with cash, you may need
an Investor.

Investors Are Easy To Find With
A Web Site Like This

They really are a dime a dozen when you have a good
property to sell.

When you drive investors to your new site, they will be
directed to the Investor "sign up sheet." To see what it
looks like, go here or go to www.wewillbuy.com/go.html

Investors will fill out the contact information so you can
call them or email them when you have a good property
you want to flip or sell.

They will be anxious to purchase the deals you find and
will pay you for your trouble. I showed you how this whole
process of flipping property works in Chapter 6.

It is easy to get a reliable list of solid investors using a
web site like this.


One thing to remember... Investors are always easier to
get than good deals. If you find the deals, the money and
the Investors will come easily.

You can set up a web site just like mine (please dont
copy it - just create something similar) if you have some
expertise in setting up web sites. The form script is a
simple cgi script that I got for free from:
www.bignosebird.com

It was not difficult to set up and you can do it yourself if
you have web space and a piece of web authoring
software like Frontpage.

You also want to buy an easy-to-remember web address
like www.wewillbuy.com

It has to be something that you can remember after
seeing it in your car.

Dont use hard to spell words or hyphens in your URL.

This is an example of a BAD web address:
www.associatedhomebuyersofamerica.com
No one will remember it when they get home, and if you
try to put it in a classified ad, it will not fit on one line.

This book is not the place to go into how to set up a web
page. You can get info on that just about anywhere on the
web for free.

But not everyone wants to learn how to write a web page,
how to buy a domain name, how to use a cgi script, how
to format a page with HTML, how to buy web space, how
to FTP your files, how to converge the emails so they are
sent to the right place, etc

That is why I set up a simple, but effective site at:
www.wewillbuy.com


I want everyone to be able to use these techniques and
not have to worry about the technical stuff.

Okay, now Im going to show you how to get set up fast
using my web site!

It is really simple. Just fill out the sign-up page and send
us your information. Go to www.wewillbuy.com for details
on how to register.

If you sign up now, I will waive the $799 set up fee. Thats
right, no fee to set it up, just a reasonable monthly fee of
$45.

When you register, we will get to work creating a personal
web page for you with an easy-to-remember web address
(domain name).

It will look something like this:

www.WeWillBuy.com/1
or
www.WeWillBuy.com/78
or
www.WeWillBuy.com/go
or
www.WeWillBuy.com/now

You will want an address that is easy to remember, so
anyone who sees your sign on the street can remember it
when they get home.

All of the site names will start with: www.WeWillBuy.com,
but they will each have unique extensions that are easy to
remember, like the ones above.

These pages will be for you ALONE. You do not have to
share them with any of my other clients.


They will be personalized with your name and email
address so when a Seller submits a potential property,
the information will go directly to you!

The web site will be YOURS for as long as you want it.

The cost of this service is only $45 per month, paid
monthly (minimum of 3 months).

Once again, let me state that there is NO SET UP FEE

SAVE $799 SET UP FEE!
(For A VERY Limited Time)


Hurry... I won't be offering this free set up for long.

So, that's it.


Bonus One

Easy-To-Use Guidebook

How To Get Wealthy Buying And Selling
Single Family Homes!

Learn How You Can Make The Money You Need To:

Put Your Kids Through College,
Quit Your Current Job
Pay For Your Retirement
Achieve Financial Freedom!


By
Joe Crump


www.realestatemoneymaker.com


United Home
4040 E. 82nd Street
Suite C-9-202
Indianapolis, Indiana 46250



Copyright 2000-2003 - United Home

SUBSCRIBE TO OUR E-ZINE!

If you have not subscribed to our FREE ezine (email
newsletter), "The Real Estate Money Maker," you can do
it right now. Just send a blank email to:

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Privacy Guarantee: Your email address will not be
misused or sold to anyone!

Thank You For Subscribing!

You will learn many money making and money saving
techniques for buying and selling homes in the following
chapters.

It is our hope that by reading the free information in this
ebook, you will discover the great opportunities that exist
for someone who is willing to take the steps outlined here
to become a profitable real estate investor.



Introduction
Why This System For Buying Homes Really
Works!

Chapter 1
The Perfect Investment

Chapter 2
Only 5% Of Americans Avoid Poverty At
Retirement!

Chapter 3
Real Estate Has Been A Fantastic Investment
Throughout History - "It's The Only Thing They
Ain't Makin' More Of!"

Chapter 4
What Makes Single Family Homes A Powerful
Investment Strategy?

Chapter 5
What Is The Downside Here? Am I Taking A
Huge Risk By Investing In Homes?

Chapter 6
Where Do You Get The Amazing Deals You
Hear About On Those Late Night Infomercials!

Chapter 7
What Type Of House Will Maximize My Profits?


Chapter 8
What Is The Minimum That I Need To Do To Get
My House Ready To Rent?

Chapter 9
Survival Strategies For Managing Your Houses

Chapter 10
How Long Should I Wait Before Selling In
Order To Make The Most CASH?


DISCLAIMER: The information in this book is solely
advisory and should not be substituted for legal, financial
or tax advice. Any and all financial decisions and actions
must be done through the advice and counsel of a
qualified attorney, financial advisor and/or CPA. This book
is not intended to solicit properties already listed by a real
estate agent. The author, Joe Crump and the publisher,
United Home, have made their best effort to produce an
accurate, informative and helpful book. Nevertheless,
they make no warranties of any kind with regard to the
completeness or accuracy of the contents of this book.
They accept no liability of any kind for any losses or
damages caused or alleged to be cause, directly or
indirectly, from using the information contained in this
book.



Copyright 2000-2003 - United Home


Introduction

Why You Should Pay Attention To The
Valuable Lessons You Will Learn In This
Book

I am going to show you, in the next eleven
chapters, one aspect of the real estate
investment business.
You are going to learn some key basics for
purchasing single-family homes and holding
them as rental properties. This is one of the
easiest and best-known methods of investing in
real estate today.
As a subscriber to my free ezine, "The Real
Estate Money Maker," you are also going to be
exposed to many different types of real estate
investments in the future that are not discussed
here. You will learn about:
Flip properties
Multi-unit rental properties
Rehab homes
Foreclosure properties
Investments that will replace your income
Investments that are designed for long term
profits
Investments that are designed to generate
quick cash


If you haven't yet subscribed, send a blank
email to:
subscribeme@realestatemoneymaker.com
As a real estate investor and real estate agent for
the past twelve years, I've helped a lot of people
buy income properties. I've seen (or personally
made) nearly every possible mistake a real estate
investor can make.
But I've also made a lot of money in real estate,
and helped many others make money too. Real
estate investing is one of the most exciting
businesses you can get involved in, and one of the
most profitable if you do it right.
Income potential and profits are not the only
benefits to investing in real estate. Running your
own real estate business gives you enormous
freedom to run your life the way you want.
I haven't had a "real" job since I worked part-time at
a little camera shop on a noisy train platform in
Chicago. I was a college student then, almost 20
years ago.
Since then, I have always been my own boss. I
have succeeded or failed based on my own
triumphs and mistakes. I've been around the block
once or twice since I started. Ive made lots of
mistakes, and had my share of success as well.
Today, I write books related to real estate and
personal finance. I market them on and off the
Internet. I am also the author of the ezine you just
subscribed to, "The Real Estate Money Maker."
I have been a licensed real estate broker for 14
years and am currently in the top 1% of all real
estate agents in the world.
I spend the rest of my time investing in my own real
estate and offering my services as a business

coach for Realtors. I show agents how to get more
clients and make more sales while working fewer
hours. I teach them how to systemize and optimize
their business in order to make their profits
explode... virtually overnight.
If you are a Realtor, or would like to be, check out
my "real estate agent" web site at:
www.getmoreclients.com

I Also Coach Real Estate Investors
Like You
Until now, I have only been willing to coach investor
clients in my home market area - which is
Indianapolis, Indiana. Coaching real estate
investors is one of the most rewarding things I do.
It is very exciting to watch someone discover that
real estate investing is not difficult (as long as you
know what to do) and can be very profitable, even
if you have bad credit or no start up capital.
80% of my investor clients had less than $1000
in start up capital!
I've helped others become very successful as real
estate investors and I can do it for you too, if you
are willing to "do what it takes."
Although there are many helpful guidebooks
available regarding real estate investments, most
people find it very difficult to get started without
making any major mistakes.
That's where I come in.
I can analyze your situation and help you make the
right choices, choices that you can live with and
profit from, choices that fit your lifestyle and your

particular personality.
To find out about my coaching program, go to:
http://www.zerodowninvesting.com
I hope you find this book enlightening. It is my wish
that it will spur you on to great success in whatever
field you choose. The ideas and concepts you will
learn here as a real estate investor, will carry over
to just about any business you care to start in the
future.
Thank you for your time and interest.
Here's wishing you the very best that life has to
offer.
Your partner in real estate success,
Joe Crump Joe Crump Joe Crump Joe Crump
joe@realestatemoneymaker.com





How To Get Wealthy Investing
In Single Family Homes

Chapter 1
The Perfect Investment
Every intelligent person knows the importance of
planning and investing for the future. The tough part is,
there are so many difficult and critical decisions to
make. Everyone you talk to has his or her favorite
"perfect" investment.
So whom do you believe, and what is the "perfect"
investment? First off, you need to realize...
There Is No Such Thing As A Perfect
Investment!
All investments are a trade-off between risk and return.
An investment with a high return will have a
corresponding high degree of risk.
On the other hand, a "safe" investment with low risk
will offer a lower return or profit.
Therefore, any investment is a compromise. Each
investor must weigh the different levels of risk and
return for any given investment.
One investor may be willing to take more of a risk in
exchange for the potentially large returns, while
another is more comfortable with safer, less risky
investments.
There is no investment that fits everyone.

NOTE: With the free newsletter you subscribed to,
("The Real Estate Money Maker"), you will learn about
many different types of real estate investments. Some
will have more risk and have a higher potential for
profit than others.
If you have not yet subscribed, send a blank email to:
subscribeme@realestatemoneymaker.com
A moment ago we stated that there is no such thing as
the "perfect" investment, and this is true.
But there is one thing I am sure of...
Real Estate Is As Close To Perfect As You
Will Get!
Many people want to invest in real estate, but they just
don't know how to get started. There is a lot of bad
information out there, and people generally have lots of
questions.
To cover everything in an organized, logical manner,
let's look at the most common questions and discuss
the answers.

Chapter 2
Only 5% Of Americans Avoid Poverty
At Retirement!
The sad truth is only 1 out of 20 Americans will be
financially independent when they reach retirement.
The rest depend on family, friends, or charities, with
millions existing at the poverty level... literally waiting
around to die.
If you plan on spending all your money as you make it
and retiring on your social security, you need to wake
up!
Social security is designed merely to provide a
supplement to your investments and retirement plan.
If Social Security is all you've got, you are either going
to have to continue working well past normal
retirement age, or be living a very meager lifestyle.
You deserve more than that, and you can have it with
some financial discipline and planning.
Of course, a good real estate investment coach
couldnt hurt. ;-)
Why not just put your money in a mattress or safe
deposit box? Because inflation will kill you. It will eat
away at your money's value, actually making you
poorer with each day that goes by.
For those of you who need some explanation, inflation
is simply the general trend of prices to rise over time.
Think back to 25 or 30 years ago.
You could buy:
A new car for $5,000.
A hamburger for 20 cents.

A new house for $25,000.
You certainly can't do that today. While the prices of
some items are actually coming down (i.e. computers),
the overall trend is up.
This means that over time, your money will buy you
less and less. For example, if inflation is running at 4%
per year, you need to earn 4% on your money just to
break even, more if you want to build wealth.
You want to invest in things that not only give you a
good return, but also go up in value (appreciate).
Another reason to invest is for the tax advantages.
Most of us are being taxed from every angle. Of
course, I'm not talking about cheating the government,
or not paying taxes that are legally due.
Smart investors structure their investments in order to
legally pay the lowest amount of tax. This includes tax-
free investments, tax credits (as in depreciation) and
tax deferral (as in most retirement plans).
Did you know you are able to depreciate your
rental property and reduce your gross income by
the same amount?
This means you typically save a buck in Federal
Income Taxes for every three you depreciate
(depending on your tax bracket).
Many people invest for cash flow. A common goal in
real estate investing is to create a "money machine"
that eventually replaces you as the primary income
earner. In other words, instead of you working for your
money, your money works for you!
Smart investing will put you in the position where
someday your investments will earn more money each
year than you do working at your job. At that point you
can retire and do what ever you want, or continue to
work and really sock away the dough, building up

some serious wealth!
The main reasons for investing are:
1. Appreciation
2. Tax Advantages
3. Cash Flow
4. Retirement
Or stated another way, a great investment should have
the following qualities:
1. Beats (or benefits from) inflation.
2. Gives you tax advantages.
3. Provides growth or cash flow.
4. Helps your overall retirement plan.




Chapter 3
Real Estate Has Been A Fantastic
Investment Throughout History
There are truly many advantages to investing in real
estate. More millionaires have made their fortunes in
real estate than anything else.
Here is what some of the wealthiest Americans have
said:
"Real estate is the basis for all wealth." -Theodore
Roosevelt
"Buying real estate is the best, safest way to
become wealthy." - Marshall Fields
"90% of all millionaires made it through real
estate." - Andrew Carnegie
"Remember this, boy! Real estate is the only thing
they ain't makin' more of!" - Somebody's
Grandpappy
Let's look at some of the advantages in more detail:
APPRECIATION- Over the past 80 years, real estate
values have continually increased. Of course, there
have been some periods where values decreased, but
the overall trend has been up. Like anything else, the
value of real estate is determined by supply and
demand.
So what are the factors that have made real estate
in such high demand over the years?
One of the main factors is that shelter is a basic human
need. People need places to live, work, and shop,
where they aren't exposed to the weather. In periods of
high inflation, real estate values go up. Real estate is
an investment that benefits from inflation.

LEVERAGE- A great thing about real estate is you can
tie up a big asset with a relatively small amount of
money. You can easily buy a $100,000 home with only
10% ($10,000) down payment.
To illustrate the power of leverage, consider this
example.
Suppose you bought $10,000 worth of gold, mutual
funds, or some other investment. Let's say that it goes
up a modest 10% for the year. Your investment is now
worth $11,000. So your return is 10% of $10,000 =
$1,000.
Now lets suppose you take the same $10,000 and use
it as a down payment to buy a $100,000 house. Again,
let's say it goes up 10% for the year. Your property is
now worth $110,000!
Your $10,000 investment increased by $10,000.
That is a 100% return on your money (not even
considering the equity build-up resulting from the
constantly decreasing mortgage - cash flow - or tax
advantages)!
TAX ADVANTAGES- You can deduct, as an expense,
all of the interest, property taxes, insurance, repairs,
inspections, and depreciation on your investment real
estate, no matter how much you own.
Do not confuse this with the rules for your personal
residences. While you are limited to deducting interest
on up to 2 personal residences, you can write off
unlimited interest on investment real estate.
The IRS also allows you to take a paper write off
(depreciation). You can depreciate the structure (not
the land) as if it would be worth nothing at the end of
27.5 years! Of course we all know the property will
probably be worth much, much more in 27.5 years
than it is now, not less.

Nevertheless, on a $100,000 house, if we assume the
structure is worth 80% of the total, we are allowed to
write off nearly $3,000 in depreciation alone each year!
That's $3,000 off your gross annual income! Now
that is tax planning!
FREEDOM- While there is some management and
record keeping required, it is nothing compared with
other investments. If you invested in a business such
as a dry cleaners or a restaurant, you would be
married to the place, putting in an ungodly amount of
hours.
Real estate investing can be done without too much
interference with your current job.
SOMEONE ELSE PAYS FOR IT- With real estate, the
people who occupy your buildings are called tenants.
They pay you rent every month that you use to pay the
mortgage. The tenants literally buy your investment
property for you! When you invest in stocks, bonds, or
precious metals, you are the one who has to pay for it.
CASH FLOW- Real estate provides you with a monthly
cash flow. This can result in some very significant
income, especially after the loan is paid off.
SOLID ASSET- Real estate is widely recognized as
one of the greatest assets to own. It will be looked
upon favorably by anyone looking at your financial
statements. Real estate is also easy to borrow
against should you need extra capital.

Once you understand all of the advantages of investing
in real estate, it is easy to see that very few
investments can it. No wonder it is the favorite of
millionaires! If you want to be successful, do what the
most successful people are doing...

INVEST IN REAL ESTATE!!



Chapter 4
What Makes Single Family Homes
A Powerful Investment Strategy?
We have discussed the value of investing in real
estate, but why single family homes? Why not invest in
raw land, apartment buildings, shopping centers, or
office buildings?
There is certainly nothing wrong with these other types
of real estate. I will be showing you how to invest in
them in future issues of my newsletter.
Single-family homes have many advantages over
other forms of real estate.
SMALLER AMOUNT OF MONEY NEEDED- The
average person simply does not have the money to go
out and buy a shopping center or apartment building,
unless they build a financial base and really
understand financing.
As was discussed before, it is possible to buy a single
family home with 10% or less down payment. This
means you can buy a $100,000 house for only $10,000
down.
It is quite reasonable to ask the average person to
save $10,000 to buy their first investment property.
Single-family homes are great for the average investor.
PEOPLE ARE FAMILIAR WITH HOUSES- Most
people are not comfortable with shopping centers or
apartment buildings.
They don't know what the rents are, what repair costs
are, etc. On the other hand, most people do
understand single-family homes.
They probably have seen the value of their own home
go up over the years. They know in their heart that it is

a good investment. They also know roughly what it
costs for repairs. People buy what they are familiar
with!
MORE FLEXIBILITY- Let's assume, that for the same
amount of money you could either have 5 houses or 1
apartment building.
If you needed money, with the apartment you would
either have to sell the whole thing, refinance the whole
thing, or bring in a partner on the whole thing.
With the 5 houses, you could sell, refinance, or bring in
a partner on just one.
It is comparable to having five $20 bills versus one
$100 bill. If you buy coffee at the convenience store
with a $100 bill, they might not take it.
Like the $100 bill, the apartment building can be harder
to get rid of. Houses are more liquid. In most areas,
single-family homes sell in 120 days or less.
Apartments can take much longer. More people
can afford single-family homes and more people
want them.
MORE CONTROL- With an apartment building, all of
the tenants know each other, and they will know what
they pay in rent. That means it is difficult to charge one
tenant higher rent than another.
Plus, if one tenant plays the stereo too loud or causes
other problems, YOU will get the complaints. With
houses, they are generally scattered around the area.
You can raise the rents individually or offer lower rents
to excellent tenants.
HIGHER EQUITY BUILD UP- There is usually more
appreciation in single-family homes than in
apartments. Apartment buildings are valued based on
the income approach (how much money they bring in).
Single-family homes are valued based on comparable

sales.
This means your investment houses are valued
according to what the others in the neighborhood are
selling for. Owning your own home is part of the
American dream.
A home is a psychological desire. There is certainly
more demand for houses than apartment buildings.
LESS CHANCE OF RENT CONTROL- Rent control is
where the government tells you how much you can
charge for rent. In many big cities with rent control,
buildings have been abandoned because the owners
could not charge enough rent to cover their costs.
As a property owner, rent control is a very bad thing.
Fortunately for the single-family home investor, most
rent control laws only apply to buildings with 4 or more
units.
LESS RISK- With single-family homes, you don't have
all your eggs in one basket. The homes are usually
scattered around the area.
With an apartment building, if the area goes bad for
some reason (i.e. a factory or freeway goes in across
the street), you are sunk.
Single-family homes also tend to attract a better class
of tenants than apartments. Apartment dwellers tend to
be more transient, such as single people or young
couples. They will soon outgrow it and want to move to
a house.
Single-family homes generally attract a more stable
tenant, such as families with kids in school who are
less apt to move frequently.
Additionally, most people who live in apartments won't
do minor repairs and maintenance, like those living in a
house will.
Other forms of real estate are fine, but they may

require more money and sophistication than the
average investor has. It is easy to see why single-
family homes are a fantastic investment for just about
everyone.


Chapter 5
What's The Downside Here? Am I
Taking A Huge Risk By Investing In
Homes?
It would not be fair to have a discussion about
investing in single-family homes without covering the
negatives as well. Every investment has some
drawbacks. No investment is perfect."
MANAGEMENT- All real estate requires management,
either by you or a professional management company.
There are more headaches involved with real estate
than you would have by simply putting your money in a
money market account or mutual funds.
Single-family homes are more difficult in some
respects because they are spread out. This makes it
harder for showings and repairs versus an apartment
where all the units are in one location.
There is also more paperwork, because each house
has its own mortgage, property taxes, insurance, etc.
Management takes some time, but if you develop a
system and stay on top of it, it is not all that hard.
VACANCY- All real estate can suffer a vacancy from
time to time. With a single family home, if it's vacant,
the whole thing is vacant.
With a 10-unit apartment, if you have a vacancy, you
still have the other 9 units producing rents.
There are ways to minimize the vacancy rate so it isn't
a big problem.
REPAIRS- All real estate will require repairs from time-
to-time. Single-family homes have their own furnaces,
air conditioners, roofs, etc., unlike an apartment
building.

Therefore, houses may have more repairs, although
they will generally be less expensive repairs than you
would have with a larger building.
Apartments also require things like landscaping
maintenance and snow removal, things that a tenant
often does in a single family home. In addition, tenants
in houses often perform a lot of minor repairs
themselves.


Chapter 6
Where Do You Get The Amazing
Deals You Hear About On Those
Late Night Infomercials!
It almost goes without saying that you want to buy the
houses for the lowest possible price. But where do you
find these deals? They certainly don't walk up and
knock on your forehead (unless you are a real estate
agent).
Note: In future issues of my ezine, I will be discussing
the pros and cons of obtaining a real estate license for
the full time real estate investor. There are many
advantages to being a member of your local Board of
Realtors.
To find good deals, you need to actively go out and
look for them. You need to develop a system for
locating motivated Sellers.
What is a motivated Seller? It is a Seller who is
anxious and compelled to sell their house as fast as
possible, no matter the reason. These Sellers will likely
sell for less than market value, often considerably so,
and shake your hand to thank you for buying it.
They had a problem and you helped solve it. You got
the "monkey off their back." Do not ever feel like you
are taking advantage of a Seller. For whatever reason,
they are in the situation they are in and it's not your
fault. Remember, if you don't buy it, someone else will!
What would cause a Seller to be in a situation where
they need to sell fast? There are many possible
answers, but here are some of the most common:
DIVORCE- About 25% of all home sales are the result
of divorce or family problems. While this is unfortunate,
it provides some great opportunities for the investor.

There are cases where one spouse will agree to sell
the house very cheap just so the other gets less
money.
Often, in messy divorces, the court will order the sale
of the house, so it MUST be sold. When people are
highly emotional, they will do things that are
sometimes hard to believe, like accepting a low offer
on the house!
DEATH- This is also unfortunate, but it is something
that happens to all of us. Sometimes the sale is
motivated by emotion, such as a spouse who does not
want to stay in the same house after the other spouse
dies. Other times it is financial, where the home can no
longer be afforded without the deceased.
In many cases, there are large estate taxes to be paid.
If the inheritors of the estate do not have the cash to
pay the taxes, they will sell off assets like houses to
pay the taxes.
If they don't, the government will step in and force an
estate sale to generate the money owed for the taxes.
JOB TRANSFER- When a person is dependent on
their job and they get transferred, they sometimes
must move quickly. Often, one spouse will go ahead to
the new city and leave the other behind until the home
sells. This means separation, and the expense of
traveling back and forth.
After several months under this arrangement, the
motivation to sell can increase greatly. Sometimes the
transferred employee's company will pay some or all of
the costs associated with selling the house and
moving. This may make it possible to take a lower
price.
BOUGHT ANOTHER HOME- In many cases a Seller
will purchase another home before their existing home
is sold. They may need to sell the existing home before

they are able to close on the new one. Sometimes they
may close on the new one, move into it, and leave the
old one vacant. Either way, the motivation to sell can
be large!
FORECLOSURE- When the owner of a home doesn't
make the payments, sooner or later the bank will
foreclose on the property and take it back. Depending
on state/local laws, the foreclosure process can take
anywhere from 4 to 15 months. This leads to 2
different opportunities.
The first is where the foreclosure process has been
started, and the owner is still living in the property.
They may be highly motivated to sell because
soon, the bank will complete the foreclosure and
they will be forced to move out.
The other is where the bank has completed the
foreclosure and now owns the house. It is controlled by
the bank's real estate owned (REO) department. The
REO department does not want to own houses. They
will attempt to dispose of them as soon as possible,
often at substantial discounts.
VACANT HOUSES- Any of the above 5 situations can
lead to a vacant house. Any time you see a house
sitting vacant, you see resources being wasted.
Whoever owns it is either making payments every
month, or are missing out on the use of the money
somewhere else (if they own it free and clear). No
matter what the situation, a vacant house is usually a
good sign of a motivated Seller.
There are several ways to find these motivated Sellers.
The first is to find a reliable, professional real estate
agent to assist you. Real estate agents are out in the
trenches every day and are the first to know about
these types of properties. Most of the time the agents
are paid by the Seller, so it doesn't directly cost you to

use their services.
You may want to distribute flyers to real estate offices
stating that you are an investor who will buy properties
meeting certain criteria. You can also contact divorce
and probate attorneys, and bank REO departments.
The most important thing is, tell them you are
prepared to act fast and buy a property quickly if it
meets your criteria.


Chapter 7
What Type Of House Will Maximize
My Profits?
So, how do you determine what houses to buy? What
criteria are used to evaluate potential investment
houses? How do you buy them? What do you do to get
them ready to rent?
It is not really all that difficult, if you follow a few simple
guidelines.
TYPE- The most important thing to remember here is
to follow the law of supply and demand. What type of
house appeals to the most people?
In most areas, this will be a 3 bedroom, 2 bath, 2 car
garage, detached house (3/2/2). This is not to say a 4
bedroom is no good. If you come across a 4 bedroom
that is a great deal and meets all the other criteria, by
all means buy it.
What about condominiums or townhouses?
While generally not as good as a house, they do have
the advantage of being easier to maintain because a
homeowners association (HOA) handles the
maintenance.
However, this is also one of the drawbacks to a
condo/townhouse. The HOA fees are often high ($100
per month or more) and they usually go up.
Furthermore, many HOAs hold the owner responsible
for the actions of the tenant. So you could end up
getting fines because your tenant doesn't park in the
right spot or plays the stereo too loud.
Most HOAs have the power to put a lien against the
title of your property for money they claim you owe
them, such as fines or special assessments. In

extreme circumstances, HOAs can turn into ugly
battlefields with bitter disputes among neighbors.
A condo/townhouse can be harder to sell than a
house. They also tend to have a higher proportion of
renters than owners.
As a rule, the best investment properties are in
areas where a majority of the residents are owners.
A condo/townhouse can be an excellent
investment, just make sure to do some homework.
LOCATION- Look for an average house, in an average
neighborhood, to rent to an average person, and, down
the road, to sell to an average person.
You want a middle-income area with the widest
appeal. Avoid homes on busy streets or that back up to
a busy street. If you can find a home on a cul-de-sac or
comer lot, that's great.
You should research home sales over the past few
years. A real estate agent can help you with this or you
can go to your county records.
Pick an area where values are steadily increasing. As
for age, a newer home will generally require less in
repairs, although this is not always true.
PRICE RANGE- The key here is to select a price
range where you can get a positive cash flow, or at
least break even, while still being able to make the rent
affordable.
This price range is generally just below the average
price in the area. For example, if the average home in
your area is selling for $140,000, the best rentals may
be in the $110,000 to $130,000 price range.
In addition, this is a price range that should be easy to
sell in the future once the time comes.
High priced or luxury homes are generally not
recommended. It can be hard to rent them for enough

to cover the mortgage payment. If they go vacant for a
while, it can cost you plenty. Many tenants who rent
luxury homes, do so only for short terms, leaving the
owner with another vacancy.
On the other hand, if prices are increasing rapidly, a
higher priced home may appreciate more in gross
dollars.
On the other hand, a lower priced home is not
necessarily the best. The main problem is
management. People in low price areas are typically
bad money managers. They often live paycheck to
paycheck, with no savings for emergencies.
When their car breaks down or there is an unexpected
medical bill, the landlord gets a sob story saying the
rent is going to be late. Once a low-income tenant
gets behind in the rent, the chances of them
bringing it current are slim.
Tenants in lower priced homes are also more likely to
abuse the property and neglect maintenance and
minor repairs. They often have many kids and pets
crammed into a small house.
Finally, low priced homes are often in areas that
have low appreciation. Of course, these are
generalities and certainly not true in every case.
I have one client who owns 220 separate units in
neglected areas. She collects rent weekly and easily
fills vacancies.
She also gets top dollar for her properties by being
flexible on deposits (collects them in payments over
several months).
There are 6 fulltime employees on her staff to help her
with maintenance, repairs and management.
I consider her a good friend and an awesome
businesswoman.

FINANCING- There are many different ways to buy
properties, but they all fall pretty much into the
following categories.
a.) CASH PURCHASE- This is simple, just like it
sounds. The Buyer pays the entire purchase price in
cash without getting a loan for any part of it. In this
case, the Buyer/investor would have a large cash flow
because there is no mortgage payment.
There is nothing wrong with this, except the Buyer is
not taking advantage of the leverage of getting a loan
and is tying up more money than necessary.
Rather than pay cash for a $100,000 house, he could
have used the money to put a 10% down payment on
ten $100,000 houses and own ten homes instead of
one.
Of course, most people simply don't have enough
money laying around to pay all cash for a house!
b.) NEW MORTGAGE- In this case (the most
common) the Buyer makes a down payment and goes
to a bank or mortgage company to get a loan for the
balance of the purchase price. The bank will put a lien
against the property so if the payments are not made,
they can repossess it.
The Buyer will be required to fill out a loan application
and the bank, depending on the amount of the down
payment, will run a credit report, verify the applicant's
employment and bank accounts, and analyze the debt
to income ratio.
NOTE: If your credit is a problem, you will not be
able to work with these "conforming" lenders.
I've written a book about credit repair. It is called,
"How To Clean Your Credit In 60 Days!" It shows
you an easy, step-by-step, system that will help
you get perfect credit fast.

You can get a FREE trial download of this book at:

www.cleanyourcredit.com

The interest rates and fees charged can vary
significantly, so a prudent Buyer is well advised to
shop around with different loan companies before
going through the application process.
There is private mortgage money available to Buyers
with bad credit. What matters to these lenders is the
equity in the property.
If you can find a good deal (a home at 70% loan-to-
value) it won't matter how your credit looks. This is one
of the most important sources of money for investors
and I will discuss it in more detail in future issues of my
newsletter, "The Real Estate Money Maker."
c.) SELLER FINANCING- This is where the Seller acts
like a bank and loans you the money to buy his house.
The terms, such as interest rate, down payment,
length of loan, etc. may all be widely negotiable.
The advantages to the Buyer are that the Seller will
usually not require a full loan application and
credit check. They also do not charge all the
miscellaneous fees the banks normally do.
The Seller gets a good return on his money, which is
secured by the property, and the gain from the sale
gets spread out over a number of years, which may
help with the Seller's tax situation.
Seller financing is good if you can get it, but a relatively
small percentage of Sellers own their homes free and
clear. Many don't want anything to do with carrying the
mortgage, but it is always worth a try.

d.) ASSUMPTION- Prior to 1988, all FHA and VA
mortgages were assumable without qualifying. Many
investors scooped up properties by simply assuming
these loans with small down payments. Those days
are all but gone. There are still some of the old loans
around, but the equities are big, so the Buyer has to
come up with a huge down payment.
For example, if a property selling for $100,000 had an
underlying assumable loan of $50,000, the Buyer
would have to put up a $50,000 down payment.
If the Seller is willing to carry a second mortgage, then
the Buyer could make a down payment of $10,000 and
the Seller would carry a second mortgage of $40,000.
Most of the newer loans are not assumable, or require
the Buyer to fully qualify to assume the loan.
e.) CONTRACT OF SALE- There are many ways to
use this technique, but the basics are the same. The
new Buyer makes a down payment to the Seller and
takes over the property, without notifying the
underlying mortgage holder.
The Buyer makes payments to the Seller, who then
makes the proper payment to the mortgage company.
Most all mortgages have an "acceleration clause" that
allows the mortgage holder to call the entire loan
balance immediately due and payable if title or interest
in the property is transferred without their permission.
There are too many details and possible situations to
go into here, but despite the risks, buying on "contract"
is a fairly common practice.



Chapter 8
What Is The Minimum That I Need
To Do To Get My House Ready To
Rent?
It makes good sense to try to buy homes that require
the least amount of work, but sometimes the best
deals are on homes needing some, or a lot of
attention, before they are ready to rent.
Do not make the mistake of trying to rent a home if it is
not in good condition. The only tenants who will be
willing to rent it are messy and figure that since the
house isn't in good condition anyway, it doesn't matter
if they trash it.
So what does good condition mean?
INSIDE- The two best things you can do that will make
the biggest difference for the least amount of money
(in addition to a thorough cleaning) are carpet and
paint. Fresh carpet and paint make a house smell, feel,
and look new inside.
When choosing the colors, go with neutral tones,
nothing flashy. Paint should be off-white, with a beige
tint for a soft, cozy feel. Don't use gray as it gives a
cold and drab feeling. Never put up wallpaper. It is a lot
of work and you will regret it down the road!
Carpet should be something in the beige-brown range,
which is neutral and will hide some wear and tear. Use
a low to mid range carpet, but go with a higher end
pad. The nicer pad doesn't cost much more and it
makes the cheaper carpet feel more expensive. It also
makes it last longer.
OUTSIDE- The idea here is to "gingerbread" the
exterior, giving it "curb appeal. The house should look
nice and well kept; the kind of place people would

choose to live in. Paint the outside if it needs it. Again,
you should use neutral colors that are common to
other homes in the area.
As you buy more and more houses, you can save
money and confusion by buying large cans of paint
and using it on all of your houses. It makes touch ups
easy because you never have to remember what color
you painted it!
Other items include a nice looking front door, mowing
the grass, trimming the trees and bushes, planting
flowers, etc.
Many people elect to do repair work themselves, and
this may make sense in some cases. Never take time
off from work to do the repairs if you have a high
paying job. It is silly to take off from a job where you
make $30 per hour to do a repair job that you could
hire someone to do for $10 per hour.
Often when you hire the job out, it gets done much
faster, meaning less time making the payments on an
empty house. Besides, when you hire it done, you can
write off the entire cost of the job, whereas, if you do it
yourself, you can only write off the materials.
BUY-FIX-SELL- Many people like the idea of buying
houses, fixing them up and then selling them. It is
possible to profit this way, but you must be very
careful. If you dont know exactly what you are doing,
you will get burned.
Once you buy the property, you need to fix it up.
Depending on the amount of work needed, this can
take a couple months.
During this period, you are not only paying for the
repairs, but also the mortgage. Once the repairs are
done, it can take several more months to sell the
house, which means more payments on a vacant
house.

When it does sell, the average selling costs (with
commissions, closing costs, taxes, etc.) are near 10%.
It is easy to see how you would need to buy the house
for at least 25% under its good condition market
value in order to work. If you are off on some of your
estimates, or pay too much for the house, you can lose
a lot of money fast.


Chapter 9
Survival Strategies For Managing
Your Houses
Good management is critical to being successful when
investing in single-family homes. In fact, even if you do
everything else properly, you've got big problems if you
don't know how to manage the houses. Finding and
buying the house is only part of the job.
Paying attention to your properties using good
management is half the battle. Those who don't
pay attention will go broke. I've seen it happen
MANY times.
Repairs and vacancies two problems you will face. Too
much of either will turn a good investment into a bad
one. Both of them are usually the result of bad
management practices.
Record keeping is critical. Make sure you have
everything for tax time and in case of an audit.
Fortunately, once you learn the "tricks of the trade,
you can easily put together a system that allows you to
avoid most of the management nightmares.
Selecting your tenants is, without a doubt, the
most critical management decision you will make.
The profitability of your investment depends on it. So
how do you find good tenants? You can either turn the
whole job over to a professional management
company or do it yourself.
The first option is certainly easier, but a professional
will usually charge around 10% of the gross rent every
month. This may be all right down the road when you
have plenty of equity and a large cash flow to afford it,
but investors starting out can be well served to learn
the ropes themselves.

The two most common ways to find tenants are using
classified ads in the newspaper and FOR RENT
signs in the yard. In most cases, this will be adequate.
You Must Learn How To Screen And
Qualify Your Tenants
You may be tempted to take any renter that comes
along without any background check because they
"seem nice enough." NEVER, EVER, EVER, MAKE
THIS MISTAKE! People are not always what they
seem. It is better to have a vacancy than a bad tenant.
You need to tell all prospective tenants that call you:
"Thanks for calling. That home is an excellent one and
it is still available. I'd be happy to show it to you.
Continue on by saying, I should tell you that we
require a $35 non-refundable application fee and that
all references and past landlords are checked, in
addition to running a credit report. Prior to moving in,
we require the first month's rent, a security deposit of
$XX and a refundable cleaning deposit of $75. Do you
still want to see it?"
You will eliminate most of the bad tenants right then
and there. If they know you are going to check them
out, and they have a lousy record, they won't even
waste their time (or yours). You may be thinking that
by following these rules you might not get any tenants,
but this is not true. Nice, sharp-looking homes in good
areas are always in demand.
Before you agree to meet a prospective tenant at the
house, make sure to get their name and phone
number. Not only can you call them if you get delayed,
but they are more likely to show up (or call you if they
can't make it) if they know you have their phone
number.


Will These People Take Care Of Your
Investment?
When you do meet a prospective tenant at the house,
always be polite and respectful (this goes for on the
phone too). Take a look at their car. If it is filthy and full
of trash and half eaten hamburgers, this is probably
how your house would end up looking if you rented to
them.
Allow them to take a look at the house for themselves
without you breathing down their neck. Don't say stupid
things like "this is the kitchen". You should casually
mention any features or benefits that are not obvious.
Let them know you are a serious investor and you will
make any necessary repairs promptly. Strike up a
conversation by asking questions such as:
"How long have you been in town?"
"Where do you live now?"
"Why are you moving?"
"How long of a lease are you looking for?"
"Where do you work?"
"How many of you would be occupying the home?"
Listen to how they answer these questions. If they say
something like "We are moving because our last
landlord was impossible to deal with," you may have
some concerns. If they are sincerely interested, you'll
know it. Don't oversell the place, as you will only come
across as desperate.
Ask if they want to fill out an application. If so,
encourage them to fill it out on the spot and collect
their $35 application fee. Tell them it usually takes
about 24 hours to process and you'll call them promptly
either way. If they prefer, give them an application to

take with them and bring back to you later.
If you are managing a lot of houses, you may want to
get an account with a credit bureau to run credit
checks yourself. Otherwise, it makes sense to use an
outside service. Many of these services will run the
credit check, verify past landlords, employment, and
bank accounts, for around $18-35 (that's what you use
the application fee for).
It's a good idea not to put too much weight on what
their current landlord says about them. If they have
been problem tenant, many landlords will lie and tell
you they are great so you will take them and they won't
have to deal with them anymore. If possible, it's best to
go back to the landlord prior to the current one.
Remember, people are creatures of habit. If they are
slobs or slow payers, they are likely to continue to be.
If the prospective tenant checks out O.K. and you don't
have any bad feelings or other concerns, call them and
let them know the good news. Arrange a meeting for
them to sign the lease agreement and pay the required
up front money.
Be careful not to call the security deposit the last
month's rent, and do not make it equal to a months
rent. If the monthly rent is $1,000, make the security
deposit $1,250 or so. The reason is that at the end,
when they are going into their last month, you don't
want them to think they can just use the money they
paid at the beginning. Make them pay the rent for their
last month at the beginning of that month as usual.
After they move out, if everything is all right, refund the
security deposit. They will be a lot more careful and
leave the house in better condition if they know their
deposit is on the line.
Beware Of Scam Artists
If they are paying by check, never allow the tenant to

move in prior to making sure it clears the bank. If the
check is drawn on a local bank, go there and cash it. If
the move-in date is within a day or so, require them to
give you cash, money order, or a cashier's check.
This is also the time to let the tenant know what you
expect of them and what they can expect from you.
You will avoid a lot of potential problems if you spell
everything out in the lease agreement.
Since the goal is to find long-term tenants, you don't
want anything shorter than a one-year lease, longer if
you can get it. Every time a tenant moves out, you
have wear and tear on the house, a vacancy, cleaning,
repairs, and the hassle of finding another tenant.
The best tenants are the ones who stay for years
without ever causing you any problems. If you live in a
cold weather state where it may be difficult to find a
tenant from December -February, don't make the lease
expire during those months. Run the lease for 14 or 16
months if necessary and explain why to the tenant.
Make The Rules Crystal Clear...Then Stick To Them
Let the tenant know you are serious about your
investments and you follow your policies very strictly.
As long as they follow the rules, the two of you will
have a good relationship. If they don't, you will swiftly
take action to protect your investment.
Please note: Landlord-tenant laws vary widely from
area to area. Before implementing any rules, make
sure you are not violating any local or state laws.
Be very clear that rent is due on the 1st of the month
and if it's not in your hands by the 5th, you will
immediately start eviction proceedings. No matter how
tempting, do not ever accept partial rent payments. If
you do, you may have to start the entire eviction
process over, and it sets a bad precedent. There is a
$20 per day late fee after the 5th. There is a $30

charge for a returned check. Once they bounce a
check, they must pay with money orders or a cashier's
check from then on.
Do not allow them to sub-let the house. Put a limit on
how many people can occupy the house (i.e. 2 adults
and 2 children). They pay for any legal fees incurred in
your having to go to court to enforce the agreement. It
is best not to allow pets. Put this in writing. If you do
allow them, state how many, what type, and get a
bigger security deposit.
Smoking should not be allowed in the house -
PERIOD! It's just not worth it. It stinks up the house,
turns the walls brown, soaks into everything, causes
burn holes on the carpet and burn marks on the
counters and sinks, not to mention the risk of burning
the whole place down!
The tenant should be responsible for any repairs under
$50. You don't want the tenant to call you for every silly
little repair. On the other hand, don't set this amount
too high or the tenant will simply ignore the necessary
repairs and let the house slowly go downhill.
Your Tenants Will Help You Maintain
Your Investment
The tenant should be responsible for replacing the
heating/cooling system filters, maintaining the lawn
and landscaping, snow removal, etc. The tenant must
notify you immediately of any major problems needing
repair.
Tell the tenant that appliances, like refrigerators,
washers and dryers, are there only as a convenience.
They are strictly "AS-IS" and you take no responsibility
to repair or replace them.
The key to avoiding vacancy and related problems is to
have good, long-term tenants. Try to get them attached
to the house. Encourage them to work on it. Offer to

supply the materials if they want to do some
worthwhile improvements to the place.
If you are paying for part of an improvement, never
allow them to deduct it from the rent. Get copies of the
receipts, and then write them a separate check. This is
much better from a tax standpoint.
You can also let them know that when you are ready to
sell it, you will give them the first right to buy. This is
good for you because you avoid vacancies, real estate
commissions, etc.
The goal is to create a psychological attachment
between the house and the tenant. The tenant will take
much better care of the house if they think it might be
theirs someday. You should drive by the house
frequently, going inside to check it out at least every 3-
4 months.
Make fairness your guide in dealing with the tenants.
Enforce your rules strictly, but treat them with respect.
Once they know your position, they will be less likely to
break the rules, because they know the consequences
if they do.
Take Care Of Your Good Tenants And
You Will Have Fewer Vacancies
You may want to reward good tenants by not raising
their rent, or giving them $50 or $100 off of their rent in
December. Often the little things can mean a lot.


Chapter 10
How Long Should I Wait Before
Selling In Order To Make The Most
CASH?
This depends on your goals, the area, the market, etc.
Many people hold houses until they double in value.
Others hold them until the mortgage is paid off. Still
others hold them for a specified period such as 7 or 10
years.
Some investors don't sell at all unless the
neighborhood peaks out and values start to go down.
You would be smart to monitor values on a consistent
basis. This is not to say you should panic and sell
every time there is a little glitch in the market.
However, if the area has started going down while
other areas are going up, you may want to sell and do
a 1031 tax free exchange into a property that is
appreciating better.
Some investors hold the property until they are free
and clear (assuming the values are stable).
Then they can sell them by taking a down payment
and carrying the mortgage themselves. This can
provide them with a good, stable, cash flow for many
years.

**************************************************************




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Copyright 1999-2003 - United Home

FREE Bonus Two
Real Estate Marketing Techniques I
Have Used To Place Myself In The
Top 1% Of ALL Real Estate Agents
In The World!

The following manual was written for my Realtor
clients to help them understand marketing and how
to make the most of every dollar they spend on
advertising.

I'm including it with this package because I feel it is vital
information for anyone who has, or is getting ready to
start, his or her own business.

All business is about GETTING PAYING
CUSTOMERS!

It doesn't matter what type of business... be it brain
surgery, selling hamburgers or reselling real estate.

Never forget this important lesson.

I've sold this book to Realtors in the past for $79.90 and
still include it in several of the marketing packages I sell.
You are getting this information for FREE.


Make good use of it and it will serve you.




The Marketing Basics You Must Know In
Order To Profit In Your Business

I'm starting this manual out with a section on marketing
because marketing is your business. Without this
information, youll never reach the levels of success you
desire. With this information, youll become a more
successful and profitable professional.

You can't overlook the fact that if you want to build a
successful practice, you must spend a reasonable
amount of time, money and effort on marketing.

I know it sounds logical, but you'd be surprised how many
times something like this will bypass the typical agent.

An agent, no matter where they do business, needs this
information, and any professional that's "in" business to
make a profit, is in the business of MARKETING! That's
what it really boils down to...

No Matter What Type Of Professional You
Are... What Your Market Is Where Youre
Located... Or Anything Else You're Really In
The Marketing Business!

If you're going to be advertising your business, you must
know the basics of marketing and build upon them. That's
why I'm starting this first section on the basics of
marketing.

Having this information will do you good, ONLY if you put
the ideas into action. This whole special report is about
action. Never forget this:


There Is No Success Without Action


Meditation won't get you there - more Seminars wont
get you there - more tapes from the Superstars wont
get you there - more Boot camps wont get you there.
Only action will.

Some people won't like these ideas because they are
totally unique, different and proprietary in every way, but
they work! All the time! For everybody!

My point is this, you can't possibly hope to succeed in
todays marketplace unless you have the marketing
mindset, tools, techniques, systems and ideas that Im
about to share with you, as part of your business arsenal.
And, you must put them to work!

I know you want to succeed or you wouldnt have taken
the step to invest in my materials. That's why you will not
join the 85 out of 100 sales professionals that fail each
and every year. Money and time are wasted, and
dreams are torn apart, every time one of these people
fails.

You will not be one of them if you will follow the marketing
truths you're about to read. If you take the time to learn
these essentials of marketing, you will be a profitable
agent, very profitable indeed.

Marketing is a game, a game that you can win with
powerful advertising.

To win, you must play by rules that will win the game. I
will give you the basic rules you need to be able to put
marketing and advertising to work making money for you.

I have many people to thank for this information, too
many to list. And much of this information I have learned,
at great expense, by making all kinds of costly mistakes.


I hope you'll learn from my mistakes and won't fall into the
traps so many salespeople do, and end up out of
business.

Here Are The Steps To Help You Succeed In
Marketing Your Business:

1) Focus On The Benefits To Your Prospects

2) Know Who Your Prospects Are, How Many
There Are, And How To Reach Them

3) Understand Your Competition

4) Understand The Problems Of Your Prospects
And How You Can Solve Them

5) Don't Use Expensive Advertising, Use Less
Expensive Alternatives

6) Create Client-Centered Marketing
Communications

7) Always Ask For What You Want

8) Be Persistent In Your Marketing Efforts



Success Step One: Focus On The Benefits To
Your Prospects

You may be very excited about what you do. You may be
so excited about your service, company, how many
clients you have, the sales club you belong to, awards
youve won, your recognizability or anything else, that you
could talk about it for hours. However, your prospects are
only going to respond with a resounding "so what?"

The features you are so excited about, the ones that
boost your ego, are basically meaningless to those
prospects out there, unless you turn them into believable,
powerful and compelling benefits to them, benefits that
will motivate them into signing with you or working with
you exclusively.

You must take every feature you offer and translate it into
a benefit meaningful for your prospects. If a feature you
offer has no benefit, then it is a feature you don't need to
be talking about (99% of all the features the typical
salesperson talks about fall into this category).

The essence of successful marketing is to discern and
disseminate precise, compelling benefits to your
prospects; benefits which let them know in crisp,
energetic, precise detail, exactly what's in it for them
when they work with you.

So, for each specific target market you are pursuing, you
must determine what benefits you are providing the
prospect. The easiest way to do this is to look at the
features from your prospects point of view.

Ask yourself, "If I were a prospect, what's in it for me to
work with ______?" Then answer that same question in
reference to each and every feature you offer.


When you are compelling someone to work with you, you
must always tell them the benefits first, and then tell them
what feature offers them this benefit or result.

By focusing on the benefits, you'll be head and shoulders
above the other people going after the same prospect.

Now lets look at the next Success Step that will enable
you to profit from marketing basics in your business:


Know Who Your Prospects Are, How Many
There Are, and How To Reach Them

If you are to truly succeed in this business, you've got to
know who can and will work with you, how many of these
prospects there are, and how you can reach them in a
cost-effective, consistent manner.

So, first you must understand the type of prospect you are
looking for. You must realize that if you don't know what
YOU want and what YOU are all about, what YOUR goals
are, you will have a hard time finding the best suited and
matched prospect for YOU.

Most salespeople dabble in every type of market
imaginable and never get anywhere. In order to be
outrageously successful, you need a niche, a
specialty, a market that you know and service better
than anyone else.

As an example, let's assume you love working with
referrals only. Not new clients or anything else, just
referrals. To determine this, you would have had to ask
yourself most of the following questions (which I suggest
you do now, especially if you do not yet have a niche,
specialty or market that youve already determined to be
an exact match for YOU):

* How far am I willing to travel?

Determine your market area. Are you only interested in
working around town, or are you willing to drive 45
minutes for a deal? This is important to decide right now.

Once youve answered this question, use it to answer the
next:

* How many prospects are there and how do I find them?


This question could be a little tougher to answer.
Depending on which market you're after, it could be easy
to find your prospects, or tough. For our example
however, let's take a moment to think logically.

Lets say that youve determined you dont want to travel
very far for new business and youd like to stay in the
immediate area. The immediate area may have three
sub-divisions with a total of three thousand homeowners.
Would it be possible to get the names, addresses and
phone numbers to those 3000 residents?

Sure. Now, youve determined your business location and
the exact target market youre going after. Forget, ignore
and delete from your data bank of possibilities all the
other prospects that fall outside of YOUR niche market.

As funny as this may sound, only one in 100 salespeople
ever go through this simple process of deciding their
exact target market. The majority of all people are like
kids in a candy store. There are so many options, so
many choices, so many different things to try, that they
eat a little bit of everything and get sick. In business, if
you dont find YOUR niche and specialty, your just like
the sick little kid in the candy store.

This example should open your mind to understand that it
is relatively simple to determine and find a niche market
for your business. Its crucially important to your success,
so take some time and do it now.

All you've got to do is continually ask the questions that
lead you to the answers.

Now lets look at how to reach your prospects.

There are many ways to reach YOUR market, all of which
work if done correctly. You can...



Use direct mail
Telemarketing
Write a Newsletter
Conduct Seminars
Advertise - (classified, display, magazine, Val- Pak,
card decks, etc...)

These are just a few of the marketing methods you can
use. We will discuss each of them in great detail later in
this manual. But rest assured, each one works well if set
up and used correctly. After all, every traveling seminar
Top Producing sales professional that writes a book or
marketing system, has their own successful approach.

Some experts say you must make 141 cold calls per
day. Another may say to send out 100,000 direct mailers
a month or to advertise FREE REPORTS. Some may to
conduct FREE SEMINARS to reach your goals, while
still others say to focus 110% on past clients and
referrals.

You know what? Theyre all correct! Every approach will
work, but the key difference here is that not every
marketing approach works for everyone.

Thats why you have to find YOUR way of marketing,
YOUR niche, and YOUR business objectives. Thats
what Im all about and thats what this program will teach
you, besides a million other things!

I am a believer in spending a reasonable amount of time
determining your niche. Once you do, test different
marketing methods, based on YOUR own personality and
work habits, to develop a complete and super profitable
practice. You dont have to choose the expert on stage
or any other person out there.

I always attempt to spend as little money as possible
finding these types of things out. I advise you to do the

same as you are testing different approaches to making
money in this business.

Especially when you are new to the unique and
proprietary marketing that I teach. You should NEVER
throw all of your money, time and effort into a single
method. This is what most people do and its the real
reason why 85% (or more) fail miserably.

One final note concerning this Success Step. It helps you
know how many prospects you have and how to reach
them so you can set your income goals based on real-life
numbers, not approximations. It will also help you figure
potential expenses in doing a direct mail piece, phoning,
seminars, etc.

Knowing & Understanding Your Competition

Once you've determined your marketing area, you'll need
to know who else is after your target market? Your
marketing efforts will never take place in a vacuum; there
will always be other things competing for your prospects
attention and money.

Your competition is approaching your same prospect time
and time again. That's why an essential part of successful
marketing involves close scrutiny of your competitors, in
an attempt to understand what they are doing, why they
are doing it, and how well they are doing.

To be ahead of your competition you need to know:

1. Who is offering the same service in your area?

2. What are the precise features of their service?
(Do they push their company? Themselves? Their
Credentials?)

3. What benefits are derived by using their service?


4. What's unique about doing business with them?

5. How does that compare to doing business with
you?

6. Is their market exactly the same as yours?

7. Why do your prospects use your competition?

8. Why should a prospect choose you ahead of
them?

Unless you know this information, inside and out, its
impossible to formulate your marketing strategy. Which
means, your marketing efforts will never pay off.

Understand this, a competitor is someone who's getting
your prospects to work with them, thus lowering your
potential profits.

Is this something you like and want to allow to
continue? NO!

That means you've got to know about all of your
competition, who they are and how they work. You must
do your research.

You need to gather key information about your
competition in order to answer the questions above. Here
are possible ways to do this

Get Yourself On Relevant Mailing lists (Including
Your Competition's)

Subscribe To (Or Get) Periodicals They Are
Running Ads In

Ask Their Current Customers Questions About
Your Competition


Ask A Friend To Call Up And Request Information
About Your Competitors.

Also remember this: being anxious and worried about
your competition will do you no good at all. Learn from
them. Understand what they do, what works for them and
how it can work for you.

Some of you will be competing against the strongest and
most successful salespeople in your area SO WHAT?
They werent always successful. Quite honestly, they are
the easiest to knock off, so go for it!

As a final note on this subject, remember there truly is
more business to be bought and sold in this big world
than any of us could possibly do, so don't get too caught
up in worrying about your competitors. You'll have plenty
of business if you learn how to market yourself effectively.

A key to marketing yourself effectively is to follow the next
Success Step

Understand The Problems Of Your Prospects
And Sellers, And How You Can Solve Them

If you want to succeed in marketing your business, you
must understand that you are not selling anything; YOU
ARE SOLVING A PROBLEM FOR A PROSPECT!

However, you can only solve a prospects problem if you
understand the problems they have. No one is really
interested in your service, they are only interested in
getting a solution to a specific problem that they have.

So, solve your prospects problems for them and you'll
make the big bucks!

Ask yourself these questions everyday and keep them
forever forefront in your mind for each and every market
you approach:

1)"Do I understand what is bothering my
prospect?"

2)"Do I understand what my prospect wants to
achieve?"

3) "How do I know for sure?"

To be a marketing success, you must walk a mile in your
prospects shoes to better understand the answers to
these questions.

You can only succeed to the extent that you understand
precisely what bothers your prospect and precisely what
your prospect wants to achieve.

Don't get caught up in what you think your prospect needs
or wants. No one uses a person in this profession
because they NEED him or her. They only use you
because they WANT some specific outcome.


You must understand that your success is based on your
ability to solve the problems of your prospects in any
market you go after. You need to come to understand
their innermost desires, dreams, anxieties, passions, and
problems.

You need to care about these people and you must
sincerely want to help make their lives better... one at
a time.

Really, when it comes right down to it, the attitude you
need to create successful marketing is that of a salesman
who's got a long-term commitment to keeping his/her
clients happy. If he/she doesn't keep 'em happy, he/she
won't make any residual income, and will have to keep re-
inventing the wheel every month.

Do you follow me?

Think about it for a second

If you're really hoping to make serious money in this
business, you're going to do everything you can to make
sure your clients are happy and content. The only way to
do this is to really know what they want from you, NOT
what you want to give them.

If you'll put yourself into that state of mind, and completely
understand what Im saying here, you'll have come to
know the attitude it takes to create winning marketing.

In order to create marketing that sells, you have to adopt
this empathetic attitude. Grab your dictionary and take a
look at the word empathy.

My dictionary says:
Identification with and understanding of the thoughts
or feelings of another."


In plain English, this is what good salesmanship and
marketing is all about!

Read that definition again!

Do you see the power and truth revealed in it?

That, my friend, is exactly what great marketing is all
about, being empathetic!

You see, if you identify with and understand the feelings,
hopes, and anxieties of your target market, you're going
to be able to deliver what THEY want and need!

But first, you've got to understand them. You have to tap-
in to their thoughts, feelings, hopes and desires in order
to help you create marketing that sells.

Essentially, what I'm saying is you must be sensitive and
understanding as to what each individual prospect wants.
The fears and hopes of a scared, first-timer type of client,
are much different than an older, seasoned-veteran type
of client.

In addition, I think youll agree that a single man or
women will have a different demeanor than a married
couple will. You must listen and understand each
prospect uniquely. Its the only way to reach the next level
in your career.

As I think about it, that's probably not going to be easy to
do for some people reading this material.

But, if you're serious about wanting to succeed in making
tons and tons of money and becoming a true success,
you've got to get serious about serving, caring about, and
getting to know, people.




Empathize with people.

Go out of your way to show your concern for people.
Create marketing that solves their problems, and focus on
them. Once you do, you will succeed big time!

Avoid Using Expensive Advertising - Always
Use Less Expensive Options

If you choose to run ads in newspapers, daily or weekly
shoppers, grocery cart ads, magazine ads, full-page ads,
and the like, you are destined to lose money, unless
you've tested and proven those media to be profitable in
your area and for your target market.

You must always test small, then rollout big. Sometimes
your small test ads will be profitable and sometimes they
will die. You must not try to analyze, rationalize or
anything, just test!

The inexperienced salespersons will always buy some
marketing gimmick that some Superstar sells and jump
into it with both feet because it seems so easy for that
guy. But Ill tell you something, if you go ahead without
testing first, your guaranteed to be disappointed and lose
money.

I always counsel my clients to find the least expensive
way to reach their prospects and test marketing
approaches.

For Example:

Instead of running a full-page magazine ad thats
guaranteed to work because the Superstar says so,
test the headlines, layout and copy of the ad on a smaller
scale - maybe 1/8 or 1/4 page.

Instead of sending a new direct mail piece or postcard
to a 2000 person database, send the card to only a
couple hundred to check response, or use it as a mail
stuffer for the local paper at 5 cents a piece (vs. 40+
cents a piece).


Instead of paying by the hour to call for you, pay them
per appointment or sale. There is more in it for them and
youre only paying for performance.

Instead of running seminars and paying the entire
marketing budget yourself, coop with other vendors and
run your seminar jointly.

These are just a few money-saving ideas (if you use
them) that will save you hundreds and thousands of
dollars spent on untested and unproven marketing
ventures.

Youve got to be proactive about this. You've got to think
hard and long about your objectives, which is to spend
the least amount of money for the greatest possible
return!

Create Client-Centered" Advertising Materials

People who try to further their name recognition, their
company, their accomplishments and everything else with
useless marketing communications waste too much
money every year.

All too many of these marketing efforts forget to:

Focus on your prospects:

Show your prospect that you understand their
anxieties and aspirations

Offer a compelling incentive to induce them
into action

Make it easy for them to get the information
they are looking for right now


Talk to your prospects as though you were
sitting across from them at a table

Remind your Buyer and Seller prospects of
their problems and have a solution

Provide complete details about what your
prospects have to do to get the benefit you are
offering

Remind your prospects what will happen if
they dont take action

These are things you cannot afford to forget in your
marketing efforts. These basics must be in your ads,
letters, postcards, scripts, telemarketing calls, seminars,
display and classified ads. After you have completed the
basics, then you may consider putting in graphics,
pictures of yourself and other "less important" stuff.

Always Ask For What You Want

More times than I can remember, I have been in
consultations, trainings and conference calls where my
clients tell me they dont even ask their prospects for what
they want.

Think about that...it's crazy!

Why bother to work hard to get new business, if you're not
even going to ask your prospects for what you want?
Maybe the sale, maybe a referral, maybe a chance to do
business, maybe an appointment, maybe something
else... but you DO want something, right? You have to
learn to ask for what you want!

If you know you offer a good service, it is your
RESPONSIBILITY to tell them about it and ask for what
you want.


If they don't use your services today, you must keep
asking them for what you want for as long as it takes.
Have you ever heard of the old saying, Keep asking till
they buy or die? When you think about that, it really is
your duty to get them to take action. You are a problem
solver, not just a salesperson.

Further, if they wont tell you why they arent using your
services, you need to find out why that is, and under what
circumstances they will. You must know.

Marketing is the art of finding out what the prospect
needs and letting him/her know you can get it for
him/her.

Do not think that an appointment is finished until you have
specifically asked him/her to use your services.

Be Persistent In Your Marketing Efforts

This is the Success Step that you must engrave on your
forehead! You must internalize this and live by it if you
want to succeed on a large scale in sales:

MARKETING IS A DAILY ACTIVITY - IT IS NOT
SOMETHING YOU DO ONCE AND THEN GET RICH!

Never forget this.

Persistence is the key to marketing success.

Once you've identified your target market, you've got to
connect with them over and over again, letting them know
you have the solution to their problems and needs.

You are the one they need to eliminate their anxieties.


The prospects you approach will not always take action
the first time they hear about you. They must be exposed
to you and your service over and over again.

There's a general rule for how many times you should
contact your prospects:

AT LEAST SEVEN TIMES WITHIN 18 MONTHS using a
variety of marketing means:

Direct mail (letters, postcards, stuffers)
Telemarketing
Free publicity
Print ads (classified or display)
Seminars
Television
Workshops
Any and all other alternatives

Only after you've made a connection 7 times in 18 months
can you drop them (unless they give you some other
proof they're not a qualified prospect) and be assured
your prospects know about you and how you can help.

By then a significant portion of your market will have
taken action themselves or passed your name on to a
referral. This "rule of seven" is something you must live
by.

You must consider it when developing your marketing
plan. Successful salespeople understand and profit from
the rule of seven. Unsuccessful salespeople expect
outstanding results from a single mailing, ad or seminar.

Stop and think about that. It's kind of ridiculous to expect
that a one time anything is all it takes to build a
successful business. Don't forget, no one is as excited
about your service as you are.



You can't expect even a small fraction of your
prospects to be as enthusiastic about your
service as you are.

Success in marketing is daily, persistent work. Those who
succeed in marketing know this. They are clear about
who they're selling to, their prospects wants and needs,
and the time and expense it takes to reach their prospects
on a consistent basis; in a way that'll get them to take
action and use your problem solving service.

Conclusion

Now you have the basics of marketing that allow you to
profit in your business on a continuing basis. Others
without this information will fail, die and blow away, losing
the dream which once so brightly burned within them.


Marketing Madness: The 12 Reasons Why
Most Sales Professionals Fall Flat On Their
Face, Costing Themselves a Fortune Instead of
Making Money Hand Over Fist!


Introduction

Creating winning marketing is an art and a science. You
don't have to be great to market your business effectively,
but I'll let you in on a powerful truism

You Must Be A Good Sales Person

If you can sell well, you're More than halfway to creating
winning marketing! Marketing is selling, just without YOU
being there!

In this section, I'm going to cover the marketing
mistakes made by 99% of all salespeople.

Use the information revealed in this section and you'll be
head and shoulders above 99% of all your competition.

I'm not tooting my own horn here either! Thousands of my
clients have proven these marketing techniques work.
They'll work for you if you use them.

Every sales professional needs this information, but
you're the lucky one that's reading it right now. You're the
one with the potential to put these ideas to work in your
marketing efforts!

If you doubt that other salespeople do a bad job, Ill just
have to ask you to trust me. After you've studied this
section a few times, start to collect all of the marketing
materials already out there. Get advertising pieces by all
kinds of sales professionals and you'll see what I mean. It
will make even more sense to you once you do this.



These ideas work. I use them daily in crafting persuasive
marketing and advertising documents. You need to know
the mistakes that are typically made, so you won't make
them. This section will guarantee your marketing efforts
won't be full of the all-too-typical mistakes so evident
everywhere you look.

There's nothing clever here folks, just strong common
sense marketing that works. Clever doesnt sell. Read on
and you'll discover what you need to do to ensure your
marketing efforts work.

You will do well if you study this section inside
and out!

Mark it up.

Study it time and time again. It will bring you marketing
success.

Once you've had some success in using these ideas, I
welcome your success story. It excites me to discover I
may have helped someone else succeed to any degree. I
love it! Success breeds success!

Now, lets learn the mistakes you must avoid in every
marketing effort you make:


The 12 Reasons Why Most Sales Professionals
Fall Flat On Their Face, Costing
Themselves A Fortune Instead Of Making
Money Hand Over Fist!

I. You Think You Need (or You Already Have) "Image" Or
"Institutional" Advertising Instead Of Direct Response
Advertising

2. You Offer No Unique Benefit That Will Attract
Prospects To You Instead Of Your Competition

3. You Don't Use Powerful Headlines To Stop Your
Prospects Dead In Their Tracks And Pull Them In To The
Rest Of The Ad

4. You Don't Tell Your Prospect What's In It For Them -
Instead, You Focus On You, Your Business, and What
You're Selling.

5. You Don't Talk Directly To Your Prospect In A
Conversational Tone, Using Specifics to Motivate

6. You Don't Open-Up With Your Prospects Problems &
Frustrations

7. Your Marketing Pieces Are Too Boring To Motivate
Anyone To Do Anything - They Don't Use Energetic,
Exciting Action Words; They Have No Passion!

8. You're Scared To Create Marketing That Has A Lot Of
Copy -- Instead, You Leave All The Compelling Benefits
Out For Sake Of Your "Image"

9. You Don't Use Testimonials

10. You Don't Provide Your Prospect With A Compelling
Reason To Respond To Your Proposition NOW -- Tell


Them In Precise, Step-By-Step Detail What He Has To
Do To Take The Next Step In Your Sales Process!

11. You Don't Look At Marketing As A Unified, Synergistic
Team Of Moneymaking Tools And Strategies -- Instead,
You Look At Yourself & Marketing As Two Separate
Functions, With Separate Goals.

12. You Focus On Your Credentials Instead of Focusing
On What Your Credentials Can Do For Your Prospect


Now, let's take a look at each of these money-
sucking mistakes, and discuss exactly what
you have to do to overcome them:

1) You Think You Need (or You Already Have )
"Image" Or "Institutional Advertising Instead Of
Direct Response Advertising.

Have you ever seen an ad that looked and read
something like this: A large, full color piece with the
salesperson in an expensive suit sitting on top of a
cherry-wood desk with a pen in his mouth (looking as
though he is thinking about something) or a folder in his
hand (looking like he is reviewing important documents).

The caption in the ad reads John Doe - A True
Professional: Hard At Work & Committed To Excellence!
Or maybe the caption reads, John Doe - Serving Your
Needs Since 1982! Or maybe the caption reads, John
Doe - I Sell More Than Anyone!

Have you ever seen something like this? Of course you
have, because that is whats out there. What a waste of
money, time, and marketing! Terrible, terrible! All of the
people who use this type of marketing could use a lesson
or two in effective marketing!

There are several mistakes that can be made in
marketing and I think these types of pieces make every
single one of them! I don't think that talking about
yourself, how long youve been in the business or an
overused slogan is going to help you sell your service.

This is called Image or Institutional Advertising.
Whatever you want to call it is fine. I call it a waste of your
money!

When people decide to become agents, there are many
who think they have to advertise like the Superstars do.


Why? Because its how they do it. They dont know the
real numbers behind this type of advertising. Think about
it, if you spend $1,000 on Image advertising and you
make a $2,000 commission, is it really working? I dont
think thats the kind of return youre looking for, is it?

Let's face it, there aren't many of us who have money to
burn, yet, if you choose to use Image advertising, you
may as well burn-up a huge stack of one hundred dollar
bills, because that's essentially what you're doing when
you run Image ads or create Institutional marketing
pieces.

Image marketing has several downfalls:

Its a complete waste of your money.

As a smart businessman or businesswoman (no matter
how successful may or may not be), you need to watch
every dime you invest in marketing.

Yes, I said "Invest in marketing." That's because
marketing is an investment, and it can pay-off bigger than
anything you can dream of on Wall Street, but it will never
pay-off if you use Image marketing!

Your advertising must be held accountable. That's why
you should to use direct-response advertising.

2. Image advertising does virtually nothing to make
more money, and unless youve got deep pockets or are
on an ego trip, you're never going to get top of mind
awareness" (or anything else for that matter) using this
method of marketing. But, with direct-response ad-
vertising, you will get results.

If you can sell well, you can create marketing that works.

The problem is, most people do "cutesy" marketing
pieces. Maybe they dress up in some costume or they are


pictured running with their briefcase. Ive seen Realtors in
a picture with a milk mustache saying, Got a Professional
_____? (Copying the milk ads that feature famous
celebrities saying Got Milk?). All of these are a total and
complete waste of time and money. Dont do them if you
want bottom-line, dollar for dollar results.

The truth is, most of these types of ads are somewhat
entertaining and humorous (Ill even outright giggle at
times), but the fact is that profitable marketing really has
nothing to do with entertaining people. The down and dirty
reality is that the only purpose for marketing is to make
money. The only way to make serious money is to get
your prospects to take action, not laugh!

The sole purpose of marketing is to make money or
to get your prospects to take the next step. I suspect
that's what you want to do... Make Money!

Using Image advertising is one of the worst traps sales
professionals fall into. As a matter of fact, a good 99% of
all people I talk to or come across don't understand the
difference between Image marketing and direct
response advertising.

Image marketing and advertising has nothing to do with
getting the customer to take action. Sure, the Top
Producers will argue that point by saying

"It motivates prospects to action because by seeing my
ad over and over again it creates Top of Mind
Awareness! When your name is at the top of your
prospects mind, whenever he or she needs you, they
know right where to go!"

That may sound good in theory, but in practice it just
doesn't work as accountably and as effectively as direct
response advertising!

Image advertising has serious drawbacks.



Honestly, I don't recommend any agent ever use Image
advertising!!!

Why?

Direct response advertising is better! Any person can
use direct response advertising and get better results
than Institutional Advertising! Image marketing focuses
solely on you, your slogan, or something clever, funny or
cute. Direct response advertising focuses entirely on the
prospect, what's in the deal for them, and how to solve
their problems with the services you're selling.

What you've got to keep in mind is the fact that people
don't care a bit about you, your slogan, or anything else
about you until you've shown them how what you offer will
benefit their life in one way or another.

All they care about is what unique benefit, advantage,
service, or personal enhancement you offer that
somebody else doesn't. Answer these questions

How am I going to improve their lives?

How am I going to make their lives easier?

They want to know how you're going to enhance the
quality, value, enjoyment and profitability of their lives.
Very few people truly understand that!


People just don't care what YOU want!

All the things you do in marketing and in selling should
only be addressing the benefits you're giving your
customer, because they don't care about YOU. They just
want to know what's in it for them.

However, they do want to know you're qualified to help
them. So, in your advertising, you must credential
yourself. If you've got a special expertise and people don't
appreciate it, find a way to explain it.

If you've sold more _____ than anyone in your area,
you've been around longer than anyone else, you're a
specialist in _____, take advantage of that and credential
yourself.

In everything you do, give people reasons why they
should believe in you, so they'll use your services.

Institutional marketing and advertising (the practice of
doing anything simply to keep your name in front of the
public) is a big joke.

Institutional marketing is ineffective, non-traceable, and
a waste of your time and money. These ads are totally
ineffective and accomplish nothing more than transferring
your money from your bank into the bank of the
newspapers, magazines or direct mail wanna-bes.

I work to get my clients to understand this marketing
and advertising is salesmanship multiplied. It's either
salesmanship in print, salesmanship on the air, or
salesmanship in the mail.

Marketing and advertising is not a bunch of unclear, un-
motivating, off-the-wall statements that say nothing, make
no case, or compel no one to action. Sadly, few
salespeople truly understand the reason for running an


ad. I'll say it once, and you'll hear me say it again I'm
sure

The only reason YOU ever create marketing is to
stimulate a direct and immediate response -- either a
qualified inquiry, phone call or an appointment or
better yet, to promote an instant buy or sell. Nothing
else is worthy of your hard-earned money!

How do you tell the difference between an Image
marketing piece and a direct-response marketing piece?

That's easy...An Image marketing piece is not traceable
in any specific way. Its purpose is merely to put your
name, or your companies name or message, in front of
the general public.

On the other hand, a direct-response marketing piece is
traceable. It asks your prospect to respond in some way
by phone, mail, coupon, etc., so you can measure the
effectiveness of a direct-response marketing piece.

1) When you run a direct response ad, you know
within a few days whether it worked or not. With
Image marketing, you can't tell where your
business is coming from.

Direct-response advertising will keep you from throwing
your money away because you can measure whether or
not your creations are effective. After all, if your marketing
isn't converting into closed transactions at a dollar amount
equivalent to their overall worth, you might as well stop
running that particular marketing. Doesn't that make
sense?

And unless you know the purpose of marketing and how
to create profitable pieces, I don't think you should be
marketing at all, because all youll end up doing is
throwing away your hard earned money.



When running direct response marketing, you must make
sure you keep track (write it down) of everything:

1. The positioning (the page number and position the
ad appeared on)
2. The basic appeal of your ad
3. The headline
4. What action you asked for
5. Any other information that'll help you come up with
a better marketing piece next time you test.

You must constantly analyze your marketing. What does
it say? How does it say it? The headline? The offer? The
action you direct the prospect to take? The costs? The
closings? After your analysis tells you which offer,
headline and approach worked best, try to beat it with a
better marketing piece!

The kind of moneymaking leverage you can get from
direct response marketing and advertising is incredible. It
just can't be done with straight Image marketing, so
don't do it!


2) You Offer No Unique Benefit That Attracts
Prospects To You And Not Your Competition

Think about this, why do you go to the certain few
restaurants that you go to? Its probably "Because they
offer unique environment, food, or service.... I get some
respect."

Now, even though most restaurants don't know what
makes them unique, I'd bet the reason you go to those
few certain restaurants is because of their individual
uniqueness.

The same thing is true of the people who do business
with you. You give something unique to the those who
chose to do business with you.


Most salespeople fail to identify and promote their
uniqueness, but not you, not any more.

Once you define what's unique about you and your
services, you will take business from your competition.
This will happen because the unique benefit is desirable,
and because you've taken the time to define this
uniqueness. This uniqueness is often defined as a
"Unique Selling Proposition" or a USP.

Your Unique Selling Proposition will help you shine as a
real estate agent. Later on in the course, I will go into
great detail about USP's, how to figure what yours should
be, and more.

3) You Don't Use Powerful Headlines To Stop Your
Prospects Dead In Their Tracks And Pull Them In To
The Rest Of Your Classified, Display and Magazine
Ads.

Your classified, display and magazine ads will go
absolutely nowhere 99.9% of the time without a
compelling headline. Your headline must do most of the
work. If your headline doesn't get your prospects
attention and pull them into what you've written, he'll
throw it away, turn the page or tune it out!

It doesn't matter how powerful, how good, how appealing
or how wonderful your ad looks. If the headline doesn't
stop your prospect dead in their tracks, they won't read
your great marketing work of art!

Give headlines more attention than you do your copy or
graphic design. Headlines are crucial to your classified,
display and magazine ad's success.



As I see it, the purpose of the headline is to
snag your specific prospects interest

Give your headline all the attention it deserves, because
your prospects see hundreds of such headlines a week in
the form of mailers, classified ads, display ads and
magazine ads. Yours better be good, and better stop your
prospects dead in their tracks!

A good headline will:

1. Talk directly to your prospect. They stop him in his
tracks because they yell out THIS IS FOR YOU! HERE'S
THE SERVICE YOU NEED!"

Sound silly? It's true. If your headline doesn't do this, it's
missing the mark by a mile.

2. Promise a benefit. This benefit may be implicit or
explicit, but it must be in the headline in order to snag
your prospects attention.

3. Let your prospect know that there's a powerful
benefit simply for reading the ad!

Tell me, do your headlines currently face up to these
criteria?

If they don't, you've got to change them, even if you have
to chuck that $4000, 4-color brochure in the garbage. You
have to do it! That beautiful 4-color brochure won't sell a
thing if it doesn't have a prospect-focused, benefit-packed
headline that grabs their attention!

Later in this course, you'll learn in great detail about
headlines; how to create them, how to use them, and
everything else you need to know in order to start making


your marketing more powerful and profitable with
headlines!

4) You Don't Tell Your Prospect What's In Your Offer
For Him. Instead, You Focus On You, Your Business,
And What You're Selling!

This is the most often committed mistake on this list.
Salespeople everywhere, everyday, focus their marketing
on themselves. They talk about how long they've been in
business, how many ____ they have sold, who they work
for, and on and on! None of it focuses on the prospects
they are going after!

Just today I had a flyer left on my doorknob by a Realtor
out walking the streets. This marketing tactic can work, if
it uses the right approach and contains the right offer.

Take a look at the headline this agent put on top of
his flyer:

"I am pleased to introduce myself as the neighborhood
specialist"

Did you notice the focus? I am pleased to introduce
MYSELF...." Theres no focus on whats in it for the
prospect, which means no sale!

Please understand, this guy has a great marketing idea or
plan; getting his info, flyer and message into the hands of
his target market inexpensively. At two to three cents per
flyer, or even ten cents if he had someone do the hanging
for him, its a great way to market your service!

However, when it comes to the headline he used, he fell
apart at the seams!

PLEASE UNDERSTAND



Every Advertisement You Create, Every
Marketing Piece You Produce, Must Focus On
Your Prospect And The Benefits He Gets From
Doing Business With You!

Everything from full-page ads costing hundreds or
thousands of dollars per run, down to three cent flyers,
should focus on your prospects and should list the
benefits they get from doing business with you!

It's that simple.

When you do talk about yourself in your marketing pieces,
talk about yourself in terms of what your prospect gets.

Look at it from the prospects point-of-view. What does he
want to know? He wants to know you'll give him the
benefits hes looking for and that youre the one who can
deliver them.

Great service, a quick sale, competitive prices,
reasonable rates, good communication, consistent
updates, strong sales, negotiation skills and prompt
attention are just a few of the benefits you offer, so put
them into your marketing pieces.

Your prospect wants to know, "What's in it for me?"
Therefore, you must continually answer that question,
even when you're talking about yourself.

5) You Don't Talk Directly To Your Prospect In A
Conversational Tone; Using Specific Facts, Numbers,
Quotes, And Details To Convince And To Motivate.

Talking directly to your prospect is important. All of your
marketing efforts should sound one-on-one. People like
doing business with people. They dislike doing business
with powerhouse salespeople who dont give the time of


day, put them on hold for hours, or talk on their cell phone
every where they go.

This is why you've got to make your marketing sound like
it's coming from you when youre sitting across from them
at the kitchen table.

The best marketing is created for a specific person with a
specific problem, coming from a specific person with
specific solutions.

Just remember your marketing will be read by one person
at a time, that means you should talk directly to that
person as if you were sitting across from them at the
table.

Creating your marketing in a conversational tone has got
to be one of the easiest of all the mistakes to overcome.

Simply put, when you're creating a marketing piece, talk
in a conversational tone to your prospects. People will be
more comfortable with what you are trying to convey if
you talk in a conversational tone.

Use simple words and sentences, making your point
easily understood. Try not to use big words. Break your
words down to their simplest expression.

People like doing business with other people. They don't
like doing business with big, super-busy, going 120
miles an hour all the time" people. They want to know that
behind that marketing piece, there is a caring, sincere,
likable person.

Now, lets talk about being specific in your marketing.

There's one key rule you need to remember in youre all
your marketing endeavors, Generalities Don't Sell -
Specifics Do!



Ill go into greater detail later in the course, but the more
specific you can be about the benefits your prospects will
enjoy, the more effective your marketing will be.

For example, instead of saying:

"Sell Your Home Faster Using XYZ Realty!"

You should say:

"Sell Your Home 32 1/2 Days Faster And For
$1,850 More With XYZ Realty. Call For Details
Today!"

It's obvious, isn't it? Look at the difference in the impact
the specific headline has over the general headline! This
will have a strong impact on your prospect, and thus, on
your marketing success!

In every marketing piece you create, you must make sure
you don't fall into the trap of "getting by" with vague,
overused generalities. Sometimes, it will take some effort
and time to come to the specifics, but its time and effort
well spent.

You're going to have to start being more responsible
about taking care of your customers, because that is
where you'll get most of the specifics you need, by
interviewing your current and past clients.

You need to call them, interview them and find out

How much money did they save by using your
service?

How much time did they save by using your service?

How quickly did you help them and how does that
compare to the competition?



What's the specific reason they chose you?

How much stress and anxiety did you relieve them
of?

The questions you should ask are endless. Every person
out there needs to have a full list of these types of
questions. In fact, why dont you take the time right now to
create one?

Being conversational in your marketing is the most
powerful thing you can do to increase the response you
get. You'll learn more about how to create and use some
specifics, which ones to use, when and where to use
them, later in the course.

6) You Don't Put Your Prospects Problems,
Frustrations Or Anxieties In your Marketing

One of the most powerful ways to begin any type of
marketing program is to remind your prospect of the
problems, frustrations or anxieties they're facing. Prey
upon their fears and worries. Make them feel as though
the worst might happen if they dont take action now!

Most people have some discomfort in making big financial
decisions because it usually involves a lot of money and
planning. Plus, they rely so heavily on good
representation that a ton of stress is typically laid on your
shoulders. If you focus on this, making sure they feel it
deep down, and you let them know you have the answer
that will solve their discomfort, you'll have a powerful
marketing approach.

7) Your Marketing Is Too Boring To Motivate Anyone
To Do Anything. You Don't Use Energetic, Exciting
Action Words. Your Marketing Has No Passion!



You must be excited about what you offer or you may as
well not be in business. You are destined to fail.

You must be excited about your service. If you're not
excited about it, how in the world do you think your
prospect is going to get excited about working with you?

And when I say, "excited," what I really mean is
passionate! You need to be passionate in your marketing
efforts. Don't be afraid to say something controversial.
Say it, and stand your ground with passion!

Passion is an element missing in too many marketing
campaigns. Because of this, passion becomes an
incredible advertising tool to help you get your prospect
motivated to take action.

I think you'd agree most marketing is flat-out boring. It
couldnt possibly motivate anyone to do anything, except
turn the page or throw it in the trash.

Your marketing must exude energy. Of course, it depends
on the approach you're taking as to how that energy
flows. Nonetheless, energy and passion sells, while being
boring dont!

In this manual, you're going to learn several key things
about passion and energy in marketing. I think you'll be
surprised at the difference it can make in the success of
your marketing.

8) You're Afraid to Create Marketing That Says A Lot.
Instead, You Leave All The Compelling Benefits Out
For The Sake Of Your "Image."

Let's set things straight right here and now, the only
reason you're in this business is to make money. You do
this by providing a quality service that benefits people in
ways they can't find anywhere else, a service people


come to you for. They think they can't live without, so they
must use you!

This being the case, why is it so many people fail to
present their entire sales proposition in their marketing?

I dont have the first clue! But now, this won't be you
anymore.

A key to successful marketing is this

You need to present your entire case when you present
an offer to a prospect. If you fail to answer a certain
prospects question or concern, you've lost the sale.
Chances are, there will be more of these same types of
prospects.

I can't tell you how many marketing consultations I've
done where the person created these incredible 4-color,
graphic masterpieces. They call them "personal
brochures or profiles. I often call them "garbage"!

Having a Graphically Gorgeous Marketing
Piece (and I dont care what it is) Will Not Make
You A Lot Of Money. It May Win You The Best
Known Salesperson In The World Award, But
As For Real Sales, I Dont Think So!

9) You Don't Use Testimonials

Unless prospects are lined up outside your door, jamming
your office wanting to buy from you, you will never sell
your service to the degree someone who has used your
service can.

Testimonials should do most of the work for you. When
acquiring testimonials, try to get as many specifics as
possible.


Using testimonials can reduce fear as well, especially if
you use specific names, numbers, etc. Avoid the vague
testimonials you see most of the time, like:

"Nice Job, John. We would definitely use you again!" P.T.
Denver

This type of testimonial is unspecific and useless. As a
matter of fact, this type of testimonial is actually harmful to
your marketing efforts. It causes your prospect to think
consciously or subconsciously, "Well, if P.T. is so happy
with John, why didn't they give their whole name and
leave a number?"

It leads the prospect to believe there never was such a
person! This hurts your credibility and will cost you the
sale. I guarantee it, people want to be reassured they are
making the right decision when they work with you. Spe-
cific testimonials are a powerful tool to help reduce a
prospects anxiety.

When you ask for testimonials, make sure it's OK with
your prospect to use their quote, name, address and
phone number. That way, you can use their quote at "full
power." There's nothing weaker than a testimonial with
only initials and no specific information.

10) You Don't Provide Your Prospect With A
Compelling Reason To Respond To Your Proposition
NOW. Tell Them In Precise, Step-By-Step Detail What
He Has To Do To Take The Next Step In Your Sales
Process!

If your prospect, after reading your marketing materials,
takes the next step towards using your services, you have
succeeded. If he's not motivated to act, then your
marketing has failed.

Pretty simple, isnt it?



This means that every marketing document you create
must always give the prospect an invitation, and a reason,
to ACT NOW!

Don't just tell the prospect to act, though, tell them WHY
to act

For example:

"Pick up the phone now to solve your greatest problem in
_________!"

"Schedule an appointment today to see our new
_______!"

In order for your marketing communications to succeed,
you must talk about your prospect continuously. That's all
they're interested in.

They want to hear about themselves.

Every thought and word in your marketing must clearly
show, above all else, that you are thinking only of the
prospect and what he or she wants. It should assure them
that you'll do what it takes to solve their problem(s), if only
they contact you NOW!

You must, in no uncertain terms, tell your prospect exactly
what to do to take action. If you want them to call, tell
them to call.

"If you're serious about ______ in the next in the next 30
days, you owe it to yourself to get my fact-filled _____!
Pick up the phone right now and dial these 10 little digits,
XXX-XXX-XXXX. Ask for me and Ill send you this FREE,
informative gift today!

That's pretty clear, isn't it? There's no question in the
persons mind as to what they're supposed to do in order
to get the benefit they want, or to solve the problem they


have! And, it's worded in a compelling fashion. It tells
them what to do.

11. You Don't See Marketing As A Unified, Synergistic
Team Of Moneymaking Tools And Strategies. Instead,
You See Yourself And Marketing As Two Separate
Functions With Separate Goals.

This is a critical mistake. You must understand that your
marketing (in all its forms) works hand in hand together
as your sales team.

It shocks me to see how many people out there talk to
prospects differently in person than they do through their
marketing efforts. This is wrong.

In sales, your marketing and advertising should be the
same in person, over the phone, on a postcard, in an ad,
at a seminar, and any other way you can think of. Its all
the same. Nothing changes except the medium.

Make sure all your sales presentations, marketing efforts,
and advertising campaigns are in synch.

12) You Focus On Your Credentials Instead of
Focusing On What Your Credentials Can Do For Your
Prospect

Ive stressed this several times already, but just as
another reminder to you, in all your advertisements and
marketing efforts, talk about yourself in terms of what your
prospect gets from you.

Think about it: What does your prospect care to know?

He wants to know youll give him the benefits you say you
can deliver, and the benefits he wants you to deliver. Your
prospect continually wants to know, "What's in it for me?

Therefore, you must continually answer that question,
even when you're talking about yourself.



Your prospect wants to know what you can do for him; not
how many degrees you have, where you got them, when
you got them, or anything else 99% of all salespeople
push. No one cares about any of that kind of stuff until
they know what's in it for them.

I'll be telling you exactly how to take your credentials and
"frame" them in a way that shows your prospect what's in
it for him later on in the course when we talk about
features and benefits.

Right now, just know that if you've got a certain
designation, you need to realize that your prospects don't
give a you know what about them, until you tell them
what benefits those credentials will deliver to them!

You'll learn how to do that in the next section of this
course. It's an easy, yet important concept to understand
and use.

Conclusion About Marketing Madness: The 12
Reasons Why Most Salespeople Fall Flat On
Their Face, Costing Themselves A Fortune
Instead of Making Money Hand Over Fist!

There you have them. If you'll follow these rules, you can
rest assured your advertising and marketing documents
will be read.

As I challenged you at the onset, begin collecting
marketing samples of all sorts. Make note of what you like
about them. Note what works. Test them against the
guidelines in this section of the book to see why they
work, and you'll also begin to see these 12 mistakes
popping up over and over again in most of the marketing
materials you review.



It is your responsibility to learn these mistakes and avoid
them like the plague. They are money-sucking wastes
that you can now avoid. If you don't learn them and
internalize them, your prospects will not get the solution to
their problems from you, and you won't get that big, fat
commission check!

That's what it all boils down to!

Now, I'd like to move on to a topic that's so incredibly
important to your success in marketing, as well as sales
in general, that without it youll go no where


Benefit Magic: The "Meat n Tators" of
Winning Marketing!!!

Let me make the difference between features and
benefits clear, right here and right now.

What is a Feature?

A feature is static -- it's the color, year built, size, style,
layout, etc. of your product or service. Its also your
degrees, years in business, company you work for,
experience level, designations, awards youve won, etc.

What is a Benefit?

A benefit is what your prospects get from your features!

These two marketing definitions are two of the most
important definitions you need to understand if you're
going to create some advertising magic that brings in new
prospects to work with.

Your prospects don't buy features, they buy the benefit
that feature gives them. It's plain and simple, yet so many
people seem to be hung-up on listing all the features of
their product or service.

Features focus on you and your service (what it is).

Benefits however, are the specific results or outcomes
your customer gets from your product or service (what it
gives the customer).

People don't buy "things," they buy the results those
"things" bring them. Things like happiness, making
money, saving money, saving time, more safety, more
security; and easier, simpler ways to do things.



That's why you absolutely must become a master at
transforming features into benefits. You must learn how to
take the individual features of you and your service, and
turn them into compelling benefits that get prospects to
take action and call you!

A key point you must always remember when creating
marketing is this

Always Lead With Benefits, and Follow With
Features! Yes, always.

That's because benefits tell your prospects what's in it for
them. Features focus on you. Your prospects will always
be interested FIRST, in themselves. They want to know,
what's in it for me?

Once your prospect understands what's in it for him,
then he might be interested in you. Most often, if you've
focused on the benefits your prospect will get, they won't
even care to know anything more about you, your
company, your awards, or anything else! That's how
persuasive benefits can be!

That's why you must take a careful look at each and every
feature, and then turn them into powerful, motivating,
compelling benefits.

Really, when you stop to think about this, it makes
sense.

The reality is, when you open a magazine, or look in the
mail, or read through the ads, most people don't even
begin to do this. They focus on themselves and list boring
feature after feature. When they do include a benefit, they
usually dont use a specific, meaningful benefit.





Specific Benefits Sell - General Benefits
Don't

Most of your benefits should be specific if you want them
to pack a wallop. General benefits usually come across
as "hype" and they're not half as compelling as a specific
benefit.

How do you get specific?

One way to gather specifics is to gather your features
together and examine the specific results they provide.

Just remember, your prospects will be asking questions
about your general features and benefits:

I) So what?

2) Compared to what or whom?

3) Says who?

You need to back-up your general features and benefits
by turning them into specific benefits! Unless you do, your
prospects will write you off as a "typical salesperson" and
nothing more.

What will enable you to deliver specifics instead of
generalities? Your research! Your knowledge of your
service and market. Your knowledge of the features
you're selling, compared to what else is out there.

If you're going to be able to deliver specific benefits,
you've got to

Know the features of what you are selling (you and
your service).



Know the benefits of what your competition is selling!
You must make sure to do your research carefully,
continually and completely

Understand how the features of what you're selling
relates to the benefits of what your prospects want

Prove to your target market how empathetic you are by
placing their interests first (lead with benefits - follow
with features) and backing up your benefits and claims
with facts!



Using Your Competition to Prove Specific
Benefits

Here's a slick little "ditty" that'll help you uncover specific
benefits based on what your competition is already doing.
The procedure goes something like this:

1) First, you make a list of your features and benefits

2) Next, you make a list of your competitors features
and benefits.

3) Now, you make a comparison, uncovering the
advantages your features and benefits offer your
prospects that your competition doesnt!

4) Lastly, turn your comparison into moneymaking
marketing materials that work. You can create a
comparison chart, state it in bullet form, or simply in
paragraph form.

This system is powerfully convincing! I hope you'll
use it to your advantage.

As you can see, benefits are powerful motivators.
Knowing this will give you a definite advantage because
most people don't use benefits. Instead, they choose to
get "creative" and clever, and they fall flat on their face!

Make It Clear and Never Assume Anything

When it comes to benefits, understand that you must
state them clearly and precisely so there's no question in
your prospect's mind about what benefits he gets.

Never assume your prospect will know what the benefits
are. Don't think your prospects are smart enough to know
what the benefits are of using your product or service.



You'll lose the sale!

You Must Never Assume People Can Figure
Out On Their Own What Benefits They Get
From Your Features.

Tell Them Clearly & Precisely what Benefit
They Get From Each Worthwhile Feature!

Remember, the benefits your prospects get from you and
what youre selling is the driving force behind all your
marketing efforts. That being the case, how do you turn
features into benefits?

First, let me say that this process is simple once you get
the hang of it. It's also pretty fun!

The first thing to do is to create a list of all the features.
Dont worry if you're not sure if it's a feature or a benefit,
just make a list.

Now, take a look at each feature and ask yourself, "What
does my customer get from this feature?" If the answer is
a good, strong answer, write it down next to the feature.

Continue with this until you've done the entire list.

Next, you'll want to prioritize the list of benefits in order of
importance from your prospect's point of view. Do this for
marketing yourself at listing appointments and when
creating advertisements.

You should know what your prospects priorities are. If
you don't, you haven't done enough research. Why guess
at it? Why not take the time to find out for sure?

What it boils down to is that you have to ask yourself,
"What does my customer get from this feature?" The
answer gives you the benefit. Understand though, not all


features can be turned into worthwhile benefits. Some
benefits will not be used in your marketing materials.

Here's another way of turning features into benefits.
Pretend you're a prospect for what you're selling. For
each feature on your list, ask yourself these questions:

"What's in this feature for me?"

"What do I get from using this feature?"

"What benefit do I get from this feature?"

By answering these questions, you will find what the
benefits are.

Benefits give you the selling power needed to create
winning marketing. This is how you develop a super
successful real estate career. Without benefits, you will
not make many (if any) sales. That's the power of
benefits!

Also understand that your prospects are interested in
features. But by themselves, features will never sell you,
your listings, or your service. Only benefits will do that
because only benefits tell the prospect what advantages
there are for him to take action!

So, benefits sell because benefits are about what your
prospect gets, where features are about you and your
service. In other words, features are usually "me-focused"
instead of "prospect focused".

The heart and soul of creating winning marketing is
understanding how to plaster-on benefit after benefit after
benefit. Benefits answer the never-ending question,
"What's in it for me?" That's the question your prospects
will ask from now until forever!



Answer each question with what the benefits are and
you'll get the business you deserve!

Conclusion to Benefit Magic: The Meat n
Tators of Winning Marketing!

Remember, a feature is basically some part of you and
your service.

A benefit is what the prospect gets from that feature, what
the feature does for him! Features alone are virtually
worthless and will basically do nothing to help you sell
more.

Benefits put the focus on your prospects and what they
get, and that's where the whole focus of your marketing
should be... on your prospect


Ad Writing Magic: The Basics Of Creating And
Writing Ads That Produce Deals!


INTRODUCTION

This section has been included for those who aren't very
familiar with the process of creating and writing ads. I
suggest everyone read it, even if you dont currently use
ads in your marketing approach. It sheds some light on
the subject of how I look at marketing and advertising.

Reading this will help you understand me better and
where I'm coming from.

Even if you've never used ads to produce a deal in your
life, this chapter will teach you all you need to know to get
"up to speed."

Creating winning marketing for your brochures, ads,
flyers, business cards or other communication, is critical
to your success in this business. It's something you can
learn to do.

At least I learned to do it, so assume you can too. Im
going to give you the basics here.

This section is full of the tips, hints and techniques I have
learned and proven for years, along with over 500 of my
best clients from around the country.

Ads can be a powerful and inexpensive marketing
tool if you do it correctly. There's nothing clever or
elaborate. Everything's simple about the way I approach
it. My philosophy is, "the simpler the better," when it
comes to creating winning ads.



In this section you'll learn how to transform your ideas and
features into benefits your prospects will want to act on.

We will also talk about using flyers, brochures,
advertisements, postcards and newsletters and the like.

I'm sure you'll enjoy all of this, but there's one thing you've
got to understand from the beginning.

No one will read or respond to your ads if you dont
put their needs, wants, desires and passions first.

Your prospects are only interested in doing business
with you to the degree that he understands what you
can do for him.

You must be entirely unselfish in your marketing in
order to create ads that produce deals.

In every word you write, every sentence you
construct, every paragraph that goes into your
advertisement, you must realize that your prospects
desires, anxieties and aspirations must always come
before your own.

This is the basic fundamental rule of successful ad
writing. Its also something that very few people can do. If
you doubt this is true, read through your local Sunday
paper and notice all the bad ads that are there.

Compare them to what you learn in this section and you'll
understand that there are very few good ad writers out
there.

You've got to understand that successful ad writing is all
about your prospect. It's about their dreams and desires.
If you dont grasp this, don't bother trying to create your
own ads and marketing materials, because you won't be
able to.



Typical Mistakes You Must Avoid So
You Can Write Powerful Ads

Hundreds and thousands of dollars are wasted every day
on ads that are not focused on the prospect. Too many
mistakes mean dissatisfied, un-motivated prospects,
which means too many unprofitable salespeople.

The problem is:

1) Most ads: Do not focus on the prospect... they focus on
the salesperson, the company, etc. A very selfish thing
indeed!

2) Most ads: Assume the prospect is as excited to
respond to you, your company, your offer, etc. as you are
to sell! A false assumption if ever there was one!

3) Most ads: Try to be clever and creative. The minute
you get clever with your copy is the minute you lose your
prospect.

4) Most ads: Try to create a "professional image." This is
ridiculous, but it happens all the time! Your professional
image should always come second to THE PROSPECTS
NEEDS, WANTS AND DESIRES. Nothing should be
more important than your prospect, especially not "your
image!

5) Most ads: Drone on and on about the features of a
salesperson, instead of the benefits and what they can do
for the prospect.

6) Most ads: Are deadly boring and dull. Copy should be
written full of action, spunk and enthusiasm. It should
move the prospect to action!

7) Most ads: Do not give the prospect a reason for acting
NOW. After your prospect reads your ad they should be


so excited about the benefits they get, they drop whatever
they're doing and take immediate action!

8) Most ads: Dont address the anxieties and aspirations
of the prospect.

9) Most ads: Do not sell specific benefits to the prospect.
For example, the best ads are stuffed with specific
benefits for the prospect. For each individual market you
target, your copy must be specific. Stop writing general ad
copy.

These are only a few of the mistakes most salespeople
make.

After you've created a new ad, turn back to these pages
and test your ad against these listed mistakes.

If you've made any of these mistakes, weed them out! If
you have to, start from scratch and re-create your whole
ad.

By the way, get used to re-creating ads!


Transforming Your Features Into Benefits That
Will Make Your Prospect Pick Up The Phone
And Call You NOW!

Before I explain how to do this, I feel the need to re-
emphasize this fact

If you don't know what your prospect wants to buy or
why he wants your service, how are you going to sell
it to them? You can't!

This is why theres a tremendous need to do your
marketing research. If your preparation has been
thorough, you stand a much greater chance of writing a
successful ad.

As a matter of fact, its the key to creating a hot ad.

Having said that, let's assume you know what your
prospect wants, why he needs you, and how to turn your
features into benefits.

Features are the elements of what you're selling. The
elements of your service that is desirable for your
prospect. Features are all about you and your product.
They define both.

Features are important, but only to the degree that they
relate to a benefit the prospect gets from the feature.

Features will not sell your service, benefits will. Benefits
describe the advantages to your prospect. Benefits are
what cause a prospect to buy or use your service.
Benefits are what your prospect gets from a feature.

Benefits answer the prospects biggest question "What's-
in-it-for-me? Your prospect wants to know the answer to
this question RIGHT FROM THE START, so tell him!



If you want to write successful ads, you've got to get good
at transforming features into benefits.

One of the basic rules of successful ad writing is this...

You Must Always Lead With The Benefits, And Then
You Follow With Features

Prospects always want to know what's in it for them first.
After they know this, they may want to know the ins and
outs of your service.

If you have a feature that doesn't offer a strong benefit,
leave it out. Don't waste your time with it. You should
never list features of your service as if they were, in and
of themselves, something meaningful.

They aren't!

A feature is only meaningful if it tells your prospect what
he gets from it. By their very nature, features alone don't
do it. Once you grasp this, you are ready to begin the
process of turning features into benefits.


When Creating An Ad That Sells Your Service
Remember A Few Key Principles

People use your services because of what you've done
for others who are like them, the results you've achieved
for other people who have used your services.

Formal credentials are not synonymous with results.
Results are always more important than credentials to
your prospects.

Credentials are features, and features must be turned into
benefits.

Some of the basic rules for telling your prospects about
yourself and how "professional" you are go like this:

The professional salesperson is seen as a warm,
welcome, helpful and interested, not self-interested
and "untouchable."

The professional's credentials don't scare the
prospect into using their services and they don't
make the prospect feel insecure and unworthy of the
professional. They reassure him about the
professional and convince him that the professional
is sensitive to the prospects needs and can help him
solve his problems.

Each feature of the professional's resume is
transformed into a lever that helps the prospect
understand that this is the person he should work
and is a person who will help achieve any desired
objectives.

You cannot succeed if you are viewed as being
untouchable, a "god" of sorts! So get down from any high
horse you might be on and realize that your prospects
want to deal with someone who is personable,


conversational, kind and gentle. Someone who will talk
straight, in order to help them solve their problems.

If you want to create profitable ads that sell you and your
service, these are the steps:

1) Write down all of the credentials you possess.

2) Put the credentials in context -- Tell your prospect
what difference your credentials make to them.

3) Write down the kind of prospect you want to attract
and work with.

4) Select the credentials that relate specifically to the
prospect you want to have as a client.


Rules For Writing Ads That Motivate Your
Prospect To Respond NOW!

Remember to continually ask yourself this question with
each word or sentence you write, with each paragraph
you finish:

Does This Get My Prospect To Act Now? If It Doesn't,
It Should Be Pulled-Out And Thrown Away!

The purpose of your advertising is to get your prospect to
respond NOW! If the copy does not accomplish this, it
doesn't belong!

Never forget this!

No matter what anyone else says, ads should always be
written so its focus is on the prospect, never on you or
the service youre selling.



Put your ego aside and realize that you will win at ad
writing if your focus is on your prospect, his desires, his
wants, his interests, etc.

Let your prospect know that you have the solution to their
problem and you understand what THEY are looking for.
Prove it in your copy! To do this you must:

Identify With The Prospects Wants and Needs

Let Him Know You Have What He Is Looking For

Remind Your Prospect That The Problem Will Stay If
He Doesn't Take Action To Get Rid Of The Problem

More basic rules for writing ads that sell:

1. Target your market specifically.

2. Write the ad as if you were writing to a specific person.

3. Read your copy as if you were the prospect. Consider it
from his point of view.

4. Never assume your prospect understands what you are
saying. Tell him specifically what it is you mean.

5. Make your copy short, spunky and full of energy. Use
action words.

Avoid adverbs and adjectives. Using non-specific
adverbs and adjectives indicates to your prospect
that you don't have any specific facts or numbers to
share about yourself, your property or anything else.

6. Make Your Copy Interesting. Write everything so it
focuses on the prospect. This alone will make your copy
interesting. If you write something not about the prospect,
it doesn't belong!



7. Make your copy active. You want your prospect to take
action, so your copy must breath action. You are
basically saying to your prospect, "You're in this un-
comfortable situation. You want to be in a better, more
comfortable situation. I can get you in that situation. All
you have to do is act NOW!"

8. Write your copy the way that people talk. Use sentence
fragments. Use short sentences. Use one-word
sentences.

9. Use emphasis devices to draw attention to words that
are important, words which are more likely to get your
prospects attention sooner.

* You can underline important words.

* You can make them bold.

* You can use asterisks to set them off.

* You can indent them.

* USE CAPITAL LETTERS.

* Use boxes, or other outlining devices

* Use different colors

Use anything that lets your prospect know that THIS IS
IMPORTANT. READ ME! I'VE GOT A BENEFIT FOR
YOU!

These emphasizing devices work, and will guide your
prospects eyes across the page to the important
messages you are trying to convey to them to get them to
act in their own best interest.





10. This is a key rule to never forget

Always Lead With Benefits And
Follow With Features.

Following this rule alone will increase your response
significantly. Make sure the benefits:

Speak Directly To The Prospect

Excite Him

Frighten Him

Let Him Know What He Has To Do To Get
The Benefit

11. Make it easy for your prospect to respond.

Dont hide your phone number by burying it deep in the
text.

Writing ads that compel an immediate response is
something anyone can do, if they work hard at it and
follow the guidelines I have shared in this section.

These tips, hints and techniques I have learned and used
with hundreds of clients across the country, will help you
write ads that will get your prospect to call you NOW and
use your service.


Magical Openings: How To Start Your
Marketing Pieces To Get Your Prospect's
Attention Immediately!!!

More than 95 percent of the marketing running today
doesnt have headlines. Don't believe me?

Open any magazine, newspaper, direct mail piece or any
other advertisement and look at it -- you'll be surprised.

Ninety percent of the success or failure of any marketing
piece is the headline. Without a headline, your marketing
is doomed to fail almost every time.

Headlines can increase your response as high as 2100%
if they're on target, making powerful promises and/or
benefits to your market.


If You're Serious About Creating Marketing
Pieces That Sell, You Need To Spend The Time
It Takes To Write At Least Two Dozen
Headlines Every Time You Sit Down To Create
A New Piece!

24? Really?

YES, at least that many.

I can show you files on my computer with hundreds of
headlines I've created to go with display ads, sales letters,
direct mail vehicles, newspaper ads, sales presentations,
brochures, flyers... I save them all.

Why do I write so many headlines, or more importantly,
why should you write that many headlines every time you
sit down to create a new marketing piece?

Look at it like this, even if you think you've come up with a
sizzling hot headline after writing only 5 or 10, if you take
the time to write out another 15 or 20, you are likely to
improve your best headline by 3 or 4 times.

In fact, chances are good that along the way, YOU will
come-up with something much, much better!

Trust me, coming up with profitable marketing headlines
takes more than just a few minutes. You've got to commit
yourself to sitting down and writing out at least 24.

I'm going to help you do that right here. You'll get a few
dozen headline words that work like magic, along with
several "Headlines formulas" that are proven to work.
These words and formulas will make it easier for you to
come up with those 24 headlines.

Why? Simply because they are more important than you
can possibly imagine.



Headlines are important because nearly 5 times as many
people read the headline as opposed to the body of a
marketing piece. Unless the headline effectively sells you
and your service, compelling your target audience to jump
in and read the rest of the ad, you are blowing the biggest
part of your marketing budget.

Headlines should offer your reader a reward for reading
the rest of the ad and pull them in to the rest of the body
copy.

What Else Do Headlines Do?

Good headlines are important for several critical reasons:

They draw the attention of your target prospect and
single out the audience you want to attract.

Your headline must practically reach out to your prospect,
grab them by the throat and say, "Hey, I'm talking to you!"
You want to attract only your target prospect! Attract the
"foxes" and don't worry about offending the "dogs."

They communicate the strongest benefit(s) you and
your service offers and speaks to the self-interest of your
target prospect. It answers the important question we'll
keep talking about: "What's In It For Me?

They deliver a clear, complete, understandable
message, a message full of benefits. They will address
your prospects self- interest, OR make a promise to
overcome your prospects' frustrations, fears and
anxieties.

They set the "tone" for the offer you're making.
Sometimes, youll even put your offer right in the
headline!



They will compel your prospect to keep reading. When
done correctly, a proper headline will make them hungry
to find out more, pulling them directly into the copy and
getting them to read it all!

Perhaps most importantly, your headline will be the "ad
for your ad. If your headline doesn't get your prospects to
stop dead in their tracks and read what you have to say,
its a waste of your time and money!

That's the job of your headline -- to get them going down
the path towards taking the action you desire.

Your headline must work. Let me put it in a way that will
help you understand what it means when your headline
doesn't work....

If your headline doesn't work, your prospect doesn't read
on. If they don't read on, it means you've wasted your
time, effort, energy, and hard earned money. Every time
you lose a prospect, you lose money.

Looking at it that way, doesn't it make good sense to
spend the time necessary to write and rewrite at least 24
different headlines, if not more? It does to me!

Here are some guidelines and questions I ask myself
when I create a great headline:

1. What am I trying to communicate to my target
prospect?

2. Does my headline offer the reader a reward for reading
the entire piece?

3. What is the BIG benefit I've got to promise my target
prospect?

4. Is my "promise" believable?



5. What do I offer that will induce him to read my
message NOW?

6. Have I written a headline that's going to motivate him to
take action?

7. Am I being selfish by talking about my company, my
production, and me or am I focusing on the benefits my
prospect will get?

8. Am I staying focused, talking directly to one prospect,
or is my ad speaking to any Buyer or Seller?

9. Is my headline interesting from my prospect's point of
view?

10. Does my headline build on a frustration or problem
that my prospect might have which I can solve?

11. Does my headline answer the question, What's In It
For Me?

Essentially, headlines are the key to marketing success. If
a prospect cant see what's in it for them, you won't get
their attention and you definitely won't get their business!

With few exceptions, you must always have a headline
that uses words and phrases that stops your target
prospect in his tracks, gets him to start reading your
material, and compels him to action.

The Best Way To Get Started Writing Headlines

The thing to remember when it comes to writing headlines
is to simply write down everything you can think of. Look
at your prioritized benefit list and write down everything
that comes to mind.




Remember too, that you're writing to one person at a
time. So make your headline talk directly to that person.

Brainstorming Winning Headlines

As I mentioned earlier, in order to get started writing your
headline, you should have an "idea File" handy to go
through and look at the headlines filed there. Jot down the
headlines that make you excited about taking action on
something you would buy or some service you would use.

Find ads, letters, postcards, direct mail pieces, brochures,
flyers or anything else that grabs your attention. OPEN
YOUR EYES - THERE ARE IDEAS EVERYWHERE YOU
LOOK!
The main thing to remember when it comes to creating
headlines is just get things down on paper (or in your
computer as I do). At this point, don't worry a stitch about
getting it perfect.

This is a "brainstorming" session for headlines. As you
probably know, you don't edit out anything when you
brainstorm. You just get the ideas on paper and worry
about cutting out the "losers" later.

STEP ONE: To create winning headlines, get out your
Idea File and begin finding the winning headlines you like.
Apply the same themes, words, and approaches to your
marketing efforts, plugging-in your benefits and service.
Get some words and ideas down on paper!!!

Doesn't it make sense to borrow ideas that are working
and make them your own, than to sit and try to re-invent
the wheel? Youll many good ideas in the appendix of this
course, but I also want you to learn how to create your
own reference library of great marketing ideas.

STEP TWO: The next step to take when it comes to
creating headlines is to brainstorm some more. Except


this time you do it with a little twist by making it
outrageous and fun.

The point is to have fun, be creative. Dont you think
headlines like these will grab someones attention?
Believe me, they will, because they are so different, so
outrageous, so unique, that your prospects will have to
stop and look.


Powerful Headline Words That Are Proven
Effective

I feel like the absolute safest headline begins with the
words: "How To". Although it's not very original or
creative, the words "how to" immediately appeal to your
target prospect's self-interest. As long as there are
people, I think the words "how to" will always be powerful.

"How To" also arouses curiosity. If your benefit and
promise are powerful, it's a sure bet your prospect will go
on to read the rest of your ad.

With the words "How To," you immediately involve your
reader in something they have an interest in.

I've used the How To headline so many times that I have
lost count. I use it because it works. You should try it, too!

Here are my favorite power headline words:

1. Announcing 14. How Would
2. Advice To 15. Amazing
3. Yes 16. Here
4. Inside-Secrets of 17. This
5. The Truth About 18. Facts
6. Little-Known Secrets 19. Discover
7. Amazing Secrets 20. Only
8. Love 21. Breakthrough
9. New 22. Do You
10. How Much 23. Which
11. Which of 24. Sale
12. Now 25. At Last
13. Life 26. Bargains

And finally, the two most powerful headline words:





26. Free

27. You


Use them whenever you can. For obvious reasons,
nothing sounds better to a prospect than FREE and
YOU.

Your headline must stir an emotion in your prospect. It
must strike a chord that gets your prospect excited or
scared, or remind him of his problem or frustration for
which you have the solution. That's why you need to use
the words listed above. They will create intrigue and build
passion.

Your headlines must motivate your prospects in one
powerful way or another. You need to hit the nail on the
head about their biggest problem, frustration or worry, or
you need to hit smack-dab on their most desired benefit
as it pertains to your service.

Conclusion:

Some key questions to ask yourself every time you
decide which headline to use:

What are the message and the feeling of the message
I want to communicate to my target prospect?

What is the strongest benefit I have to offer?

What is the strongest frustration I can build on to get
my prospect interested?

What's the most compelling offer I can make and can it
be stated clearly in my headline?



Have I written a headline that will motivate my prospect
to keep reading?

Is my headline an "ad" for my ad, or is it just a plain-
Jane, boring statement?

Is my headline speaking directly to my target prospect,
or could a snake-breeder read it and think it was for
him?

Am I focusing on my prospect and his wants, desires,
fears or frustrations, or am I being selfish and talking
about myself?

Will my headline be interesting to my prospect, or does
it bore him?

Is my headline passionate? Does it use action words
and not "fluff" adjectives?

Have I used specifics in my headline instead of
generalities?

Have I thought about the headline, what I want to say
and what I wish it to accomplish, or have I just written
something because I had to?

Answer these questions each and every time you write an
opening headline and you'll stay focused on writing
powerful headlines that work.


The Magic Question Your Prospects Want
Answered: "Why Should I Do Business With
You Instead of Your Competition?"

Finding Your Unique Competitive Advantage
and Blending It Into All Your Advertising and
Marketing To Boost Immediate and Long-Term
Response!


Most salespeople I consult with or talk to don't have a
clue about the advantages of having an UCA. I've even
had some who say to me, "You know, I don't get this UCA
thing -- what's so powerful about it and why should I have
one?

What is an UCA anyway? UCA stands for:

"Unique Competitive Advantage"

Simply put, your "Unique Competitive Advantage" (UCA)
is the features or benefits that make you and your service
stand out from your competition, and we all know that the
competition is fierce. So having a UCA is crucially
important.

It's what makes you and your service better than all your
competitors. It's the "something different" that your
prospects can't get anywhere else. In other words, it's
only available from you.

Some people term it as a "USP" (unique selling
proposition). Still yet, some call it a "SOB" (statement of
benefit). Whatever you choose to call it, you need to know
what a UCA is and how it can benefit your marketing and
advertising in a big way!



Without an UCA, the average Tom, Dick or Harry has no
way of knowing why he should choose you and your
service over the others that are available. And it's your
responsibility as a marketer to inform and tell your
potential customers why you and your service are more
desirable.

If you don't tell them, they'll never know. Its as simple as
that. Never assume that your prospects know anything.
You need to make the effort and tell them!

UCA based marketing is the most effective, wallet-
fattening advertising there is. With very few exceptions, all
truly effective advertising is UCA-based advertising.

In short, when you find out what that "certain something"
is that sets you and your service head and shoulders
above the rest, you should use it in your marketing,
presentations, ads, business cards... everywhere.

Your UCA is that one distinct, appealing benefit that sets
you apart from every competitor you have. It's something
special, something that makes you unique. It's how you
position yourself as compared to the competition.

There are different kinds of UCA's, any one of which may
be the one you'll want to use for your business, or you
may want to come-up with your own:

Formulating Your Own UCA

Coming up with your own UCA can be very simple. What
I'm about to share with you is a really easy method for
formulating your UCA. It's a new method that I recently
learned from another marketing minded teacher.

It is the simplest way of coming up with your UCA that I've
ever come across:




Here's what you do:

I) Get a couple of sheets of paper.

2) On the top of one page, write, "You know how..."

3) On the top of the next page write, "Well, what I do is..."

Then, you simply fill-in the blanks. Let me give you a few
examples that should help you catch on rather quickly.
Let's say you're a real estate agent who just lists
properties and nothing more. Heres what your UCA might
look like:

"You know how most real estate agents work with both
Buyers and Sellers - splitting their time between both
groups? Well, I only list properties, which means I deal
directly with Sellers. Using my 21-step marketing plan on
each home I have listed, I spend more time, money and
attention trying to get your home sold, instead of spending
time on other activities.

Do you see how the questions work to help you get a
handle on what's so unique about you? Let's do another
one

Let's say you are a real estate agent who offers to sell a
home for 1% commission if the Seller agrees to buy their
next home through you. Your UCA may look something
like this:

"You know how most real estate agents charge you a full
6 or 7% commission on the sale of your home? Well,
what I do is save you thousands of dollars by only
charging a 1% commission if you buy your next home
through me.

Are you getting the idea?



This method is beautiful in its simplicity. Its power is in
the simplicity. I've had this UCA/USP thing explained to
me time and time again, but nowhere have I found such a
simple and thorough way to formulate an UCA so easily.

That is the power of an UCA. A well-formulated UCA will
accomplish several things for you:

1. It will lay out in precise detail what your
prospects/customers can expect from your relationship.
There are no hidden surprises, so you have greater
credibility!

2. It gives you an overall focus of where the rest of your
advertising and marketing should go.

3. It's highly unlikely that any of your competitors will have
anything even remotely like an UCA, so yours will have
an incredible knockout blow to any competitor.

They don't stand a chance, because they can't clearly and
succinctly express the reasons why their prospects
should do business with them, instead of you! That's a
powerful position to be in!

The real key to creating a highly successful UCA is to
focus on the one need that is lacking the most. Of course,
you'll have to make sure you can keep the promises you
make!

By finding the one little problem that no one else in your
area is taking care of, and building your UCA around it,
you can profit enormously.

Putting Your UCA Down on Paper

Before you jump in and start throwing your new UCA all
over the place, you need to focus and say it as clearly


and crisply as you can, with impact. When you do,
remember one thing

Do Not Try to Be Cute or Clever!!!

Doing so will defeat the entire purpose of your UCA,
which is to clearly and crisply state the reason why your
prospects should do business with you instead of your
competition. Think it through carefully.

Take the time you need so you can write out your UCA in
one compelling paragraph or less.

It may take a few tries to get it down clearly, but it's well
worth it. Believe me, if you use the method I outlined
above, coming up with your UCA is going to be 10 times
easier than it was for me back before I found out about it.

Conclusion:

Your UCA will be one of your most powerful marketing
weapons. It needs to be a part of everything you do. That
being the case, you need to take the time necessary to
come-up with your UCA today!


Today's Missing, Magic Ingredient That Will
Almost Guarantee Your Success In Business

The information in this chapter will absolutely change your
business and your life, if you spend just a few moments
and really let it sink in.

This chapter will help give you a thought process,
something that will give you clarity and provide an
immediate advantage. It will give you purpose, certainty,
and fuel the vehicle that will enable every one of your
endeavors to be successful. You will possess the
understanding to relate with your Buyers and Sellers, with
one simple business, life and marketing concept.

With that in mind, let's get started:

What I'm about to share with you will help you in a way
that will give you the same kind of distinction that makes
massive financial breakthroughs for salespeople all over
the country.

What you've got to do is take this information and
interpret it into your own business. Force yourself as you
read this chapter to make notes of not only what I say, but
the implication and application it has to your marketing
efforts.

To start off, the first thing I want to tell you about, is the
importance of demonstrating genuine empathy, a
sincere understanding of where your customers are and
what their frame of mind is.

Empathy is very different than just understanding.



It is having an emotional, heart-felt comprehension of
what someone else feels. Its an understanding of the
"plight" they're in and life from their point of view.

When you lose empathic respect for where your client is
coming from, you've lose rapport right from the beginning.
You've got to understand that.

You've got to take a position of "selling leadership" in the
literal sense to your prospects.

Not leadership like being the king in your area, but
rather in the context of leading your clients to solutions,
answers, protections and enrichments.

Our charge as sales professionals and marketers is to
lead our clients to "higher ground" and better lives, to
greater enrichment and having more joy in purchasing
different products and services.

You must become extraordinarily adept at conveying to
your prospects the message that, "I feel the way you feel
and I understand what your problem is!

Your prospects are silently begging to be led, but they
want be led by a leader who has their best interest at
heart, not someone who is looking through them and to
their wallet.

It's important to realize that most people don't have a
clear picture. They don't know what they want, how they
feel, or what's possible.

The more you help them paint their picture, provide clarity
of focus and show them what's possible, the more you
show them what theyll lose if they dont use your
services. This is how you empower them to take action.



Your purpose, your responsibility, your charge, your
reason for being in the real estate business, is that you've
got to lead your prospect to whatever they consider their
"promised land."

You see, most people don't trust "salespeople" or the
systematic way that we operate in business. They don't
trust everyone doing things the same way because it
makes them feel manipulated and out-of-control.

But, when you put on a pair of empathetic glasses and
take off the blinders, you see that we all feel like we're out
of control.

Think about yourself for a moment. Have you ever been
in a buying situation where you felt helpless or frustrated?
Of course you have. Its simply human nature.

Even salespeople at one point or another feels like the
competition is out to get them and that the "system"
sucks.

People are mad, they really are. Have you noticed a level
of apathy or ambivalence in your customers?

They feel like they've been taken advantage of. They feel
like they're always being screwed. They feel like they
have no real choice. They feel like the whole system is
manipulated around them.

You've got to stop and spend a few moments in your
prospects shoes. Youll see that they feel like you do -
you feel like they do. In the sales business, if you don't
comprehend the feelings of your prospect, you won't be in
business for long!

The fact is, people feel they're not being told the whole
truth, or all of the facts, or all the options.




Don't you respect somebody when they let you in on the
truth? Think about it. Have you ever bought something
from somebody who tells you truthfully how they see it, or
advises you honestly?

Did you ever have anybody like that in your life?

Did you feel confident of them?

Did you buy from them?

If someone takes a straight-forward and honest position,
you find you want to trust and believe him or her.

Your job as a marketer is to give others focus that helps
them realize you offer a better way to look at buying.
That's your responsibility, your higher "purpose".

Give your prospects the focus. Help them see it as you
see it. Give them advice. Give them an alternative to the
way everyone else does it. Have a fresh, more honest,
more empathic, externally focused mind-set.

Help them take the first step. Help them see what the
logical action should be, and why. Give them reasons that
are in their best interest, not yours. If you don't have the
reasons, spend as much time as it takes to get them. Until
you do, you have no advantage over the competition.

Maybe this chapter has been a bit abstract in it's thinking
and approach. Maybe you don't understand the point I'm
trying to make. I guess what it boils down to, is that if
you're hoping to sell a lot, and you haven't taken the time
to really get to know your prospects, success will be
difficult.

Identify and understand the feelings, hopes, and anxieties
of your target market. If you do, you'll be able to deliver a
product that helps them and marketing pieces that sell
them!



You must walk more than a mile in your prospects shoes
in order to understand how to market to them and how to
create a service that'll solve their problems.

My question to you is this:

If you're serious about wanting to succeed in making tons
and tons of money, you've got to get serious about
serving people, caring about them and getting to know
them.

Create a service using marketing vehicles that help your
clients solve problems. If you do, you will succeed big
time!


FREE Unadvertised Bonus
How To Structure Zero Down
Deals
Transcript From Joes Hands-On
Workshop
RAW UCUT UEDITED

In the book you just read, I taught you how to put zero
down deals together. You learned everything from A to Z,
but Ive decided to give you an additional FREE bonus.
This is the transcript from a seminar workshop that I did. It
is very rough unedited with lots of stumbling sentences
and some of it may not even be complete.

But it is also FULL of EXTREMELY powerful ideas,
strategies and techniques that will help you understand
zero down structures on a very deep level. Dont write
back to me and tell me how bad the grammar is or how
many words were misspelled or how badly it was
formatted I already know. I just wanted to get this
material included in the book as quickly as possible so
you could start making money today.

So here goes learn a lot.

***************************


Joe Crump: Okay guys, lets get going. We are
going to talk about how to analyze the deals that you find.
And then Im going to take you through some exercises
and actually have you analyze theoretical deals.

There are two types of deals were looking for.
Substantially under market value which you can buy for
cash. And when you buy these for cash, it doesnt have
to be your cash; it can be another investor who will pay


you a fee to takeover that property. So youll be
assigning that property over to someone else for a fee
using an assignment form. Also were looking for
properties we can buy at market value or below, but on
terms.

Steve, thats a little hot. Could you bring it down just a
little bit?

So you can actually make money on properties that you
buy at full value, preferable to buy it under value, but you
can actually make money on properties Whats that?
Talk louder. Okay.

You can actually make money on properties that you buy
at full value if you can get them on terms, because you
can sell them for more than market value. Remember the
stuff we talked about way back on Saturday morning.
The types of deals were going to be looking for: the
wholesaling, thats the ones that you flip, properties that
you buy subject-to, wraparound contracts which are also
known as land contracts, or if youre in a trust-deed state,
contract for deed, and lease with option to buy.

So these are the four different structures of purchasing
properties that were talking about. Im going to start out
with wholesaling. You want to buy substantially under
market value when youre buying for cash. The big
question always is what is substantially under market
value? And Ive heard people say, It is 10 percent, its 20
percent, its 30 percent. I dont like to put it on a
percentage basis because it doesnt the numbers dont
work very well. If you got a $10,000 dollar property, 30
percent of $10,000 dollars is only $3,000; its not going to
be very profitable. On the other hand, 30 percent of
$200,000 dollars is $60,000; its a lot more attractive.

So what youve got to do is youve got to take the project
and youve got to back out of it. So lets say youve got a
property thats worth $100,000, you want the investor


the minimum most investors that are going to do rehabs
are going to accept, and this doesnt mean that I would
accept that but investors that I found that they would
accept, is $15,000. Usually if an investor can make about
$15,000 after they do their rehab, theyre probably going
to be okay.

Now I wouldnt ever recommend that you do a rehab
where you only think youre going to make $15,000, do
them if youre going to make $25,000 I think is a
minimum.

Rick, you got a comment on that? Yeah, yeah you do.
So $25,000 is what you want to look. But I think that you
can still sell properties to people where they make $15
grand. So you got to look at what are repairs going to
cost, what are you going to charge for your fee? Is it
going to be $3,000, is it going to be $5,000 to flip this
property? So lets say $15,000 plus you got another
$3,000 for your fee, another $5,000 to do some cosmetic
work. Now youre at what is that? $23,000 dollars, so
you got to get it at $77,000. Is this substantially under
market value? I think this is marginal, a pretty marginal
deal.

Does it mean you shouldnt take it? I think that marginal
deals sometimes make sense. Remember you dont
have any risk here. You put a purchase agreement
together on here that is assignable. It is also contingent
upon approval by your investor. So if your investor says,
No, I dont want it, or your investors depending on how
many you got on your list. If they say, No, I dont want
this property, you can bow out of this contract and you
can walk away from it without any risk.

And in fact, you would never close a deal. Whether it is
on terms or whether it is on cash unless you have a buyer
in place ready to go. And on a cash deal it is very nice,
because all you have to do is turn around and sign it, and


let them close it. The nice thing about wholesaling
properties is you get your money upfront.

The way Azam and I are doing it, we dont even assign
these contracts until the money is wired into our account
or until we have a cashiers check, because that gives us
some leverage on whos going to accept this, who were
going to accept as the investor for this property. If an
investor says, Oh, I want that property. I want it. Save it
for me. I say, Well save it for you until somebody else
comes along with money. As soon as that person comes
along with money, thats the person who gets it. So it
creates a little bit of urgency.

If they know it is a good enough deal for them to accept,
they have a feeling that other investors may accept that
deal as well. So our thing to them and the way our
assignment contract is written is this contract is not valid
until money is wired into our account or until we have a
cashiers check for that amount, depending on how they
want to do it.

And its all tied together. Okay, no problem. Okay, lets
go onto. Oh yeah, you always have the weasels clauses.
Thats what Im talking about as the contingencies to get
your out of a deal. And this is the core of the safety-net
method, by the way, having the ability to get out of a
contract no matter what happens and no being tied up
with having to make payments.

Buy in subject to the existing loan. What Im going to try
and do is help you understand the difference between
subject to land contract and lease option. Im going to
stop after let me go through the three of them and then
Im going to stop and Im going to ask you questions and
see if you understand what were doing here. Because
sometimes it takes people a little bit of time to grasp this
concept.



When you buy it subject to, you need to buy it at market
value or below. Youre going to take over the property
subject to the existing loans with a quit-claim deed. You
can use a warranty deed. Youre not assuming the loan;
youre not qualifying for that loan. The person who took
out that loan originally stays on that loan. There are no
closing costs in a deal like this and you can actually close
it at a kitchen table. The title transfers to you. You
become the owner of that property. Just because the
mortgage is still in the name of the original borrower
doesnt mean that you dont have title. You have the title
to that property, which gives you the ownership of it.

We talked a little bit about due-on-sale clauses yesterday.
A due-on-sale clause is in about 99 percent of mortgages
out there. And it says that if a property is transferred then
that mortgage becomes due and payable. Or I guess the
better way to say that is the mortgage company has the
right to foreclose upon that property and take it back.
Now the question is will they do that? Will they take that
property back? I have been through hundreds of millions
of dollars of real estate transactions of all kinds and I
have never seen that happen. The closest that Ive ever
gotten to that is a mortgage company once sent us a note
and said this payment has to come from the borrower not
from another party. And so we sent it through the
borrower and we didnt have a problem.

I had another guy, one of my students actually, the
mortgage contacted him and said, We would like to
wed like you to take this loan out in your name or were
going to foreclose on it because of the due-on-sale
clause. This is the only time Ive ever heard of this
happening. He told them to go ahead and foreclose.
There was no equity in the property. Most of these
subject-to properties dont have any equity in them.

You dont and since youve got the due-on-sale clause
there, I suggest that you not put a ton of money into these
properties. If youre going to go and put $50,000 dollars


in this property and keep it for 30 years, youre at risk for
the lender to take it back. If you got a huge amount of
equity in these properties, you probably dont want to
leave it in a subject-to situation. Ive never heard of it
happening, but if the bank looks at those numbers and
they realize theyve got a 50- or 60-percent equity
position, you know maybe theres somebody at that bank
that wants to raise some funds and they want to do this
foreclosure.

But even if they decided to foreclose on that property and
youve got a 50-percent equity position on that, you still
have time to sell that property and get out of it. If youve
got that big of an equity position, youre probably not
going to lose money so you just need to refinance it, sell
it, and get that loan off of there and they wont be able to
foreclose. So thats due-on-sale clauses there.

People get nervous about these things and theyre really
not as frightening as you and actually theres other
things that you can do. They have trusts that you can put
them and theres some other research that you can do on
this, and its not I dont think its necessary, but Im not
an attorney.

When you write the purchase agreement of a subject to,
essentially instead the sale price, when theyre asking for
the price of the property youre putting in subject-to the
existing loan or value subject to the existing loan, and
everything in there is all subject to the existing loan.
Youre taking over the escrow account, so youre going to
be making payments on the taxes; youre going to be
making payments on the insurance. Youre going to
leave the insurance in place in the name of the mortgage
holder, because the bank demands that they have an
insurance policy in their name. But you also want to put
yourself on as a writer so that youll be covered in it as
well.




The nice thing about subject-to and the reason I like this
the best of all financing all together is the fact that it gives
you more options to sell it. Youre on that deed. If you
buy it subject-to, you can sell it subject-to, because you
got the deed. You can also sell in on land contract. And
Im going to talk about land contracts and why youd want
to do that. And you could also sell it on a lease option.

If you bought it on a land contract, you can sell it on a
land contract and you can sell in on a lease option. If you
buy it on a lease option, you can sell it on a lease option.
So you have a lot more opportunities to sell the property
because of the way you buy it. And the more
opportunities you have to sell it, the more options youll
have on whos going to buy from you, and the more
flexibility youll have when you turnaround and sell it.

Wraparound contracts. You dont take title to the
property, but you have ownership rights. Its like buying a
car. If you go out and get a loan on a car, they will not
give you the title. Youll have a contract with them that
says youre going to pay this amount money over this
period of time at this interest rate. And when it is paid off,
they give you the title. They turn the title over to you.
Thats unlike a deed where you actually have, or even a
mortgage, where you actually have the deed in your
name.

When you buy with a wraparound contract, this gives you
more options in your arsenal to buy properties, because it
allows you to actually give the seller their equity. If youve
got a seller whos willing to sell on terms, but he wants his
equity out - lets say he owes if the property is worth
$100,000 dollars, he wants $100,000 dollars for his
property. And the numbers work, it makes sense to buy it
but he only owes $50,000. You cant buy this property
subject-to, because otherwise youd have to buy it for
$50,000 because hes only got a $50,000-dollar note on
it.



So youve got $50,000 dollars worth of equity there. So
what we do is write up a wraparound contract, a land
contract, for $100,000 dollars. Lets say his payment is
$500 dollars on his $50,000 dollars and the balance if you
were to finance the whole $100,000 it would be a $1,000
payment, that other $500 dollars, if you paid him $1,000
dollars a month, $500 would go to his mortgage, $500
dollars would go to him. And if hes got a mortgage, by
the way, its better to split those two up and send one of
them to the mortgage company directly to make sure that
payment is made, and the other one to him directly.


This is an easy this makes it easy to sell to somebody
whos not necessarily motivated and doesnt need the
cash right now, because it saves them on their tax hit.
Theyre not going to have a capital gains hit, except on
the money that theyre making. It also makes them more
money.

Lets say their interest that theyre getting on this property
is maybe $300 dollars more than - $300 dollars more than
what their mortgage payment is. And youre paying lets
say youre paying $50,000 dollars for the property. Are
these numbers going to work here? Youre going to pay
them $300 dollars more above their Lets say they owe
$50,000; it is worth $80,000. Youre going to buy it for
$80,000; $500 dollars a month goes to them - $500
dollars a month goes to the mortgage company, $300
dollars a month goes to their equity.

Now what theyre making is $300 dollars a month and if
you do it over a 5-year period, which is pretty standard
with a land contract, 60 month, $300 dollars a month.
What is that? $18,000 dollars. So theyre getting an
extra $18,000 dollars over a 5-year period for this
property. So instead of buying it for $80,000, youre
buying it for $96,000. And you can show them, hey,
youre going to get an extra $16,000 dollars if you just
wait for your money, plus youre going to save all these


taxes over these years, and then you can take the hit at
that point. And it is a nice way to sell.

And I find this works a lot on folks that own properties free
and clear and they dont need you know like retired
folks that have these properties. All they want is the
income. And they still have the right to foreclose, by the
way. On a subject-to since the deed is transferred, the
person who sells it doesnt have the right to foreclose.

Ill answer your questions __________, okay.

They dont have the right to foreclose. But on a
wraparound contract, they do have the right to foreclose
and take back the property so they wont lose their equity.
Now it will take them they have to go through the
process of foreclosure, which is a pain in the butt. So if
youre going to sell a property on land contract, you want
to be aware of that that its going to take that. Thats one
of the nice things of selling on a lease option, because
you can evict and thats a lot easier. So making it
assignable you can sell if you make the contract
assignable, you can sell the you can assign that
contract to someone else and they can take it over.
Assigning for a fee, obviously.

When you write the contract, basically youre going to use
the purchase agreement the same way that you use a
regular agreement except in the further conditions or the
place where it allows you to put write in some material.
You can say this is going to purchased on a land contract
for x-amount of dollars for x-interest rate for this period of
time, that this contract is to be written by an attorney
acceptable by both parties so thatthe land contract,
itself, should be written by an attorney, a real estate
attorney.

After you do this a fee times, you may want to use the
same contract. What I do is well, what I did was have
an attorney write up a land contract for me and I asked


him to email it to me. And since he emailed it to me, it is
in a Word document and I can now modify it and use it
anyway I want. And you can do the same thing. But it
might make more sense both for your comfort and the
comfort of the seller for an attorney to go ahead and
create the document and even record that document for
you, because this is going to be a recorded position that
youre getting ownership of that property.

When you sell a wraparound contract, if you sell it with a
wraparound contract thats assignable or you can sell it
on lease option. You can not sell it subject-to, because
you dont have the title. And this is the way property used
to be financed, by the way. This is sort of the classic
method of financing property before they even had
mortgages.

Lease with an option to buy. This is my third favorite way
of buying a property. Now when selling a property we
look at them a little bit differently, but as far as buying a
property I think this gives you the fewest options. What
youre doing is youre buying a property youre leasing a
property, Im sorry, over a certain period of time with the
option to buy at a specific price. So if that value goes up
in price, you have the right to purchase that property and
make a profit on it.

You dont have ownership rights. You couldnt go to a
title company with a lease option and ask them to sell that
property for you or to close a deal. Youre going to have
to get ownership rights to make that happen, so it makes
it more difficult to resale. You always want to make all
your contracts assignable. Theres less profit on the front
end sometimes with lease options, but you got a big
chunk in the back end that you can make money on
because you can sell it for more money. Typically, you
can get more money when you sell it for lease option.

One of the techniques that Ive used to sell a property that
I purchased with a lease option is to ask the seller, and I


had to go back and get their permission, but I had to go
back to the seller, get their permission to switch it over to
a land contract for one day, the day of closing, and then
that contract would be due at that day. So that would give
me ownership rights and I could then sell the property and
have them buy it directly from me.

One of the things I like to do is separate the lease and the
option. They are two separate documents. So if there
is some question if you have an option on a property that
that does give you some ownership rights, and if the
lease and the option are tied together and a judge
decides that because they got an option on that property
you need to not just evict them, but you need to foreclose
on them, that creates a problem. So make it two separate
documents, two separate agreements, and dont tie them
together.
This is my least favorite way to buy on terms. And I

Lets do some first, lets take some questions on this
process. You want to start __________.
Student: When you just gave __________. Oh thank
you. When you just gave the example, $80,000 was the
price and was worth it, and you make terms $50,000 and
the rest is carried by the owner, right? Would that work
also if the house is free and clear to do that completely as
owner financing?
Joe Crump: Well, first of all, lets make sure we
clarify how thats working. Its not that youre taking a first
and a second. Its not two mortgages here. Whats
happening is you got he owes $50,000. Hes going to
take that $50,000 plus his equity, wrap it up into just one
contract that youre going to sign for $80,000. Does that
make sense? So its not a first mortgage and a second
mortgage, its a wrap thats why they call it a
wraparound, because theyre wrapping it all up. Does that

Student: But would it make sense to oh yeah, okay,
its not a wrap around then, its just straight out seller
financing.


Joe Crump: Yes, you could do this with you asked
if you could do it if it had no liens on it at all?
Student: Yeah.
Joe Crump: Yes. You could do it. I mean thats it
could be any amount of equity or no equity. Lets say you
had a property that was worth $100,000 dollars, they had
a mortgage on there of $100,000 and the seller didnt
want to do a subject-to. They just didnt want to turn the
title over, they wanted some recourse. Well, you could
give them recourse just by doing this as a land contract,
just back down to your second favorite choice. Now
youre down to a land contract for $100,000 dollars and
its exactly whats on the note.
Student: So in other words, the land contract can be
done no matter if it is free and clear or after 100 percent
no equity.
Joe Crump: Correct.
Student: Okay.
Joe Crump: Correct. Who else has got a question?
Student: With the lease with option to buy, you were
talking about separating the lease and the option and you
make it easier to evict. But youre the buyer youre
buying this property, why would you want to make it
easier for them to evict you?
Joe Crump: You caught me in a mistake. (Laughing)
Very good, because it should be the opposite way
around. Because I keep thinking Im selling, because I
never buy with lease options. So basically what that
should be is the opposite way around. Tie them together
when youre buying, because then you have more rights
on it. And whether or not youll be able to get away with
or not thats, you know the ownership rights
_______________. Did I just confuse everybody?
Student: ______________
Joe Crump: Okay. Okay. Who else has got a
question?
Student: On a subject-to, when do you record the
deed?
Joe Crump: You can record it as soon as you get it.
Student: Before you actually sell, before you sell?


Joe Crump: No, the recording of the deed or the
transfer of the deed is when it becomes your property,
when he gives you that deed. Thats the closing. You
close when you have a buyer in place. So as soon as
you have a buyer in place, you close it, he gives you the
deed, you get the money from your lease-option person
or somebody else whos buying it from you, and then you
take it down and record it, so nobody can take it from you.

Who else? Lets just
Student: I have a question. When you do property and
you got the deed, taken it over, lets say theyre moving
out, Ive got my new buyer moving in, utilities and things
like that in the interim, in between. My seller is moving
out and they say, well, we want to shut off utilities, and I
didnt quite have my new buyer in there. Whats the way
to handle that so youre not out of pocket?
Joe Crump: Close it when youre buyer is going to
be in there. That way it is seamless.
Student: So just make it happen at the same time.
Joe Crump: Right, same day. And that way and
tell your buyer. Say, look, your utility is going to be shut
off on this day so make sure you have them turned on in
your name on the day we close.
Student: Mine just kind of adds on to the last question
over here. You said that you didnt mean to separate the
lease and option to purchase when you buy, but do you
want to do that when you sell?
Joe Crump: Yes.
Student: Okay. And thats so that you can evict them
without them saying that they have ownership rights.
Joe Crump: Right. And that way if they dispute
ownership rights and you have to give them, you have to
continue with their option, you can still at least put
somebody in there. You can lease it out so you dont lose
money with it.
Student: So how do you actually separate the lease
option and option to purchase? I mean you have typical
lease like if you were, say, renting an apartment.


Joe Crump: Well, there are two documents to start
with. And the only way that they would be connected is if
you connected them verbally on the contracts.
Student: Okay.
Joe Crump: Because they dont refer to each other.
Student: So in your option to purchase are you saying
that they have the option to purchase this on this date, or
they only have the option to purchase this because
theyre making these payments for this amount of time?
Joe Crump: They have the option to purchase it
before this date, which is a year in the future, or two years
or three years in the future.
Student: Okay.
Student: When youre buying on a wraparound contract
or land contract, what are the specific disadvantages of
not holding title? You mentioned you cant sell on a
subject-to. If it is assignable are there other
disadvantages of not holding title?
Joe Crump: Im not sure I understand.
Student: You were saying in a wraparound contract you
dont actually take title.
Joe Crump: Correct.
Student: Although you do have other ownership rights.
Joe Crump: You have ownership rights so you could
take it to a title company and say, I want to sell this
property. Theyll go to the title search, theyll find out that
you are the owner of record, and they will allow you to sell
that property.
Student: But youre saying you cant sell it subject-to,
so Im just curious is the technical issue of holding title.
Joe Crump: The only way that you can sell subject-
to is if you have the deed, because what youre doing is
transferring the deed. But a land contract is not a deed.
Its ownership rights, but its not a deed.
Student: Okay.
Joe Crump: Its not the actually, physical form of a
deed, which means that the person who has the deed has
foreclosure rights on a contract, on a land contract. If that
land contract buyer defaults, the person who has the
deed can foreclose on them.


Student: Okay.
Joe Crump: Which protects somebody if they dont
want to go with a subject-to deal. If theyre afraid of
turning over the deed and having no recourse, which
doesnt happen that often, but if it does you have a
fallback position. You know, one of the things I dont want
you to go out and do is start falling back on these fallback
positions before they reject. Because a lot of times
people will think, well, I wouldnt do a subject-to so theres
no way that Im going to ask anybody else to do it. Ill just
go ahead and offer them something thats less valuable to
me because Im willing to do that anyway, and why not
just negotiate from that weaker point.

I think it makes sense to negotiate for the best position
that you can, because it will give you a lot more options to
sell it. And it actually serves your seller by doing that,
because it makes it more likely that youll be able to turn
that property. The less opportunities that you have to turn
that property and sell it, the less likely that theyre going to
get their money and that their mortgage is going to be
paid for.
Student: I like youre saying with wraparound contract,
it would probably have to be require if the guys got equity
in the property. Otherwise, he wouldnt want to do a
subject-to.
Joe Crump: Correct.
Student: Yep.
Joe Crump: Otherwise, hell leave his money on the
table; hed leave all that equity on the table.
Student: I have actually two questions. One is I
understood that lease option is your least favorite
possibility, right.
Joe Crump: To buy.
Student: To buy.
Joe Crump: Not to sell.
Student: Yeah. What lease-option terms do you think
are the optimum, one, two, or three years?
Joe Crump: One.
Student: One year.


Joe Crump: But, welllets do a __________ on
that.
Student: Okay. And always like $200 dollar cash flow.
Joe Crump: ___________ you have to decide what
you want that property to do for you. Do you want to keep
that property long term, or do you want to keep it this is
something we talked about earlier do you want to keep
that property long term, or do you want to flip that
property quickly and get your equity out of it?

Lets say I want to build a stable of properties that Id like
to keep and see them go up in value, but I dont really
want to be a landlord. And the beauty of selling on a
lease option is you can set it up so that even though you
are a landlord according to the IRS and according to the
lease, youre still a landlord, you can put a lot of the
responsibility for taking care of the property on the
shoulders of the lease option. So that way if the furnace
goes out, they call you up, say, hey my furnace went out.
Well, thats too bad. Youre going to have to get a new
one in there, arent you?
Youre not.

And what we tell them is, hey you know, think of us as the
lender. Were not the landlord. Think of us as the lender
and you remember you wouldnt call Countrywide to
replace your furnace, so dont call me to replace your
furnace. Youre going to be taking care of it. And they
know this upfront. You know we have them initial it on the
lease agreement that we have.
Student: So in other words, if you plan to put it in your
matrix then one year would be optimum and otherwise
Joe Crump: If youre trying to get the cash out, then
do the matrix. Absolutely, one year is what you want to
do.
Student: Okay.
Joe Crump: Now if youre wanting to get it out in one
year, you need to get the highest lease-option fee
possible. Now I suggest $5,000 dollars as a minimum to
pretty much guarantee that this deal is going to close.


Well, not guarantee it, but 70, 80, 90 percent of those are
going to close. And Im talking about the $100,000
property again.

If you only got $1,000 dollar lease-option fee, the
likelihood is the 50 percent that is not going to close. So
the theory is then if you want to keep those properties and
let them appreciate and have those lease-option people
come in, take care of their own properties. You know if
they buy it, great, they bought it at a price thats 10
percent above market value. If they dont buy it, thats
even better, because you wanted to keep it. And you go
get another lease-option person to give you another
$1,000 thats also nonrefundable. It is not deposits, so
they dont have to give it back to them when they leave,
which is another nice thing. And you can keep doing that
perpetually until somebody ends up buying.

And what youre going to do is raise the price next time.
And when youre ready to really move that property then
you make sure you get a high lease-option fee on it. Now
what if you want to move that property and you can only
get a low lease option. Maybe you can only find
somebody whos willing to pay $1,000 bucks on this
lease-option fee, does it still make sense to do that
property? I think it does, because you still want to be able
to move that property. And if you have it subject-to you
can actually try to increase your down payment.

What I like to do, lets say you go this $110,000-dollar
property thats got a mortgage on it of $90,000 and youve
got it advertised. You want to try to get $5,000 down, so
when people call you ask them how much money theyve
got for their down payment. They say, well, I got $3,000.
Well, if you had $5,000 that would probably work, so
maybe you can bump them up to $5,000. Well, I can
come up with $4,000. Well, maybe accept that.

Well, lets say they have $5,000. They say, Oh, I got
$5,000; I can do it. Well, you know if you can come up


with $10,000 dollars, Ill sell it to you for $5,000 dollars
less. Ill sell it to you for $105,000 and Ill sell it to you on
a land contract. So now Ive got $90,000 first mortgage
and I got $5,000 dollars of equity because I sold it for
$95,000. I got $95,000 left that theyre paying on and I
got $10,000 dollars upfront.

Or you could give them another option, Ill come down
you know another $2,000 dollars if you give me $13,000
dollars. Yeah, then were down to I cant remember
what all the numbers are. But what you can do is give
them some incentive to give you more cash by lowering
the price. And as long as youve made the price above-
market value, you can always drop it back down to make
it more attractive to them to give you more money and
actually get ownership position.

Say, look, you can take this beyond lease option, you
could take me out of this deal all together where youre
the owner, you got deed. You know you can do
whatever; this is your property. If you want to do that you
just have to give me a little bit more money to do that.
And you may find somebody that finds value in doing that.
Student: Yeah, and the second question I had was, you
mentioned yesterday in connection with subject-to quit
claim deed, could you very briefly explain exactly what the
is quit claim deed something where you have like just
performer $1 dollar just to have the title in the your name
orwhat exactly was that?
Joe Crump: A quit-claim deed is just exactly what it
says there. Theyre quitting their right to that property and
theyre giving it to you. Its a very basic way to transfer
title.
Student: Yeah, but what is the minimal amount
Joe Crump: You dont have to you dont have to
Student: Oh, not at all.
Joe Crump: Yeah.
Student: It doesnt have to have any amount on it.
Joe Crump: Yeah, you can I mean what J.J. was
talking about earlier today with LLCs. If you deed your


property into a LLC, youre just quit claiming into an LLC.
The LLC takes it over.
Student: Without money at all.
Joe Crump: Yeah. Anyone else got a question?
Student: At what point in a subject-to deal do you do
the title search to make sure theres no clouds or anything
on the title before you actually take deed to the property?
Joe Crump: You have to decide if youre going to be
the one thats taking thats going to be buying it. What I
do in my disclosures, I let the buyer, the person who is
buying it from me, take responsibility for the title, take
responsibility for the value, take responsibility for the
condition. I dont do inspections, I dont do title searches.
You know I dont do any of that stuff, because it takes too
much time. Its not necessary. What you do is put that
responsibility squarely on the shoulders of the person
who is buying it from you.

So lets say I got whose lease optioning that property. Ill
tell them, you know, heres the deed. Youre going to
take this property with a lease with an option to buy from
me. Youre going to put this much money down. And
heres a disclosure that you have to sign.

What Id like you to do to satisfy yourself and this is
exactly what my disclosure says satisfy yourself as to
the condition of the title, that Im not rely on Joe Crumps
opinion of the title. Ive satisfied myself of the title. Not
relying on Joe Crumps opinion of the price, Ive relied
upon my own valuation. Im not relying on Joe Crumps
valuation of the condition of the property; Ive made my
own inspection to do that. So that that takes me off the
hook.

Does that make sense? Who else has got a question?
Student: When you say title search, do you mean
complete or preliminary title search? I think theres a
difference, right?
Joe Crump: I would do a prelim.
Student: Prelim.


Joe Crump: Yeah, because a complete title search
basically is the same as a prelim except they do it at the
day of, you know, they just check it at the very day right
beforea prelim is what they doIt is what?
Student: _________________
Joe Crump: No. It is just current. It is just more
current.
Student: Do you require that they do the title search
and contingencies? For instance, say what happens is
you bought the project or you got a contract as subject-to,
youre about ready to do a lease option, youre basically
demanding that they do it. If they didnt do it, say when in
six months decided there was a problem, say theres a
major problem with the house or there was cloudy title,
they get out of the lease option after one year and then
you basically got youve got the property now at this
point with known problems. So how do you protect
yourself against that?
Joe Crump: So is the concern the title if I get the
property back?
Student: Yes.
Joe Crump: Its got a bad title.
Student: In other words, do you demand that the lease
to buyer lease-option buyer do the title search and the
contingencies checks? Im sorry, the inspection checks.
Joe Crump: I do not. If its a comfort level that you
would like to have, it doesnt hurt to do that. What I do is
look at where is my risk here? What is going to be the
problem is that happens? Whats the worst-case scenario
for me? What is the worst-case scenario?
Student: ___________
Joe Crump: Walk away from the property. One thing
to remember here walking away from a deal like this is
not against the law. Its not fraud. Theres nothing wrong
with doing that. Its breaking a contract; its not breaking
the law. Thats the same with due-on-sale clauses.
Youre breaking a contract; youre not breaking the law.

If you get a Visa card and you dont make the payments
on time, youre breaking a contract. Youre not breaking


the law. Youre not going to jail for that. If you dont pay
your house payment and they foreclose on that property,
theyre not going to put you in jail for that. Theyre going
to foreclose and theyre going to screw up your credit.
Thats the same situation there.

If you lose that property, what its going to do, its going to
damage the seller. And this is not an attractive situation.
But the person that youre trying to protect in the first
place was probably going to be in this situation anyway, if
you didnt say it. So what youre going to do is try to do
that best you can to protect that person. But if they didnt
tell you about a lien that was against the property or a title
problem that was against the property, they would have
known about that. If they didnt tell you about that, then
theres some deceit there as well.

So you can only do a certain amount. And you have to
decide at what point it becomes cost effective to keep
working on this stuff and to keep doing it. Because you
can I mean I can probably name ten other things that
you could probably search on, but its just going to get
more and more complicated, more and more time and
you want to get on to the next deal. And you dont have
the risk here because the deal could go away.

Now you dont want deals going away on you. It will give
you a bad reputation if people find out about. Although,
youd have to do an awful lot of them to get that
Student: I got one other question. Just trying to fully
understand the difference between a salesay you
bought a property subject-to and now youre going to sell
it, either subject-to or with a lease option. Basically, its
just a matter of money down. If they put the full money
down for youre equity, then effectively youre selling that
again subject-to.
Joe Crump: Right.
Student: If theyre not willing to do that, then the only
way youre going to get your equity is through you know


basically selling with a lease option, and it is still subject-
to.
Joe Crump: If I was buying a subject-to and I was
selling a subject-to, what I would do is assign the
contract, never close it in my name. So lets say I bought
it for $90,000 subject-to, Ive got a purchase agreement to
do that. And Im going to sell it for $100,000. Theyre
going to give me $10,000. And theyre going to take over
that property subject-to and Im out of the deal. I get my
$10,000, Im out.
Student: Thats just a transfer fee or assignment fee.
Joe Crump: What I would do is an assignment. I
would assignment contract that says Im assigning this
contract for $10,000 dollars. As soon as that money is in
my account, then I sign over the contract to them. And the
deed is transferred directly from the previous owner to the
new buyer, because youre transferring that contract that
lease contract.

I want you to understand how these structures work
because were going to do a little bit of exercises here in a
minute.
Student: So if youre buying a subject-to and youre
selling a subject-to, would the original owner give the new
buyer the coupon book and the directions on where to
send the payment and so forth or is it just kind of a guess-
type thing?
Joe Crump: No, no, you want the coupon book. You
want to know who the insurance company is, you know
you want to know that the property taxes are escrowed,
which most of the time they are, but if theyre not
Student: But youve already just assigned it to this new
person who knows nothing about the original seller, so
youre out of the picture anyway but you want them to feel
comfortable.
Joe Crump: No, youre going to connect them.
Student: Oh, youre going to do that.
Joe Crump: Yeah, youre not walking out. What
youre doing is youre connecting them and stepping back
with your $10,000 dollars.


Student: So youre still working with them to close the
deal?
Joe Crump: Youre not closing the deal. You took
the $10,000 dollars, go close it. If they need help, Ill help
them.
Student: Youre assisting them even though youre out
of the picture.
Joe Crump: What I would probably do is have them
do it through an attorney. That way I dont close their
deal. I dont do their title. I dont want to be responsible
for that.
Student: Oh, I see.
Joe Crump: And it is not that expensive to have an
attorney do the closing, couple of hundred bucks, $250.
Anyone else have a question about these specific things?
Okay.

What Ive got is a bunch of theoretical deals. Who wants
one? I only got about ten of them so lets spread them
out a little bit. Got to play favorites. Got one
moreokay. Okay, Connie, why dont you start?

What Im going to do iswhat these say is they tell the
asking price, the value of the property you know I need
somebody to do overhead. Who wants to do an
overhead? You want to, Marshall?
Student: You want me just to read it?
Joe Crump: Whats that?
Student: You want me just to read the
Joe Crump: I want you to write on the overhead
these deals. Let me get this overhead going, so they can
write these deals down because that will make it easier
for everybody to visualize and remember.

Is it unplugged? Okay, so just write them down as you
might want to put down the left-hand side asking price.
Student: Okay, asking price $110,000.
Joe Crump: Let them catch up with you here a
second.
Student: Value is $105,000.


Joe Crump: Hold on a second. Pull downasking
price is $110,000.
Student: Value is $105,000. Condition is good.
Joe Crump: $105,000 and condition is next and its
Student: First mortgage is $75K. No second mortgage.
Joe Crump: Hold on a second. No, not you.
Connie, go ahead. First mortgage-
Student: First mortgage $75K. No second mortgage.
And a total PITI of $700.
Student: Say that again.
Student: A total principal and interest with PITI of $700,
yeah, $700. And the alternative to if he cant sell it, he
would have to foreclose.
Student: ___________
Student: If cant sell
Joe Crump: Alternative is foreclosure.
Student: - the house, he would like to foreclose he
would have to foreclose. And hes willing to negotiate
terms, but would rather have cash.
Joe Crump: So do terms, yes.
Student: Terms, cash, but rather he would be able to
do terms and is not late on payments.
Joe Crump: Okay, Connie. Tell us how would you
structure this deal? What kind of offer what were trying
to do here is trying to figure out whats the best offer we
could make this guy and is still profitable. And I think the
questions to ask yourself here, first, is it substantially
under-market value? Were looking for two types of
properties. Is it substantially under-market value?
Student: Yes, it is.
Joe Crump: No.
Student: No, because ____________________.
Because of the equity of $30,000.
Joe Crump: Hes asking more than it is worth. Okay.
Heres a guy who clearly
Student: Which is unrealistic.
Joe Crump: Whats that?
Student: Hes unrealistic.
Joe Crump: Hes clearly not understanding the
situation. Okay


Student: Yes, since hes equity is like $30,000, right?
First mortgage Hes equity is $30,000, since I want to
make a deal on it so the most I would be offering, I
guess
Joe Crump: Hed like to have cash. How much
could you give him cash?
Student: $25.
Joe Crump: $75. See he owes $75,000 on it. Is
$75,000 substantially under-market value? Id say thats
a decent deal. So its worth $105,000, you could offer
him $75 cash. And what I would suggest is give him two
separate offers. He wants $110,000. The chance that
hes taking $75 is pretty slim. So if we offer him $75, say,
look, I can give you $75 or I can have his buy it on
terms. Now what kind of terms would we have to offer to
make that deal work? Would it be a subject-to, would it
be a land contract, would it be a lease option?
Student: _____________
Joe Crump: Land contract, subject-to?
Student: _____________
Joe Crump: How could you do a subject to? If you
took whats that?
Student: _____________________
Joe Crump: He wants his equity, right? Land
contract. Its land contract. Because and then it is a
matter of negotiating price. If hes really adamant about
this $110, you want to try and negotiate the price. Now
hes alternative is a foreclosure but hes not late. Hes
making his payments, but hes not going to be able to
make those payments very long. He is willing to do
terms, so give him a land contract. See if he can get it for
$100,000. You know make sure that the value is there.
Get it for $100,000 and then you can turn around and
how would you sell that property?

So does everybody understand how we bought it now?
Land contract, $100,000 is what were offering, maybe he
wants $105. We could still give him $105 and make a
profit. But the lower you can get him to negotiate down,
the more money youre going to make.


Student: _________________
Joe Crump: Thatd be good. Lease option for $110,
maybe $115. So you turnaround, you sell it to somebody
else on a lease option. You got it for $100; hopefully, you
sell it for $110-$115 on a lease option. You get your
$5,000 upfront. You got to carry the rest of it for the year.
Get your money out at that time.
Student: ___________________
Joe Crump: And then your payment. Yeah, you try
to get your lease fee to be at least $900. Now it probably
could be higher than that. Actually youre going to be, Im
sorry, youre going to be buying on a land contract, so
youre payment is going to be higher than $700. Youre
payment is probably going to be around $900-$950. So
youd want to be above $900. You want to try to get
$1100. Because Im guessing you can probably get
$1000-$1100 depending on the market that youre in.
Student: So even though you attractive terms on that to
resell it, would you still make a contingency of approval by
your investor?
Joe Crump: Absolutely.
Student: Or would you just sell it the way it is?
Joe Crump: Every time.
Student: Every time. Regardless of whether you have
good terms or not?
Joe Crump: If you know that youre going to
turnaround and lease option this one out, you might say
this is subject-to me finding a tenant for this property,
because you know that youre going to put a lease-option
person in it. And that way theyll understand that better
than the investor thing.
Student: So theyre not going to say
Joe Crump: Because youre going to be the investor.
If you know that if youre not sure it really doesnt
matter. One way or the other, both of those will cover
you. Say I just couldnt find a tenant for it. But if you
know that youre going to be able to put a tenant in it, just
make it subject-to finding a tenant for the property before
closing.



Is this helpful, guys?
Student: Yes.
Joe Crump: Is this helpful? Okay, good.
Student: What would you say to the seller to get him to
hold off for 60 days or 90 days for the closing in order to
get a lease-option person in there so youre not paying
any of the monthly payments?
Joe Crump: Write the contracts give yourself 90
days on the contracts. If they wont go for 90, at least 60.
If they wont go for 60, at least 30.
Student: Okay, so you trying 90 days first and then
come back.
Joe Crump: Right. But remember if he gives you
only 30 days to do this and you cant get it done, he loses
as much as you do. So it is in his best interest to give you
more time. And you can probably get it down a lot faster
than that. Now what you could do, lets say hes adamant
its got to be 30 days. Say, well, Ill do my best to get it
done in 30 days. And if you dont get it done in 30 days,
then you come to him and say, can I have another 30?
Whats he going to say, no?

I mean if he says no or maybe, you knowanother
thing we run into is, okay, I dont want to tie my property
up for 90 days you know and then have it not sell.
Because I want you to be honest with these people about
the possibility that it may not sell, because it is contingent
upon the approval of your investor or it is contingent upon
you finding a tenant. And you dont want to just jerk
people around, you want to be honest and let them know
what youre doing. You dont need to explain how youre
doing it, you just need to explain theres a possibility that
it wont close but thats not likely but it possibility.

And if theyre really concerned about that, you can always
say, well and this puts you out at risk so you dont want
to do this unless you have to you can go ahead and sell
it to somebody else if somebody else comes along. And
just give me a one-week first right of refusal, so that I
have the right to come in and buy that property and get it


closed within one week from time that you accept another
deal from somebody else. So if they accept another deal
from somebody else that deal has to say on it its not
going to be valid for seven days, because they got a first
right of refusal from somebody else.

Does everybody understand what that is what I just said?
Okay. That way because it is unlikely that thats going
to happen, first of all. And the risk here is that you tell
your investor, whos unscrupulous, about this property.
He goes to them and he says, Ill buy it from you directly.
Lets not go through this guy. Im not going to buy it
unless I go through you directly. And the seller says,
Well, I want to sell it. Ill just go ahead and sell it to him.
I have the right to back out of this contract, but youre the
one who told the guy about it. So they can go around
you. So you dont want to do this unless you have to.

As you start working with investors over and over again,
the investors you work with will want to keep working with
you becauseI mean you got a list of investors that you
work with and if somebody were to pull that on youI
mean youre doing multiple deals with particular investors.
Student: If someone were to come in behind me, I
would not work with them again. And since we have a
property list thats weekly and 40 available properties, I
would say they lose.
Joe Crump: Right. See what youre trying to do
overall here with building a list with creating a presence is
building credibility, building some leverage into your
business, because now people dont want to screw
around with the big guy. And shes perceived as the big
guy now six months.
Student: What do you tell the seller in order to get them
to accept a land contract or $100,000 when theyre asking
$110,000?
Joe Crump: You say, Well, you know, it really
makes sense for me to pay $100,000. It doesnt make
sense for me to pay $105 or $110. I feel the value is right
around $105 and I have to make a profit as an investor.


You know if that doesnt make sense to you, I understand,
but it has to make sense to me as an investor. You know,
Im not trying to push you but this

Youre going to develop your own style of negotiation. I
do it in a very soft way. But its a take away but it is also
as gentle as possible. And I dont hammer people too
much either. Some investors you know sometimes it
probably makes sense to hammer on a certain level, you
know to try to get a good deal, you know to do this deal.
Well, give me my first three months for free, or you know
first three months at $700 dollars and then well go up to
$950 after that. Once you start doing these negotiations,
youll start negotiating all sorts of new things.

Well, you know, it needs new carpet you know. Why
dont we, you know, give me $2,000 dollars carpet credit
so that I can go get carpet. Or it needs work and it just so
happens this guy is a handyman and he can paint the
whole house for you for $200 dollars, you know have him
do the work. Negotiate that into the deal.

One of the things that Phil did, which was pretty fun, it is
actually on the he negotiated this whole deal on the
three-day boot camp CDs that Ive got. But there was a
guy that was selling his house, he was buying it
undervalue for cash, but he was a handyman. Hed been
fixing up the property. He just needed to get rid of that
property. So Phil said, Well, I wont give you your price.
Ill give you this price instead, which is $15,000 dollars
under what you want, but Ill give you $15,000 dollars
worth of work because I got another house that needs
work on, which he has to pay for anyway. But he gives
this guy the money because hes doing the work. And the
guy agreed to it. So he got a great deal, plus he got good
work done.
Student: Do you ever consider, if somebodys asking
for more than the house is worth and is kind of mistaken
about the value of his own house, do you ever consider
then giving him comps or taking comps -


Joe Crump: Absolutely.
Student: - so he sees that hes mistaken?
Joe Crump: Yeah. Help people understand what the
value of the property is in the nicest possible way.
Because if you just say, Your propertys not worth that.
Dont waste my time, you know youre not going to make
any friends here. But if you say you know, Well, how did
you come up with that value? Well, you know, the house
next door sold for $105 and I got the heavy-duty nails in
my I got the drywall in the garage, and I got the extra
high-quality paint in the kitchen.

Do you understand how values are created in property?
Welland you just go explain. You say, Here are the
other properties that have sold. All Im doing is going by
numbers. Im not doing this as an emotional buy. Im not
living here. It just kind of makes sense numbers wise
because Im an investor and I have to make a little bit of
money to make this thing work.

And you know I would use, in this situation, I would try to
get them down under the market value even though
youre buying it on terms, because you need to make
money and I think thats a fairly good statement to do that.
Student: Would he not be bound and would be able to
go and have an accepting offer from somebody else when
he already has an agreement with us?
Joe Crump: The only way that would happen is if
you gave him the right to do that.
Student: Okay.
Joe Crump: Because he was uncomfortable tying it
up for that amount of time. We need more mikes.
Student: In this case where hes thinking he wants
$110,000, hes got $30,000 equity in the house. You
know whats he could with, say I dont know, 8 or 9
percent closing, whats to prevent him fromI mean what
would you say that he wouldnt just go and, say, get a
realtor and try to sell it that way and get, for instance,
cashed out verses all youre offering is a land contract?


Joe Crump: He could easily go to a realtor, because
hes got the equity to do it. Theres no reason for him not
to.
Student: Yeah, so what would we say in our case
Joe Crump: But heres the problem that hes got.
Hes going into foreclosure so hes got this motivation
happening with him. Okay, so hes got some stress on
him. Now hes got to decide, well, at what point the way
to do a quick sale in MLS is how? How do you do a quick
sale? Lower the price, right?
Student: Yeah.
Joe Crump: So if youre going to lower the price, but
he wants $110. So its not going to work.
Student: So its only because hes got the foreclosure
pressure that really brings a land contract deal into
looking more, plus are ability to sell the thing quickly.
Joe Crump: Right. Plus, you know now youre
buying on a land contract. You definitely show him how
much extra money hes going to get because of all the
interest hes going to make over the next five years on
this property.

Now another objection that youre going get on a deal like
this could be, well, I need my $25,000 or $30,000 dollars
out in order to buy another property. Well, thats a pretty
good argument. So how do you handle that situation?

You tell him, well, hows your credit? Well, my credit
stinks. Well, you cant get a mortgage anyway. Well,
what if their credit is good? Well, you can go get a 100-
percent loan.
Student: ______________
Joe Crump: He could refinance. He could refinance
and get his cash out that way. Ive had people do that.
Or he could out and get a 100-percent loan on a new
property. Well, will he qualify for both loans? Yes, he will
because he is selling the first one. And the bank, even
though the mortgage is still in his name, the bank will
allow 100-percent of the income on a sale to be applied


towards his income. Am I losing you guys? You
understand?

Okay, so the bank will allow 100 percent so it will be a
wash. Actually, it will show as a profit to him. That
property will show as a profit, because hes going to be
making more money than his $700 dollars a month. Hes
going to actually increase his income so hell be able to
qualify for more property.

Now if he were to rent that property out. Lets say he
rented it for $1,000 dollars. The bank only allows 75
percent of a mortgage or of a rental towards the debt
service. So they would only allow $750 dollars. In this
case this would still put him over $700 dollars, but that
doesnt happen in every case. You want to keep that in
mind. If youre renting it, it is only 75 percent that the
bank allows; if you sold it, it is 100 percent that the bank
allows. So that way you can qualify for other properties.
And youre going to hear that question a lot.
Student: Im sorry, I think I missed something real
simple in the very beginning. What did how much did
we give him to enter into the land contract? Anything at
all?
Joe Crump: Oh no.
Student: Nothing at all.
Joe Crump: No, thats me. I do zero.
Student: Okay.
Joe Crump: No money.
Student: Okay. I didnt miss something then.
Joe Crump: Right.
Student: And we offer to him $105, you said?
Joe Crump: I would offer $100.
Student: $100, okay. And for him to agree to that, hes
going to in the future get his money. Im just trying to
really fully see why he would take that other than the fact
that hes going into foreclosure. Because he may have
other people offering him something more than nothing.
Joe Crump: Well, whos going to give him full price?
No investor is giving him full price.


Student: I see what youre saying. So hes getting full
price, but in the future and thats the big plus.
Joe Crump: Right.
Student: Gotcha.
Joe Crump: He can go to a real estate agent right
now, drop it down to $75, and sell it in 30 days, get out of
that foreclosure, and not have late payments.
Student: Or full price for a future date.
Joe Crump: Eventually, hell be able to sell it at full
price if the markets good and hes accurate on his price.
So it may take him a few months to do that. In the
meantime, his credit is taking a ding. His credit is not bad
yet.
Student: ______________
Joe Crump: Why is he what?
Student: _____________
Joe Crump: Because he couldnt make his
payments.
Student: That was my one question. Why he went into
foreclosure _____________
Joe Crump: Theres a lot of people that know theyre
going into foreclosure that have never been late before.
And those are people that are trying to save your credit.
And youre going to get calls like this pretty frequently. I
lost my job, Ive been making my payments for three
months, but Im out, Im tapped out. Next month Im out
of money and Im going to be late.

Now these people are going to be really motivated. There
also going to be really stressed on this time issue. You
want to close 90 days, thats going to be hard. Id still try
it.
Student: If thats the case and this guy needs to walk,
and he needs $3,000 so that he can move into another
apartment, just pay off whatever other bills, would you
take that?
Joe Crump: Not at this price. If he sold it to me for
$75 on terms, I would.
Student: Well, lets say if Im the sell saying, Joe, Ill
drop it to $93, so Ill give you $3,000 cash.


Joe Crump: Well, then you got to make a decision.
The money that you get for your lease option is going to
get eaten up. So youre not going to close it, not going to
give him the $3,000 until you get it from a lease option.
Student: Right.
Joe Crump: So its not actually coming out of your
pocket, its going to come through the lease option. But if
you only get $3,000 from the lease option, you just broke
even. Now youre still going to get money on the back
end. If you sell it for $110, you still made a pretty good
profit.
Student: Right.
Joe Crump: But it is not for a year or two years down
the line.
Student: Right.
Joe Crump: So did that answer the question? Okay.
Student: I just remember you was saying he would
make interest on the house later on possibility. I just
wonder where the interest would come from? The seller?
Joe Crump: What payment on the interest?
Student: Right.
Joe Crump: Well, it depends on what his mortgage is
at. You know, lets say this property is free and clear,
because that will be easier. If it is free and clear, I would
do a seven-percent mortgage. Seven-percent simple
interest would be even better, because that means you
dont have to amortize it, you dont have to pay towards
the loan amount. So seven-percent simple interest, five-
year balloon. So in five years you have to pay the full the
amount, or whoever owns it at that time, will have to
refinance and pay it off. Hes out of the deal. Okay? And
the interest rate is arbitrary; you would negotiate that.

So if you want it to be you know if the going rate in
interest rates were nine percent like it was ten years ago,
then maybe youd negotiate at eight percent or nine
percent. Try to keep getting it down. Now if he had an
interest rate of 10 percent lets say his credit wasnt
great when he got the loan, he put 20 percent down, he
got a 10-percent, B-paper loan, bad-credit loan. Now his


payment may go from $700 to $900, and what youd have
to be careful of is that you dont get above what you could
rent it out for.

So if you give him $950, hell only make $50 bucks a
month, so it is not as attractive to him as far as the
monthly cash flow. But he knows hes got a problem loan
on his hands and he may still go for it. But just make sure
that your interest rate hes going to want to make sure
that his interest rate covers his payment. Although thats
not always true either.

Ive had people that have taken deals they took out the
second to pay off their credit cards, because that was real
popular for awhile. So they take out a second to cover
their credit cards and now theyre upside down in their
property. And theyll, Well, I owe youre going to buy it
for $105,000; I owe a $75,000 first and a $30,000 second,
so I owe $100,000 dollars on it. And the payments going
to be on 7 percent on $100,000, lets say it is $800
dollars. You know he owes $900 dollars month on his
_________, so $900 dollars a month on it. Have him pay
that $100 dollars to you, now. Dont expect to get that
money. Have it in the contract and try to collect it from
him, but dont expect.

But if youre then going out and renting based on
expecting to get that, you know getting that $100 dollars
back youll probably lose money. Youll probably have to
pay that $100 dollars yourself, because if hes in financial
problems to start with, the likelihood that hes going to
making that $100-dollar payment is questionable.
Anytime you ask people like that that are in these
positions to pay you money out, you may not get. I try to
negotiate it, but you may not get it.
Student: Hes asking $110 for the property, and you
offered $100. What formula did you use to arrive at the
$100 or did you just draw the number out of a hat?


Joe Crump: I pulled a number out of the hat. I felt
like I wanted to make more money on it. If I really wanted
to push him, Id go $90 or $85.
Student: Because Im just wondering if it is not
dangerous just to select a number _____________
Joe Crump: I think that it is going to come from a gut
feeling eventually. Where youre talking to the guy and
you find out how motivated he really is. Is he just blowing
smoke here with this $110,000 dollar thing, or is he really
motivated, does he really need to get out of this property?
And you have to make a judgment call. And a lot of that
comes from experience. And the more you do this, the
better youll get a feeling.

Because you may make an offer and he immediately
accepts it and you think, well, maybe should I have asked
for a little bit less. And then the next time you do it youll
have a better feel based on that same situation, because
youve done it before. It is just a process of learning. It is
really an arbitrary figure.
Student: _______________
Joe Crump: Whats that?
Student: That sounds familiar.
Joe Crump: Oh.
Student: Joe, I just had a thought on this. First of all,
he was asking you know how you picked that number,
and then I got a question. But you know what sometimes
you want to test the water. The house that I just sold that
I bought from Vegas. The guy was asking $37, I bought it
for $16.5. So you got to test the water. I mean that guy
might be blowing smoke like you said. You start at $75, I
would, in a subject-to. All hes going to say is yes, no, or
lets work on it. You know soits different; Im different.
Joe Crump: I agree.
Student: You know Id start right at $75.
Joe Crump: It is not what you deserve that matters, it
is what you negotiate.
Student: Thats right.
Joe Crump: So its to negotiate the best position you
possibly can.


Student: You know you got to take care of yourself, you
dont have to worry about this guy. You want to make
sure that hes youre helping him out anyways, but at
$75 youre really helping him out. Well, the question is
Joe Crump: Let me speak on that just for a second.
I believe that you have to approach this business with a
servant attitude where youre going there to help those
people. Now I believe that you should be paid well to do
that because you have the knowledge to do that. And
Ive said this to a couple of you here already, but if you
have if you need heart surgery, you do not want to be
cut on, you dont want anybody cutting on you. But if
thats what is going to save your life, youre happy to have
that done.

My dad had prostate cancer, and he just had his prostate
taken out a month ago. And we were all concerned. His
feeling was, I want it out, I just want it out. And they took
it out. Hes doing great. Its gone. No more cancer. But
he was happy to pay lots and lots of money to have that
done. Just like people are going to be happy to pay you
to take over and do this for them, because youre saving
them.

I talk to ___________ a lot. Let me get her comment on
this because I think what she has to say on this is pretty
value, kind of the (Laughing) kind of the attitude that
shes got on this.
Student: ____________
Joe Crump: About the servant attitude.
Student: When you go in and talk with these people
and you empathize or sympathize with them and let them
know that you are there to help them and you can help
them and let them talk, you earn their trust. And I just
Joe Crump: That doesnt mean that you should
negotiate your best deal.
Student: No, absolutely. And with this deal here I
would do as Dave said. I would explain to them that first
of all you got to pay a realtor, thats 7 percent, take that
right off the $110. The condition only says good. What


does that mean? Do you need new carpet? And let them
know well, what do you think you can carpet for? What
do you think you can pay for? Do you want people in and
out of your home? Do you want to deal with a realtor?
Theres a bunch of things here that you can tell this
person that brings the price down to a price where youre
going to make a profit, youre going to help them, theyre
not going to go into foreclosure.

And again, you just talk to them and let them know that
youre there to help them. And you help them with
information. You help them by learning how to do this
and giving them the information, letting them know what it
is like to list a property ________________.
Joe Crump: Tell them the story about how people
have reacted to you. I mean are people angry at you
when you do a deal like this, do they feel theyve been
taken advantage of?
Student: No, not all. I was telling several people here
about a deal we did, where a home a lady and a
gentleman, they were a couple, they called us. And they
had been trying to sell their home for five years, five
years. I went into the lady and I talked to her. She had
the home listed with several different realtors. And I
thought the monthly payment was pretty high, as she was
paying a high interest rate. However, she had good
credit. And I told her I would take the house subject-to,
again, after talking with her, listening to her, seeing her
child, looking at the house, the different things that you do
to build a relationship with this person.

Because when you build a relationship with this person
like we talk about ten minutes ago, if an investor comes in
behind your back they wont sell to them because they
dont trust them. So if you build a relationship with this
person I mean it is not a long-term relationship, but earn
their trust and let them know that youre there to help
them, it makes all the difference.



So this lady five years trying to sell her house. Jeff and I
went in, we told her what we could do for her. The relief
in her face was just unbelievable. I mean she literally
started tearing up and crying, five years Ive been trying to
do this, this sounds like a great idea, this is what I want to
do. And she was more than willing to refinance the house
to bring the interest rate down to get a better payment so
that we could take it subject-to and get a person in there
and make a profit. And this happened after a 20-minute
conversation.

So then the next day she called and she said, Well, my
husband and the realtor want to meet with you. And I
was a little concerned; we were fairly new at this. But the
realtor is sitting there and he was asking us how we do
what we do and all these different questions. And we
explain to him that we take over the home or we locate
properties for investors. And how we go about do it:
subject-to, making the payments, getting a person in
there, getting them qualified.

And the realtor is sitting there, and come to find out after
about ten minutes of conversation, this realtor had eight
lease-option homes. He had done this with eight different
people, but didnt help her. And we were floored. Bottom
line is we have the house and that realtor is no longer
dealing with them. But if you go in with the intention of
helping this person, listening to their need, not their want
but their need and how you can help them, it works great
for everybody.
Joe Crump: Everybody is going to be different on
how you deal with sellers. You listen to Azams deals, I
mean he just gets right to the point. You know he doesnt
screw around with being nice. I mean he just gets right to
the point. Everybodys going to be a little different, their
personality. But this is my mindset, this is where I go with
my deals when I talk with people. I want to do that I can
sleep at night, I want to know that I can be happy with my
life. I also want to know that I make a lot of money at this.
So I got to find a balance.



Were going to move on to the next one.
Student: ____________
Joe Crump: Go ahead. Go ahead. One more, one
more.
Student: ________________
Student: Which one? Ill go _________ ask my
question. Joe, something just popped into my head.
What if you got somebody with a variable-rate mortgage?
What happens then?
Joe Crump: Well, you have to prepare for it. You
have to prepare for that mortgage to change or they do if
it is going to be on a land contract. So theyre going to
have to everybody knows what a variable-rate mortgage
is. If the index goes up, the mortgage rate goes up. And
they have caps on them on how much they can go up. It
is usually two and six, which means that it can go up two
percent in one year, up to six percent over the life of the
loan on the interest rate.

One percent on a $100,000 dollars is about $70 dollars.
So if it goes up 2 percent in a year and it is a $100,000
dollar property, it is going to go up $140 dollars on the
payment. That can be pretty substantial. So if youre
paying him $900 and hes paying $700 and it goes up 2
percent one year, now hes up to $840, hes got a very
small margin there.
If it goes up again the following year, he could be in bad
shape. So then he would have to come out of pocket. So
he may not want to do it that way. You know, once again,
you have to negotiate that stuff and see if hes going to do
it and you have to be aware of it too. So that if you buy a
property like that you have to be aware that maybe that
seller isnt going to keep make those payments, or the
payments arent going to be enough to cover that amount.

But it may be a good enough deal to go ahead and accept
that risk yourself, because you know youre going to get a
decent enough lease payment on it. So if it does go up
and you can sell it in a year, or two years, or three years,


you just figure out what the numbers are and make sure
that it makes sense.
Student: Thats probably a good question to ask the
seller if it is a variable-rate mortgage.
Joe Crump: Well, youre going to know before it is
closed, but that would be a good question.
Student: Ive never even thought of it. That could really
screw you up.
Joe Crump: Yeah.
Student: Anyways, on to the next one, right? Sellers
Joe Crump: By the way, these are I do this
exercise Ive done it several times and this is the best
questions and the most questions Ive ever had on just
one. And Ive gone through the whole list in this amount
of time before. So congratulations for that. I think this is
great, its a lot more fun. Go ahead.
Student: The sellers asking price is $150,000. Oh, I
got to wait.
Student: Hold on.
Joe Crump: You need a napkin or something?
Student: ________________
Joe Crump: You got a napkin there or do you need
one? Do we have a napkin?
Student: _________________
Student: You ready? $150.
Joe Crump: Will you grab us a napkin?
Student: $150,000. The value is $150,000. Condition
is good. First mortgage is $110,000. Theres a second
mortgage on the property of $10,000. Payment is $1100
bucks. His alternatives to selling: he can list it with a
realtor or for sale by owner. But the guy hates the
realtors and he wont leave money on the table. Carry
terms ___________________.
Student: ___________________
Student: __________ on terms, yes. Late on
payments, no. And the guy says he wont leave money
on the table.

I think Id take if on this deal here, Id start right out with
a subject-to, and Id sit down and talk to him like Nina


says. And Id offer him the $120 on the subject-to. Hes
either say, yes, no, or maybe. But if hes really serious
that hes not going to leave money on the table, then Id
put a wraparound mortgage on the house or a land
contract, I guess. Or maybe he would take somewhere
between the $150 and the $130.
Student: ___________
Student: Anyways, I tried to put it on the land contract
and sell it out or give him the $150 if I had to. And then
sell it for $165, probably, on a lease option.
Joe Crump: You can tell Daves in the mentor
program. He knows this. Anybody disagree with what he
just said?
Student: Yeah, I disagree.
Joe Crump: Go ahead.
Student: See to me, I dont know.
Joe Crump: Speak into the mic please.
Student: Im sorry. I have no idea since I never did
this. But to me he doesnt seem to be too much
motivated if he wants to list it with a realtor and has the
time to do it or even to wait til somebody comes and
looks at his __________________
Joe Crump: All he is saying is try it.
Student: Oh, okay.
Joe Crump: Make the offer. The guy looks to me
like the guy is not motivated, but hes willing to take
terms. So hes willing to get payments on it. So that
doesnt necessarily mean hes motivated. You know, he
says, look, Ill just take payments, if I can get my full price.
If I have to sell it with a realtor, its going to come down. I
mean theres probably not enough reason for him to
accept that price, but it doesnt mean that we shouldnt
ask for it.
Student: If you dont ask, you dont get.
Joe Crump: _________
Student: And just one thing too that also if he would sell
it with a realtor. I mean hes got almost $11,000 dollars
that hed be tied up anyways so you could easily
negotiate $139,000 or $140,000 on it all so.


Joe Crump: Theoretically. But if he says, look, hey,
you know, Im taking terms, its not cash. You know I can
get cash if I do it this way. It just depends on it depends
on the situation. So much of this is situational.

Okay, lets go to the next one. Whos got the next one?
Were going to run out of time. _____________
Student: _____________
Joe Crump: Well just do as many of these as we
can.
Student: The asking price is $35,000.
Joe Crump: By the way, if you havent figured it out
by now Declons not coming today.
Student: _______________
Joe Crump: Yeah, hes in New York. Hes stuck in a
hotel. I talked to him last night and he wasnt particularly
happy. He apologizes to everyone.
Student: ________
Joe Crump: Sorry. Go ahead.
Student: Value is $55,000. Condition is fair. Needs
about $3,000 dollars to fix up. The first mortgage is
$20,000. Zero for a second. PITI is $200 a month.
Alternatives are list with a realtor. Carry terms no, late on
payments no.
Joe Crump: Youre the rehab guy.
Student: What I would try to do is try and wholesale this
to an investor. Get the investor possibly to pay cash.
Negotiate that price. If they have $20,000 in the first
mortgage, try to negotiate maybe $25,000 to $30,000.
And then try to wholesale it to an investor. Maybe assign
the deal for $3,000.
Joe Crump: How do you make money if youre
wholesaling? He needs $3,000.
Student: ______________
Joe Crump: Im sorry. Im reading that wrong.
Okay.
Student: When they would resell it.
Joe Crump: Exactly. You, as a rehab guy, what
would you have to get that property at to make it worth
doing?


Student: I could answer that.
Joe Crump: Let Rick. He does this.
Student: Basically, what I would want to make is
somewhere between on a deal sometime like this would
be between $15,000 and $20,000 dollars. So purchase it,
if theyre asking $35, wed have $38 plus your closing
costs, youre at about $12,000 to $15,000 right there.
Joe Crump: So what kind of offer are you
suggesting?
Student: I would offer somewhere around $28,000.
Joe Crump: Okay. So if you can get cash out for
$28,000. See if you can negotiate that. And if you could
it might even make sense for him to do the deal himself.
But there are a lot of investors that will take less than that
kind of profit, and you would assign those. And you wont
make as much money, $3,000.

And lets say you did get it for $28,000, does it make
sense to rehab it yourself? Say you have the money and
you can rehab it, you can buy it with cash, or maybe get
hard money loans, or you get somebody else to finance it
for you, get an investor. Does it make sense to do that
property and make the money or make the $3,000
dollars?
Student: It all depends on your situation. What youre
looking for in the deal, I guess.
Joe Crump: What would make it I guess it makes,
yeah. So its all going to depend on whether or notsee I
think it a lot of times makes sense just to make money
now rather than go through, especially rehabs. You got
all this money tied up, you got your cash tied up, you got
loans on the property possibly, and you got to wait maybe
takes a month, two months, three months to get the work
done, another two or three months to get it sold. So
youre in this six months with all your money.

Lets say you only have a limited amount of money and
youre able to do ten properties, youre going to stop. And
thats having a lot of cash. So a lot of times it makes
sense just to flip this property, move on to the next one,


and wait for the ones that make you $100,000 dollars
because those are out there too. Actually, Rick just did
one.
Student: Joe, can I ___________
Joe Crump: Sorry, go ahead.
Student: Can I - ________ lets say for $30, give them
$1,000-dollar option with a right to fix it up. Then I dont
have all my holding costs would be $200 dollars a
month.
Joe Crump: On a land contract.
Student: Not a land contract, just an option contract
with a right to fix up the property for $3K.
Joe Crump: Before I start sinking money into it, I
think Id want to have ownership rights rather than
options. Because those options are too easy
__________ in my opinion. So what I try to do, and
actually Ive done this, where we get a property on a land
contract because sometimes it is easier to convince
somebody to get a good price and get terms if it is a
short-term land contract. Just give six months and
interest free, and I dont have to make any payments, and
I got six months to fix it up. Theyre protected because
youre putting money into the property. So if you default,
you dont close the deal, they can have the property. So
thats a great argument for them.
Student: I dont know, as I see it, since the price hes
asking is really low, it shouldnt be absolutely no problem
to get a hard money loan and then $3,000-dollar repair. I
mean usually rehabbing starts about $10,000 - $15,000 at
least.
Joe Crump: This is a cosmetic repair.
Student: Yeah, this is like carpet and walls and maybe
outside paint or something. I mean that shouldnt take
like longer than month or two, max. Dont you think it
would make sense to take, like, even a hard money loan
and do it yourself, and then just sell it.
Joe Crump: Me paint, me do drywall, me clean
toilets.
Student: No, have somebody no, I mean I get the
hard money loan and somebody paint it.


Joe Crump: _____________ Im not being factious.
I am being factious, but I (Laughing) No, you have to
decide does this make sense for you. And I think when
you start out just take the money. Just move on to the
next deal. What Im trying to create here for you is a
paper business. Youre just moving paper. Youre not
even you dont even go to this property. You dont have
to go look at this property. You dont have to see what
the repair you get the investor to do it.
Student: The only difference is to me
Joe Crump: ________________
Student: - profit of $10,000 is a lot for you, its nothing.
Joe Crump: No, no. I just made this deal over the
phone. I can the time it takes me to do drywall and
paint and carpet, I could have done ten more deals or
more.
Student: No, I would have somebody already lined up.
Because I have people where I know they do this kind of
rehabbing. And they would be
Joe Crump: I think it is a mistake.
Student: Yeah?
Joe Crump: Yeah, yeah.
Student: All right.
Student: ____________________
Joe Crump: Especially when youre starting, Connie.
If you got the cash and you need to put it some place and
you want to make more money.
Student: So I just want to review this. The quick flip on
this would basically be youd say it is $35, needs $3,000,
so you offer $32,000. Kind of hold the three, then what,
you flip it with a $5,000 dollar assignment with $15,000 for
the new guy, the buyer. Or am I seeing that wrong?
Joe Crump: What were doing is creating a
purchasing agreement for, hopefully, $28,000 or more.
Student: ________________
Joe Crump: Maybe he just takes $35. Still a pretty
good deal even at $35.
Student: Yeah.
Joe Crump: So you take $35, you know youve got it
under purchase agreement now, you can close it within


60-90 days, you go and show that to your investor. You
can assign that to them. They pay you $3,000 dollars,
they close the deal, they buy it for $35,000. Theyve
already paid you $3,000. So they pay $38.
Student: Okay.
Joe Crump: All they have to is put $5,000 into it.
Now they can go out and now theyre at, what, $43. So
theyve got $12,000 dollars profit if they dont pay a
realtor. Its kind of marginal for them. But Ive seen
investors take deals at a lot less than that.
Student: How do you determine the $3,000 dollars?
Joe Crump: It is based on the amount of equity that
youve got.
Student: _______________
Joe Crump: Oh, the fix up.
Student: Yeah.
Joe Crump: Yeah, well
Student: __________________
Joe Crump: I ask him, Whats wrong with the
property? But then lets say the foundation is cracked
and it is a $60,000 dollar fix. And my investor goes over
there and says, Hey, the foundations crack. Lets be
more reasonable. Lets say it is a roof thats leaking and
its a $5,000 dollar fix. And my investor goes over there
and says, I would have bought that property but its got a
roof that is leaking. Thatd cost me five grand. I go back
in and say, Can you knock five grand off the price? I got
a contingency. Im out of the deal if he says no. I let my
investor decide whether it makes sense or not, whether
that $3,000 is real. You decide based on what your told
by the seller. And if the seller tells you an untruth, you
always have recourse to walk away and you didnt waste
your time going out looking at this property that you didnt
want to go into anyway because its got a leaky roof.
Student: Doesnt your investor get mad
_____________ something like that when you dont have
an idea what it really looks like?
Joe Crump: Ive never had a problem with that.
Nina, have you had a problem with that?


Student: No. _____________________________
thats what they do all day. Usually call them on the road
when you get a deal like this, give them the address
____________________________.
Joe Crump: Would that $38,000-dollar deal work for
one your people at $55 value?
Student: ___________________
Joe Crump: So even though it would be marginal to
us, it would work for another investor, right?
Student: Absolutely.
Joe Crump: Okay.
Student: Joe, you could even take that property and
make some serious cash on that. Because even if you
paid the $35 and you lease option it, youre holding $20 in
the back end. $20,000 if its worth
Joe Crump: If you fixed it up.
Student: If you fix it up. But why would you do a sweat
equity?
Joe Crump: Thats what I was going to bring up next.
Thats a great idea. But are they dont a contract, you
mean?
Student: Yep, yep.
Joe Crump: Okay, lets say you got it on terms. And
you got it for they were able to give it to you for $35,000
and they gave it to you on a land contract. That wouldnt
be a bad way to buy it. I mean it sounds to me like they
want to go to a realtor or they probably wouldnt do that,
but this wouldnt be a bad offer to make. $35,000 on
terms, 5-year land contract, and then turnaround and sell
it on a lease option, but a lease option with sweat equity.
You put an ad in the paper that says, Sweat equity.
Work for value, or whatever. Lease option.

So basically what youre doing youre still selling it to
them for $55,000, but youre allowing them to come into it
and do the work. And lets say it needs $3,000 dollars
and lets say it is a serious $3,000. Lets say its a
furnace and its got to have a furnace in there. What I
would do okay, you got to come in with $3,000-dollar
worth of work. That work has to be done before you


move in. Once I approve it, has to be approved by me,
once it is approved then you can move in as soon as you
give me another $3,000-dollars as a lease-option fee.

Now youre improving your property. Its your money
thats going towards that property, but it is going into the
property. And then you have to come up with another
$3,000 dollars or whatever that is, you can negotiate.
Maybe they dont have six grand, maybe they have four
grand. They could do three under the work and one to
you. Or maybe it just needs a furnace and cosmetic work
and just $1,000 bucks for the furnace and the other
$2,000 they can give to you. You just have to figure out
what theyve got to work with and make it work.
Student: How do you do that ______________
Joe Crump: The seller? How do you find out what
the buyer has?
Student: Yeah.
Joe Crump: Thats my question how much do you
have for down payment? In your ad youre putting rent to
own, sweat equity, how much do you have for a down
payment?
Student: Straight out.
Joe Crump: Yeah.
Student: They tell you that.
Student: Sure.
Joe Crump: Well, then theyll tell me, Well, I got
$2,000. Well, if you had $4,000 I could probably make
this work.
Student: Okay.
Joe Crump: Well, I dont know. I dont have $4,000.
Do you want to do it for $2,000? You know, I mean you
have to decide. It is a negotiation thing. Maybe it makes
sense to do it for $2,000. Say, well, you got to put that
$2,000 into the property. I still got $20,000 dollars worth
of equity. And Im going to get that money later plus they
just fixed up the property for you, and you got a tenant
who has money into the property. So thats a pretty
strong tenant to have.


Student: And why wouldnt raise the ______________.
Im sorry why wouldnt you raise why wouldnt you leave
it would you leave it at $55,000 when you sell it to him
just because he does the work?
Joe Crump: Lease option, yeah. ______ raise it to
$60,000.
Student: In this case would it be all right to have a
network of other investors, and you know someone who
likes to do the fix-up jobs. So you can put down the
__________ $38 and he can buy it. And pay you the
$3,000 fee and then he can take his time to fix it up and
sell it and you havent lost anything on it.
Joe Crump: Thats exactly what were talking about.
What were talking about is youre giving it to an
investor to buy it, hes going to pay you a fee to take it
over. So thats perfect, yeah.
Student: Joe, I know that some of the pride in some of
your methods are that you can buy properties that you
dont live by. Now what you just said over there was that
theyre going to make the repairs that you have to
approve. Does that mean that you have to go to the
property to approve them?
Joe Crump: It depends on where you do it. I mean if
youre it depends on how you do this. First of all, I think
its great to be able to do properties outside your area.
For anybody whos in the mentor program, Im going to
give leads that are all over the country. One, thats going
to teach you how to talk to sellers. Two, you might put
together deals as well, hopefully, if you follow what were
talking about.

Now at that point if you put together a deal and you find a
buyer, you have to decide is that property in condition, do
I want to mess with this situation, is it worth it for me to
drive out there, is it 100 miles away, is it 6 states away, I
mean how far is it? You got to make those decisions.
Student: So you say youre not going to advertise it as
a deal where the guys going to have to fix up the property
in order for you to approve it ________________.
Joe Crump: Exactly. _______ just dont approve it.


Student: Okay.
Joe Crump: Get receipts. You know do the best you
can. Have them send you a photo. I dont know, theres
other stuff you can do. You just have to use your head
and then some.

Lets move to another, lets move to one on this side. I
dont know if we have enough to dookay.
Student: Asking price $295,000.
Joe Crump: Am I wearing you guys out on this? Are
you understanding is this still helpful? Are we still on
track with this? Do you want to go til 4:30 instead of 4:00
or do you want to stop closer to 4:00?
Student: ______________
Joe Crump: 4:30, you want to do another half an
hour? Does everybody want to do that?
Student: Value $325,000.
Joe Crump: Okay, were going to go to 4:30.
Student: $325. Condition good.
Joe Crump: Unless we get thrown out. Will we get
thrown out?
Student: First mortgage $250,000.
Joe Crump: Whats that?
Student: No second mortgage. Monthly payment, PITI,
$2,225.
Joe Crump: They like this deal.
Student: Im sorry about that. It is $2,250. $2,250, Im
sorry. Alternative to selling: must sell. Carry terms, no.
Cash only. Late on payments, one payment behind, lost
job.

Now the way this is setup like it is, you know, $295 is
about 90 percent of its value. And you could make
something work with that, but considering since he
doesnt want terms, youre only going to work on a cash
deal. So if you got it for a cash deal at $295,000, you
know, youre still looking at 90 percent, which isnt quite
enough. Youre making $30,000 off of it. And if want to
do this deal, youd want to take it and assign it to
somebody else. And that means theres $30,000 profit in


it. And if you took, say, $10,000 that only leaves $20,000
for the investor to take.

But your best option would be try to work that asking price
down a little lower. If you got him to do it at say 80
percent, it would be $260,000 and the first mortgage was
$250,000. That gives him $10,000 he can put in his
pocket and gets him out of this deal, because you know
hes going to be hurting for foreclosure soon because hes
already one payment behind and he lost his job.
Joe Crump: _____________
Student: So you try to negotiate your best cash price.
Joe Crump: Exactly. Now this guy is a lot more
motivated that he thinks he is, because hes got to have
cash. He might go for terms on this deal. It might still
make sense. If you got this thing at $295 on a land
contract, it might make sense to do that, because you
could get a decent down payment. You got 5 percent
down, thats $10 grand. Five percent down is, how much,
$15,000.
Student: Yeah. If he says he only wants cash you
could say Ill put $10,000 cash in your pocket and take
over your mortgage and then you can go assign it to
somebody else. And with $260,000 you still got plenty of
profit to mess with and you can get $20,000 for an
assignment fee and still assign it to somebody else and
take $45,000 for the end investor with you putting still
$20,000 in your pocket.
Joe Crump: Right. So I think what youre saying
here is given two options.
Student: Sure.
Joe Crump: You know, say, you know you
understand Im an investor; Ive got to make money on
this deal. Theres two ways I can buy property. One,
substantially under market value, or two, on terms.
Student: Yeah, you really cant work the numbers that
he gave you.
Joe Crump: Whats that?


Student: You really cant work the numbers he gave
you. Youd have to work something, either terms or get a
better cash deal.
Joe Crump: And you have to help him understand
why you know, hes a payment behind. Hes credit has
already taken a hit. Hes got some equity there. I mean
he could put it on the market with a realtor but hes credit
is going to get worse and worse. And if he has one 30-
day late right now that only takes a year to recover from,
and hell be able to go get another mortgage.
Student: How many payments late does it take before
they start foreclosure proceedings?
Joe Crump: Depends on the bank. I had a guy that
a year and a half and hadnt paid, and they werent
foreclosing. It was a VA foreclosure that he bought. But
a lot of mortgage companies if theyre really on top of it,
you know three, four, five months before they start. Then
it will take them another, depending on the state that
youre in, another three, four, five, six months to get it
down. And then there could be a redemption period.
_________________ like that.
Student: And youd also have you have to get his
payments caught up before you took over his mortgage.
Joe Crump: Right. But lets say you got it on a land
contract for $295 and you had someone buy it from you
subject-to with 5 percent down, which is $15,000. You
make up the late payment; you still made $12,000 dollars.
Student: Sure.
Joe Crump: This could be a good deal. Whos got
the deal thats $1.6 million?
Student: I got it.
Joe Crump: Lets do that one. Because I want you
to see that the price does not matter, it is the numbers
that make the difference.
Student: Asking price is $1.6 million.
Student: __________
Student: $1.6. Value is $2 million. Condition is
excellent. First mortgage is $1.6 million. Second
mortgage zero. PITI $13,000 a month. Alternative is
foreclosure. Terms, yes. Late payments, no.


Joe Crump: Is that $13,000 dollars scary?
Student: Oh yeah.
Joe Crump: Why is it scary? Whats scary about it?
Student: If its yours it is scary.
Joe Crump: Is it your money?
Student: No.
Joe Crump: Why should it be scary? It is
intimidating.
Student: ________Can you find somebody who can
afford $13,000 __________?
Joe Crump: What if you cant find somebody what
if you make first of all, what kind of offer are you
making?
Student: Okay, I would do a subject-to. Hes willing to
do terms and hes only asking the value of what the
mortgage is. So you just do a simple
Joe Crump: He just wants out.
Student: He just wants out. Just do subject-to and find
an investor and Id take the rest of the year off.
(Laughing)
Joe Crump: Lets saylets go away from investors
and go to homeowners.
Student: Okay.
Joe Crump: When you get into these high-priced
properties, youre going to look for a homeowner. So now
you got to find somebody, you know somebody whos got
makes $30,000 or $40,000 dollars a year or $40,000
dollars a month.
Student: Sell it at $1.8.
Joe Crump: I mean thats half a million dollars a
year, thats doctors salary, good-paid doctors salary or
real estate investor thats one of my ___________. So I
would say that youre exactly right and it is just a numbers
game. If you dont find the person to buy this property,
what happens?
Student: ________________
Joe Crump: What happens is you give it back to him
because youve got the right to back out of this deal?
Student: I have two


Joe Crump: Youre not going to close it unless you
have somebody to give you money, and youre going to
get a nice chunk from them because five percent.
Student: Couldnt I ask him if he can make the next
two- to three-mortgage payments in case I dont find
somebody? I mean for the next two or three months,
cant I do that?
Joe Crump: Well, dont close it.
Student: No, no, no.
Joe Crump: But yeah that would be great, if he could
make a couple of months payments after you close it.
Student: Yeah.
Joe Crump: I mean if you can negotiate it.
Student: Because it is better for him than having his
credit damaged with this
Joe Crump: Yeah, absolutely.
Student: And I also wanted to ask what you think of the
idea if you dont find a homeowner able to move in to offer
that to a corporation? They have a lot of CEOs where
they can offer that to them, you know. Would that make
sense or?
Joe Crump: Sure. Relocate some kind of corporate
housing or rental.
Student: Yeah.
Joe Crump: I mean if you want if you could find a
corporation that had a high-paid CEO that they wanted to

Student: Yeah, or they take and buy it and just rent it
out for a year to each of their CEOs. I dont know.
Joe Crump: I just think it would take some legwork to
try to track that down. I think Id rather just run an ad in
the paper and put it into like the business journal of the
city. You know put it in the place where the guys with the
money, the local Wall Street Journal, put it in the place
where the people that have money are reading. Id put it
in the daily paper as well.
Student: I dont know. I would call some headhunters,
some high-rise headhunters, which deal with these kind of
companies.
Joe Crump: Yeah.


Student: There are people out there that make the kind
of money ____________________
Joe Crump: Oh theres a lot of them. A lot of self-
employed people that have gone through _________.
Student: ___________________ Why would you want
to pay a few months rent when hes actually just passing
off the property?
Joe Crump: It would be a tough negotiating, I think.
Student: Yeah. Thats what Im looking at.
Joe Crump: He might do it though just to protect his
credit. I think if the guy is ready to get out, hes going into
foreclosure in the next month or two months or whatever,
he doesnt have much alternative
Student: ________________
Joe Crump: Yeah, hes going to go jail. (Laughing)
Student: ___________________ For something this
expensive though wouldnt he be carrying considerable
risk taking on a subject agreeing to a subject-to
considering he knows the value is $2 million. You know
why would he you knowI was thinking maybe allow his
credit to be damage temporarily while he waits for the
thing to sell you know for a slightly higher price and he
gets cashed out and eliminates the huge, ongoing liability.
Joe Crump: Right. Thats not I mean thats a
consideration. But what if he offered it to you for $1.8
million on contract or $1.9, would it still make sense?
What if it was $1,950,000? What if it was $2 million on a
land contract, would it still make sense?
Student: Well, how would we make money?
Joe Crump: $2.1 lease option.
Student: I see.
Joe Crump: $50,000 dollars down. You can still
make money and give him his full price. It is exactly the
same as $100,000-dollar property except, yeah, an extra
zero. It doesnt make any difference to you. Since I keep
picking on Nina, theres another situation about what
was the $700,000 dollar?
Student: Yeah, we had a $700,000-dollar house and a
monthly payment was $4800 dollars.


Joe Crump: I mean she was having problems with
this. First of all, trying to sell it. Because you were trying
to sell it to an investor, right?
Student: I wasnt really sure what to do with it, but once
I put it out there I was looking for this investor wanted to
lease option this home. And I was going to take the down
payment to do it for him. And our house and this is the
most expensive house that weve handled at this point,
which was $700,000-dollar house, it moved in 4 days.
And it was somebody who was getting a large settlement
in six months but did not have the cash today to put
down.
Joe Crump: Average price in the town that she lives
is $125,000, so this is a high-priced property for that
neighborhood for that town.
Student: Yes. I was amazed. It happened so quick.
And you know $4800 dollar house payment I was just like,
wow, thats a lot of money, but it wasnt to these people.
They wanted to be where that house was located, which
is an area in Indianapolis thats very popular with people
that are self-employed or with high incomes. It is on the
water in Indianapolis. And this house moved very, very,
very quickly. It was amazing.
Joe Crump: One of the highest percentages of
people that go bankrupt are doctors that are brand new.
Now they suddenly have a $300,000-dollar-a-year income
and they go and buy everything, because theyve been
living on $25,000 dollars a year for the past 7-8 years.
Theyve got this huge debt because of their school bills,
which theyre not going to get rid of even in a bankruptcy.
But they get themselves in a real mess because they feel
like, oh, now I make money. Now I finally have the
money. And they go and spend it.

My sister-in-law is a cardiologist and I remember her
talking about this and this one of the things that they
warned her about as soon as they as soon as she got
through her residency. So theres a lot of people with big
incomes that have terrible credit and thats something to


remember, and something that makes this type of
property attractive.

Why dont you do one?
Student: Sure.
Student: Okay, we got another one here.
Student: Asking price is $60,000. Value is $90,000.
Condition is poor. It needs $5,000 dollars to fix up. First
mortgage is zero. Second mortgage is zero. Monthly
payment is zero. Alternatives are list with a realtor or for
sale by owner. Terms, no. Late on payments, no, since
there are none. (Laughing)

So Id probably try to get this for like $50,000 on a
subject-to and sell it to an investor for maybe $70,000
with the investor
Joe Crump: Let me stop you just for a second.
Student: Yeah.
Joe Crump: Theres no mortgage on there.
Student: Okay.
Joe Crump: So can you do subject-to?
Student: Oh, Im sorry. You mean just buy it with a
land contract.
Joe Crump: Exactly.
Student: Yeah, okay. But then, okay, yeah.
Joe Crump: By the way, if youre in a trust-deed
state - theres mortgage states and theres trust-deed
states. If youre in a trust-deed state, its called a contract
for deed.
Student: Okay. But Id still, yeah, try to get it for like
$50,000. Sell it for $70,000 to an investor with him
picking up the $5,000 in fix ups.
Joe Crump: That would be a nice place to start.
What if they wouldnt accept the terms?
Student: The $50?
Joe Crump: He says he wont accept terms.
Student: Oh, I see what youre saying. Well, you can
still make money if you gave him $60,000, a contract for
$60,000.


Joe Crump: Right again, you put the right choice of
negotiating down to the best-case scenario or what you
think might be the best-case scenario and then moving up
from there.
Student: _________________
Joe Crump: Yeah, I mean I think it depends. This
condition poor, $5,000-dollar fix up. I think Id start
questioning about it. Why is it so poor? Is it the furnace
is bad? Is the roof leaking? Sometimes theyll just say,
Oh, it just needs carpet. You know, its really a mess
and I got so much stuff here. That maybe all it is. Or
maybe, well, the porch is sinking into the ground because
the foundation is a mess, and then I had this tree that fell
on it. That one wall is gone. Actually, a fire and its kind
of an empty shell and it actually has to be torn down.
Student: So are you going
Joe Crump: But it should cost about $5 grand to fix it
up. I can get my brother to come in.
Student: _______________
Joe Crump: (Laughing)
Student: Going back to what you were saying about an
investor that comes in and finds out it cost more to fix it,
and youre not really concerned about that, but how does
that have any
Joe Crump: Well, lets say an investor came lets
say you negotiated a price, they told you it was okay, the
price. They told you, okay, well take $50,000 for it, cash.
You send your investors out there. They realize that the
house has been burned out and it would have to be
completely replaced, that it is not worth $10,000 dollars
let alone $50,000. You can go back to that person
andif it something like that Id just say, No thanks.
Student: Forget it.
Joe Crump: But if it was maybe $10,000 dollars
more worth of work. You know well see foundation
issues, or you know maybe theres a septic system and
that septic has a bad finger system and it has got to be
replace and thats $5,000 bucks. I mean in my course I
teach some about inspections. Somebody asked me,
well, you dont do inspections, why do you teach


inspections? Because to know whats possible here
would be very helpful. And if you dont go through my
program you need to go over to Lowes and walk down
the aisle and find out how much it costs to do things and
go through a house, and learn how to do an inspection,
and learn all the different functions of house. The
electrical work, go and turn on the lights to find out if the
electrical works.

I mean there are things that you can do that are basic.
Turn on the water to see if the water is running. Flush the
toilets to see if it flushes. I mean these are really basic
things you can do to find out if it is probably reasonable to
think that those things are okay. If you flush the toilet and
you go downstairs in the basement and a bunch of water
has just been flushed down there, you know you got a
problem. And same with the septic system. If you run the
water, if you know they got a septic system and you run
the water for a half an hour and you go outside and
theres a big puddle out in the backyard, you know that
the finger system is no good. For those of you who live
in septic areas.
Student: Even when you see or hear that the condition
is poor, would you still say Im not going to check the
house even if it is not physically possible?
Joe Crump: Exactly. I dont go to see the property,
especially an ugly one.
Student: One quick question. How do you check the
condition of a vacant property?
Joe Crump: Well, the seller is going to have a pretty
good idea. I mean lets say the seller is in California and
the property is in Texas, youre in Indiana. And that point,
youre just going to have to say, well, last time you were
there, how long ago was it? Well, it was a month ago.
When you were, what kind of condition was it in? Has it
been broke do you have anybody in the neighborhood,
did you have any family members there? No, weve all
moved. I dont know anybody in the area. How are you
going to get rid of this property? I want to find out what
the deal is with the property.



And they say, well, why dont we go ahead and put the
deal together and Ill send my investor of there. And if
theres something really different from what you told me it
was, you know if it is in a really nasty neighborhood, and
all the windows have been knocked down, broken into,
and played in by kids and sprayed painted, you know you
can get a better price on it later. And those people will
lower the price more than likely, if theyre able to. You
know if they dont have a mortgage to keep them from
doing that. And if they do and if theyre not willing to do
that then just dump it. Go on to the next one.

Whos got another one? Whos got another deal? How
many more people have deals we havent done? One,
two, three. Okay.
Student: Okay, this ones asking $155,000. Value is
$220,000. Condition is okay with a first at $105,000. No
second. $950 monthly payment. Alternatives are he
could keep and hes got a tenant that pays $1,000 dollars.
He will take terms and hes not late on payments.
Joe Crump: How much does the tenant pay?
Student: $1,000.
Joe Crump: $1,000.
Student: SoI guess in looking at this my approach
would be to you could offer a land contract at $155,000
and just keep the thing I guess.
Joe Crump: That monthly payment is $950, right?
Student: Yeah.
Joe Crump: Thats on his $105,000 though. If he
sells it for $155,000Im sorry what did you say? Did
you say contract or subject-to?
Student: Land contract.
Joe Crump: Okay. So land contract at $155,000.
Student: Yes.
Joe Crump: The payment is going to be higher than
the $950. Its going to be higher than the $1,000 dollars a
month that they pay. So hes going to have a negative
cash flow if he does that, if that tenant stays there.



Wheres the mic?
Student: I was saying that the rest of the property
would be empty so there would be a vacancy whether
youre going to occupy it or rent it.
Joe Crump: Make it vacant before closing. Is that
what youre saying?
Student: Yeah.
Joe Crump: Yeah. Make it vacant before closing.
Put that in the contract. Because otherwise make the
tenant the first give them the opportunity to go up and
rent, you know to buy it from you on a lease option. But
you want to check on that tenant and see if theyve paid
on time. If theyve been paying on time for the past six
months, and all you have to do is ask for check stubs to
see if theyve been paying on time. Although, they may
just give you a money orders and I havent gotten that.
Student: So my first suggestion in this case then what
would you write a land contract for something slightly
lower than the asking and then resale it on a lease
option?
Joe Crump: Exactly.
Student: To a new tenant probably.
Joe Crump: To a new tenant
Student: Unless the existing tenant would you get
them to take the rent increase.
Joe Crump: Only if that tenant can prove that theyve
been paying on time.
Student: Yep.
Joe Crump: Okay. And then negotiate something,
whatever you think you can get for that property. Do you
have something?
Student: Yeah, I was just wondering about the land
property part. Is there more benefits from that because
______________ I see that we do the land. When you
offer a land contract you can do it at the price that their
selling if the value is up high. Is there more
Joe Crump: Yeah, you could probably pay $220,000
on a land contract. But see theres no reason because
theyre willing to take terms and theyre asking $155,000.
So all Im saying is try to negotiate even better than that.


Student: Okay, so whats the difference between the
land contract? Whats a land contract?
Joe Crump: And a subject-to?
Student: Yeah, the difference between them.
Joe Crump: Okay. Subject-to is where the deed
transfers. You got a deed, youve got Okay, so you
understand. Does everybody understand how subject-to
works? You have the deed and it transfers to you if
youre the buyer. You actually own you actually have
the deed in your name. That property is your property in
your name.

Land contract, the deed stays in the name of the seller.
When you create a land contract that takes the mortgage
or equity or whatever is there. If it is all equity or if it is
mortgage in an equity, it wraps it all up together and
theres a note for a certain price point that you are
agreeing to pay that seller who owns title. And as soon
as you pay that note off - its not a note, its a land
contract as soon as you pay that contract off, then that
deed is transferred to you. Does that make sense?
Okay.

Ill hold it for you.
Student: I was just wondering if how do you separate
the two? The money that ________________.
Joe Crump: Youre as bad as Nina. (Laughing)
Student: You have you owe the gentlemen $105,000.
Joe Crump: Okay, owe him $105. He owes $105.
Student: Right, he owes $105. And he wants $155. So
theres $50,000 dollars difference.
Joe Crump: Right hes got $50,000 dollars of equity
that he wants to get out of that property.
Student: And hes making $950 on the $105.
Joe Crump: Correct.
Student: Okay, so then when you figure out what youre
paying him
Joe Crump: Hes paying $950.
Student: Hes paying $950.
Joe Crump: Right.


Student: So the $50,000 thats leftover, hes going to
try and use so much interest and you just figure out the
$50,000 how much hes going to charge interest.
Joe Crump: What youre going to do is youre going
to base
Student: ____________
Joe Crump: - Youre going to base your interest on
your purchase price on a land contract. So $155 on
$155, were going to look at first you have to decide
whether youre going to amortize that money or if youre
going to do a simple interest. Simple interest is where
you pay interest only. So lets say 10 percent if youre
paying 10 percent interest on a $100,000-dollar property,
10 percent of $100,000 is $10,000 dollars, right? Divided
by 12 is whatever it is.
Student: Okay.
Joe Crump: Okay, so that would be the monthly
payment, if it was interest only. Now if it was a 30-year
amortized I cant do these in my head. But if it was 30-
year amortized, you would not only pay the interest that
$800-some dollars interest, whatever that is $10,000
divided by 12, but also youd pay enough principle
towards the purchase price in order to start buying down
that loan. So after five years it will be bought down a little
bit, not very much probably $50 bucks a month or so.
Does that make sense? Does that answer the question?
Student: So you just go by the $155 and figure out the
interest rate on that.
Joe Crump: Right, right.
Student: __________ five-year period. _____________
Joe Crump: You can whatever is negotiated in the
contract. You can negotiate a 30-year land contract, if
you wanted to. It is whatever you negotiate. It could be
just a one year. Maybe its a rehab that you know an
investor is going to take it and you do a six month,
because you know theyre going to turnaround and sell it.
See this property is okay condition, maybe it needs a little
bit of work and it would bring the value up to $230-$240,
maybe an investor would want to take that and buy it from
you for $265 and its got a 6-month contract. They just


gave you $10,000 bucks; they have now a land contract
that in six months they have to pay off of $155. They do
the fix up, sell it for $230. That might be something that
might be interesting for you to do, because theres a lot of
equity there.
Student: It seems to me that the land contract is more
in favor of the seller than the buyer. So in a case like this
why would you not take it subject-to and then offer a
second mortgage for the extra $50,000?
Joe Crump: You could do that. You could do second
mortgages. I dont lets not get into second mortgages.
Student: __________________
Joe Crump: Yeah, but they want their equity. They
have $50,000 dollars of equity.

Okay. So we got one more. Okay. Or is it two more that
we got. Oh, Gregorys got one too.
Student: Okay, weve got an asking price of $110,000.
Value is $110,000. Condition says habitable.
Student: Say that again?
Student: Habitable, which would indicate to me it needs
some work.
Joe Crump: (Laughing) Just a little.
Student: First mortgage
Joe Crump: Actually, what habitable means is that
you could live in it. Azam, are you in the room? We were
doing our challenge thing and hes talking on the phone to
this guy. And the guys telling him how terrible the
condition is, and he says, Well, is it habitable? Well, Im
living in it.
Students: (Laughing)
Joe Crump: Well, okay. That was not really the
question. (Laughing) Habitable would be considered, you
know, that the windows are in placed, its got a furnace,
its got plumbing, you know its got electrical. It could
have a furnace thats 30 years old and ready to die but it
is working.
Student: Hes got a first mortgage of $50,000. Zero
second. PITI is $450. Alternatives to selling could be


renting for $1200 or he could list it. Hes willing to carry
terms. Not late on any payments.

Well, I made the assumption that its anywhere from $7K -
$10K, maybe even $15K of work needed to make the
house more than habitable. So I was thinking of a land
contract offer for $85, which would then allow the $10K to
$15K in there for fix up and then youd have money for an
investor to come and still make money, if they took it over
and did the fix up.
Joe Crump: I think Id try to get that price a little bit
than that. I guess it depends. Did you say $15,000 for
the work?
Student: Yeah, $10 to $15.
Joe Crump: Okay, so that puts you at $100. I guess
that only gives you $10,000 profit.
Student: Yeah.
Joe Crump: So youre going to need more than that
if youre going to do it as a fixer up. Although, you might
be able to do it as a sweat equity lease option if you got it
on a land contract. So if they sold it on land contract for
$85 and then have the person come in and do the sweat
equity, and maybe they can make it acceptable/habitable
for $7,000 rather than $15,000. It doesnt have to be the
Tajma Hall. So you got to make a judgment call on that. I
think that makes sense.
Student: Either that or come up with some good two
and a half inch caulk and fix everything.
Joe Crump: (Laughing) Very big holes. One more.
Student: This is pretty high priced house
Joe Crump: Is Azam out there?
Student: - asking price is $850,000. Value is $900,000.
Condition is excellent. First mortgage from this is $750.
Second is $25. And monthly payment $6,450 dollars.
Alternative to selling is foreclosure. He will carry the
terms. And hes late on just one monthly payment.

Well, in this case I would probably start with the subject-to
for $775,000, but it is probably unlikely that he will accept
it since the difference between what he owes for his home


and what hes asking is $75,000. So its a pretty
substantial chunk of equity that people dont want to throw
out. So the second option
Joe Crump: Yeah, dont assume that though. Lets
assume that hell come down. Even though our natural
reaction is and this guys you know hes a corporate
lawyer and hes a hardnosed guy and hes going to stick
to his price, but hes in foreclosure.
Student: Yeah, hes pretty desperate in his position.
Joe Crump: ___________
Student: I mean that would be my first offer. But the
second offer would be a land contract for $850,000 and I
guess this would be 5-year term for 8 or 7 percent. And
Ill just be asking for interest rate until the end of five
years or ten years, whichever we decide to negotiate.
Joe Crump: How would you sell it?
Student: I think the lease option, selling somebody for
$950,000 or $1 million dollars on a lease option is the way
to do it.
Joe Crump: Good. With how much lease option
fee?
Student: Lease option, well on this size of a house
$20,000 or $30,000, somewhere in there.
Joe Crump: Try for five percent. Try for five percent
on higher pricing. You may not get it but _____________
nothing to complain about.
Student: _________________
Student: So I was going to say in a prize like this youre
talking executive level. Most those people dont play with
the contracts and seller financing. They usually have
their chunk of money and ______________.
Joe Crump: You knowno, no, its not true.
Student: _______________
Joe Crump: He cant make his payment. He cant
make his payment. See youre thinking about, okay,
theyre rich. They live in a $900,000 dollar house; hes
rich. Hes got lots of money.
Student: I mean the person coming in.
Joe Crump: Im sorry.
Student: The new buyer.


Joe Crump: What about the new buyer again?
Student: Youre not going to be able to do a lease
option. Im thinking theyre going to say, you know, I
qualify. Theyre not going to be looking for terms.
Joe Crump: No. Ive done it. $1.6 million is the
highest Ive done. I did a bunch of these in the Hollywood
Hills.
Student: Yeah, people forget that the American way is
living paycheck to paycheck and doesnt matter if they
make a million dollars a year. Most people are living
paycheck to paycheck, because theyre living above their
means. And thats the big thing that you keep harping on
about. Dont look at how big the numbers are because
its the same. People are the same no matter what.
Joe Crump: So somebody asked me at lunch, we
usually live above our means. So somebody asked me at
lunch, you know, I can pay off my house. Should I pay off
my house or should I keep that money to invest in
property? What do you think my answer was? Pay off.
Pay off the house is my __________. See if you keep the
money if you pay off the house you can always get an
equity line against that property, if you have to have it.
But if you force yourself into a position where you cant
put money down, you wont put money down.

You know how do you think I learned this stuff? I learned
it because I didnt have any money and I didnt have any
credit. So you dont spend money on these deals and
dont ever think that you should spend money. Dont ever
even consider spending money. Well, hes four months
behind in his payment and you know its going to cost me
money to close this deal. Man, Id have a hard even if I
had some decent equity in it, Id still have a hard time
coming out of pocket with a few thousand dollars. I would
really baulk at that. I want to see some money happening
now to cover the costs.

Now sometimes it makes sense. If there was just a you
had a $100,000-dollar property and you were able to have
a $70,000-dollar mortgage, and he was willing to take it


you know he let you takeover the loan subject-to and it
was, you know, six months behind in payments, it still
might make sense. I mean thats $76,000 I mean you
still have some equity there. It would probably have to be
even less than that for me to want to do it.
Student: I think Im starting to get this but Im still a little
slow. So subject-to at $775 is by far the better deal rather
than going with land contract, right, because doesnt that
allow more people to get in later?
Joe Crump: Exactly.
Student: Okay, so if youd want to try to get them to
do a subject-to and only if they wouldnt, when would you
then decide whether or not you wanted to do a land
contract verses say just skip on the deal on something
like this? Youre going to have to if you do a land
contract, youre going to have to turnaround and
buildsell this for at least ten percent above value, right?
Joe Crump: If you got it on land contract, and that
land contract was assignable, and you got it for $850, and
you sold it for $900, youd make $50,000 dollars, and you
could walk away from the deal. Youre still buying you
could probably sell it for even more than that. So you
could turnaround and sell it on lease option. I think it is
probably the best way.
Student: But that would only be if youre assigning the
land contract to an end user. Thats not to an investor.
So thats the difference.
Joe Crump: Correct.
Student: But weve been talking about selling these to
investors, not trying to find end users, right? Or is that all
part of the mix?
Joe Crump: No, the high-price properties, were
going to look for the end user.
Student: Okay.
Joe Crump: And actually finding lease-option buyers
that are going to live there if Im doing lease options, Id
like to have those people living there rather than have an
investor buy it. Id much rather see somebody whose a
homeowner be there, because theres going to have a lot
more at stake. An investor, they can walk away a lot


easier. So were going to focus on if were doing lease
options, were going to focus on people that are going to
live there.
Student: So but in your
Joe Crump: But that doesnt mean that we dont
present that to investors as well. But when we start
getting over $3, $4, $500,000 dollars its going to be hard
to find any investor whos going to pick up that kind of
property unless theres real substantial equity in it.
Student: Yeah, but in your program you know on the
marketing side of this program, you concentrate mostly on
bringing in finding investors rather than finding end
users.
Joe Crump: Correct.
Student: Or finding end users that can come in with
zero down.
Joe Crump: Im looking for end users that have
money.
Student: Yeah.
Joe Crump: I want somebody that
Student: Because hes got to give you $50,000, for
instance in order to
Joe Crump: Now one of the things that we do is we
bring in investors to get on our list. Those investors,
theyre going to be good for us for quite some time,
because theyll probably be investors for a long time.
Lease option, we can also advertise for lease-option
buyers and bring those into the list. But theyre only going
to be a very, small window of time when theyre going to
be interested in lease option because theyre going to go
find a house.

So that list isnt going to be as effective and its not going
to be long term. Its not going to last as long and you
have to replenish it constantly. Whereas an investor list,
you can build those guys. And somebody may not buy for
a year, maybe three years down the line they finally buy
something from you. Or maybe they buy something
besides the house from you that you monetize your list


with. You know maybe an affiliate program that you sell
something else.

Having that list is such a powerful, powerful thing. You
know this list builder thing that were doing, Ive been so
excited about it because what Ive done is taken I spend
an hour and a half or so on the phone with everybody and
talked about what the value is of a list, you know how to
develop that list, how to get people on the list, how to
make it work, what software to use. And then Im going to
take whats called screen capture software. It makes a
movie of my computer screen. And Im going to talk into,
Im going to show you how to use text pad to build a
database, and how to use mail bomber to create the
mailings out, and how to create use text pad to create the
template for the newsletter every week to this list, and
also to show you other ways that you can monetize this
list.

This is way I did this internet thing with this because I
think it is so integral. You can once you have a list
any direct marketer that you talk to makes a lot of money
on his list. My list is worth millions of dollars. My half a
million people on my list is worth millions of dollars and it
is going to make more than that over the years. So if I
was going to sell it, I was going to sell it for a lot of money
because its going to keep making me money over and
over. If you build this list, it is going to give you residual
income.
All you have to do is send the mail out and you get
money. Its beautiful; its a beautiful thing.

So you can sell your properties to those people, you can
sell other peoples properties. You know, lets say I took
somebody off Ninas 40 houses on her list and I put it on
my list, and I sent it out to my investors, and those
investors raise their hands and say Im interested in this
one. You connect them with Nina. She pays you a
referral fee if they buy the property. And it may be one
that shes getting a referral fee for, so she gets part of the


referral fee, you get part of the referral fee. You know
maybe you make $250, $500,000 dollars depending on
what the deal is and whether it makes sense.

Theres going to be other investors that are going to be
willing to do that with you as well. And what Im trying to
do is create a database and a mastermind of people that
will work amongst each other. Because for me, one of
the most valuable things in this whole process is
masterminding. You know I learn so much from my
students. A lot of the stuff comes out of their
experiences. You know

I used to tell students, dont run this ad in the freebie
papers, you know the thrifty nickel, the penny savers. I
ran an ad there a bunch of times; I didnt have any luck on
it. And then Rick goes out and runs it, but he puts five
ads in. He puts one in the homes one, he puts one in
north section, east section, west section, south section.
Cost him the same as the daily paper and he got the
same results. So he just doubled his results; he got
double the amount of calls now. Cost him twice as much,
but was able to do it in the same area and double his
results. So I changed my opinion about that.

Whenever I say anything absolutely, positively is going to
be true, somebody, one of my students goes and does
something different that whacks that out of the
neighborhood. And thats what is so neat and whats so
valuable. And these things that are in my program are
coming out 90 percent of it come out my experience,
because Ive been in it such a long time. You know Ive
done hundreds, literally, hundreds of millions of dollars in
real estate transactions over the last 20 years.

I dont know anybody that has more experience than me
in residential property. Sure, theres people in
commercial property, theres people in large, multi-family
buildings that have different types of experience, but I
dont know anybody that has more experience than me.



When I started I had a mentor in my business. Im above
my mentor now. I got another mentor and I am not above
that mentor. Then I got another mentor and I went above
that mentor. I want to find I keep looking for mentors
that I can keep reaching. Theyre going to keep taking
me to the next level. So I try to find people that will do
that for me in my life. And although Im not doing it in real
estate right now, although my mentors are my students,
but Im not doing that so much in real estate going out
and looking for guys that know more than me, because
theres not that. But theres this group mind that has this
energy that creates exponential power and thought and
Im getting esoteric here, but its true.

I dont know if you guys you put two people together,
put their minds together, it is way more powerful than
having two people thinking. You get three people
together you know Azam and I will sit at the Steak and
Shake. Meet me over at Steak and Shake at 9:30 tonight
and will have a shake, and we end up talking til one or
two in the morning about what were doing next. I mean
thats where we developed the challenge. Heres how
were going to do it, heres how were going to make it
work, heres how were going to play it out.

You know I want to try this, oh but what about this, or
what about that. And then Phil got in the mix, and then
Nina got in the mix, and Rick got mix because they would
throw in ideas because wed be talking to them about this
stuff. And wed figure out how to make this thing work.
So I mean the concept for that was to make this refutable,
powerful claim that this can be done anywhere in the
country, any price, any type of market up market, down
market, doesnt matter theres motivated people
anywhere you go, and to show that.

So that mastermind has group because Ive been in this
process sort of when I started this I kind of went off on
my own and Ive been very insular, Ive been veryits


just been me. It just was me for a long time thinking up
these ideas. And it was working. I made money, the
business built. And then I was in my office just typing
away and talking to people on the phone, but it was just
me. So when I brought in other minds, you know when I
found people that were thinking on the same path that I
was, I started latching on to those people. And some of
them latched on to me. And it built around me, mostly my
students. And we created this kind of inner circle of
people that work together.

I want to keep expanding that. I want to keep working
with people. I want just for my needs I want that. But I
also think thatI think having a mentor, having a
mastermind, it is much easier to join one than it is to
create one. And if I had this to do over again, I would join
one. I would find the best people I could and I would join
it.
And it doesnt have and I tell this to you guys, it doesnt
have to be me, it doesnt have to be my mastermind. It
doesnt have to you dont have to come do this with me.
Im saying whatever you do, do it with somebody. Do it
with somebody thats above you, somebody and Im
talking about with this knowledge, not any other level of
above but with this knowledge, somebody who
understands this process better than you do. Do it with a
group of people that will make your mind start to snap and
things will start happening for you, because it will change
your life.

You are who you surround yourself with. Youll become
the people you surround yourselfif all you do is go out
and drink beer with the buddies and watch football, its all
youre going to become. If all you do is, you know in
college is smoke dope and do that, I mean thats all
youre going to become. Youre not going to go any
further. So the whole idea here is - you know they say
you are what you eat, but you are what you think too.
You are what youre around. Theres an energy that


everybody youre around will throw out there and you
want to be able to absorb it.

So with that said, I think were done for the evening. I
would like you guys the ones that feel that this would be
a value to them to join us and to become a part of this
mentor program, this mastermind program. I think you
know what it includes. Ive gone over that this morning. If
you dont know, ask Azam or I. Well tell you all the
because it includes an awful lot of stuff. I mean theres a
huge amount of materials and theres some bonus. You
know were going to give leads right now because of the
seminar. I want people right now to do it. But I want you
to do it only if it is right for you.

I think that you know in your heart whether this is right for
you or not. And if it is not, dont do it. Because youre
just going to waste your time, your money, and youre
going to waste my time. And youre going to create a bad
energy in the group and I dont want that. So keep that in
mind. Come see us in the back. Azam and I are going
be back here. Ask us questions if you want.

I really want to thank everybody for coming. Its been
you know Ive spent a lot of time with you guys over the
last it seems like Ive know Im getting to know
everybody because we had drinks late last night,
everybodys going off in different directions. Im hearing
stories about Hooters, and Im hearing stories about two
in the morning dancing things, while Im sound asleep.
So it sounds like it has been a fun weekend for a lot of
people. And I hope it has been educational for you. I
hope that youve walked away with some good stuff. My
goal here was to give you just a ton of content and to give
you as much information as I could in the time. And then,
hopefully, get some of you to join and work with me in the
future.

So thanks a lot.
Students: (Clapping)


[End of audio]





Appendix

Every Contract And Form In This
Book Is Here

Property Profile Sheet
Inspection Form
Purchase Agreement
Counter Offer
Inspection Response
Investor Agreement
Investor Qualifying Sheet
Quitclaim Deed
Tenant Application
Lease Agreement
Investor & Buyer Qualifying Sheet
Option To Buy Real Estate (used in
conjunction with lease for a Lease-Option
Sale)


Property Profile Form


Where is the property located?


How much do you want for it?


What kind of condition is it in?
Do all of the major functions (mechanicals) work?
Furnace
Water Heater
Roof


How long have you owned it?


How much did you pay for it?


Do you have a mortgage, if so, how much do you owe?


How much do you think it is worth? Why?


Why are you selling?


Are you moving out of the area?


Do you have to sell or would you consider keeping it?



Inspection Form

ROOF Inspected from _____________ Covering_________ No. Layers______________
Approx. age________________ Vents_________________ Chimney Mtl.______
Flues________________________________________Facia_________________
Roof Covering__________________________________________________________________
Flashings______________________________________________________________________
Vents_________________________________________________________________________
Valleys_______________________________________________________________________
Ridges________________________________________________________________________
Gutters________________________________________________________________________
Chimneys_____________________________________________________________________

EXTERIOR Siding______________ Masonry________________ Trim____________
Doors___________________ Windows___________ Storms/Screens____
Electrical svc_______________________ Raceway/cables____________
Siding________________________________________________________________________
Masonry______________________________________________________________________
Trim__________________________________________________________________________
Doors_________________________________________________________________________
Windows______________________________________________________________________
Crawl Space vents_______________________________________________________________
Basement wells_________________________________________________________________
Eaves_________________________________________________________________________
Electrical______________________________________________________________________
Hose hydrants__________________________________________________________________
Lighting_______________________________________________________________________
Receptacles____________________________________________________________________
Other_________________________________________________________________________

SITE-GROUDS Walks___________________ Steps______________ Patio______
Porch_______________ Driveway____________ Culvert___________ Ditches_______
Swales_____________ Retaining walls____________________ Fences______________
Evidence of buried tanks______________ Out-buildings__________________________
Driveway______________________________________________________________________
Walks________________________________________________________________________
Steps_________________________________________________________________________
Patio_________________________________________________________________________
Porch_________________________________________________________________________
Retaining walls_________________________________________________________________
Drainage______________________________________________________________________
Fences________________________________________________________________________
Vegetation affecting house________________________________________________________
Other_________________________________________________________________________


Out-buildings inspected?_________________________________________________________
Visual adjacent property problems?_________________________________________________
Downspouts/Splash blocks/Underground drain?_______________________________________

EXTERIOR
FOUNDATION WALLS

General Condition_____________________________________________________________
Settling_______________________________________________________________________
Drainage/grading_______________________________________________________________
Surface condition_______________________________________________________________
Vegetation problems_____________________________________________________________
Physical damage________________________________________________________________

HEATIG-COOLIG Air cond./Heat pump manuf.________________________
Electrical power_________________ Gas Meter_________________________ Oil tank______
Furnace/fan coil unit manuf_______________________________________________________
Air cond. operation_____________________________________________________________
Air cond. Appearance____________________________________________________________
Air cond. piping________________________________________________________________
Gas/oil piping__________________________________________________________________
Oil tanks______________________________________________________________________
Heating operation_______________________________________________________________
Furnace appearance____________________________________________________________
Needs cleaning_________________________________________________________________
Air filter______________________________________________________________________
Flue__________________________________________________________________________
Drain_________________________________________________________________________
Secondary drain above ceiling_____________________________________________________
Heat exchanger_____________________________________________________________
Burners_______________________________________________________________________
Controls_______________________________________________________________________
Humidifier_____________________________________________________________________
Air cleaner_____________________________________________________________________
Combustion air_________________________________________________________________
Outside air intake_______________________________________________________________
Piping/insulation________________________________________________________________
Grilles/diffusers/convectors_______________________________________________________
Air ducts/insulation______________________________________________________________
Clearances to combustibles________________________________________________________


Clearance from doors/windows/roof_________________________________________________
Aux. heaters/wall heaters/unit heaters_______________________________________________

PLUMBIG Potable water supply_______________________ Waste______________

Well location_____________________ Septic location______________ Water heater________
Water flow operation____________________________________________________________
Drain flow operation_____________________________________________________________
Well system operation____________________________________________________________
Septic system operation__________________________________________________________
Faucets_______________________________________________________________________
Drains________________________________________________________________________
Valves________________________________________________________________
Pipes_________________________________________________________________________
Vents_________________________________________________________________________
Water heater_______________________________________________________________
Temperature-pressure relief valve/piping_____________________________________________
Water softener/filter equipment____________________________________________________
Sewage/waste pumps____________________________________________________________
Sump pumps___________________________________________________________________
Water heater in garage raised 18 above floor?________________________________________
Floor drains____________________________________________________________________
Bath tubs______________________________________________________________________
Showers_______________________________________________________________________
Sinks_________________________________________________________________
Water closets___________________________________________________________________
Spas/hot tubs__________________________________________________________________
Bidets________________________________________________________________________
Booster pumps_________________________________________________________________

ELECTRICAL Panel locations___________________________ Size, amps_____
LIGHTIG No. breakers/fuses_______________________________________
Wiring in service panel___________________________________________________________
Wiring in attic__________________________________________________________________
Wiring in basement______________________________________________________________
Wiring in crawl space____________________________________________________________
Wall switches__________________________________________________________________
Receptacles____________________________________________________________________
Receptacles, GFI________________________________________________________________


Light fixtures_______________________________________________________________
Appliance receptacles____________________________________________________________
Appliance safety switches_________________________________________________________
Appliance disconnects___________________________________________________________
Appliance operation, permanent only________________________________________________
System grounding_______________________________________________________________
Clearances for safety_____________________________________________________________
Clearances for service____________________________________________________________

KITCHEN
Appliances: Oven__________ Range___________ Disposal________ Refrigerator_________
Microwave__________ Dishwasher______________ Other_____________________________
Smoke detectors__________________ Exhaust fan_______________ Compactor____________

Walls___________________________________________________________
Floors________________________________________________________________
Ceiling________________________________________________________________________
Counter tops___________________________________________________________________
Cabinets_______________________________________________________________________

Sink plumbing__________________________________________________________________
Stains/leaks___________________________________________________________
Doors________________________________________________________________
Windows______________________________________________________________________


LAUNDRY
Walls_________________________________________________________________________
Floors________________________________________________________________________
Ceiling________________________________________________________________________
Counter tops ___________________________________________________________________
Cabinets_______________________________________________________________________
Dryer vent__________________________________________________________________
Sink plumbing__________________________________________________________________
Washer plumbins_______________________________________________________________
Ironing board___________________________________________________________________
Shelves_______________________________________________________________________
Dryer gas service________________________________________________________________



BATHROOMS Half baths____________________ Full Baths________________
Master bath____________________________________________
Walls_________________________________________________________________
Floors________________________________________________________________________
Ceiling________________________________________________________________________
Counter top____________________________________________________________________
Sinks_________________________________________________________________________
Sink plumbing__________________________________________________________________
Water closet________________________________________________________________
Bath tubs______________________________________________________________________
Showers_______________________________________________________________________
Spas/Jacuzi____________________________________________________________________
Fans__________________________________________________________________________
Heaters_______________________________________________________________________
Doors________________________________________________________________
Windows______________________________________________________________________
Shut-off valves_________________________________________________________________
Stains/leaks____________________________________________________________________
Tile__________________________________________________________________________
Caluking______________________________________________________________________

OTHER ROOMS Living room_____ Dining room _____ Family Room _____
Great room _____ Bedrooms_____ Hallways_____ Entry _____ Vestibule_____ Porch _____
Sun room _____ Enclosed pool_____ Basement room_____ Balcony_____

Walls_________________________________________________________________
Floors________________________________________________________________________
Ceiling________________________________________________________________________
Counter top____________________________________________________________________
Cabinets_______________________________________________________________________

Shelving______________________________________________________________________
Railings_______________________________________________________________
Sinks______________________________________________________________________
Sink plumbing__________________________________________________________________
Aux heaters____________________________________________________________________
Exhaust fans___________________________________________________________________
Doors________________________________________________________________
Windows______________________________________________________________________


Paneling_______________________________________________________________________
Trim__________________________________________________________________________
Partitions/screens_______________________________________________________________
Fireplaces_____________________________________________________________________

GARAGE
Walls_________________________________________________________________
Floors________________________________________________________________________
Ceiling________________________________________________________________________
Doors_________________________________________________________________________
Window_______________________________________________________________________
Over-head doors________________________________________________________________
Door openers_______________________________________________________________
Firewall/separation______________________________________________________________
Aux. heaters___________________________________________________________________

ATTIC Number of areas__________
Access type____________________________________________________________________
Framing_______________________________________________________________________
Insulation______________________________________________________________________
Roof sheathing_____________________________________________________________
Vents_________________________________________________________________
Flues_________________________________________________________________________
Chimneys_____________________________________________________________________
Plumbing/vents_________________________________________________________________
Exposed electrical wiring/devices___________________________________________________
Lighting_______________________________________________________________________
Evidence of leakage_____________________________________________________________
Evidence of moisture condensation_________________________________________________

BASEMENT
Walls_________________________________________________________________________
Ceiling/joists-subfloor____________________________________________________________
Floors________________________________________________________________________
Windows______________________________________________________________________


Doors________________________________________________________________
Floor drains________________________________________________________________
Sump pump____________________________________________________________________
Sinks_________________________________________________________________________
Evidence of flooding_____________________________________________________________

Mildew_______________________________________________________________________
Termites______________________________________________________________________
Mice/vermin___________________________________________________________
Radon________________________________________________________________________

CRAWL SPACE
Access________________________________________________________________________
Framing_______________________________________________________________________
Subfloor_______________________________________________________________________
Walls_________________________________________________________________________
Footings______________________________________________________________
Soil conditions_____________________________________________________________
Leaks in plumbing_______________________________________________________________
Leaks in walls__________________________________________________________________
Evidence of flooding/standing water________________________________________________
Foundation vents________________________________________________________________
Air ducts______________________________________________________________________
Piping________________________________________________________________
Electrical wiring/devices__________________________________________________________
Settling of walls/footings_________________________________________________________
Termites______________________________________________________________________
Mildew/fungus_________________________________________________________________

OVERALL

TERMITES / Wood Destroying Insects _____________________________________________
OTHER/NOTES
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________


____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________

Sketches


PURCHASE AGREEMENT


Date: _______________________


12. BUYER: ____________________________________________________________________
(Buyer) agrees to buy the following property from the owner (Seller) for the consideration
and subject to the following terms, provisions, and conditions:
13. PROPERTY: The property (Property) is known as ______________________________
______________________________ ________in _________________________County,
_________________________ City, _________________________State, and legally
described as: ____________________________________________________________
_______________________________________ together with any existing improvements
and fixtures attached, such as, but not limited to, electrical and/or gas fixtures, heating and
central air-conditioning equipment and all attachments thereto, built-in kitchen equipment,
sump pump, water softener, gas grills, central vacuum equipment, window shades/blinds,
curtain rods, drapery poles and fixtures, ceiling fans and light fixtures, towel racks and bars,
storm doors, windows, awnings, TV antennas, satellite dishes and controls, storage barns, all
landscaping, mailbox, garage door opener with control(s) AND THE FOLLOWING:
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
_ All items sold shall be fully paid for by Seller at time of closing the transaction.
14. PRICE: Buyer will pay the total purchase price of $_______________________ for the
Property.
15. EARNEST MONEY: Buyer submits $ ______________________ as earnest money which
shall be applied to purchase price. The "Seller" shall deposit earnest money into an escrow
account at _______________________Title Company, within two (2) banking days of
acceptance of this Agreement and Title Company will hold it until time of closing the
transaction or termination of this Agreement. If Buyer fails for any reason to submit earnest
money, Seller may terminate this Agreement. Earnest money shall be returned promptly in the
event this offer is not accepted. If this offer is accepted and Buyer fails or refuses to close the
transaction, without legal cause, the earnest money shall be forfeited by Buyer to Seller as
liquidated damages, and Seller may pursue any other legal and equitable remedies. The Title
Company holding any earnest money is absolved from any responsibility to make payment to
the Seller or Buyer unless the parties enter into a Mutual Release or a Court issues an Order
for payment. If the parties do not mutually consent to the release of the earnest money, then
they agree that the Title Company holding the earnest money may file an interpleader action
with a Court regarding disposition of the earnest money and that the payment of the Title
Company's resulting costs (including attorneys fees) incurred in connection with such
interpleader are a priority claim against the earnest money regardless of the Courts
apportionment of the balance of the earnest money.
16. METHOD OF PAYMENT: (Circle appropriate paragraph letter)
E. CASH: The entire purchase price shall be paid in cash and no financing is required.


F. NEW MORTGAGE: Completion of this transaction shall be contingent upon the Buyer or
the Buyer's assigns, ability to obtain a
__ Conventional ____ Insured Conventional ____ FHA ____ VA ____Other
___________________ first mortgage loan for __________ % of purchase price, payable in
not less than __________ years, with an original rate of interest not to exceed ________ %
per annum and not to exceed __________ points. Buyer shall pay all cost of obtaining
financing, except _____________________________________________________
Notwithstanding any other provisions of this Agreement, any inspections and charges which
are required to be made and charged to Buyer or Seller by the lender, FHA, VA, mortgage
insurer, or closing agent, shall be made and charged in accordance with their prevailing rules
or regulations and shall supersede any provisions of this Agreement.
C. OTHER METHOD OF PAYMENT: (Attach Financing Addendum)
17. TIME FOR OBTAINING FINANCING: Buyer or Buyer's assigns agrees to make written
application for any financing necessary to complete this transaction or for approval to assume
the unpaid balance of the existing mortgage within ____ days after the acceptance of this
Agreement and to make a diligent effort to meet the lenders requirements and to obtain
financing in cooperation with the Broker and Seller. No more than ______________ days after
acceptance of the Agreement shall be allowed for obtaining favorable written commitment(s) or
mortgage assumption approval. If a commitment or approval is not obtained within the time
specified above, this Agreement shall terminate unless an extension of time for this purpose is
mutually agreed to in writing.
18. CLOSING: The closing of the sale (the Closing Date) shall be on or before
________________________, or this Agreement shall terminate unless an extension of time is
mutually agreed to in writing. If the method of payment for this transaction is cash, assumption
or conditional sales contract, the closing fee shall be paid by ___ BUYER ___ SELLER ___
shared equally.
19. POSSESSION:
I. The possession of the Property shall be delivered to Buyer ___ at closing ___ within
________days after closing. If Seller does not deliver possession by the date required in the
first sentence of this paragraph, Seller shall pay Buyer $ ___________________ per day as
liquidated damages until possession is delivered to Buyer; and Buyer shall have all other legal
and equitable remedies available against the Seller.
J. Maintenance of Property: Seller shall maintain the Property in its present condition until its
possession is delivered to Buyer, subject to repairs in response to any inspection. Buyer may
inspect the Property prior to closing to determine whether Seller has complied with this
paragraph.
K. Casualty Loss: Risk of loss by damage or destruction to the Property prior to the closing shall
be borne by Seller. In the event any damage or destruction is not fully repaired prior to
closing. Buyer, at Buyers option, may either (a) terminate this Agreement or (b) elect to close
the transaction, in which event Sellers right to all insurance proceeds resulting from such
damage or destruction shall be assigned in writing by Seller to Buyer.
L. Utilities/Municipal Services: Seller shall pay for all municipal services and public utility charges
through the day of possession.
20. SURVEY: Buyer shall receive a (check ONE) ___ SURVEYOR LOCATION REPORT, which
is a survey where corner markers are not set, ___ BOUNDARY SURVEY, which is a survey
where corner markers of the Property are set prior to closing; ___ WAIVED, no survey
required, at (Check ONE) ___ BUYERS expense; ___ SELLERS expense. The survey shall


(1) be received prior to closing and certified as of a current date; (2) be reasonably satisfactory
to Buyer; (3) show the location of all improvements and easements; and (4) show the flood
zone designation of the Property.
21. FLOOD AREA/OTHER: Buyer ___ may ___ may not terminate this Agreement if the
Property requires flood insurance or Buyer ___ may ___ may not terminate this Agreement if
the Property is subject to building or use limitations by reason of the location.
22. INSPECTIONS: BUYER RESERVES THE RIGHT TO HAVE THE PROPERTY INSPECTED
(Including Lead-Based Paint) independent of and in addition to any inspections required by
FHA, VA, or Buyers lender(s). All inspections are to be at Buyers expense (unless noted
otherwise or required by lender) by qualified inspectors or contractors selected by Buyer within
the following time periods.

A. INSPECTION/RESPONSE PERIOD: Buyer shall order all INDEPENDENT INSPECTIONS
immediately after acceptance of the Purchase Agreement. Buyer shall have _____ calendar
days beginning the day following the date of acceptance of the Purchase Agreement to
respond to the inspection report(s) in writing to Seller (see Buyers Response) except:
(check appropriate paragraph(s)
___ Buyer shall have ____ calendar days to receive and respond in writing to the written lead
based paint inspection and/or risk assessment report.
___ Buyer shall have ____ calendar days to receive and respond in writing to the written
Radon Report.

Inspections may include but are not limited to the condition of the following systems and
components: heating, cooling, electrical, plumbing, roof, walls, ceilings, floors, foundation,
basement, crawl space, well/septic, water, wood-eating insects and organisms, lead-based
paint (note: intact lead-based paint that is in good condition is not necessarily a hazard), radon
tested at lowest livable area either currently finished or unfinished) and/or the following:
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
_________If the Buyer does not comply with Inspection/Response Period or make a written
objection to any problem revealed in the report within the Inspection/Response Period, The
Property shall be deemed to be acceptable. If the Buyer, in the reasonable discretion, believes
that the Inspection Report reveals a MAJOR DEFECT with the Property and the Seller is
unable or unwilling to remedy the defect to the Buyers reasonable satisfaction before closing
(or at a time otherwise agreed to by the parties), then this Agreement may be terminated by
the Buyer or such defect shall be waived by the Buyer and the transaction shall proceed
toward closing. BUYER AGREES THAT ANY PROPERTY DEFECT PREVIOUSLY
DISCLOSED BY SELLER OR ROUTINE MAINTENANCE AND MINOR REPAIR ITEMS
MENTIONED IN ANY REPORT TOTALLING NO MORE THAN $ ______________ TO
REMEDY, SHALL NOT BE A BASIS FOR TERMINATION OF THIS AGREEMENT.
23. TITLE APPROVAL: Prior to closing, Buyer shall be furnished ___ a commitment for title
insurance in the amount of purchase price or ___ an abstract of title continued to date showing
marketable title to the Property to pay mortgage policy. Any encumbrances or defects in title
must be removed and Seller must convey title free and clear of any encumbrances and title
defects, with the exception of any mortgage assumed by Buyer and any restrictions and
easements of record which will not materially interfere with Buyers intended use of the


Property. Seller shall order the commitment ___ immediately ___ after mortgage approval.
Seller agrees to pay the cost of obtaining all other documents necessary to perfect title
(including the cost of the deed and vendors affidavit), so that marketable title can be conveyed.

24.TAXES: All taxes assessed for any prior calendar year and remaining unpaid shall be paid by
Seller, and all taxes assessed for the current calendar year shall be prorated between Seller and
Buyer on a calendar-year basis as of the day immediately prior to the Closing Date. If the tax rate
and/or assessment for taxes assessed in the current year have not been determined at the closing of
the transaction, the rate and/or assessment shall be assumed to be the same as the prior year for the
purpose of such proration and credit for due but unpaid taxes and this shall be a final settlement.

If at the time of closing the tax bill for the Property for the succeeding year has not been
issued, taxes payable by either party shall be computed based on the most recent tax rate
and/or assessment available to the closing agent.
WARNING: The succeeding year tax bill for recently constructed homes or following
reassessment periods may greatly exceed the last tax bill available to the closing agent.

25.PRORATIONS AND SPECIAL ASSESSMENTS: Insurance, if assigned to Buyer, interest on any
debt assumed or taken subject to, any rents, all other income and ordinary operating expenses of the
Property, including but not limited to, public utility charges, shall be prorated as of the day prior to the
Closing Date. Seller shall pay any special assessments applicable to the Property for municipal
improvements previously made to benefit the Property. Seller warrants that Seller has no knowledge
of any planned improvements which may result in assessments and that no governmental or private
agency has served notice requiring repairs, alterations or corrections of any existing conditions.
Public or municipal improvements which are not completed as of the date above but which will result
in a lien or charge shall be paid by Buyer. Buyer will assume and pay all special assessments for
municipal improvements completed after the date of this Agreement.
26.TIME: Time is of the essence. Time periods specified in this Agreement and any subsequent
Addenda to the Purchase Agreement are calendar days and shall expire at midnight of the date
stated unless the parties agree in writing to a different date and/or time.
27.HOMEOWNERS ASSOCIATION/CONDOMINIUM ASSOCIATION: Documents for a mandatory
membership association shall be delivered by the Seller to Buyer within _____ days after acceptance
of this Agreement. If the Buyer does not make a written response to the documents within ______
days after receipt, the documents shall be deemed acceptable. In the event the Buyer does not
accept the provisions in the documents and such provisions cannot be waived, this Agreement may
be terminated by the Buyer and the earnest money deposit shall be refunded to Buyer promptly. Any
approval of sale required by the Association shall be obtained by the Seller, in writing, within ______
days after Buyers approval of the documents.
28.ATTORNEYS FEES: Any party to this Agreement who is the prevailing party in any legal or
equitable proceeding against any other party brought under or with relation to the Agreement or
transaction shall be additionally entitled to recover court costs and reasonable attorney' fees from the
non-prevailing party.



29.MISCELLANEOUS:
Q. Unless otherwise provided, any prorations for rent, taxes, insurance, damage deposits,
association dues/assessments, or any other items shall be computed through the date of
closing.
R. Conveyance of this Property shall be by general Warranty Deed, subject to taxes,
easements, restrictive covenants and encumbrances of record, unless otherwise agreed.
S. Seller represents and warrants that Seller is not a foreign person (individual entity) and,
therefore, not subject to the Foreign Investment in Real Property Tax Act.
T. Any notice required or permitted to be delivered shall be deemed received when personally
delivered, transmitted by facsimile or sent by express courier or United States mail,
postage prepaid, certified and return receipt requested, addressed to Seller or Buyer or the
designated agent of either party at the address set forth below the signature of the party.
U. In case any provision contained in this Agreement is held invalid, illegal, or unenforceable
in any respect, the invalidity, illegality, or unenforceability shall not affect any other
provision of this Agreement.
V. This Agreement constitutes the sole and only agreement of the parties and supersedes any
prior understandings or written or oral agreements between the parties respecting the
transaction and cannot be changed except by their written consent.
W. All rights, duties and obligations of the parties shall survive the passing of title to, or an
interest in, the Property.
X. Buyer discloses to Seller that Buyer is licensed and holds Real Estate License
#_______________________.

30.FURTHER CONDITIONS:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________
31.EXPIRATION OF OFFER: Unless accepted by Seller and delivered by Buyer by _________
____A.M. / P.M. (circle one), the _________ day of ______________, 20______ , this Purchase
Agreement shall be null and void and all parties shall be relieved of any and all liability or obligations.
32.CONSULT YOUR ADVISORS: Buyer and Seller acknowledge they have been advised that, prior
to signing this document, they may seek the advice of an attorney for the legal or tax consequences
of this document and the transaction to which it relates. In any real estate transaction, it is
recommended that you consult with a professional, such as a civil engineer, environmental engineer,
or other person, with experience in evaluating the condition of the Property..



This Agreement may be executed simultaneously or in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the same instrument. The
parties agree that this Agreement may be transmitted between them by facsimile machine. The
parties intend that faxed signatures constitute original signatures and are binding on the parties. The
original document shall be promptly delivered, if requested.

________________________________________ _______________________________________
BUYERS SIGNATURE DATE BUYERS SIGNATURE DATE

________________________________________ _______________________________________
PRINTED PRINTED

________________________________________ _______________________________________
BUYERS SOCIAL SECURITY #/FEDERAL I.D. # BUYERS SOCIAL SECURITY #/FEDERAL I.D. #

_____________________________________ ________________________________________
MAILING ADDRESS ZIP CODE MAILING ADDRESS ZIP CODE


_____________________________________ ________________________________________
(Area Code) TELEPHONE NUMBER (Area Code) TELEPHONE NUMBER


___ A. As the Seller(s) of the property described herein, the above terms and conditions are accepted
this ____ day of ___________ at ___________ __ A.M. ___ P.M. ___ Noon


______________________________________ _________________________________________
SELLERS SIGNATURE DATE SELLERS SIGNATURE DATE

_______________________________________ ________________________________________
PRINTED PRINTED

________________________________________ ______________________________________
SELLERS SOCIAL SECURITY #/FEDERAL I.D.# SELLERS SOCIAL SECURITY #/FEDERAL I.D.

________________________________________ ______________________________________
MAILING ADDRESS ZIP CODE MAILING ADDRESS ZIP CODE

_______________________________________ ________________________________________
(Area Code) TELEPHONE NUMBER (Area Code) TELEPHONE NUMBER


COUNTER OFFER # ______

___________________________________________, 20_____ ___ A.M. _____ P.M.

The undersigned makes the following Counter Offer to the Purchase Agreement Dated
____________________________________ concerning property commonly known as
______________________________________________________________________________
_______________________ in _____________________________________________ Township,
__________________________________ County, __________________________________ City,
__________________________________State, between: ________________________________
_____________________________________ as Sellers _________________________________
______________________________________as Buyer(s)

________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

Note: Seller has the right to accept any other offer and Buyer has the right to withdraw any offer prior
to written acceptance and delivery of such offer/counter offer.

All other terms and conditions of the Purchase Agreement and all previous Counter Offers shall
remain in effect except as modified by this Counter Offer.

This Counter Offer # ___________ is void if not accepted in writing on or before
____________________ ___ A.M. ______P.M. on (date) _______________________________.

This agreement may be executed simultaneously or in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the same instrument. The
parties agree that this Agreement may be transmitted between them by facsimile machine. The
parties intend that faxed signatures constitute original signatures and are binding on the parties. The
original document shall be promptly executed and/or delivered, if requested.






____________________________________ _________________________________________
SELLERS/BUYERS SIGNATURE DATE SELLERS/BUYERS SIGNATURE DATE

____________________________________ ________________________________________
PRINTED PRINTED

____________________________________ ______________________________________
SELLERS SOCIAL SECURITY #/FEDERAL I.D.SELLERS SOCIAL SECURITY #/FEDERAL I.D.

____________________________________ ______________________________________
MAILING ADDRESS ZIP CODE MAILING ADDRESS ZIP CODE

__________________________________ ________________________________________
(Area Code) TELEPHONE NUMBER (Area Code) TELEPHONE NUMBER

ACCEPTANCE OF COUNTER OFFER # _________

The above Counter Offer # ____________ is accepted at __________________________ ___ A.M.
___ P.M. ___ Noon ___ Midnight __________________________ Receipt of a signed copy of this
Counter Offer is acknowledged.



_____________________________________ _______________________________________
SELLER /BUYER SIGNATURE DATE SELLER /BUYER SIGNATURE DATE

_____________________________________ _____________________________________
PRINTED PRINTED

_____________________________________ _____________________________________
SELLERS SOCIAL SECURITY #/FEDERAL I.D.SELLERS SOCIAL SECURITY #/FEDERAL I.D.


INDEPENDENT INSPECTION RESPONSE
BUYERS INSPECTION RESPONSE # ______________

Date: __________________________
Property Address:
______________________________________________________________________________
A. Buyer agrees to: (Initial one)
5. ____________ Waive inspection(s) and rely upon the condition of the Property based upon
Buyers own examination.
6. ____________ Accept the Property in the condition reported in the Inspection Report(s).
7. ____________ Accept the Property provided Seller corrects the following condition(s):
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________ on or before
____________________________________________ ___ A.M. ___ P.M.
_______________________________, or within ___________ days after
______________________ , whichever is later, and the Buyer shall have the right to
inspect and accept Sellers repairs ___ prior to closing.
8. __________ Other: _____________________________________________

____ A complete copy ___ Appropriate pages of the Inspection Report is/are attached
(including lead-based paint and/or radon, if applicable).

E. If a Response is required, the Seller shall respond on or before
______________________________________________________________.
F. After compliance with selected item above, the Buyer releases the Seller named in Purchase
Agreement from any and all liability relating to any non-latent or disclosed latent defect or
deficiency affecting the Property; provided however, this release shall not apply to any known
but undisclosed latent defect(s) or misrepresentations affecting the Property, which shall
survive the closing.
G. This inspection Response may be executed simultaneously or in two or more counterparts,
each of which shall be deemed an original, but all of which together shall constitute one and
the same instrument. The parties agree that this Response may be transmitted between them
by facsimile machine. The parties intend that faxed signatures constitute original signatures
and are binding on the parties. The original document shall be promptly delivered, if requested






____________________________________ _______________________________________
BUYERS SIGNATURE DATE BUYERS SIGNATURE DATE

____________________________________ _____________________________________
PRINTED PRINTED



SELLERS INSPECTION RESPONSE # _____________

C. Seller responds as follows: (Initial one)

1. ____________ Seller agrees to correct condition(s) in Item #3 ___ prior to closing the
transaction or ___ within _______ days after _______________________________
________________________________________________________________________
2. ____ Seller is unable or unwilling to make the corrections requested by Buyer.
3. ____ Seller agrees to correct the following condition(s) at Sellers expense ___ prior to
closing the transaction or ___ within ________ days after
______________________________________________

4. ____ Other:
______________________________________________________________________
____

D. If Item #3 and/or Item #4 is/are selected, the Buyer shall reply on or before
_________________________ ____ A.M. ____ P.M. ____ Noon
____________________________________.


_________________________________ _______________________________________
SELLERS SIGNATURE DATE SELLERS SIGNATURE DATE

_________________________________ ______________________________________
PRINTED PRINTED



BUYERS INSPECTION REPLY # ____________
B. Buyer replies as follows: (Initial one)

3. ___ Buyer accepts Sellers Response.
4. ___ Buyer rejects Sellers Response, deems the Purchase Agreement void and
requests that the earnest money be returned.


________________________________ ________________________________________
BUYERS SIGNATURE DATE BUYERS SIGNATURE DATE

________________________________ ________________________________________
PRINTED PRINTED


Assignment of Real Estate Contract - (Investor Agreement)

This Assignment of Contract ("Assignment") is made on (date)______________, by and between
_________________________ ("Assignor"), and ____________________________("Assignee").

Assignor is a party to the "Real Estate Purchase Agreement" dated, ___________________ with
(Seller) ____________________________, regarding property located at: __________________
________________________ in the city of _____________________, in the State of _________.
(a copy of which is attached hereto (the "Contract").

Assignor now desires to assign its interest in the Contract to Assignee, which Assignee desires to
acquire.

NOW, THEREFORE, for the sum of $ _______________, to be paid by the Assignee to the Assignor
and in consideration of the mutual agreements of the parties, it is agreed:

1. Effective Date.
Assignment of Assignor's rights in the Contract and other benefits and obligations in this Assignment
are effective (date) _______________________.

2. Assignment.
Assignor is a party to the Contract. Assignor does hereby grant, bargain, sell, convey, transfer and
assign to Assignee all of Assignor's interest in the Contract.

3. Assumption by Assignee.
Assignee assumes and agrees to perform all of the duties of Assignor in the Contract, which accrue
and become due on or after the effective date. Assignee will indemnify, protect, defend and hold
Assignor harmless from and against any and all loss, cost, damage and expense arising out of or in
any way related to a breach or default of the Contract after the effective date. Assignor will indemnify,
protect, defend and hold Assignee harmless from and against any and all loss, cost, damage and
expense arising out of or in any way related to a breach or default of the Contract on or before the
effective date.


__________________________________________
Assignor Date

__________________________________________
Printed

__________________________________________
Assignee Date

__________________________________________
Print


Investor & Home Buyer
Qualifying Form

CREDIT HISTORY

Do you have good credit?

Bankruptcy more than 2 years discharged?

Any late payments in last 12 months?

If no established credit, do you have an apartment lease in your name with
cancelled checks showing on-time payments?


DOWN PAYMENT

How much money do you have for a down payment?


TIME ON JOB

Do you have 2 years in your current line of work.

If just out of school, are you performing the job for which you trained in school?

If self employed, do you have 2 years of Tax Returns showing consistent or
growing income? Average the past 2 years for qualifying income.


INCOME

What is your gross annual income?

Gross?

28% of gross? (front end ratio)

36% of gross? (back end ratio)



Income of the subject property? (this is something you will already know)

75% of the subject property's income (is it enough to cover debt service?)


TYPE OF PROPERTY THEY WANT

What type of income property are you looking for?

Do you want to be put on my investor list to be notified when I find a suitable
property?


IF THEY FIT THE PROFILE YOU NEED


Name:


Address:




Phone (wk):

Phone (hm):

Email:


How you found this lead?

Date you added this lead to list?



Quitclaim Deed

This Quitclaim Deed made [Date]__________________, by ___________________
_____________________________ [Seller] ("Transferor") ____________________
_____________________________________________________[Seller's Address]
to:
___________________________________________________ [Buyer] ("Transferee")
___________________________________________________ [Buyer's Address]

Transferor, in consideration of One Dollar and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, remises, releases, and
forever quitclaims to Transferee all of the interest of Transferor, if any, in an to that real
property located in the County of ___________________________________ [Property
County], and State of _______________________________ [Property State], and
more certainly described as follows: ___________________________________
____________________________________________ [Legal Description of Property].
To have and to hold, all and singular the described property, together with the
tenements, hereditaments, and appurtenances belonging to such property, or in
anywise appertaining, and the rents, issues, and profits of such property to Transferee,
and Transferee's heirs and assigns forever.

IN WITNESS WHEREOF, Transferor has executed this Quitclaim Deed on the date
first above written.
______________________________________
[Signature] Seller

Acknowledgment

State of ________________ )
) ss
County of ______________ )

On this _________________ [Date], before me personally appeared _________
_________________[Transferor], to me know to be the person described in and who
executed the foregoing Quitclaim Deed and acknowledged to me that ________
__________________________[Transferor] executed the same as [His/Her] free act
and deed.

______________________________
Notary Public


Tenant Application
Please fill out this application completely, sign at the bottom and submit funds for the
application fee (which pays for your credit report(s)).

Name (primary applicant):_______________________________

Social Security: __________________________

Name (secondary applicant): ______________________________

Social Security: __________________________

Current Home Address:_____________________

City: ____________________________________

State: ______________ Zip:______________

Phone (home): _____________________

Phone (his wk): _____________________

Phone (her wk): _____________________

Current Landlords Phone: _____________________

Previous Address: _______________________________
City, State, Zip: _________________________________
Previous Landlord's Phone: _______________________

Employer (primary): ___________________________
Address: ____________________________________
City, State, Zip: _______________________________

Employer (secondary): _________________________
Address: ____________________________________
City, State, Zip: _______________________________

Gross Annual Income:
$ ________________

Monthly Obligations: (not including rent)
$ ________________



I hereby submit $ ____ for a credit report and criminal check. I give my
permission for Prospective Landlord to have this information accessed by a credit
information provider.


______________________________________________
Primary Signature Date


______________________________________________
Secondary Signature Date


LEASE AGREEMENT

This Residential House Lease Agreement ("Lease") is made and effective this
__________________ [Date] by and between ________________________
___________________[Landlord] ("Landlord") and ____________________
________________________________[Tenant] ("Tenant," whether one or more).
This Lease creates joint and several liability in the case of multiple Tenants.

1. PREMISES.
Landlord hereby rents to Tenant and Tenant accepts in its present condition the house
at following address: ___________________________________________________
_________________________________________(Address of House) (the "House").

2. TERM.
The term of this Lease shall start on ____________________[Move-in Date], and end
on [Lease End Date]. In the event that Landlord is unable to provide the House on the
exact start date, then Landlord shall provide the House as soon as possible, and
Tenant's obligation to pay rent shall abate during such period. Tenant shall not be
entitled to any other remedy for any delay in providing the House.

3. RENT.
Tenant agrees to pay, without demand, to Landlord as rent for the House the sum of
_______________________ [Monthly Rental Amount] per month in advance on the
first day of each calendar month, at __________________ [Address for Rent
Payments], or at such other place as Landlord may designate. Landlord may impose a
late payment charge of ______________ [Late Pay Charge] per day for any amount
that is more than five (5) days late. Rent will be prorated if the term does not start on
the first day of the month or for any other partial month of the term.

4. SECURITY DEPOSIT.
Upon execution of this Lease, Tenant deposits with Landlord [Security Deposit
Amount], as security for the performance by Tenant of the terms of this Lease to be
returned to Tenant, following the full and faithful performance by Tenant of this Lease.
In the event of damage to the House caused by Tenant or Tenant's family, agents or
visitors, Landlord may use funds from the deposit to repair, but is not limited to this
fund and Tenant remains liable.

5. QUIET ENJOYMENT.
Landlord agrees that if Tenant timely pays the rent and performs the other obligations
in this Lease, Landlord will not interfere with Tenant's peaceful use and enjoyment of
the House.



6. USE OF PREMISES.
A. The House shall be used and occupied by Tenant exclusively as a private single-
family residence. Neither the House nor any part of the House or yard shall be used at
any time during the term of this Lease for the purpose of carrying on any business,
profession, or trade of any kind, or for any purpose other than as a private single-family
residence.

B. Tenant shall comply with all the health and sanitary laws, ordinances, rules, and
orders of appropriate governmental authorities and homes associations, if any, with
respect to the House.

7. NUMBER OF OCCUPANTS.
Tenant agrees that the House shall be occupied by no more than ______ [Total
Number of Occupants] persons, including no more than ________ [Maximum Number
of Children] under the age of eighteen (18) years, without the prior written consent of
Landlord.

8. CONDITION OF PREMISES.
A. Tenant agrees that Tenant has examined the House, including the grounds and all
buildings and improvements, and that they are, at the time of this Lease, in good order,
good repair, safe, clean, and tenantable condition.

B. Landlord and Tenant agree that a copy of the "Joint Inspection," the original of
which is maintained by Landlord and a copy provided to Tenant, attached hereto
reflects the condition of the House at the commencement of Tenant's occupancy.

[Include Lead Paint Disclosure If Required]



9. ASSIGNMENT AND SUBLETTING.
A. Tenant shall not assign this Lease, or sublet or grant any concession or license to
use the House or any part of the House without Landlord's prior written consent.

B. Any assignment, subletting, concession, or license without the prior written consent
of Landlord, or an assignment or subletting by operation of law, shall be void and, at
Landlord's option, terminate this Lease.

10. ALTERATIONS AND IMPROVEMENTS.
A. Tenant shall make no alterations to the House or construct any building or make
other improvements without the prior written consent of Landlord.

B. All alterations, changes, and improvements built, constructed, or placed on or
around the House by Tenant, with the exception of fixtures properly removable without
damage to the House and movable personal property, shall, unless otherwise provided
by written agreement between Landlord and Tenant, be the property of Landlord and
remain at the expiration or earlier termination of this Lease.

11. DAMAGE TO PREMISES.
If the House, or any part of the House, shall be partially damaged by fire or other
casualty not due to Tenant's negligence or willful act, or that of Tenant's family, agent,
or visitor, there shall be an abatement of rent corresponding with the time during which,
and the extent to which, the House is untenantable. If Landlord shall decide not to
rebuild or repair, the term of this Lease shall end and the rent shall be prorated up to
the time of the damage.

12. DANGEROUS MATERIALS.
Tenant shall not keep or have on or around the House any article or thing of a
dangerous, inflammable, or explosive character that might unreasonably increase the
danger of fire on or around the House or that might be considered hazardous.

13. UTILITIES.
Tenant shall be responsible for arranging and paying for all utility services required on
the premises, except Landlord will provide: __________________________ [Services
Provided by Landlord]. Tenant shall not default on any obligation to a utility provider
for utility services at the House.



14. MAINTENANCE AND REPAIR.
A. Tenant will, at Tenant's sole expense, keep and maintain the House and
appurtenances in good and sanitary condition and repair during the term of this Lease.
In particular, Tenant shall keep the fixtures in the House in good order and repair; keep
the furnace clean; and keep the walks free from dirt and debris. Tenant shall, at
Tenant's sole expense, make all required repairs to the plumbing, range, oven heating
apparatus, electric and gas fixtures, other mechanical devices and systems, floors,
ceilings and walls whenever damage to such items shall have resulted from Tenant's
misuse, waste, or neglect, or that of the Tenant's family, agent, or visitor.

B. Tenant agrees that no signs shall be placed or painting done on or about the House
by Tenant without the prior written consent of Landlord.

C. Tenant agrees to promptly notify Landlord in the event of any damage, defect or
destruction of the House, or the failure of any of Landlord's appliances or mechanical
systems, and except for repairs or replacements that are the obligation of Tenant
pursuant to Subsection A above, Landlord shall use its best efforts to repair or replace
such damaged or defective area, appliance or mechanical system.

15. ANIMALS.
Tenant shall keep no domestic or other animals in or about the House without the prior
written consent of Landlord.

16. RIGHT OF INSPECTION.
Landlord and Landlord's agents shall have the right at all reasonable times during the
term of this Lease and any renewal of this Lease to enter the House for the purpose of
inspecting the premises and/or making any repairs to the premises or other item as
required under this Lease.

17. DISPLAY OF SIGNS.
During the last thirty (30) days of this Lease, Landlord or Landlord's agent may display
"For Sale" or "For Rent" or "Vacancy" or similar signs on or about the House and enter
to show the House to prospective purchasers or tenants.



18. HOLDOVER BY TENANT.
Should Tenant remain in possession of the House with the consent of Landlord after
the expiration of the Term of this Lease, a new tenancy from month to month shall be
created which shall be subject to all the terms and conditions of this Lease, but shall be
terminable on thirty (30) days by either party or longer notice if required by law. If
Tenant holds over without Landlord's consent, Landlord is entitled to double rent, pro-
rated per each day of the holdover, lasting until Tenant leaves the House.

19. SURRENDER OF PREMISES.
At the expiration of the Lease, Tenant shall quit and surrender the House in as good a
condition as it was at the commencement of this Lease, reasonable wear and tear and
damages by the elements excepted.

20. FORFEITURE OF SECURITY DEPOSIT - DEFAULT.
It is understood and agreed that Tenant shall not attempt to apply or deduct any
portion of any security deposit from the last or any month's rent or use or apply any
such security deposit at any time in lieu of payment of rent. If Tenant fails to comply,
such security deposit shall be forfeited and Landlord may recover the rent due as if any
such deposit had not been applied or deducted from the rent due. For the purposes of
this paragraph, it shall be conclusively presumed that a Tenant leaving the Premises
while owing rent is making an attempted deduction of deposits. Furthermore, any
deposit shall be held as a guarantee that Tenant shall perform the obligations of the
Lease and shall be forfeited by the Tenant should Tenant breach any of the terms and
conditions of this Lease. In the event of default, by Tenant, of any obligation in this
Lease which is not cured by Tenant within fifteen (15) days notice from Landlord, then
in addition to forfeiture of the Security Deposit, Landlord may pursue any other remedy
available at law, equity or otherwise.

21. ABANDONMENT.
If at any time during the term of this Lease, Tenant abandons the House or any of
Tenant's personal property in or about the House, Landlord shall have the following
rights: Landlord may, at Landlord's option, enter the House by any means without
liability to Tenant for damages and may relet the House, for the whole or any part of
the then unexpired term, and may receive and collect all rent payable by virtue of such
reletting; Also, at Landlord's option, Landlord may hold Tenant liable for any difference
between the rent that would have been payable under this Lease during the balance of
the unexpired term, if this Lease had continued in force, and the net rent for such
period realized by Landlord by means of such reletting. Landlord may also dispose of
any of Tenant's abandoned personal property as Landlord deems appropriate, without
liability to Tenant. Landlord is entitled to presume that Tenant has abandoned the
House if Tenant removes substantially all of Tenant's furnishings from the House, if the


House is unoccupied for a period of two (2) consecutive weeks, or if it would otherwise
be reasonable for Landlord to presume under the circumstances that the Tenant has
abandoned the House.

22. SECURITY.
Tenant acknowledges that Landlord does not provide a security alarm system or any
security for the House or for Tenant and that any such alarm system or security
service, if provided, is not represented or warranted to be complete in all respects or to
protect Tenant from all harm. Tenant hereby releases Landlord from any loss, suit,
claim, charge, damage or injury resulting from lack of security or failure of security.

23. SEVERABILITY.
If any part or parts of this Lease shall be held unenforceable for any reason, the
remainder of this Agreement shall continue in full force and effect.

24. INSURANCE.
Tenant acknowledges that Landlord will not provide insurance coverage for Tenant's
property, nor shall Landlord be responsible for any loss of Tenant's property, whether
by theft, fire, acts of God, or otherwise.

25. BINDING EFFECT.
The covenants and conditions contained in the Lease shall apply to and bind the heirs,
legal representatives, and permitted assigns of the parties.

26. GOVERNING LAW.
It is agreed that this Lease shall be governed by, construed, and enforced in
accordance with the laws of the State of ____________________________.

27. ENTIRE AGREEMENT.
This Lease shall constitute the entire agreement between the parties. Any prior
understanding or representation of any kind preceding the date of this Lease is hereby
superseded. This Lease may be modified only by a writing signed by both Landlord
and Tenant.



28. NOTICES.
Any notice required or otherwise given pursuant to this Lease shall be in writing; hand
delivered, mailed certified return receipt requested, postage prepaid, or delivered by
overnight delivery service, if to Tenant, at the House and if to Landlord, at the address
for payment of rent.

IN WITNESS WHEREOF, the parties have caused this Lease to be executed the day
and year first above written.

______________________________________________
Tenant Signature Date

______________________________________________
Tenant Signature Date

______________________________________________
Landlord Signature Date





OPTION TO PURCHASE PROPERTY

Date:____________

This option to Purchase Property is entered into between____________________________________________
_______________________________________________________(Seller), located at __________________
_______________________________________________________________________________________and
_________________________________________________________________________________(Buyer),
located at _________________________________________________________________________________
______________________________________________ in consideration of and subject to the following terms
and conditions.

1. GRAT OF OPTIO
Seller grants and conveys to Buyer the exclusive and irrevocable option to purchase (the Option) the
following real estate property (the Property) located in __________________________________City
_____________________________________, State, and is legally described as: _____________________


2. OPTIO MOEY
Buyer pays Seller the sum of
_______________________________________________________________
Dollars ($____________________________) (the Option Money), the receipt of which Seller
acknowledges as consideration for the Option.

3. TERM, EXERCISE/OTICE
C. TERM. Buyers right to exercise this Option shall commence on the above date and shall continue until
________________________________________________________________and including the
_____________________________ day of __________________________________
(the Option Period).

D. EXERCISE/NOTICE. This option shall be exercised by Buyers written notice to Seller of Buyers
intention to purchase. The notice shall be deemed received when personally delivered, transmitted by
facsimile, sent by express courier or sent by United States mail, postage prepaid, certified and return
receipt requested, addressed to Seller or the designated agent of Seller, as the case may be, at the address
set forth in this Option of any party prior to the expiration of the Option Period.



Initials Buyers _______________ Initials Sellers __________________

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4. CLOSIG AD DISPOSITIO OF OPTIO MOEY
If Buyer exercises this Option as described above, the transaction shall be closed in accordance with the
terms and conditions of the attached Purchase Agreement.
A. The Option Money shall be credited to the purchase price.
E. If the Option is not exercised, then Seller shall retain the Option Money as consideration for the granting
of this Option.


5. TERMS BIDIG
All terms and conditions are included and no verbal agreements shall be binding.


6. ACKOWLEDGEMETS
This Option may be executed simultaneously or in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same instrument. The parties
agree that this document may be transmitted between them by facsimile machine. The parties intend
that faxed signatures constitute original signatures and are binding on the parties. The original
document shall be promptly executed and/or delivered, if requested.

___________________________________________ _______________________________________
BUYERS SIGNATURE DATE BUYERS SIGNATURE DATE

___________________________________________ _______________________________________
PRINTED PRINTED

___________________________________________ _______________________________________
BUYERS SOCIAL SECURITY #/FEDERAL ID # BUYERS SOCIAL SECURITY #/FEDERAL ID #



___________________________________________________ ________________________________________________
SELLERS SIGNATURE DATE SELLERS SIGNATURE DATE

__________________________________________ _____________________________________________
PRINTED PRINTED

___________________________________________ _______________________________________
SELLERS SOCIAL SECURITY #/FEDERAL ID # SELLERS SOCIAL SECURITY #/FEDERAL ID #



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