The RE Investment News: February 2018 by Mid-America Association of Real Estate Investors

FEBRUARY 2018

RE N E W S

INVESTMENT

NEWSLETTER OF MID-AMERICA ASSOCIATION OF REAL ESTATE INVESTORS

THIS ISSUE MAREI Member Library Stupid Wholesalers Understanding Private Lending Why You Can't Sell to Every Buyer Challenges to Affordability Member Directory

BBRRIIAANN && M MIICCHHEELLLLEE W WIINNBBEERRRRYY IINN FFEEBB REAL LIFE REAL ESTATE DEALS HOW DEALS WORK IN REAL LIFE

MAREI.ORG

REAL ESTATE NEWS Affordable Housing in KC Rental Applications Saving Money Evictions Healthy Housing Rent Control National REIA Awards of Excellence Winner 2017

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THE CALENDAR FEBRUARY

REAL LIFE REAL ESTATE WITH THE WINBERRYS

This month we are excited to host Brian & Michelle Winberry with a few case studies of recent deals. With over 20 years of real estate experience, the Winberry's have been hosting their own group meeting since 2009. We have invited them to share their knowledge at MAREI on February 13th. Monthly meetings are held at the Holiday Inn at 8787 Reeder Road, Overland Park, KS. MAREI Members & First Time Guests who Pre-Register at MAREI.org attend free - all others pay $25 at the door or $15 online. As always there will be the Business Hall, the Deal Table and Networking from 6 to 7pm. Starting at 7, the presentation kicks off with Ten Minutes on Private Lending and The Winberry's take the stage about 7:20 AGENDA

NEW MEETING FORMAT

Networking Hour: As always we will have our Vendor Hall, Our Business Card and Deal Table and General Networking from 6 to 7 pm. Come early, bring a flyer for the deal table, talk to the vendors and network.

Speed Table: This is in the planning stages and we hope to have a couple of tables and 12 chairs. We hope to have 2 15 minute speed rounds, but we do need a See full day coordinator. Mailing Address: 6709 W 119th #332 Overland Park, KS 66209 Phone: 913-815-0111 Web: MAREI.org Web: MAREIMember.com Email: Kim@MAREI.org Views and advertising expressed in the RE Investment News are not necessarily endorsed by Mid-America Association of Real Estate Investors. The information contained within should not be construed as a recommendation for any course of action regarding financial, legal, or accounting maters by MidAmerica Association of REal Estate Investors. Email to inquire about advertising oportunties or membership.

workshop 5

Ten Minute Topic: We are adding a 10-minute topic to the beginning of the page meeting at 7 pm, This month we will be focusing on member websites. Announcements: MAREI & Vendors Announcements at 7:10 Speaker: Robyn Thompson will start at 7:30 and run till 9:00 MARCH

VENA JONES COX WHOLESALING

Vena Jones Cox, real estate investor, trainer and REIA leader from Ohio is joining us in March. On the 13th at the MAREI meeting, she will be outlining how to make $5 to $10k in the next 30 days by Wholesaling. And on the 24th, she will dig into the mechanics of wholesaling with a huge focus on marketing. Get the details at www.MAREI.org. FROM OTHER GROUPS >

You will find a list of other groups complete with links to details that meet through out the Kansas City Metro area listed at MAREI.org/Calendar/Other-Groups

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real estate news AFFORDABILITY Attom Data Solution took a look at metros across the country to determine if it was more affordable to buy a median-priced home or to rent a 3 bedroom home. In Cities across Missouri, the results show that it is more affordable to buy a house than it is to rent. Kansas was not reporting. In most U.S. housing markets it was more affordable to buy, but they did note that housing prices were outpacing rental growth in most areas and we may be faced with more areas being more affordable to rent. Check out their interactive map at MAREI.org/Attom

DOWNTOWN AFFORDABILITY The number of affordable housing units available in downtown Kansas City are expected to decrease over the next 5 years. This is due to the expiration of tax credits used to develop the housing in the first place. Many of the buildings in downtown KC were developed before 2008 received tax credits in

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exchange for keeping rents lower. As these tax credits expire, expect rents that are currently $500 to $700 a month to rise to market rents of $1000 to $1100 a month. Read more at MAREI.org/affordable

RENTAL APPLICATIONS City Councilman Jermaine Reed proposed a new ordinance that would prevent employers and landlords in Kansas City from having the question on your applications about felony convictions. You would still be able to do a background check, you just would not be able to ask the question. This passed the Infrastructure Committee unanimously and will go before the city council in February.

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SAVING MONEY ON RENO

EVICTIONS

Whether you are rehabbing a whole house or you have a lot of regular routine maintenance, you can save a bundle on materials at the Home Depot.

If you only count the cases that end up in court, on average 42 eviction cases are filed in Jackson Count every day.

Be sure to make a complete list of all materials needed for your rehab or that you might need for a month of maintenance. Take this list to the ProDesk at your local Home Depot and ask them to Quote You a Volume Discount Price. This can save you from 10 to 15%.

The researchers from www.EvictionKC.org say that "Most low-income renters in Kansas City—and, increasingly, some with moderate incomes— struggle to pay rent. Poor renters often occupy housing that costs more than they can afford, which can result in evictions and homelessness."

Then combine the Volume Discount Pricing with our 2% Rebate on all purchase, 20% Discount on Paint and Coupon on Hampton Bay Cabinets and you will save $1000s annually.

So what can we as landlords do to help?

Learn more at www.MAREI.org/HDBid

1. Have a good rental application to ask the right, legal questions.

EVICTION ATTORNEY Are you managing rentals in Kansas City? Attorney Julie Anderson Clark can help you with forms and instruction on her website, her rental leases, or consultation on the situation. Learn More about Julie and the services she offers at www.MAREI.org/Anderson

Here at MAREI we have several suggestions for members.

2. Screen Tenants well using a good service like RentPerfect.com. 3. Have a well-written policy on who you will and will not accept and follow it. We urge all members to visit the website www.EvictionKC.org

"Steer Clear of Your Next Eviction" Get Your FREE Copy Today! We are excited to share with you a free copy of Rent Perfect's new eBook, "Steer Clear of Your Next Eviction: A Guide for Rental Property Owners." David Pickron, President of Rent Perfect, shares over 20 years of knowledge in this book which is overflowing with great advice for landlords as well as seasoned and new investors. Learn some common mistakes made during the application process, costly red flags and money-saving tips to help you steer clear of your next eviction.

Visit www.RentPerfect.com and request link is at the top! RE INVESTMENT NEWS

004 05 05

HEALTHY HOUSING

RENT CONTROL

Fannie Mae started a new reward initiative that offers financial awards to borrowers. To qualify, you must be borrowing for a multifamily project that will offer affordable housing. Then you need to offer services in this affordable housing that will improve the health and well-being of the tenants.

California may be facing a rent control-style program through its ballot process by a group that evolved from ACORN. Several Cities including groups in Kansas City.

These services could be a lot of different things such as an in-house daycare or an onsite grocery store. or perhaps educational programming and job training as well as youth activities. This initiative aims to advance sustainable communities and the availability of affordable housing by encouraging their borrowers to improve their design features and services to help the residents. At least 60 percent of the units seeking the financial awards must serve residents earning 60 percent or less of the average median income. These awards can help Fannie Maes borrowers save between $15,000 and $75,000 per year.

Tenant Advocacy groups want to make sure landlords are licensed, that every unit is inspected, that all units are updated and upgraded, that it is harder to evict and oh yes, with rent control, despite the fact that Rent Control is not allowed by Missouri State Law.

HEAD IN THE SAND Readers don't stick your head in the sand and say "Someone needs to do something!" You are somebody and unless you stay informed and take action some little law somewhere could change the way you do business, affect the values of your properties, and make changes to the economy as a whole.

To learn more about the Healthy Housing Rewards program, visit https://www.fanniemae.com/multifamily/healthyhousing-rewards.

EVICTION - THE BOOK Evictions are the latest hottest issue to “address” by municipalities and was the topic of an event in Kansas City in January. The book “Eviction”, has set the stage for an argument for making it more difficult to evict a resident. Yes, even if they have wasted their income, blown their money on drugs (as repeatedly documented in the book) and lied to their landlord. Somehow the accountability aspect of paying a bill, i.e. rent, should now be more difficult to enforce. Read the book, get a used copy. This might be a marketing ploy to sell books.

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MEMBER LIBRARY MEMBER BENEFIT

There are a lot of gurus who come to town pitching very expensive courses and have highly motivating presenations to get you to buy.

at any time and other than your membership fee, it costs nothing extra. Whats In It?

Third: Click on Member's Library in the Drop Down Menu

Here at MAREI we are the first to tell you to invest in your own training But before you plop down $1000s of dollars on any training you need to not only do a bit of research on the guru themselves, but on the topic at hand.

Forms and Documents that have been donated to the library by members.

Fourth: Click on Link to the LIbrary in Google Drive

Audio Recordings, Video Recordings and E-books we have been emailed through out the years.

For example before you spend a ton of money to learn more about the note business, might you want to read up a bit on the note business to make sure it fits your style, your needs and your resources? The same goes for any topic.

Webinars and Podcasts we have done with members and trainers.

If you are a trainer or a service provider and you have an ebook or other training item you would like to share with our members please email kim@MAREI.org to explore options for sharing your materials in our library.

So to get you a good broad overview of the many different topics related to real estate investing, here at MAREI we have been assembling a massive library since we started in 2004. It is 100% digital meaning you can access it

So Members, if you have not logged in and checked it out, what are you wating

And when ever a speaker comes to MAREI, we do try to get at least one giveaway item from them to add to the Library.

How to Access It? First: log into MAREIMember.com

Second: Find the My Account Tab

If you are not yet a member of MAREI and would like to access just a small part of the MAREI Member Library, please visit our FREE Training Page at MAREI.org/free-training/ If you are thinking about learning more about a specific topic, please explore the library first to learn more about it before you spend $1000s. RE INVESTMENT NEWS • PAGE

Stop Losing Leads Our Real Estate Investor Websites Drive More Qualified Leads Than Any Other Platform

If you’re looking to finally have a real estate investor website that gets search engine rankings and drives you free seller and buyer leads… to be able to take FULL CONTROL of your site from start to finish so your brand is unique to your target market and does not feel like just another template website… to generate leads the RIGHT way… and be easy for you to run yourself… you’re looking at the right place.

Learn More Today SEO Keyword Bible 90 Day Action Plan Carrot Business Plan Content Marketing Conversation Marketing Craigslist Download Effective Pay Per Click Facebook Promotion Free Resources

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STUPID WHOLESALER

CASE STUDIES FROM VENA JONES-COX Vena is a long-time wholesaler and past president of the National Real Estate Investors Association. She’s on a mission to professionalize the wholesaling business and create wholesalers who make lots of money while also treating buyers and seller right and not making idiots of themselves. Come learn from her at our March 13th MAREI Meeting. Is it wrong of me to get ticked when people who call themselves wholesalers show a complete lack of understanding of what wholesaling is, or why wholesalers get paid? I mean, it IS my businesses—and I imagine that, say, a pediatrician might get mad of some guy who’d never gone to medical school hung up a shingle and started treating kids’ broken arms. Not that I’m trying to compare what wholesalers do to what doctors do— people’s lives are rarely saved or lost because of what happens in a real estate deal. But I do sometimes wish 08

that wholesalers had to prove some basic level of competence before they could call themselves wholesalers. But that’s not the case: anyone who thinks they can “buy low, sell not so low” is allowed to print business cards that say “Don Dufus, Wholesaler” and run around wreaking whatever havoc they can manage. My favorite type of stupid wholesaler is the one who’s fallen for one of those, “You don’t really have to know anything, it’s all done for you” sales pitches, bought himself a website, and tries to sell me properties about which he knows NOTHING, from the actual value of the property to the amount and cost of the work needed. In case you haven’t had the pleasure of buying one of these courses / Ebooks / seminars, the basic pitch seems to be this: don’t worry about knowing the market—the tax folks have the value of the property right up there on the

Here is, as closely as I can remember, an actual word-for-word conversation I had last year with one of these “fake” wholesalers:auditor’s website. Don’t worry about repair costs—you never need to see the house. Just offer owners half of whatever they’re asking or whatever the property tax folks think it’s worth, and you’ll be fine. Buyers will line up to buy that house at 55% of value. If you don’t understand what’s wrong with that theory, please don’t call yourself a wholesaler. Wholesalers get paid for providing profitable deals to serious buyers, not for getting deal under contract. REAL wholesalers know what they’re offering, know that it’s a good deal, and can stand behind their numbers. The folks I’m talking about seem to think that they can and should get checks for throwing numbers at a wall and seeing what sticks. RE INVESTMENT NEWS • PAGE

Him: “Hi, my name’s Don Dufus, and I saw on craigslist that you buy junker properties in Cincinnati. I have one that I think you’d be interested in.” Me: “Ok, do you own it, or are you wholesaling it?” Him: [long pause] Me: “It’s fine if you’re wholesaling it, I just want to know if I’m dealing with an owner or a wholesaler.” Him: “I have it under contract.”

Me: “Have you even seen it?” Him: “No, I’m in Portland. This was a lead I got from my website. I got my repair numbers from the seller, who said he had a bid from a contractor to fix it for $7,000, and he told me it was in Delhi. The County website says it’s worth $70,000. I have it under contract for $19,900, what should I do?” Me: “I guess you’ll have to go to some other Dufus from the West Coast’s website and post it there, ‘cause you’re never going to sell it to anyone who actually bothers to go and see it.”

Me: “Ok, tell me about it” Him: “It’s at 1234 main street in a neighborhood called Delhi. It’s a 2 bedroom, it’s worth about $70,000 fixed up, needs about $7,000 in work, and I’m asking $22,000” Me: “OK, Dufus, let me tell you a few things about that property. “First of all, it’s not in Delhi, which is a bread and butter area with a great school system—it’s in Fairmount, a near-warzone in the city schools. It doesn’t even adjoin Delhi. “Secondly, I could literally buy that house and every house for 2 blocks around it for a TOTAL of $70,000, because 9 out of every 10 houses on that street are boarded up. On a rental evaluation, this house is worth $35,000, max, and that’s really an imaginary number because there are no sales of fixed-up properties in that area for the last 5 years. “Thirdly, it doesn’t need $7,000 in work, it needs $17,000 in work, and the reason I know this is that I sold that property 12 months ago for $1,500. “So, Dufus, I’m curious: where did you get your numbers?” Him: [long silence].

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You may think that this kind of wideeyed naiveté—“It’s done for me! I can make thousands, and don’t have to do a thing!” is rare. If only. I have some version of this conversation an average of once a month with people who honestly think they don’t have to know, or do, anything in order to make money wholesaling. And, let me add, the ‘gurus’ who are willing to sell courses using this pitch are making money hand over fist. Of course, their making it selling courses, not wholesaling houses.

and that he trusted me so much that he’d take a personal check for that amount on the spot. I, of course, have no problem with paying any fee to a wholesaler, as long as the overall price works for me. But before I wrote the check, I asked to see the purchase contract. Why? Because when a wholesaler assigns a contract, the buyer—me , in this case— is agreeing to ALL of the terms of the contract. Before I pay an assignment fee, I want to know what it is I’m agreeing to. The “wholesaler” then informed me that he didn’t have a contract—he was co-wholesaling the deal for the ACTUAL wholesaler, who was in contract with the seller. The cowholesaler then asked me to pay HIM the ENTIRE wholesale fee (only $2,000 of it was his, the rest was what the actual wholesaler was asking), so that he could get into contract with the real wholesaler, so that he could have a contract to assign me.

Don’t get me wrong: there are creative things you can do with wholesale deals— but they kind of have to fall within the parameters of what’s possible, given the nature of the deals we do.

HUH?? So, this guy was asking me to pay him for something that he didn’t have: the right to buy a property. And, apparently, this is tactic that has worked for him in the past. Unfortunately for him, I actually understand that paying someone for something they don’t have and have no guarantee of getting (who’s to say that the actual wholesaler hadn’t already found a buyer? Or that she was actually in contract, for that matter, since neither he nor I had seen such a contract?) is a really, really bad idea.

For instance: I was recently approached by a local wholesaler who told me about a deal that sounded pretty interesting. After evaluating it and deciding that the numbers were right, I asked what part of the total price the was the wholesaler’s fee. He informed me that it was $7,000,

So I told him I would do this: pay his wholesaler $7,000 for her contract, and let her pay him, the co-wholesaler, his $2,000. He refused on the grounds that he was afraid she’d want to keep the entire $7,000…and he did not at all see the irony when I mentioned

But what’s almost worse is people who decide to get “creative” with their wholesaling techniques, and because they don’t really understand WHY it is that real wholesalers do what they do in the ways that they do it, end up doing things that make absolutely no sense.

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that I was sort of afraid the same thing was going to happen if I gave the $7,000 to him. Was it pretty creative of him to bypass the whole deal-finding process and specialize in marketing other people’s deals to buyers? Sure. Was it pretty stupid of him to be out trying to sell a deal that he had no actual interest in, no idea what the contract he was trying to sell looked like, and no concept that what wholesalers get paid for is a piece of paper he’d never seen and didn’t even know for sure existed? Yep. In a twist on the same “wholesalers who don’t understand that wholesaling is assigning contracts” theme, a student of mine recently related this story (basically accurate, but details changed to protect the Dufus): A co-wholesaler approached him and asked if he could bring a buyer for the student’s deal and get paid for it. The

student agreed, and the co-wholesaler proceeded to bring him an offer from a buyer that included a closing to occur in 30 days. Problem: the student’s contract expired in 10 days. Problem 2: the cowholesaler had already collected $500 from the buyer in return for the deal. Follow this: the co-wholesaler took certified funds from a buyer. The cowholesaler had no contract on the property. The co-wholesaler allowed the buyer to make an offer that couldn’t possibly be accepted, because the buyer wanted to close 40 days after the expiration of the student’s contract. What, exactly, was this guy thinking? My guess: “I got $500! I got $500!”, and not much else. Here’s what I’m thinking: what this cowholesaler did could easily be construed as criminal fraud. He took money for a

product he didn’t have—a deal—and couldn’t get, because rather than thinking about the fact that a contract already existed and needed to be fulfilled, he was thinking, “in real estate, we make offers”. I strongly recommended to the student that he track down this cowholesaler and slap him upside the head for me, just for claiming to be in the same business we are. PLEASE, if you’re going to wholesale, know your craft and understand your product. If you don’t, the best thing that’s likely to happen to you is that you’ll spin your wheels a lot and not make the money you should. The worst thing could be that you unwittingly break the law, or ruin your own reputation. Get trained, take advice, and don’t try to reinvent the wheel.

Learn Wholesaling with Vena Jones-Cox Learn how wholesaling really works in today's market. Find out which properties are the most profitable & which to avoid. How to make the right offer to make $5k or more in cash every time. How to get a property under contract with no risk if you can't sell the deal. How to find tons of anxious buyers for your deals who will pay you cash up front. Plus much more and all with real-life examples. If you are a wholesaler or you wanna be . . . or just want to generate more profitable deals, then you can't afford to miss his meeting with master wholesaler & veteran investor, Vena Jones-Cox at the March 13th MAREI Meeting. PLUS she's coming back on March 24th for a full day of training.

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EscrowServ.com

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things to understand about private lending ARTICLE

BY KIM

TUCKER

DEFINITION

SECURING THE LOAN

A private money lender is a non-institutional

All transactions should be secured with a

(non-bank) individual or company that loans

promissory note and a mortgage or a deed of

money, generally secured by a note and deed

trust. As a lender, it is important to close all

of trust, for the purpose of funding a real

transactions through a title company or closing

estate transaction. Generally, they do not

attorney. Make sure the closing service

advertise that they lend and are found by

records the deed or mortgage immediately and

building a relationship with the person who will

then sends you the orinal copies and recorded

only lend to you once they get to know you and

copies of everything.

build confidence in your investing skills.

HOW LENDERS GET PAID

PROTECTING THE INVESTMENT

Hard money lenders tend to charge points on

Close all private loans through a title company

the loan and an interest rate for a short term

or escrow service and lender should review

and many private lenders do the same. But

title to make sure the borrower owns the

this is not set in stone and loans can be

property and that the loan will be in the first

negotiated with or without points, with varying

position. Lenders should request to see proof

interest rates, amortizing or interest only. And

of insurance naming the lender as second

in some cases with a minimum fee. Others get

insured. And if part of the loan is for

paid a portion of the profits. Or a

renovation lender may want to set the loan up

combination of some or all of the above.

with draws as the renovations are made.

WHERE LENDERS OBTAIN FUNDS

TO LEARN MORE

Lenders have build up funds in various

There are quite a few private lenders at MAREI

accounts which can include: cash in the bank,

including several attorneys that can assist you

money in an IRA or 401k, money borrowed

in learning, there are also quite a few

against stock investments, home equity lines of

resources in the MAREI Member Library under

credit.

the Private Lending tab.

RE INVESTMENT NEWS • PAGE

NOT A "GOOD" DEAL Why You Can’t Sell to Every Buyer… by Vena Jones-Cox

Vena Jones-Cox is a wholesaler with over 25 years experience in the real estate business and more than 800 deals under her belt. She’s also a world-class teacher and coach in the business, and best of all, she’s the guest speaker at our March meeting. Make sure you mark your calendar for the 13th and get there—whether you’re a brand new wholesaler or an experienced pro, you’ll learn plenty! It’s a frustrating thing when you’ve put a wholesale deal under contract, have evaluated it to the nth degree, and then get told by a buyer that “It’s not a good deal” or “I’d never pay that much for that house”. 14

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Yet it will happen to you, over and over again, even when you’re a REALLY GOOD wholesaler, and here’s why:

Let’s take an example of a single retail house that’s worth $100,000 fixed up and needs $20,000 in repairs.

Despite the fact that we use the same set of formulae (After repaired value x 70% less repairs for retail deals, After repaired value x 60% less repairs for rental deals), buyers are not some monolithic group that all have the same costs, the same profit requirements, or the same rehab standards.

As a wholesaler, you’d want to pay around

Yet when we make offers, we can’t do so to satisfy the needs of ALL buyers, or of particular buyers—we have to shoot for a number that makes sense to a lot of buyers, but not to the pickiest or to the ones that have the highest costs.

-$7,000 for your profit $43,000 offer.

$100,000 X .7 $70,000 -$20,000 $50,000 (your sale price)

Now let’s look at how 3 different buyers—all based on actual buyers I know—might view this same deal.

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Buyer #1 is a retailer who buys and sells about 4 houses a year. He uses hard money to close and rehab his deals, an agent to sell them, and contractors to do all the work. He wants to make a minimum of $20,000 per deal, so he’d do his calculations like this: $100,000 sale price -$20,000 profit -$10,000 sales costs** -$20,000 repairs -$6,000 holding costs -$8,750 finance costs ++ $35,250 maximum allowable offer. Clearly, for buyer #1, your $50,000 deal isn’t good enough. ** (6% commission + 4% for buyer concessions) ++(15% interest + 5 points on $70,000 borrowed) Buyer #2 is also a retailer, who buys and sells 6 houses a year. He

uses a mixture of contractors and his own labor, borrows private money at 8% interest with no points, and sells most of his houses himself. He also wants to make $20,000, but he’d calculate his MAO differently: $100,000 sale price -$20,000 profit -$4,000 sale costs -$15,000 repairs -$6,000 holding costs -$2,800 finance costs $52,200 MAO. For this buyer, your deal looks really good. Buyer #3 is a high-volume retailer. He uses contractors to do all of his work, and does a higher level of work than the other buyers. However, he’s also able to sell his finished properties at about 5% more than “market”. He’s a licensed broker who lists his own properties, thus paying a 3% commission rather than a full 6% commission, finishes and sells his

has a properties in an average of 3 months, borrows money, at 12% interest, but it goal of $15,000 per property. His calculation would look like this: $105,000 sale price -$15,000 profit -$25,000 repairs -$7,350 sales costs -$3,000 holding costs -$4,200 finance costs $50,450 maximum allowable offer —right on target with what you’re asking. The moral of the story is, as a wholesaler, you can’t and won’t satisfy all of your buyers with all of your deals. And it’s not because you’re doing anything wrong—it’s because your buyers have different needs and desires. Don’t take it to heart if a particular buyer tells you a particular deal isn’t a good one: what he really means is that it isn’t a good one TO HIM.

WHOLESALE

HOUSES correctly

FREE Training for our readers. Go to marei.org/bonuses-from-vena/

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CHALLENGES

TO THE AFFORDABILITY OF THE AMERICAN DREAM by Joe Varnadore with NoteSchool As home sales have cooled, it seems that “affordability” has become a concern and focus for many institutions, consultants and real estate companies. Last Summer Lawrence Yun, Chief Economist for the National Association of Realtors, joined Rosen Consulting Group and Berkeley Hass Real Estate to provide information regarding the new white page report from RGC titled Hurdles to Homeownership: Understanding the Barriers. Adam DeSanctis, of National Association of Realtors blog, highlights the conclusion to the barriers as: Post-Foreclosure Stress Disorder: There has been long-lasting psychological changes in financial decision-making for some of the 9 million homeowners who experienced foreclosure and the 8.7 million people who lost their jobs during the Great Recession. Mortgage availability : Credit standards have not normalized following the recession. Growing burden of student loan debt: Student loan debt makes it extremely 16

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difficult to save for a down payment, qualify for a mortgage and afford a mortgage payment, especially in expensive markets. Single-family housing affordability : Many markets are experiencing decaying affordability conditions because of soaring home prices and rents and a lack of singlefamily housing inventory. Single-family housing supply shortages: An insufficient level of homebuilding has created a cumulative deficit of nearly 3.7 million new homes over the last eight years. Yun gave a presentation titled Affordability Challenges to Homeownership. The presentation provided informative information about equity, job growth, and overall supply and demand. Following are some the highlights from Yun’s presentation according to DeSanctis: • Home equity has doubled since 2009. • Job creation is far outpacing housing starts. • Home sales are at a decade high and would be higher if there were more supply. • There’s a mismatch between what’s for sale and what households can afford. • Affordability challenges will remain

because of low housing supply. • Home prices up 5.0 percent. Thinking through the above information should lead one to summarize that lack of supply and financing are holding the market back. On the positive side, more people are working, credit issues are being slowly turned around and people would buy if the terms and prices were affordable. As a real estate investor you should recognize this as an opportunity to fill a void in the market place. Large supplies of homes are sitting vacant. These homes are not on the market for sale but rather are in idle position while the non-performing loan works its way through the system. Once the non-performing loan is acquired and the note holder repossesses the property, putting it on the sales market with seller financing will lead to a quick sale. Note investors have access to the inventory (supply) and the ability to fill the void (demand) in the market by offering attractive terms to potential buyers. Learn more in May at MAREI when Joe Varnadore from NoteSchool will speak. WWW.MAREI.ORG

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With MAREI Business Members Save time and money by starting with service providers who already know your business. Who can solve problems as they arise to help you get the deal completed on time and for maximum profit. Attorney Anderson & Associates Evictions / Collections Julie Anderson www.MOKSLaw.com 816-931-2207 Auction Company Auction.com Rachel Bailey www.Auction.com 816-797-6875 Building Supplier KC Cabinet Collection Mark Yanda 913-980-4260 The Home Depot George Neal 816-461-9583 2% Rebate / 20% Off Paint Other Discounts Details in Member Benefits

Joe’s Carpet / Weber Flooring Jerry Ratway www.WeberFlooring.com 913-236-3680

business associates

NuLook Custom Finishes Cabinet Refinishing Carol Baldwin www.NuLookFinishes.net 913-385-2574

Contractor Candid Construction General Contractor Blake Brose www.CandidKC.com 816-368-1341 Hearth Masters Fireplace / Masonry Gene Padgitt www.ChimKC.com 816-461-3665 Genesis Home Restorations Mold Remediation Terry Amerine GenesisHomeRestorations.com 913-270-0812

KC Grout Works Tile Refinishing DJ Hoffman www.KCGroutWorks.com 816-448-5579 Serve Pro East Independence/ Blue Springs Crytsall Gregg www.ServeProEastIndependence BlueSprings.com 816-224-5300 Insurance Arcana Insurance Rental, Vacant, Landlord & More www.ArcanaInsurance.com 877.744.3660

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Self Directed IRA Equity Trust Company TrustETC.com/NationalREIA FREE Training 844-732-9404 Lending

Pat Live Answering Service Discounts www.MAREI.org/PatLive Zoom Video Conferencing www.MAREI.org/Zoom

Crossroads Investment Lending Hard Money Britton Asbell / Doug Harris www.KCLend.com 913-800-8226 House Traders Monthly Meeting

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Investors Choice Funding Hard Money Scott Ficinus InvestorsChoiceFunding.com 816-668-7223

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Merchants Mortgage Mushy Money Susan Aubin www.MerchantsMtg.com 303-514-0815

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REI Investor Funds Hard Money Charlie Fitzgerald www.REIInvestorFunds.com 913-904-8090 Marketing Build A Sign Signs & Banners Plus www.BuildASign.com Discount Link in Member Benefits Constant Contact Email & Social Media Marketing FREE Trial MAREI.org/ConstantContact Investor Carrot Investor Websites Free Training & Discounts www.MAREI.org/IC 18

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Office Depot / Office Max www.OfficeDepot.com Discount Link & Card in Member Benefits Package

BedBugTraps.com Stop BedBugs Discounts for Members

Bridge Management Turn Key Provider Nathan Brooks www.BridgeTurnkey.com 913-276-4114 McKinnis Real Estate Turn Key Provider Nick McKinnis McKinnisRealEstateInvestments.com 816-914-2614 B & C Investment Group Wholesale Allen Cuffey www.FlipNvest.com 816-867-8617 KCInvest Investment Properties Scott Tucker & Kim & Don Tucker www.KCInvest 913-735-0018

Pride Properties Wholesale Marcus Bray & Matt Bray www.PridePropertiesHomes.com 913-213-5370 Deal Makers Monthly Meeting Property Manager Home Rental Services Paul Branton www.Home4Rent.com 913-627-9543 MÂ & M Property Pros Michael & Michele Bellman www.MMPropertyPros.com 816-490-6745 Royal Gate Management Ryan Goyer RoyalGateManagement.com 913-735-7783 Realtor Realty Resource Listing Agent Scott Tucker www.RealtyResourceKC.com 816-284-7844 Rent Collection National Credit Systems Specializing in Collections www.NationalCreditSystems.com Screening Rent Perfect Tenant Screening Plus Heather Johnson www.RentPerfect.com 877-922-2547 Discounts at www.MAREI.org/RP

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Escrow Services Inc. Loan Servicing Nationwide www.EscrowServ.com Title Company

Julie Anderson : Attorney

Accurate Title Company Dave Green www.AccurateTitleCo.com 913-338-0100 While Julie and her team are known for their specialty in Evictions and Landlord Tenant Issues they handle a wealth of issues: Alpha Title Mary Kellogg www.AlphaTitleInc.comLandlord-Tenant Disputes Collections 913-498-8999 Real Estate Law Foreclosure Trash Out Civil Litigation Bankruptcy 1-800-Got- Junk Trash Pick Up www.1800GotJunk.com Julie is a very very busy attorney and works hard to make sure her clients are educated Discounts in Member Benefits and doing their job correctly so she does not have to charge by the 1-800-JunkPro hour to teach you how to be Trash Pick Up & Dumpsters a better landlord, she speaks at Clint Pringle MAREI and other organizations, www.Junk.pro she offers a b unch of instructions 816-935-7078 and forms for FREE on her website and she also has a lease package for managing tenants in Kansas or Missouri or both. And she has offered a discount for MAREI Members.

Julie's Lease Package Covers The Screening & Application Process Lease Agreements & Addendums Move In / Out Process Eviction Documents Sale of a Leased Property

Servicing Escrow Services Inc. Loan Servicing Nationwide www.EscrowServ.com Title Company Accurate Title Company Dave Green www.AccurateTitleCo.com 913-338-0100 Alpha Title Mary Kellogg www.AlphaTitleInc.com 913-498-8999 Trash Out 1-800-Got- Junk Trash Pick Up www.1800GotJunk.com Discounts in Member Benefits 1-800-JunkPro Trash Pick Up & Dumpsters Clint Pringle www.Junk.pro 816-935-7078

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