Think and Grow Rich in Michigan Real Estate Part 1 – How To Become An Accurate Thinker In Your Michigan Foreclosure Flipping Business:
You recently met a contractor who will put sidings on your house and will paint your foreclosure once the other rehab is done. You think the guy is wonderful and everything is going to turn out just fine.
You are an OPTIMIST.
You are about to go and meet a private investor for the first time. You have done 4 deals so far – three of them got big checks; fourth one turned to be O.K. – you made a mistake in buying to expensive of a foreclosure in your Michigan city. You are confident that the guy is going to laugh at you once he realizes what a chump you really are. You don’t bother to put together an Investor Credibility Kit or anything resembling that. You know that there is no reason to spend time and energy doing either one.
You are a PESSIMIST.
Both of these other labels are true and dangerous – may be it is fun to swing in these two extremes in our personal lives but when it comes to running a business especially a small business like buying and selling bank foreclosures – one of the most valuable traits you can develop is to become what Napoleon Hill identified as a common trait in hundreds of extremely successful people when he was researching Think and Grow Rich – the ability to think accurately.
Not become an optimist or a pessimist – but an accurate thinker.
Here is my own accurate thinking in everything I do in my businesses:
1. I know that this new contractor I just meet this morning is reliable. He looked hones, talked straight, is a family man (showed me the pictures of his kids), gave me a quote that looked reasonable and complimented me twice on my car and my technique of carrying a digital voice recorder everywhere I go.
So what? My accurate thinking says that I should still ask for three references, call all three, make sure that the guy delivers, on time, under budget, all the time from these there previous customers of his. Ask him to sign an agreement (Paul Mueller and David Schmidt, Ijlal Inner Circle members have put together a killer agreement to be used for controlling contractors – we all use it now) that will insure that the things are going to happen according to my plan.
The optimist will hope that things are going to work out because the guys look trustworthy. The pessimist will stay up night dreading the contractor to steal money from him and not finish the house on time. The accurate thinker who read Think and Grow Rich will do the above to make that things are going to happen as planned and sleep peacefully and will have a house done on time and in budget.
2. I want to partner up with John to buy and flip a house. I have known John for over three years now and in these three years we have become good friends. He is fun to hang out with, likes to go restaurant hopping, reads books, his wife and Nora have become good friends, I have been to his house for his kids birthdays, he has been to mine for ours. I believe John to be a good person. Period. He has been hounding me to do a deal together and play bank / partner for half of the profits.
The Optimist will say that this is truly one of these dream win-win situations. I know where to go and find bank foreclosures in a Michigan City without effort. He can finance the purchase and rehab and is willing to go to the house and manage contractors. I will put the pieces together to sell the house. I say lets do it and do it now before he changes his mind or finds someone else.
The Pessimist will say that I should not trust anybody to do what he or she is saying they will. I know that John is just playing nice to learn from me. He probably will steal money from me during rehab or worse never show up to manage the house once we start fixing it thus wasting my time. The pessimist says that this is going to go down bad and I should not bother with it.
Accurate Thinking teaches me that I should take John me with me to a lawyer, explain what we are trying to do to him, draw up a cookie cutter agreement just for that deal that outlines exactly what is going to happen and each other responsibilities, draw up an agreement with the help of the lawyer in an hour, and we both sign it.
Accurate Thinker in me says that this deal can work out if I truly help John to see the bigger picture – all the future deals we can do together and make lots of money. So I go overboard and help him, teach him more than what is required of me so he is overwhelmed with gratitude toward me.
I also tell Nora to talk to his wife and paint her the same bigger picture – lots of future deals, lots of future checks with her name on them, but this deal has to work perfectly – so she will make sure that John shows up, on time and does what he is supposed to do.
3. You need to raise private money – around $250,000 to start with a target of $500,000. You tell pretty much all of your friends, family members, acquaintances. They all politely tell you that it is the single worse idea that they have ever heard. Not only they have no money to give you but also the whole idea of investing in real estate well actually investing in anything is terrifying for them.
They like the idea of somebody else taking money from their check and stuffing it in their company stock on every two Fridays. No hassle; no headache; off course they are losing their shirts investing their 401K in the market but hey we live in an imperfect world! Right???
The Optimist in you says that these people just need a little time. So you decide to wait for six months and go to the same people all over again. You genuinely believe that your friends and family will come around once they have listened to you several times. You decide to wait for them to realize the error of their ways and show up one day on your doorstep, apologetic and with checks in their hands.
The Pessimist in your says that the reality is that NOBODY IN MICHIGAN has money. Period. The State of Michigan is going to hell. Everybody is broke. Your friends, family member and acquaintances included. So first there is nobody who has money to invest in real estate in Michigan and play your private partner.
Second even if you could find somebody – why would they trust YOU? After all everybody knows that deep down inside you are chump! The best thing for you is keep going back to mortgage lenders, keep putting credit inquiries on your credit report, or worse sit on the sidelines while all the good deals are scooped by other Michigan real estate investors who were probably born to rich parents.
The Accurate Thinker, the person who read Think and Grow Rich and got it, will say that actually talking to friends, family and everybody else was nothing more than “practice”. They said NO – fine. Most like somebody making $70,000 a year and living in the Michigan suburbs does not have too much to invest any way. They are wage earners NOT savers and definitely NOT investors. But it was a good practice run, worth the 2 hours it took.
But now you, my accurate thinker, are ready for the real thing. You pick up the March 5, 2007 issue of Fortune Magazine and notice that on page 83, Mapping America Millionaires, they have Michigan as having 190,871 households with $1,000,000 (one million dollars) in investable assets i.e., everything but the primary residence.
You say to yourself – would it not be cool to get the list of these folks in my Michigan City so I can talk to them and nobody else since they are true investors and not wage earners and show them what I have done during my last two deals?
Turns out that there is a way to get that list. Turns out that there is a method to put together a document that will blow the heads off these folks. Turns out that once you do sit with them and talk to them– a large number of them is going to smile and say, “ Do you know how long we have been looking for somebody like you?”
The Accurate Thinker will find out where to get that list, how to put together a killer Investor Credibility Kit and do some really simply but overlooked things that will insure that pretty soon he or she will have a list of private investors fighting to partner up with them to do real estate deals – big or small.
Being sunny or being gloomy is a waste of time for any Michigan real estate investor. Becoming an accurate thinker will enrich you and get you what you want out of your business without stress and with speed.
I am an accurate thinker; by choice. Sometime I am labeled by people who don’t know me well as a “cynic” because on my insistence on being prepared for most eventualities. I typically smile, don’t argue with them, and keep on doing what I was in the first place.
You should become an accurate thinker too. It is one of the greatest traits that Napoleon Hill identified in his works. If it worked for Henry Ford and Thomas Edison – I am sure that it will work for you and me too.
Part 2 of Think and Grow Rich in Michigan Real Estate coming soon.
The April Quick Start 2007 Bootcamp is now scheduled and taking enrollments. Dates are April 27,28,29, location is Troy, Michigan. Details are here. There is an additional $100 Gift Certificate that you can use toward your enrollment before Tax Day 2007 (April 15). Only 10-15 students max.
What I teach has Accurate Thinking fused deep into it. Can’t help it – that is how I think about everything. And since you want to become an accurate thinker – you would be happy to know that there is a 100% Risk Enrollment Guarantee – sit in for an entire first day; don’t like what you hear; get 100% refund plus $250 Gift Card for Gas. I have been told that gas prices are going up. I never pay attention to gas prices. It is a waste of time and energy but I believe most people do so it is a good “accurate thinking” guarantee. :-) Once the 10 spots are gone, the door will close for the month. Details are here.
